An international court has dismissed a case filed by Koch Industries challenging the Doug Ford government’s 2018 cancellation of cap-and-trade. 

The decision means Canada is off the hook for more than US$30 million the company claimed it lost when the carbon pricing program was scrapped.

Since February 2020, the multinational giant has been challenging the termination of the $3 billion program before an arbitration tribunal at the International Centre for Settlement of Investment Disputes, a World Bank body that handles global trade issues. 

The cap-and-trade cross-border program — launched by Quebec and California — sets limits on industrial greenhouse gas pollution. Companies that exceed this cap are required to purchase emissions allowances, or credits, from others that emit below their limit. 

Ontario joined this market under the previous provincial Liberal government in 2016, but announced it would pull out after Ford’s Progressive Conservatives defeated former premier Kathleen Wynne’s Liberals in the June 2018 election.

During and after the campaign, Ford would repeatedly describe the program as “a Liberal cap-and-trade carbon tax,” vowing to eliminate it. According to legal documents previously reviewed by The Narwhal, Koch Industries bought these emissions credits in May 2018, as Ford was campaigning to scrap the program. 

Koch claimed it lost more than US$30 million and issued its legal challenge to recover that money under the conditions of the North American Free Trade Agreement, which was in place when the cancellation happened. Due to the nature of the agreement, Canada was forced into the international tribunal rather than the province.

Koch argued the cancellation “wiped out” its business in Ontario, and “arbitrarily and illegally stripped” the company of “millions of dollars in inventory without any compensation.” Koch Industries said this decision amounted to “guerrilla policy by a populist government, pure and simple, regardless of legalities or solemn commitments.” 

The case would take four years to resolve, with the World Bank tribunal finally issuing its decision on March 13. While the details have not yet been made public, the federal government confirmed the case has been dismissed. 

“The Government of Canada welcomes the tribunal’s decision to dismiss this case on jurisdictional grounds,” Jean-Pierre J. Godbout, a spokesperson for Global Affairs Canada, said in an email to The Narwhal. 

Godbout added that the government supports such investor-state dispute processes because they guarantee a “predictable, rules-based investment climate” through “impartial and objective means.”

Koch Industries lawsuit forced federal government to defend Ontario decision it opposed

Throughout the deliberations, Canada defended the Ford government’s decision to cancel the program — despite publicly fighting the province on carbon pricing. The federal government argued Ontario cancelled the program “in good faith and for legitimate policy reasons,” and that Koch Industries was fully aware of the shift in policy. 

Canada also argued an emissions credit cannot be considered a true investment: “Koch Supply & Trading bore a commercial risk: it bought emission allowances at auction, betting that it could resell them at a higher price in another jurisdiction.”

“We don’t know for sure but if the case was tossed out on jurisdiction then it’s likely that the tribunal agreed with Canada that Koch’s purchase of emissions credits in Ontario does not qualify as an investment,” Stuart Trew, director of the Canadian Centre for Policy Alternatives’ trade and investment research project, told The Narwhal. 

“I am relieved,” he added, “because it clearly isn’t an investment if a company buys emissions credits in one place in order to pollute somewhere else.” 

The multinational giant’s legal action is one of two lawsuits businesses have launched for losses suffered from the Ford government’s cancellation of cap-and-trade. Koch Industries has a long history of fighting environmental policy and initiatives in court, including other carbon pricing programs. 

Godbout told The Narwhal the final decision “will be made publicly available as soon as confidential information has been redacted.”

The office of Ontario’s attorney general did not respond to a request for comment. Koch Industries also did not respond to a request for comment.

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The B.C. government has scuttled a federal plan to designate large swaths of core critical habitat for the endangered spotted owl, easing the way for imminent old-growth logging, The Narwhal has learned through a freedom of information request.  

Almost 50 per cent of core critical habitat — habitat that biologists, using the best available science, deemed necessary for the owl’s survival and recovery — was quietly removed from federal maps between 2021 and 2023, following negotiations with the province. 

On maps published in late January, in a proposed spotted owl recovery strategy, the areas removed from core critical habitat are labelled “potential future critical habitat.” The designation is not a legal term and does not exist under Canada’s Species at Risk Act. 

“Critical habitat” is a defined term under the Act, triggering certain obligations and requirements once identified.

The removed areas, including old-growth forests and connected habitat that juvenile spotted owls require to move away from their birthplace, find a mate and reproduce, total more than 188,000 hectares, or about 16 times the size of the city of Vancouver. 

“Essentially, what happened was some very high-value spotted owl habitat was removed from the maps in areas that don’t have other protection measures,” Charlotte Dawe, conservation and policy campaigner for the non-profit group Wilderness Committee, said in an interview. 

“It’s just the same old story, which is the reason that there’s only one [wild-born] spotted owl left,” Dawe said. “Government is not operating in good faith, not protecting the habitat the spotted owls actually need to survive … It’s do or die for the species. And it’s just really disappointing to see that so late in the game, at such a crucial moment.”

The removed core critical habitat sits mostly in valleys in southwest B.C., where as many as 1,000 northern spotted owls once raised chicks in cavities in old-growth trees, preying largely on flying squirrels and packrats. 

The spotted owl has been in the limelight on and off for decades as efforts to protect it clash with plans to log the commercially valuable old-growth forests the owl requires for survival.

In February, federal environment minister Steven Guilbeault said he would recommend the federal cabinet issue a rare emergency order to protect spotted owls and their habitat. An emergency order would give Ottawa the power to step in and make decisions that normally fall to the province, such as whether to grant logging approvals in spotted owl critical habitat. 

If the spotted owl disappears from B.C., it will join 135 other species, including the black-footed ferret, on the list of wildlife extirpated from Canada — after the federal government signed a landmark global agreement in December committing to recover at-risk species and protect biodiversity.

Just three spotted owls remain in Canada’s wild, following decades of industrial logging and despite a multi-million dollar captive breeding program funded by the B.C. government. Only one owl was born in the wild. The other two hatched in incubators at a spotted owl breeding centre in Langley, where the owls live in outdoor aviaries and are fed euthanized rats and mice. The captive-bred owls were released near the Fraser Canyon last August with little GPS backpacks, while a third owl released from the breeding centre was later found injured and brought back into captivity.

B.C. government says no spotted owl habitat erased

In the freedom of information request, The Narwhal asked for a copy of the 2021 amended recovery strategy for the spotted owl, which includes the core critical habitat maps and was never made public. The maps were approved in an executive review at Environment and Climate Change Canada, according to a source who asked not to be identified because they were not authorized to disclose the information.

The Narwhal then asked Wilderness Committee’s research and mapping coordinator Geoff Senichenko, who has been mapping the spotted owl’s vanishing habitat for almost two decades, to compare the 2021 critical habitat maps included in the response to the 2023 maps.

Senichenko estimated 48 per cent of designated spotted owl core critical habitat was removed from the maps and re-named “potential future critical habitat.” 

About 203,000 hectares remain in core critical habitat. Because Senichenko didn’t have the map shape files and was working without fine detail, his calculations of total habitat are approximate. 

In an emailed response to questions, the B.C. Ministry of Water, Land and Resource Stewardship did not respond directly to a question asking why the provincial government removed critical habitat from the federal maps and designated it “potential future” critical habitat. The ministry said “no spotted owl habitat was erased” between 2021 and 2023. However, the ministry did not differentiate between legally defined core critical habitat and newly created “potential future critical habitat.” 

Approved cutblocks overlap with core critical habitat

According to Senichenko’s research, more than 200 approved logging cutblocks overlap with spotted owl “potential future critical habitat.” The cutblocks, where logging might have already taken place or might be underway, add up to almost 1,700 hectares, more than four times the size of Vancouver’s Stanley Park. An additional 43 cutblocks that overlap with “potential future critical habitat” await approval by the B.C. forests ministry.

Senichenko also discovered 100 approved cutblocks overlapping with “core critical habitat,” including in wildlife habitat areas the B.C. government set aside for the spotted owl that permit conditional timber harvesting. Another 13 planned cutblocks in core critical habitat await B.C. government approval.

Numbered company 606546 B.C. Ltd. was assigned 34 cutblocks overlapping with core critical habitat and “potential future critical habitat” — more than any other entity. A B.C. registry records search showed the company’s sole director is Brian Dorman, owner and president of Western Canadian Timber Products. 

Squamish-based Black Mount Logging Inc., recently in the spotlight over its plans to log the old-growth Elphinstone forest on the Sunshine Coast, has the second most overlapping cutblocks at 21. 

Approved cutblocks include six assigned to Fortis BC for a fracked gas pipeline to supply the Woodfibre LNG plant, and five assigned to Teal Jones, the company that sparked protests and a record number of arrests over plans to clear-cut old-growth forests in and around Fairy Creek on southwest Vancouver Island.

Among the pending cutblocks assigned to 606546 Ltd. are three in the old-growth Teapot Valley near the Fraser Canyon that overlap with “potential future critical habitat” and an additional cutblock in the adjacent Nahatlatch River Valley that also overlaps with the newly coined designation. 

Spuzzum Valley, where the last wild-born spotted owl lives, has two approved cutblocks that overlap with “potential future critical habitat.” The owl, a female, hatched three chicks in two recent years, prior to the death of her mate. Biologists working for the B.C. government captured the juveniles and took them to the breeding centre to augment the captive gene pool.  

The week after Guilbeault’s recommendation for an emergency order was made public, the B.C. government announced a two-year extension of Spuzzum Valley logging deferrals, which had been set to expire at the end of February. The province also extended logging deferrals in the nearby Utzlius watershed, where a wild-born male spotted owl who couldn’t find a mate lived until recently, when he disappeared.

“As we learn more about how captive bred owls behave when released, government will adapt habitat conservation measures to ensure we are continuing to support [the] spotted owl,” the ministry said in its email.

The ministry side-stepped a question asking why it approved cutblocks in core critical habitat and “potential future critical habitat.” It replied that “damage to spotted owl habitat” is not permitted in more than 281,000 hectares B.C. has protected for the owl, including in provincial parks and wildlife habitat areas that are included in core critical habitat on both maps. 

Some spotted owl wildlife management areas include conditional harvest zones that allow logging. “I have stood in recently clear-cut old-growth forests labelled as a [wildlife habitat area] for spotted owls,” Dawe said. Protected areas should not include timber harvesting opportunities, Dawe said, urging the public to watch for “language loopholes” as B.C. announces how it will fulfill a promise to safeguard biodiversity by protecting 30 per cent of its land by 2030.

Species at risk biologist Jared Hobbs, a former scientific advisor to B.C.’s spotted owl recovery team, said the government has engaged in “disingenuous accounting.” For example, out of 32 spotted owl wildlife habitat areas on the timber harvesting land base, only 51 per cent of the total area is currently suitable for spotted owls, Hobbs said. He said the rest was logged in the past.

Lawyer ‘shocked’ to see changes to recovery strategy

Although the Species at Risk Act requires recovery strategies and habitat mapping to be science-based, Dawe said the change from the 2021 to the 2023 maps shows “outside influence of socio-economics” in creating the new maps. “And that is something that is not allowed to happen under the federal Species at Risk Act.” 

The federal government must also take responsibility for allowing core critical habitat to be removed from the maps, she said. “They should know better than to allow B.C. to influence a recovery strategy that would erase important critical habitat from the areas that they’re obligated to protect.”

Ecojustice lawyer Rachel Gutman said she was shocked when she opened the proposed recovery strategy and saw the term “potential future critical habitat” in the legend of the critical habitat maps. 

The removal of core critical habitat from maps and its re-classification as “potential future” critical habitat has major implications for the recovery of spotted owls because protection initiatives under the Act are only triggered by the identification of critical habitat, she explained.

Given the language of the newly reworked recovery strategy, it does not appear the federal cabinet could make an order to protect “potential future critical habitat,” she said. 

Gutman was also shocked to discover the new recovery strategy sets out a “schedule of studies” to verify — sometime before 2083 — whether spotted owl “potential future critical habitat” is in fact critical habitat. 

“This 60 year time period for verification is completely unreasonable given that the federal government has had nearly 20 years to identify this species’ critical habitat,” she said.

 “This delay will also undermine the recovery and survival of the species by enabling the logging of ‘potential future critical habitat’ before it can even be verified.”

In its email, the resource stewardship ministry said the newly created designation includes “habitat currently being studied that could become critical habitat.” 

Changes to recovery strategy called ‘illogical’ 

Gutman also pointed to troubling wording changes in the spotted owl recovery strategy released in January, calling them “emblematic of the overall gutting of the recovery strategy.”

Topping a list of “short-term statements” in the 2021 proposed recovery strategy is to “immediately cease human-caused threats that would cause the loss of habitat needed for recovery.” 

The 2023 amended recovery strategy, approved by B.C., uses far weaker language. It says “sufficient critical habitat” should be maintained and human-caused threats “where spotted owls are detected” should immediately cease.

The new statement suggests critical habitat can be destroyed without undermining spotted owl recovery, Gutman said. 

“This is completely illogical and represents a fundamental misunderstanding of the definition of critical habitat and the requirements of [the Species at Risk Act].” 

The glaring problem with ceasing human-caused threats only where spotted owls are detected is that only three spotted owls remain, she pointed out. Recovery of the species now depends on reintroductions through the captive breeding program and sufficient unfragmented habitat for released owls to survive and thrive. 

“If we only immediately protect areas where individual spotted owls are detected, there will not be enough habitat to support these released owls and a future spotted owl population.” 

Ecojustice is calling on the federal government, which determined spotted owl recovery to be both biologically and technically feasible, to fix the recovery strategy and for cabinet to issue the emergency order to protect spotted owl habitat. 

Guilbeault’s recommendation for an emergency order follows a petition Ecojustice filed last year on behalf of Wilderness Committee, demanding the federal government step in and halt logging in spotted owl habitat. Ecojustice, acting for Wilderness Committee, also asked for a federal emergency order in 2020 to save spotted owls from Canadian extinction.

Speaking to The Narwhal at a press conference in early March, Guilbeault said the federal government has a plan to help spotted owls recover. “It’s going to involve restoration, it’s probably going to involve some difficult decisions around logging rights. So that’s one option,” Guilbeault said. “And that’s really my preferred option.” 

If Ottawa can’t reach an agreement with B.C., Guilbeault said he has a legal obligation to come to cabinet with a solution. “So if it’s not a negotiated solution, it would be a federally imposed solution, which is not quite what we want to do.” 

In a February letter to B.C. Minister of Water, Land and Resource Stewardship Nathan Cullen, Guilbeault said a federal assessment had determined the spotted owl faces imminent threats to its survival and recovery. More than 2,500 hectares across spotted owl habitat had a high potential to be harvested over the next year, Guilbeault noted in the letter, a copy of which the B.C. government shared with The Narwhal upon request. 

“The complete or partial logging of these areas, distributed over a patchwork of spotted owl habitat, would alter the amount and configuration of their habitat, making the achievement of its recovery objectives highly unlikely,” Guilbeault wrote.

B.C. government says it continue to support spotted owl recovery

Cullen’s ministry said habitat conservation measures will be adapted as the government learns more about how spotted owls behave when released “to ensure we are continuing to support spotted owl recovery.” 

Legal protections such as wildlife habitat areas may be included in the measures, and other regulation changes may be considered in addition to potential legislative changes or new enactments to support wildlife and ecosystem health, the ministry said. 

The ministry also pointed to a recent amendment in forestry regulations ending the decades-long practice of prioritizing timber extraction over all other values, including protecting at-risk species and biodiversity.

In an emailed response to questions about the removal of core critical habitat from the maps and impending logging, Cecelia Parsons, a spokesperson for Environment and Climate Change Canada, said the proposed amended recovery strategy, including the new critical habitat maps, was “informed by input” the department received during consultations in 2021. 

Following a public comment period ending March 27, the department will consider all comments received “and whether any revisions are needed prior to finalizing,” Parsons wrote. 

Parsons said Environment and Climate Change Canada is working with B.C. to create an old-growth nature fund to protect old-growth forests and habitat for at-risk species and migratory birds. 

The federal government committed $55 million over three years to protect B.C.’s old-growth forests, contingent on a matching commitment from the province. 

Despite the B.C. government’s promise to create a new conservation financing mechanism for old-growth forest protection, the provincial budget, unveiled in February, did not include the matching funds.

— With files from Emma McIntosh  

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Biologist Les Gyug was working for B.C.’s environment ministry when a logging permit application caught his eye. A forestry company planned to clearcut rare old-growth larch stands in the province’s southern interior, set aside decades earlier as seed trees to allow for natural regeneration. “Rather than log them, let’s go look, and see what’s in them,” Gyug recalls saying. 

He expected to find a suite of forest birds in the scattered 400-year-old western larch stands: birds like Townsend’s warblers, gaily-coloured western tanagers and brown creepers, a small songbird that spirals up tree trunks. Walking through the trees after dawn, binoculars in hand, he heard a mysterious bird drumming in staccato rhythm. “I had never heard this before. And I realized only afterwards, ‘Jeez, that was a Williamson’s sapsucker and it was in an old larch stand!’ ” 

Back then, in the mid-1990s, little was known about Williamson’s sapsucker — the only one of the world’s 250 woodpecker species where the plumage of males and females is so strikingly different they were once thought to be two distinct species. 

Gyug became a global expert on the bird, whose males have a lemon yellow belly and a distinctive cherry-red patch on their chin and upper throat. Females are banded in black and white, with a tawny head and a yellowish patch on their belly. 

“I’ve found my niche,” Gyug says. “I could have just as happily worked on pelicans or something else. But this was a mystery bird. We didn’t have a clue how many there were. We only had a general sense of what their habitat needs were.”

Surveys conducted by Gyug and other biologists found only about 450 Williamson’s sapsucker pairs in B.C., the only place in Canada where they live. Populations were dwindling. And the sapsucker’s old-growth habitat was vanishing, primarily due to logging. It all added up to an endangered listing under the federal Species at Risk Act in 2006.

But that wasn’t enough to protect the sweet-toothed bird, which migrates to B.C. every spring from Mexico and the southwest U.S. Nor did a B.C. Conservation Data Centre summary report, rating logging threats to the sapsucker as “high,” make any difference. The government-run data centre, which collects scientific data about species and ecosystems, singled out western larch logging in the woodpecker’s Okanagan-Boundary and Kootenay ranges as a particular concern.

The B.C. forests ministry continued to sanction logging in the sapsucker’s federally designated critical habitat — the habitat necessary for a species to breed and for populations to recover — including in western larch forests in the Okanagan-Boundary and Kootenay regions. 

“Critical habitat is still being logged,” Gyug tells The Narwhal. “If we keep losing it, [the sapsucker] will never get off the endangered list … And right now, we’re just not doing enough.”

Sapsucker ‘condos’ are falling to the ground 

Williamson’s sapsuckers often nest in a single old-growth western larch — a sapsucker “condo” — where they excavate holes the size of a toonie and raise three to five chicks. 

Like maple syrup farmers, they tend sap trees, visiting a handful of Douglas firs, larches and pines several times daily during breeding season to tap new wells or keep existing wells flowing. Woodpeckers have barbs on their tongues to latch onto insects and grubs; the Williamson’s sapsucker has a brush-like tuft on the edge of long tongues for licking up sap. 

Williamson’s sapsuckers also feed on carpenter and western thatching ants that hustle up and down tree trunks to tend aphid colonies on branch tips. The ants have a symbiotic relationship with the aphids. They protect them from predators, carry them to their nests at night and during winter and milk their antenna for sugar-rich liquid secretions called honeydew.

“You’ve got to have trees because they take ants off tree trunks; if tree trunks aren’t there, they can’t make a living,” Gyug explains. “They need the nesting trees and they need foraging habitat — you need the combination of the two in close proximity to each other.” 

Gyug’s work saved the western larch seed stands from logging. Over time, he also helped secure the designation of about 150 small, scattered wildlife habitat areas for the sapsucker. But the wildlife habitat areas only represent about three per cent of the territory the sapsucker occupies in the province, leaving the majority open to logging and other disturbances.

In the Boundary region, about 15 per cent of the sapsucker’s federally designated critical habitat was clear-cut from 2017 to 2022, according to wildlife biologist Jared Hobbs. Sapsucker “condos” fell to the ground. Hobbs says logging is likely taking place at the same rate, or even more extensively, in the other two areas where sapsuckers live — the east Kootenays and the Merritt-Princeton area. “In the other regions they’re logging like crazy as well.” 

Hobbs recently helped document 182 cutblocks, covering more than 3,000 hectares, in federally mapped Williamson’s sapsucker critical habitat within the Boundary area (a small portion of the Okanagan-Boundary region). He found a nest tree logged — “not an uncommon occurrence” — even though the slow rot and hard shell that makes the trees desirable for the sapsucker and other cavity dwellers means they are of little or no commercial value to the forest industry. 

“These trees are so valuable that with every one that’s lost, you are eroding the recovery potential of the population,” Hobbs says. “It takes hundreds of years to replace that tree cut down by the timber industry. It’s cut down as garbage and left lying on the ground. And that was gold for the Williamson’s sapsucker.” 

If logging in the sapsucker’s critical habitat continues, Hobbs says populations will reach a critical tipping point. He points to the northern spotted owl as a cautionary tale. Only one wild-born spotted owl remains in Canada, despite years of warnings from biologists about impending population collapse following widespread industrial logging in the owl’s old-growth rainforest habitat in southwest B.C.

When a species falls below what biologists call its minimum viable population, decline quickly becomes irreversible — as in the case of spotted owls, cod on the east coast and southern mountain caribou populations in B.C. Individuals struggle to find mates and reproduce, while genetic diversity — necessary for good health and adaptations, including to environmental shifts wrought by climate change — is lost.

“At that point, the crash is catastrophic and irreversible,” Hobbs says. “That’s what we did to the spotted owl. And we’re about to do that with the Williamson’s sapsucker. At that point, no matter what you do, and how much in recovery dollars you throw at it, like caribou and spotted owls, you’re not going to pull it back. The challenges become insurmountable.”

Williamson’s sapsucker populations in B.C. are genetically valuable because they’re at the northern extent of their range and have adapted to a different environment than U.S. populations, making them essential to help the species adjust to climate change and other stressors, Hobbs says. 

“These are not populations that should be dismissed, they should be cherished.” 

‘Nothing happens’ to save sapsucker

For Sean Nixon, a lawyer with the environmental law charity Ecojustice, the plight of the Williamson’s sapsucker is all too familiar. Many old-growth forest-dependent species in B.C. are in trouble, Nixon notes. “We know the causes of the decline. Generally commercial logging is the primary threat. We know what needs to be done to save the species. But then nothing happens.”

In large part, that’s because B.C. has no legislation dedicated to protecting and recovering the sapsucker and 1,340 other species at risk of extinction in the province. The BC NDP campaigned on a promise to enact endangered species legislation, but quietly reneged after coming to power in 2017.

The federal Species at Risk Act automatically protects critical habitat for most at-risk species only on federal land, a scant one per cent of B.C. 

The Act nominally protects migratory bird nests on provincial land. But enforcement is almost impossible, Nixon observes. Nests would have to be identified in advance of logging and other destructive activities and “there aren’t federal enforcement officers in most places.” 

“Generally, industry and the provincial government do very little to survey an area in advance of logging to see if it contains nests and where they are.”

Forests occupied by the Williamson’s sapsucker could be safeguarded if the federal cabinet issued an order under the Act to protect the critical habitat of migratory birds, which fall under federal jurisdiction.

But Nixon doubts an order will be forthcoming. Reluctant to tread on the jurisdictional toes of the provinces, the federal government has issued emergency orders only for two species in the 20-year history of the Act — the western chorus frog in Quebec and the greater sage-grouse in Alberta. Federal cabinet will also soon consider issuing an emergency order to protect the northern spotted owl. 

The provincial government will sometimes voluntarily designate wildlife habitat areas for the Williamson’s sapsucker and other at-risk species, Nixon notes. Yet road-building and some logging are still permitted in wildlife areas.

“They’re not required to follow objective scientific advice, like the advice in the federal recovery strategy, about how big those areas need to be, where they need to be, what kinds of activities they need to prohibit,” he says. “They’re just kind of ad hoc postage stamps on the landscape.” 

When asked why the province allows federally designated critical habitat for the Williamson’s sapsucker to be destroyed, the Ministry of Water, Land and Resource Stewardship did not respond directly. Instead, the ministry said the government has established many wildlife habitat areas for the sapsucker and best management practices are in place for timber harvesting, roads and silviculture. 

The ministry also sidestepped a question asking why the province has turned a blind eye to to nest tree logging, saying trees occupied by the sapsucker are protected under the B.C. Wildlife Act, while the federal Migratory Birds Convention Act prevents nests from being disturbed or destroyed. 

Asked what steps the government is taking to prevent further destruction of the sapsucker’s critical habitat, the ministry said the province is continuing work, in partnership with First Nations, to develop a declaration prioritizing ecosystem health and biodiversity conservation. 

Biologist calls lack of action ‘disheartening’

Ecojustice says Ottawa has embraced a “dangerously narrow” interpretation of its duty to protect the critical habitat of at-risk migratory birds under the Species at Risk Act. Under that interpretation, the Act protects only nests, not any other habitat necessary for the survival and recovery of at-risk migratory birds.  In the case of a secretive bird such as the at-risk marbled murrelet, which lays a single egg on a mossy branch high in an old-growth tree, nests are almost impossible to find. 

“The key problem is that nests are very hard to identify from the ground for most species,” Nixon says. “The birds do a very good job of hiding them. And they’re generally quiet or they disappear as soon as people show up.” 

Last year, on behalf of Sierra Club BC and the Wilderness Committee, Ecojustice announced it is suing the federal government for failing to live up to its statutory duties to protect habitat necessary for survival and recovery of migratory bird species.

If Ecojustice wins the case, scheduled to be heard in federal court this spring, Nixon says the federal government will be obliged to take steps to ensure protection of the sapsucker and other at-risk migratory birds.

A win would compel federal Environment Minister Steven Guilbeault to regularly recommend cabinet issue an order to protect migratory bird habitat on provincial land, including the old-growth stands where the Williamson’s sapsucker nests and feeds, according to Nixon.

“It would basically be the government stepping in and doing what the province hasn’t been willing or able to do: namely, set aside and protect and conserve the habitat that these species need to survive and recover.” 

Hobbs says Williamson’s sapsuckers have an intrinsic right to live in the forest. That right is acknowledged in the preamble to the Species at Risk Act, which states, “Wildlife, in all its forms, has value in itself.”

“It’s really hard to find these old-growth patches that can sustain Williamsons’ sapsucker,” Hobbs says. You can spend days hiking around and not get into a patch that’s good enough. And then you do get to one and find that it’s just been logged. And then you find it’s in critical habitat, which the province is supposed to recognize and afford effective legal protection to.”

“Yet the B.C. forest ministry is approving the [cut]blocks in these habitats. It’s really disheartening.” 

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Canada is “whitewashing” Ontario’s “reckless and illegal” cancellation of cap-and-trade, alleges Koch Industries in an ongoing international lawsuit. 

Since February 2020, the multinational giant has been challenging the Doug Ford government’s 2018 cancellation of the $3 billion cap-and-trade carbon pricing program before an arbitration tribunal at the International Centre for Settlement of Investment Disputes, a World Bank body that handles global trade issues. 

Koch Industries’ legal action is one of two lawsuits businesses have launched claiming financial losses suffered from the cancellation of cap-and-trade, which legal documents show was finalized before Premier Ford and his Progressive Conservative cabinet officially took office. 

Cap-and-trade was a cross-border program, creating a flow of emissions credits between Ontario, Quebec and California. As such, the arbitration started by Koch is under the North American Free Trade Agreement (NAFTA), which was in place when the cancellation happened. Because of this, Canada, not Ontario, is named, leaving the federal government to defend Ford’s actions internationally, despite fighting Ontario and other provinces over carbon pricing all the way to the Supreme Court at home.

Against Koch, Canada is arguing that the Ford government is a democratically elected body with the right to make changes to environmental policy in its jurisdiction. Throughout the case, Canada has cited the same rationale used by Ontario in public and in court: that Ford’s repeatedly stated intention to cancel the program throughout the 2018 election campaign was equivalent to “outlining the incoming government’s priorities and intentions for once it assumes office.” 

The tribunal has been making documents publicly available after every hearing, the most recent of which was in December. The latest is Koch’s 242-page response to Canada and Ontario’s arguments: “Canada shamefully apes Ontario’s political spin from the summer of 2018 and adopts the same ill-informed prejudice displayed by Ontario officials at that time,” the company says. 

Koch further adds in the new documents that Ford’s Progressive Conservative party “at no point represented that if elected it would recklessly and unilaterally disregard and breach their agreement with California and Québec and rush to exit the program in the way that they did.” It cites a 2019 Ontario court decision that found the cancellation was illegal as it did not properly consult Ontarians as required by law. That court decision concluded that the election platform did not equal proper notice as it did not show “the precise way in which the government intended to repeal cap-and-trade, when it intended to do this, or what, if anything, it intended to enact in its place.”

Based on all this, Koch alleges the cancellation amounted to “guerrilla policy by a populist government, pure and simple, regardless of legalities or solemn commitments.” It “wiped out” Koch’s business in Ontario and “arbitrarily and illegally stripped” the company of “millions of dollars in inventory without any compensation.” 

“To draw a simple analogy, if a company owns a ship of oil which is docked off the coast of a country, it is reasonable to expect that the value of the oil will go up or down at any point. These are risks the business undertakes,” Koch continues. “However, it is not reasonable to expect that government to simply and abruptly confiscate the oil in its entirety. The latter scenario is essentially what occurred in Ontario.” 

All of the money collected during the program’s duration, some $472 million, “went into Ontario coffers,” and wasn’t used to compensate market participants, the company states repeatedly. 

Notably, Koch Industries says the Ford government is withholding documents related to decision-making around the cancellation. The company’s latest submission notes that freedom of information requests remain outstanding nearly two years after they were filed. 

It is not clear why Koch should be compensated, Canada argues, noting that Ontario’s cap-and-trade legislation stated from the beginning that there was “no right to compensation” for any losses incurred through the program. 

Canada also notes that “a sophisticated entity like [Koch] would have been aware of the risks associated with participating” in the program when it willingly bought emissions credits during the 2018 Ontario election campaign during which Ford was repeatedly signalling his opposition to the program and his intention to remove it.

“[Koch] bore a commercial risk. It also accepted the risks inherent in Ontario’s cap-and-trade program, which contemplated changes to the program without compensation,” Canada continues. 

The Narwhal contacted both Global Affairs Canada and Ontario’s environment minister for comment. Both declined as the case is an ongoing legal matter. Koch Industries did not respond to The Narwhal’s request for comment. 

A decision by the tribunal on this case could take months or even years, with Canadian taxpayers potentially on the hook for the full costs of the lawsuit, which include the more than US$30 million Koch lost, plus interest and legal costs. 

And the stakes could be bigger than that for the environment, as this case could be the final verdict on whether companies have a right to challenge new, cross-border environmental regulations. 

Stuart Trew, director of the Canadian Centre for Policy Alternatives’ trade and investment research project, is concerned Koch Industries is looking for “a precedent that it will never lose money to environmental policy, no matter how small the sum is.” 

While it seems to be arguing in favour of carbon pricing in this case, Koch’s environmental history is complicated. The New Yorker’s Jane Mayer, journalist Christopher Leonard and others have documented the company’s long history of fighting environmental policy and initiatives in court, including other carbon pricing programs. 

“Some of the biggest environmental cases in the country are against Koch Industries,” Mayer told a live audience in 2017. “And I mean, not surprisingly, because the [Environmental Protection Agency] classifies them as the largest producers of toxic waste in the country and one of the largest air polluters, climate polluters and water polluters,” Mayer said. 

Both Mayer and Leonard reported that Koch-funded groups were instrumental in killing a 2009 U.S. bill that would have created a cap-and-trade system. 

“It’s hard to defend the Ford government’s clumsy withdrawal from cap-and-trade. It’s just as hard to swallow Koch’s claim that under international law the company bears no risk for speculating on carbon markets for profit,” Trew said. “Unfortunately, a NAFTA win for Koch would set a dangerous precedent by putting a chill on governments wanting to adjust, improve or create new environmental policies to address the climate crisis.”

‘It’s very hard to undo cap-and-trade’: Ford government cancelled a program meant to last decades, says Koch

Koch Supply & Trading is a subsidiary of Koch Industries, which is owned by the billionaire Koch family. The Delaware-based subsidiary was a market participant in the cap-and-trade program, the term for a business that voluntarily joined the scheme that allowed companies to buy and trade emissions allowances in lieu of reducing greenhouse gas emissions. Market participants made up four per cent of the emissions trading in the program.

The program was put in place by the former Liberal government, with the idea that if emissions allowances grew more expensive, businesses would choose to reduce their pollution instead of buying them. When the Progressive Conservatives abruptly shut it down, it removed Ontario from what had been called the second-largest carbon market in the world. Koch says that the shutdown caused it to suffer losses exceeding US$30 million, or 0.03 per cent of its US$115 billion revenue in 2020.

The issue of compensation is also the crux of the other lawsuit the government is facing, from Ontario businesses. Upon the final closure of the program in March 2019, the Ford government said it delivered more than $5 million in compensation to eligible participants, offering few details on where the rest of the money went. Those compensated, Canada told the tribunal, were participants “whose actual emissions of [greenhouse gases] were lower than their holdings of purchased emission allowances.”

As evidence for what it characterizes as the government’s bad faith, Koch Industries offers behind-the-scenes details of the day the government gave instructions for the cancellation. On June 15, 2018, two weeks before the Ford government was sworn in, the Liberals’ outgoing deputy minister of environment, Paul Evans, wrote an email to Jeff Hurdman, director of the environment ministry’s cap-and-trade branch, “to confirm the direction from Premier-Designate Ford that Ontario will not be participating” in the program by that August, when the province was scheduled to host a quarterly auction for businesses to buy and sell emissions allowances. 

At 4:21 p.m. that day, Hurdman informed colleagues that although the ministry had already prepared for emissions sales and trading in August, “Upon receiving the direction from Premier Designate’s announcement we have completed the necessary actions to reverse the process. Ontario participants will not be able to register to participate … ”

Koch Industries argues that without being sworn in, Ford “had no authority” to give this direction. Ontario’s legislative rules dictate that only routine, necessary or urgent government work is allowed when the legislature is dissolved, such as during an election period. No new policies or positions can be introduced. Senior members of the public service can make time-sensitive decisions that may be required for the incoming government’s policies, but historically, this has been extremely rare.

In light of this, Koch Industries says that Ontario had no right to “veto clear legal frameworks in place before the transition of power.”

“In fact, up until the Premier-elect’s unlawful ‘direction’ to government officials, those officials believed that preparing for the August 2018 auction fell within the scope of the ‘routine and ongoing administrative’ work of government,” the company argues. It says the quick shutdown was done “illegally” and “in service of the incoming Ontario Progressive Conservative Government’s political interests.”

The company adds that the cap-and-trade program was designed to last a long time, with revenues to be invested in Ontario green energy projects. The previous Liberal government began planning it in 2013: Koch quotes Liberal environment minister Glen Murray at length, citing a September 2017 interview with TVO, during which Murray said “it’s very hard to undo cap-and-trade,” that it would be “almost impossible” for someone to eliminate it and that anyone who tried would “pay a very difficult price” to do so.

Koch argues the incoming Ford government knew this in 2018. During the election campaign, Ford repeatedly told Ontarians the cancellation would only cost $5 million but, Koch argues, “at exactly the same time Ontario Progressive Conservative’s high-level political representatives were privately admitting the cancellation would give rise to tens of millions of dollars in claims.” This information comes from tribunal testimony that is not public, but is frequently cited in both Canada and Koch’s documents.

And despite “substantial lobbying efforts” over two years to meet with Ontario government officials — including direct letters to Ontario’s Attorney General and Ford — the company says it was ignored.

Says the company: “were it not for Ontario’s abrupt cancellation and termination of its cap-and-trade Program, [Koch Supply & Trading] would have continued to do business in Ontario, and would have continued to acquire emission allowances … for the full duration of Ontario’s cap-and-trade program which was expected to continue for at least a decade longer, until at least 2030, and possibly even further to 2050.”

Canada disagrees, saying that Koch is “mischaracterizing” and presenting a “gross exaggeration” of its role in the program and Ontario’s shutdown. 

“Ontario’s actions with respect to the winding down of the cap-and-trade program were made in good faith and for legitimate policy reasons, including that the existing program imposed economically inefficient burdens on Ontarians,” Canada argues. “They knew in early 2018 that Ontario’s cap-and-trade program might be cancelled.”

‘They don’t need the money’: as reducing emissions gets more urgent, is Koch looking for a precedent-setting decision against Canada?

Koch’s lawsuit is one of the last under the North American Free Trade Agreement, which has since been replaced by the U.S.-Mexico-Canada Agreement. It relies on a clause that was designed to assess whether a company’s right to a stable business environment had been violated by government action. Historically, the clause has been used by companies challenging environment policy and was removed from the new agreement. 

Having lost the clause, Koch may be trying to set a legal precedent for future challenges, said Trew, of the Canadian Centre for Policy Alternatives. “They don’t need the money,” he said. “But they’re seeing more jurisdictions getting serious about reducing emissions and they’re looking to protect their money. Because if the Ontario government can do this, cancel the program with no recourse for them, will other jurisdictions follow suit?”

In its latest argument, Koch spends some time dismantling the idea that the Ford government cancelled cap-and-trade to enact different climate policies. The company notes that if the program had to be eliminated “to truly address environmental issues” then “the gap of over three and half years between the [cancellation] and the operation of the new ‘Made-in-Ontario’ environmental plan is absurd and strains credulity.” 

In that time period, Ontario has seen two carbon pricing programs. First, the province became subject to the federal government’s price on pollution, which Ontario, Alberta and Saskatchewan unsuccessfully challenged at the Supreme Court in 2021. 

Forced to figure out some sort of carbon pricing plan, Ontario then introduced Emissions Performance Standards in July 2021, which came into effect last year and functions similar to a cap-and-trade system: all high-emitting industrial facilities in Ontario are required to reduce emissions through a strict criteria, or purchase compliance units, which are emissions credits, instead.

In light of this, Koch argues Ontario was making a “purely political gesture” with the cancellation and foregoing its business or international commitments. 

“I find the whole thing really upsetting because … our country’s trade system is supposed to be our key to reducing emissions, and this case is complicating that,” Trew said. “They are criticizing and taking apart the environmental credentials and the environmental narrative of the Ontario government. Their arguments are political, not financial.”

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Thirty minutes into the televised English language federal election debate, as the leaders of Canada’s major political parties bickered about climate policies, interrupting each other, Aaron Cosbey shut his laptop and walked away. 

It’s part of Cosbey’s job, as an economist with the International Institute for Sustainable Development, to hold Canada’s feet to the fire when it comes to eliminating public subsidies for the oil and gas sector, as climate change impacts intensify around the world and scientists issue a “code red for humanity.” 

But as Cosbey watched the first part of the Sept. 9 debate from the patio of his home in Rossland, B.C., he found the exchange about climate change issues, including the key issue of fossil fuel subsidies, to be “woefully inadequate.” 

“This is a top-of-mind issue for a lot of Canadians,” he says in an interview with The Narwhal. “B.C. went through some pretty harrowing times this summer. If you’re in Saskatchewan or Manitoba and you’re a farmer you’re in extreme drought conditions — looking at total crop loss in a lot of cases. A lot of parts of Canada are feeling the climate impact … ”

The choppy debate format and the poor calibre of the leaders’ responses made it impossible to understand the differences between each party’s platform, Cosbey says, and didn’t allow viewers to discern which political party will best deal with the climate crisis, including through its position on fossil fuel subsidies. “It was all soundbites and attacks … And that’s a terrible thing. Because this should be, and is, for many Canadians, one of the hottest voting issues on the table.”

“The format was terrible in terms of informing people and the responses were terrible in terms of actually enlightening debate. The whole thing frustrated me enormously.”

One day before the leaders’ debate, a study published in the journal Nature found almost 60 per cent of the world’s oil and gas reserves and 90 per cent of coal reserves need to stay underground in order to keep global warming below 1.5 C — the threshold the Intergovernmental Panel on Climate Change warned in 2018 would have devastating consequences. 

To avert a climate disaster, reports released this year by the International Energy Agency and the Intergovernmental Panel on Climate Change indicate all new fossil fuel developments must stop by the end of the year and governments must immediately start phasing out the use of coal, oil and gas.

Cosbey says subsidizing the oil and gas industry during the climate emergency is the equivalent of heading towards a cliff and putting your foot on the accelerator instead of the brake. “The basic idea that you would be accelerating the development, extraction and processing of fossil fuels in a climate change crisis makes no sense.” 

Most parties say they would eliminate fossil fuel subsidies

While three out of four of the major national political parties pledge to eliminate fossil fuel subsidies, there are differences in party positions that weren’t communicated during the debate, as well as issues of credibility. Varying opinions about what constitutes a fossil fuel subsidy also make it difficult to compare platforms, as it’s sometimes unclear which definition a party is using. 

In 2009, when Canada and other G20 nations first pledged to tackle fossil fuel subsidies, a collective promise was made to do away with “inefficient” subsidies. But the term inefficient has never been defined, allowing successive governments wiggle room. “I don’t know what an efficient fossil fuel subsidy is,” UBC political science professor Kathryn Harrison points out. “So there’s the complication of what is defined as a fossil fuel subsidy and then what is an inefficient fossil fuel subsidy.”

Cosbey’s institute uses the World Trade Organization’s definition of subsidy  — “a financial contribution by a government” that “confers a benefit” on its recipient. According to the institute’s calculations, Canada handed out at least $600 million in fossil fuel subsidies in 2019 and at least $1.9 billion in 2020, including funding to clean-up orphaned and abandoned oil and gas wells in B.C., Alberta and Saskatchewan.  

Even $600 million “going in the wrong direction” is alarming, Cosbey says. “A conservative definition of fossil fuel subsidies should be enough to cause us to reform.”

The group Environmental Defence takes a different approach, calculating that Canada dedicated $18 billion to assist the oil and gas sector in 2020. That figure includes $3.28 billion in direct spending and $13.6 billion in public financing for oil and gas companies — primarily from the opaque crown corporation Export Development Canada, according to the Environmental Defence report, Paying Polluters: Federal Financial Support to Oil and Gas in 2020. 

The report notes Export Development Canada provided up to $5.25 billion in financing renewals for the Trans Mountain pipeline expansion in 2020, a publicly owned project that will cost at least $12.6 billion and comes with a hefty carbon footprint. Export Development Canada also approved a loan of up to $500 million for TC Energy, the owner of the Coastal GasLink pipeline that will supply fracked gas from northern B.C. to the LNG Canada project, one of Canada’s largest single sources of carbon pollution — on par with Teck’s mothballed Frontier oilsands mine in terms of its greenhouse gas emissions.

The main oil and gas industry lobby group, the Canadian Association of Petroleum Producers, has repeatedly denied the sector benefits from subsidies, saying these incentives and tax breaks don’t fit its own definition of a subsidy. The industry lobby group has also promoted offering tax breaks to create new jobs, even though scientists warn this type of growth would lead to climate disasters.

Julia Levin, senior climate and energy program manager for Environmental Defence, says eliminating fossil fuel subsidies is one of Canada’s most important climate commitments. “We’ve had a commitment to eliminate inefficient fossil fuel subsidies for a decade, and yet we’ve seen very little progress … Because of the word subsidies, because of the government not agreeing what’s a subsidy and what’s not, we tend to miss the forest for the trees. We need to eliminate all of the financial tools that the government has made available to the oil and gas sector because those undermine all climate action.”

The Liberal election platform commits to eliminating fossil fuel subsidies by 2023, ahead of the G20 target date of 2025, conveniently sidestepping any mention of “inefficient” subsidies. If re-elected, the Liberal Party says it will develop a plan to phase out public financing for the oil and gas sector, including from Crown corporations, consistent with the party’s commitment to reach net zero emissions by 2050. 

Jonathan Wilkinson, Canada’s Minister of Environment and Climate Change before Parliament was dissolved for the federal election campaign, has said a re-installed Liberal government is “firmly committed” to phasing out mechanisms that incentivize the exploration and production of fossil fuels — but that money for  oil and gas well clean-up is not included in that subsidy bucket.

While subsidies with green strings attached are often better received by the public, Harrison notes the money is still going to the oil and gas industry. “And if it’s something they were going to do anyway, or would be required to do by law anyway alternatively, then it just frees up other money within the same company to do other things — explore for more fossil fuels or lower their cost of production beyond what it would otherwise be.”

If the government is willing to provide green subsidies to corporations, Canadians should be thinking about the industries of the future they wish to encourage “and which are the ones that are likely to decline over time,” Harrison says, ” … in which case, should taxpayers be propping them up?” 

The Liberal government first committed to phasing out fossil fuel subsidies as part of the 2016 Paris Agreement, a legally binding international treaty on climate change that aims to keep global temperatures to 1.5 C below pre-industrial levels. Wilkinson’s spokesperson Moira Kelly told The Narwhal earlier this year that the Liberals had eliminated eight tax breaks for the fossil fuel sector. 

Yet, aside from starting work with Argentina on a peer review of fossil fuel subsidies to help determine the next steps in phasing them out, the Liberals were slow to follow through on their 2016 promise. Canada provides more public finance for fossil fuels on a per capita basis than any other G20 country except for China, according to Levin. “Between 2015 and 2019 we provided $100 billion to oil and gas. These are not records that Canada can hold and claim to be a climate leader.” 

Cosbey says the caveat in the Liberal platform is the party’s promise to make sure the oil and gas sector reduces emissions “at a pace and scale needed to achieve net-zero by 2050, with five-year targets to stay on track.” If emission reduction targets are achieved, it would make moot much of the discussion around fossil fuel subsidies, he points out.

In that case, “we don’t need to talk about subsidies anymore. We need to talk about what that timetable looks like. Because the only reason we care about subsidies is because they encourage production and consumption of fossil fuels.”

The Liberals have already made good on many of the party’s climate change promises. They’ve put a price on carbon, set a 2030 target date to phase out coal-fired electricity, instituted an electric vehicle mandate, legislated Canada’s target of net-zero greenhouse gas emissions by 2050, set five year-national emissions reduction targets and passed the Net-Zero Emissions Accountability Act to deliver on their commitments.

“So those aren’t promises,” Cosbey observes. “The Liberals have a credibility problem based on their years in office — but not so big a credibility problem, because we actually have meaningful and ambitious climate change policies in place that are better than almost any other jurisdiction in the world.” 

No mention of fossil fuel subsidies in Conservative platform

The Conservative Party doesn’t include any promises to eliminate fossil fuel subsidies in its election platform. Instead, the party pledges to forge ahead with plans for new pipelines, create a LNG export strategy, invest $5 billion in carbon capture and sequestration technologies and support small modular nuclear reactors. 

“… the truth is that the world will still be burning oil and gas for decades to come,” the party platform states. 

Harrison and Cosbey both say this effectively means that the Conservative platform adds up to de facto subsidies for the oil and gas industry. “A general theme in the Conservative platform is one of support for the oil and gas industry and support for maintaining oil and gas jobs,” Harrison notes. “It says a lot that the Conservative platform doesn’t even talk about phasing out fossil fuel subsidies — however narrowly defined.” 

Cosbey says a LNG export strategy is unlikely to be viable without public subsidies. “To the extent that we’ve done anything at all on LNG in Canada it’s involved huge subsidies.” 

“If you’re talking about a LNG strategy that ramps up the existing efforts then it’s more subsidies. So really the Conservative platform — even though it doesn’t say that — is talking about putting a lot more subsidies into fossil fuel production, consumption and export.”

The NDP, on the other hand, promises to eliminate fossil fuel subsidies immediately. Taking a page from the Environmental Defence report, the party’s election platform says the Liberal government spent $18 billion to support the oil and gas industry in 2020, on top of its purchase of the Trans Mountain pipeline. 

The NDP says it will fulfill Canada’s G20 commitment to eliminate fossil fuel subsidies and redirect these funds to low carbon initiatives. It will also make sure future governments can’t reverse the policy by putting legislation in place to ban any future oil, gas and pipeline subsidies.

While Harrison agrees the investment of tax dollars in the Trans Mountain pipeline benefitted the oil and gas industry, she says the NDP has been “a bit fast and loose” with the $18 billion subsidy figure and the party’s platform costing consequently doesn’t align. “Normally, if you say you’re going to stop some spending stream it would appear in new revenues,” she notes.

And how the NDP, if elected, would deal with the pipeline purchase is uncertain. “Even for the NDP that one’s complicated, because it was an NDP government in Alberta that was strongly pushing for that pipeline and was very supportive of the federal government’s purchase of it.” 

On the issue of credibility, the BC NDP — Canada’s only provincial or territorial NDP government — has championed and generously subsidized the LNG Canada project. The provincial government announced an initial $5.3 billion in subsidies for the project, which is owned by a consortium of five of the largest and most profitable multinational corporations in the world, including Royal Dutch Shell, Malaysian-owned Petronas and PetroChina Co.  

“That’s a complicated one for the NDP,” Harrison says. 

The LNG Canada project will generate four megatonnes of emissions annually and eat up one-sixth of B.C.’s total carbon budget for 2040, placing the federal NDP in a difficult position if elected.

“There’s a good reason you haven’t heard about it in the campaign,” Cosbey says. “Nobody wants to be seen as treading on provincial toes with regard to their natural resources policies.”

The Green Party also promises to eliminate fossil fuel subsidies. The Greens go one step further and promise to end the extraction of oil and gas — wrapping up oilsands production between 2030 and 2035 — and to ban fracking for natural gas. But the platform contains no detailed costing, Harrison points out. 

“I think a lot of what’s in the Green platform is aspirational. They have no expectation that they will be in government. So they are throwing everything out there. These are all the things a government should be doing in a climate emergency. Eliminating fossil fuel subsidies is one of them.”

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The federal government, Quebec and the Northwest Territories are leading Canada’s efforts to protect land and water, but Ontario, Alberta, Newfoundland and Labrador and Saskatchewan are laggards heading in the wrong direction, says a new report card released on Tuesday by the Canadian Parks and Wilderness Society (CPAWS).

The report — The Grades are in: A report card on Canada’s progress in protecting its land and ocean — is the first of its kind. It tracked the conservation record of all provinces, territories and the federal government and measured how close each one has come to targets set in 2010 to protect 17 per cent of Canada’s terrestrial territory and 10 per cent of its oceans.

While there are mixed reviews across the country, the report singles out Ontario, Alberta and Newfoundland and Labrador in particular, giving each of them an “F” for inadequate policies and actions. Saskatchewan also received a “D” for its performance.

“These four jurisdictions demonstrated little or no commitment to protecting more of their land base,” the report states. “In Ontario and Alberta, this lack of interest is coupled with serious harmful anti-conservation action, including rolling back nature protection policies and legislation and proposing the delisting of protected areas.”

The 2010 targets emerged from Canada’s international commitments made under the UN Convention on Biological Diversity. More than 150 government leaders signed this international agreement at the 1992 Earth Summit in Rio de Janeiro to promote sustainable development and protect ecosystems essential for food security, medicines, fresh air, water, shelter and a clean and healthy environment. But international progress has been slow to achieve the objectives in the decades that followed.

The executive director of CPAWS, Sandra Schwartz, said the conservation group decided to prepare this report because it believes that the planet is facing a double threat from the climate crisis as well as a “nature emergency” due to human activities that are causing rapid habitat loss and fragmentation across the planet.

“If we don’t halt and reverse the critical decline of biodiversity across the globe, climate action alone isn’t going to be enough,” Schwartz told The Narwhal in an interview. “It’s not just because we like to go out for nature walks or to go [out on] a canoe. Our health is intimately linked to the health of our planet. And that includes the health of the biodiversity of the planet we call home.”

The report also noted that Indigenous leadership was one of the drivers of success in provinces with a strong track record. For example, in Quebec, which received an “A-” grade, the conservation group’s report card said the biggest advances were made in northern regions where Cree, Inuit, Naskapi and Innu nations and communities “identified vast ecologically and culturally significant areas for protection and worked with the Quebec government to protect these areas under Quebec law.” 

In December, Quebec announced plans to expand protections in the Eeyou Istchee, homeland of the Cree Nation, which would double the territory’s protected area from 12 to 24 per cent. The territory includes the carbon-rich Broadback River watershed, which is a sanctuary to migratory birds and provides habitat to at-risk woodland caribou.  

But the report also said that some strong gaps remained in the southern part of the province and the southern boreal forest, where it identified industry and the Ministry of Forests, Wildlife and Parks as a “major obstacle.” Overall, Quebec was estimated to have protected 16.7 per cent of its territory by 2020.

The report card had a particularly harsh evaluation of Ontario and Alberta for reversing actions of previous governments that were designed to promote conservation and protect threatened species. Instead of sustaining those policies, the report card said the governments in those provinces had instead chosen to open up sensitive areas to new and unsustainable development.

In Ontario, the report said the province had only protected 10.7 per cent of its territory, and that most of the progress occurred in 2011. More recently, it said the provincial government had “dismantled or weakened key elements of its environmental law and policy framework, including the Endangered Species Act and the environmental assessment process.”

The report card said Alberta had protected 15.4 per cent of its territory by 2020, but began to reverse course in 2019. It is currently permitting industrial activities in many provincial protected areas. This would include a 2020 decision to open up the Eastern Slopes of the Rocky Mountains to coal exploration and mining. Although the government announced new public consultations in response to public pressure, some permits were already issued, the damage had begun and several projects are moving forward, the report card said.

The report also said that about 95 per cent of Alberta’s provincial parks do not have management plans, while most of the other parks have plans that are out of date and not implemented.

“Alberta is in urgent need of a conservation course correction,” said the report. “This includes not only refraining from policies and actions that threaten natural ecosystems, but also committing to evidence-based conservation targets and standards for protected areas, providing stronger protection for the Eastern Slopes and supporting Indigenous-led conservation initiatives, including Guardians programs.”

Conservation efforts have emerged as a significant resource in Canada’s battle against climate change after a 2017 study published in the Proceedings of the National Academy of Sciences found that the simple act of preserving wetlands, forests and grasslands could provide more than one-third of the emissions reductions needed to stabilize global temperature increases below 2 C by 2030 under the Paris Accord. As home to 25 per cent of Earth’s wetlands and boreal forests, as well as endangered prairie grasslands and the world’s longest coastline, Canada has a significant role to play in fighting global climate change by using nature-based climate solutions.

The report found that Newfoundland and Labrador had protected 6.9 per cent of its territory, but “made virtually no progress over the past decade in creating new protected areas and still ranks behind most Canadian provinces and territories in the percentage of land and inland waters protected.” It said that the province only upgraded the status of one small seabird site over the past decade, the Lawn Bay Ecological Reserve.

Saskatchewan had protected 9.8 per cent of its territory, as of 2020, but it “showed little ambition and achieved limited progress in protecting nature,” the report said. 

The federal government received an “A-” for its efforts to protect land and freshwater even though the country as a whole had only protected 5.1 per cent of its territory, well below the 17 per cent target. The report card also noted that there were some positive signs such as new proposals from Indigenous nations and Indigenous-led conservation efforts, with the support of the federal government’s $175 million Canada Nature Fund.

The federal government also earned a “B+” in the report card for its efforts to protect oceans, noting that it had protected 13.8 per cent of marine areas, exceeding the international target of 10 per cent. The lower grade for oceans protections was due to “significant weaknesses in protection standards and the lack of progress on implementing minimum standards and Indigenous-led conservation lowered the grade,” the report stated.

The report also said that Canada had made “considerable progress” on marine protection since 2015 when less than one per cent of marine areas were protected.

Regarding land and freshwater, the report said the federal government demonstrated strong national and international leadership, supporting and elevating Indigenous-led conservation as well as significant budget investments and new targets, while noting that more funding and management policies would still be needed.

Moira Kelly, a spokeswoman for federal Environment Minister Jonathan Wilkinson, said that the government has announced the two largest investments in nature conservation in Canada’s history, starting with a $1.3 billion investment announced in 2018 and an investment of over $4 billion announced in the federal 2021 budget.

In January, the federal government announced a new target of protecting 30 per cent of lands and oceans by 2030.

“As the report indicates, we have made substantial progress, and remain committed to our ambitious targets,” Kelly said in an email. “As rampant biodiversity loss continues, we know there is more work to be done to preserve our land and water so future generations can experience Canada’s irreplaceable natural spaces. We will continue to work with local communities, Indigenous Peoples and provincial governments to do just that.”

The Northwest Territories earned a “B+” after protecting 15.8 per cent of its land by 2020. The report noted that the jurisdiction had created four Indigenous protected areas since 2018 that covered almost five per cent of the territories.

“The progress was largely the result of longstanding Indigenous leadership and investments from the federal Nature Fund.” The report noted that demand for the Canada Nature Fund “far exceeded supply,” demonstrating appetite for new funds allocated for conservation efforts in the 2021 budget.

The Narwhal shared details of the report’s findings with several other governments on Monday, seeking comment, but not all responded.

A spokeswoman from the Saskatchewan environment ministry told The Narwhal in an email that the province was “taking the time needed” to ensure it was protecting a network of territory of the highest ecological and cultural value and that it was already making great strides in expanding protected areas while balancing economic opportunities and conservation goals.

The province also said it was finalizing a new roadmap that would introduce a five-year plan to achieving its conservation goals.

Alberta did not respond to requests for comment on Monday, while spokespeople for the Ontario and Newfoundland and Labrador governments said they were working on providing a response.

The Canadian Parks and Wilderness Society also said that this initial report card should serve as a baseline, to track progress in the coming years and that it hopes governments will use it to track which policies are most effective at driving progress.

The federal government was the only one to be measured on efforts to protect oceans since this is considered to be of federal jurisdiction. The report card also said that the existing targets are “just milestones towards what is ultimately needed to conserve biodiversity: protecting at least half of the Earth’s land and ocean ecosystems.”

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Sheryl Lightfoot didn’t expect there would be much interest in the news of her recent appointment to the United Nations Expert Mechanism on the Rights of Indigenous Peoples.

Yet reporters from across B.C. reached out following the March 24 announcement, eager to know more about the first Indigenous woman from Canada to represent North America on the expert mechanism, which is composed of seven independent experts on the rights of Indigenous Peoples. The experts, who are appointed by the UN Human Rights Council, assist member states like Canada in achieving the goals of the UN Declaration on the Rights of Indigenous Peoples.

“There’s been actually, both from Indigenous press and non-Indigenous press, a whole lot of interest … it’s blown me away,” said Lightfoot, an Anishinaabe from the Lake Superior Band of Ojibwe who is an associate professor at UBC in political science, Indigenous studies and the School of Public Policy and Global Affairs. 

She also holds the position of Canada Research Chair in Global Indigenous Rights and Politics, studying the implications of Indigenous rights movements, the implementation of Indigenous rights in theory and practice and state responses to rights claims. 

Lightfoot, who grew up in Minneapolis, believes part of the interest in her appointment stems from the Black Lives Matter movement and the summer of racial reckoning in Canada and worldwide last year. Another factor is her work at UBC, where she is senior advisor on Indigenous affairs to the UBC president and co-led development of UBC’s Indigenous strategic plan, which outlines the university’s commitment to supporting the rights of Indigenous Peoples.

“Even before the Black Lives Matter movement, we had huge interest from non-Indigenous communities at UBC in the [Indigenous strategic] plan,” Lightfoot said.

Heightened interest in Indigenous Rights and movements also stems from provincial legislation aimed at implementing the UN Declaration on the Rights of Indigenous Peoples and the introduction of similar federal legislation through Bill C-15, she said.

In her new role, Lightfoot will be following in the footsteps of Grand Chief Wilton Littlechild and Dr. Kristen Carpenter, both of whom served on the UN expert body before her. 

The Narwhal caught up with Lightfoot to discuss her new role and thoughts on how Canada and B.C. have fared on their promises to uphold the UN declaration, which affirms Indigenous Peoples’ rights to self-determination, equality and non-discrimination.

How did you feel when you first heard the news about your appointment? What does the designation mean to you personally? 

When I was shoulder-tapped and asked to consider having my name come forward [for the position], I was of course honoured and humbled because I knew who my predecessors were and how honorable and prestigious they are. Then in late December, I was shortlisted and contacted for the interview process, which then happened in January. 

Four of us went through the interview. Following the interview process, the group that was doing the recommendation [ranked] three of the four names that they put forward. I came out as the number one ranking and had my moment of ‘oh my gosh, this could actually happen.’

The next step was for the president of the Human Rights Council to take a look at the candidates and put forward her recommendation. That letter came in February and that’s when I had my excitement and feelings of overwhelm, and honestly just readiness to dive in and start doing this work.

It was also difficult to keep it quiet because it was going to be almost six weeks before it was acted on by the Human Rights Council. So I did my best to keep my excitement [in check], to begin turning my mind to how I would transition and tailor my own academic work so that it would align with the work of the expert mechanism in the coming three years. But the excitement was building, and when the Human Rights Council acted by consensus on that recommendation, then of course, I was extremely excited and humbled.

It’s a bit daunting to be taking this step and expanding work to the global level. I’m not shy about taking on extra work, but I always am conscious of wanting to do it in the best possible way and also trying to make sure that I create supports around me, that I have students involved, that I have proper consultation going on so that I can do this work in an honourable way and with the highest integrity.

In March 2021 Lightfoot was named the North American member on the United Nations Expert Mechanism on the Rights of Indigenous Peoples. The announcement marks the first time an Indigenous woman from Canada has been appointed to the prestigious position. Photo: Jimmy Jeong / The Narwhal

How would you say your childhood experiences and generational knowledge impacted your career so far?

I’m not a survivor of residential schools but the three generations ahead of me all were, so by the time I came to be, that [had] created a great deal of disruption, pain, trauma, language loss, migration.

Growing up in the ’70s, I think, was an advantage, ahead of what the previous generation had, because there was so much focus about revitalizing culture and refreshing language. For all of us that were in the urban spaces — and I grew up in the Minneapolis urban Indigenous community — there was a lot of attention there in the late ’60s, early ’70s, [on] the political movements that were the centre of the American Indian movement. But also associated with that was cultural revitalization. 

I think growing up in that place and in that time planted a seed. In some ways, I say that my current work as an academic even began when I was five years old, which was the time of the Wounded Knee Occupation in South Dakota. It was the time of a shift, also, from the American Indian movement into the international sphere with the launching of the organizations that did end up going international. 

Then there’s the socio-economic realm. I grew up as the child of a single mom who was the child of a single mom, so poverty and difficult socio-economic conditions were the reality. My mother’s big dream for both of her daughters was that we would go to university. To her, that was going to be the pathway out of the difficult socio-economic condition that we had been raised in.

But then again, if we go with the ethos of the time … [Anyone with an] education is expected by everyone to come back and help the people. We were also given that message early on too.

We both have done that in our own way. My sister has been an elementary school teacher for more than 25 years at an American Indian magnet school in St. Paul [Minnesota, where] they’re teaching our language and our neighbouring people’s language to the little ones. 

After I did some community-based work in the urban area first, I went back for a PhD mid career, in my late 30s. So I’m giving back in different ways. My sister always laughs and says we get students at opposite ends. So [she] starts them out. And then [I] graduate them from university and beyond. Together, we make a complete circle.

What will be some of your biggest priorities in your new role? 

A couple of projects that are currently underway will pass to me, and I’m very happy to pick up the baton on both of them. One is looking at the rights of the Indigenous child around the world, and the other one is a project on Indigenous self determination around the world and how the rights of self determination are being advanced by different stakeholders. 

Both those reports will prove tremendously informative to the UN system. If we think about the rights of the Indigenous child, that report will help create rules for how UNICEF does its work with Indigenous children.

Another key project going on on the international level in preparation for the next 10 years is the international decade on Indigenous languages after it became clear that one year was not enough — that focused attention needed to be for a decade in order to revitalize and save so many Indigenous languages. Those are three ongoing pieces of work that are already in place.

One of my main concerns is the question of free, prior, and informed consent. The expert mechanism did a significant report on it about five years ago, which was a good start, but I think we need to revisit this again because there are cases of unrealized free, prior and informed consent everywhere in the world.

It creates conflict when it’s not resolved and I think all sectors — governments, Indigenous Peoples, industry — are all seeking more clarity on what free, prior and informed consent means, how you get it, and how you know you have it. 

Do you plan on addressing Canada’s failure to acquire the free, prior and informed consent of Indigenous Peoples before moving forward with projects like the Coastal GasLink pipeline, Trans Mountain pipeline and the Site C dam? 

How that gets handled is a matter of some delicacy. In order for the expert mechanism to be brought in, it has to be invited in. Before I was named as a member, you’ll find some writings and some quotes of mine from earlier articles that recommended that in our current conflicts, which sometimes feel irresolvable, it might be a good idea to bring in the expert mechanism to advise Canada and/or B.C. on best paths forward. 

I would still advise that, especially since the Committee on the Elimination of Racial Discrimination (CERD) — a treaty body that monitors compliance by Canada — has issued multiple letters to Canada. The most recent one was in November 2020, advising a change of course on several projects and actually encouraging further discussion and development of appropriate legislation and policy practice. I weighed in on those on both letters and in both cases I recommended looking to the expert mechanism and issuing an invitation because it’s an expert panel of seven human rights experts from all regions of the world who have the ability to come in, listen to the various stakeholders and provide advice from the knowledge base that the mechanism has built up. 

Do you think upholding Indigenous rights also intersects with achieving climate change goals? 

I have every reason to believe so. This is not just an anecdote. There are clear correlations between the areas that are best protected and Indigenous territories.

Quite frankly, if Indigenous lands and territories and cultures are respected in the ways that the UN declaration asks for them to be respected, there will also be a lot more land that is cared for under Indigenous jurisdiction and that in and of itself enhances the climate picture.

Canada has much work to do to move forward on implementing the rights of Indigenous Peoples in Canada, Lightfoot says. Across the country, governments, industry and Indigenous Peoples will all benefit from greater clarity when it comes to securing free, prior and informed consent for development and projects on Indigenous territories, she says. Photo: Jimmy Jeong / The Narwhal

At a provincial level, is British Columbia doing enough to support Indigenous-led conservation efforts?

I think there are some important acknowledgments of Indigenous jurisdiction over particular areas. There are some important examples of partnerships or collaborations which are also positive. What’s left to talk about is the significant amount of Crown land that is also under Aboriginal rights and title.

I believe that, given the underlying rights and title of most of those areas of Crown land, there must be discussions concerning co-management, co-development or, actually, Indigenous ownership.

How much work does the federal government still need to do in order to fully comply with the standards and framework laid out by the UN declaration, which Canada promised five years ago to implement ?

Significant work in all areas: political, cultural, social, economic, health, education. Canada’s behind in almost everything, and far from having implemented the declaration.

I appreciate that in the current proposed legislation is the requirement for a national action plan. A lot of this work will need that action plan in order to really get rolling and get off the ground. I say that because bureaucracies are very resistant to change and they have a strong preference for whatever the status quo has been.

Speaking of the proposed legislation, can you expand on your thoughts on Bill C-15, Canada’s UNDRIP Act? What are its benefits and what are its limitations?

There’s quite a bit of controversy about it in a couple of different dimensions. 

[Some people are] concerned that if it is passed, that will place roadblocks for Canadian industry and investment. I view that similarly to the idea that change is frightening. I think that will dissipate because over time, industry will have a landscape that’s more clear. When a project has the consent of Indigenous people to go ahead, there will be fewer lawsuits, fewer protests, fewer disruptions — and that is actually good for business. But before you get there, you have to do the process correctly, and the people involved have to fully embrace the project. There will be an adjustment period, no doubt, but doing business in a way that aligns with Indigenous human rights is also an exportable model for Canada. It becomes something that Canada could eventually be very proud of and bring to other locations, if done thoughtfully.

At the same time, I have heard worries from Indigenous folks that this legislation could be limiting the constitutionally protected rights of Indigenous Peoples in Canada. I hear their anxieties and I know the trust deficit that’s there. Having looked at the legislation, having given it careful thought, I don’t share that concern.

I think C-15 is actually a positive advancement that places those incentives for government officials and bureaucracies to advance the agenda that they might not otherwise have. I do worry a bit about proceeding without this legislation. On balance, [after] hearing all the concerns, the legislation does a great deal to advance implementation of the UN declaration. And it has already been five years since that last statement. It’s time to put more action on the ground.

Lightfoot says she has faith in Canada’s Bill C-15, the UN Declaration on the Rights of Indigenous Peoples’ Act, but says “it’s time to put more action on the ground.”  Photo: Jimmy Jeong / The Narwhal

Do you think B.C., the first province to unveil UNDRIP legislation, has upheld the standards laid out in the UN declaration or has it mostly been about offering lip service?

I think there have been successes, and I think there have been extreme challenges — both of those truths coexist. Most of the time since that legislation passed [in B.C.], we’ve been in pandemic times, so that’s not an ideal situation. But it is disturbing when there’s a commitment to implementing legislation, and then there’s such a dismal failure so quickly to demonstrate the principles of the UN Declaration in practice. That saddens me a lot, and it’s very discouraging.

However, I also see collaborative and cooperative work on smaller scales, that doesn’t get the visibility that the challenges or the failures do. But I think most of the work in implementing the declaration is going to be piece by piece, project by project and I want to also recognize those movements.

How is your work at the expert mechanism going to address or bridge the gap between what our governments promise to do and what they actually do on a national and international level?

The expert mechanism is charged with providing expertise to the Human Rights Council and is charged with advising states. So some of the work you’re talking about can happen through other channels, like the universal periodic review, like the CERD [Committee on the Elimination of Racial Discrimination] committee, because those are the monitoring bodies.

So they will actually issue the opinions on whether Canada or any of its provinces are aligning or not aligning [with the declaration], and it will often recommend that they contact the expert mechanism to get advice on how to alleviate the issue or the problem that has been identified. 

I look forward to playing my role in that respect.

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Canada is gearing up for a big election this fall and climate policy will likely be at the centre of debate. Prime Minister Justin Trudeau’s Liberals are trumpeting their carbon pricing policy, while Andrew Scheer’s Conservatives want to get rid of it. Meanwhile, Elizabeth May and her newly relevant Greens think Canada must do more to manage the climate crisis.

But where do Canadian voters stand on this issue?

Our research team, based at the Université de Montréal and the University of California Santa Barbara, has new public opinion data to answer this question.

Using recent statistical and political science advances, we can estimate Canadian opinion in every single riding across the country (except for the less densely populated territories, where data collection is sparse). And we’ve released on online tool so anyone can see how their local riding compares to others across the country.

Canadians are concerned about climate change

Our results reinforce what is increasingly clear: climate change is on the minds of Canadians, and not just in urban or coastal communities. A majority of Canadians in every single riding believe the climate is changing. The highest beliefs are in Halifax, where 93 per cent of the public believe climate change is happening.

Percentage of Canadians, by riding, who believe climate change is happening. Map: provided

And a majority of Canadians in all but three ridings think their province has already experienced the impacts of climate change. These beliefs are particularly high in Québec, where 79 per cent feel the impacts of climate change have already arrived.

Canadians also want to see the government take the climate threat seriously.

A majority of voters supports emissions trading. Carbon taxation is more divisive, yet more people support carbon taxation than don’t in 88 per cent of Canadian ridings.

And the handful of ridings that don’t support the Trudeau government’s carbon pricing policy — Fort McMurray-Cold Lake, for example — are already in Conservative hands.

In other words, the path to a majority government — or even a minority government — goes through many ridings where Canadians are worried about climate change and want the government to take aggressive action.

Compared to the United States, the Canadian public believes climate change is happening in far higher shares. Even Canadian ridings where belief in climate change is the lowest have comparable beliefs to liberal states like Vermont and Washington.

Overall Canadian support for a carbon tax is higher than support for a carbon tax in California, often thought of as the most environmentally progressive U.S. state.

Percentage of Canadians, by riding, who believe their province has already been impacted by climate change. Map: provided

Importantly, support for specific climate policies remains high in provinces that have already implemented climate laws. For instance, support for a carbon tax in British Columbia, where this policy was introduced in 2008, is the second highest in the country at 61 per cent (Prince Edward Island has the highest support). Similarly, support for emissions trading is second highest in Québec, again just behind P.E.I., where a carbon market was implemented in 2013.

Even Conservative ridings want action

We don’t find evidence of a backlash to carbon taxes or emissions trading — Canadians living in provinces with substantive climate policies continue to support them. Instead, we find substantial support for climate action in the ridings of Canadian politicians who have done the most to undermine Canada’s climate policy.

Ontario Premier Doug Ford’s provincial riding matches up with the federal riding of Etobicoke North, where 62 per cent of the public supports emissions trading. In other words, Ford ignored the majority will of his own constituents when he acted to repeal Ontario’s policy last year.

Riding-level public opinion estimates for the Saskatchewan riding of Regina-Qu’Apelle, currently represented by Conservative Leader Andrew Scheer. Graph: provided

The same is true federally. In Scheer’s own riding of Regina-Qu’Appelle, support for carbon taxation is at 52 per cent. Only 41 per cent of Scheer’s own constituents oppose a carbon tax. He too is offside with the people he represents.

The political risks of opposing climate reforms

Our results emphasize how the media can sometimes misinterpret electoral mandates. In Ontario, Doug Ford promised to repeal the province’s emissions trading scheme — and won. But the former Conservative leader, Patrick Brown, supported carbon pricing while enjoying a comfortable lead in the polls.

There are lots of reasons why Canadians choose to change their government, but opposition to carbon pricing hasn’t been one of them.

Climate science is clear on the need to rapidly decrease greenhouse gas emissions to avert the most disastrous consequences of climate change. As a northern country, climate impacts in Canada are already larger than in other places.

Our research, which the public can explore, shows that Canadians everywhere — from the most Conservative to the most Liberal ridings — are united in understanding that climate change poses a major threat to the people and places they cherish. The coming election will provide an opportunity for Canadians have a say in the future of climate policy in their country — and all Canadian politicians should take note.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Far from the giddy days following the Paris Agreement, Canada’s carbon tax has recently run into strong headwinds — despite recent polling that shows a majority of the public is on board.

The tax is set to come into effect in January, but Ontario’s newly minted premier, Doug Ford, is hard at work pulling the province out of its cap-and-trade system; meanwhile, Jason Kenney is looking likely to win the Alberta election next year and is promising to axe Alberta’s carbon tax.

Saskatchewan premier Scott Moe is staunchly opposing any carbon tax in his province.* U.S. President Donald Trump is running as fast as he can in the opposite direction from climate action, promoting the coal industry while mocking alternatives.

In the face of these political headwinds, earlier this month the federal Liberal government proposed to scale back its own commitment to taxing carbon — in the name of protecting international competitiveness for heavy-emitting industries.

What had been a plan to tax 30 per cent of emissions is being rolled back to just 20 per cent for most large emitters. This will mean less incentive for companies to invest in efficient technologies and processes, and less reward for companies that are already ahead of the curve.

It almost certainly means more carbon will be emitted, and that Canada’s climate goals, committed to under the Paris Accord, will be that much harder to meet.

“Clearly, competitiveness concerns are re-permeating through every policy conversation these days, and they have been doing so for a little while,” Isabelle Turcotte, interim director of federal policy at the Pembina Institute, a sustainable energy policy think tank, told The Narwhal.

“The government was somewhat overly cautious here… and [has] given a little more relief than it needed to really mitigate these risks.”

Canada’s carbon tax a moving target

Central to the new scheme is a system designed to limit the negative impacts on industries that by their nature emit lots of greenhouse gases, such as the oil and gas industry, cement manufacturers or steel mills.

The way this system — the so-called “output-based pricing system” — will work is somewhat more complex than a simple tax on emissions.

First, the government will determine the national average emissions intensity for an industry — so the amount of carbon produced per unit of production (say, a barrel of oil).

Next, it will set a target level lower than that average.

In its draft regulations in January, the government set the level at 70 per cent of the average emissions for most industries. Finally, the tax will be applied to any emissions that go above that target.

What the government is now proposing is to increase that baseline target — giving industrial sectors more room to pollute without being taxed.

Imagine three steel producers. One, Company A, is emitting 30 kilograms of CO2 for every load of steel it sells. Company B is much less efficient; it produces 60. Company C is slightly less efficient than Company A, and right on the target set by the government. Under the proposed rules, Company B would be taxed on its carbon emissions over the target, while Company A would be generating credits that it could sell to Company B. All three have an incentive to reduce their emissions, but only Company B will be paying carbon taxes.

The carbon tax plan also sets targets within — rather than across — industries. That means less carbon-intensive industries won’t benefit as much as they would if they were compared directly with big polluters.

But cleaner performers within industries — for example, a cleaner oilsands mine — will get a leg up over a dirtier one.

Carbon pricing electricity ‘awkward’: expert

It’s one thing to applying the carbon pricing system to ultra-competitive, internationally exposed industries that can’t help but produce carbon emissions — like steel.

But the new pricing system will also apply to the production of electricity, which is “somewhat awkward,” Turcotte said.

“Electricity generation is not emissions-intensive by necessity,” she said.

It’s also not exposed to pressure from international markets in the same way as steel or agricultural fertilizers are, meaning it doesn’t need the same protection from other countries that don’t have carbon prices, like the U.S.

The reasons for including electricity generation in the system are not entirely clear, although it could prevent an immediate increase in electricity prices for some consumers.

“I don’t think they had to do that, but they did do that,” Chris Ragan, director of the Ecofiscal Commission, said.

“Surprise, surprise, there’s politics that plays a role in these policy designs too — not just pure economics.”

The reasons may not be clear but the effects appear easy to predict: namely, a slower transition away from fossil fuel electricity.

Electrical generation makes up about 10 per cent of Canada’s greenhouse gas emissions, according to the National Energy Board. Turcotte said the decision to include electrical generation in the output-based pricing system could mean trouble for meeting Paris targets.

“We’re concerned by the approach to pricing emissions in the electricity sector, and we’re not sure how these align with our Paris agreement targets, and to getting to our renewable energy targets as well,” she said.

It could also mean that less emissions-intensive sectors will have to pick up the slack for the heavier polluters in meeting a national goal.

Canada’s gap between projected emissions and Paris targets is growing, something the government blamed on a combination of growth in oil and gas and “demographic changes.”

When The Narwhal inquired as to how ‘demographic changes’ relate to growing emissions, Environment Canada declined to elaborate on what relative contribution oil and gas were expected to make compared to demographics.

“We have a target as a country, and when a sector is unwilling to take leadership — when it’s given all these really enabling conditions with great incentives that actually give them the money to make those investments — it increases the burden on other sectors of our economy and of society,” Turcotte said.

International trade concerns

A major concern the federal government says it’s trying to address with the new system is the concern that Canadian firms could be put at a disadvantage relative to foreign counterparts who don’t have the same tax.

The way economists see it, a Canadian firm paying more under the carbon tax could lose customers to an American firm that isn’t paying for its emissions because the American goods would be cheaper. If the American firm started producing more while the Canadian one ramped its production down, the total pollution hasn’t actually decreased, it has just “leaked” across the border.  

Some industrial sectors are both big emitters and are exposed to competition from international trade. Nationally these sectors amount to only about five per cent of the economy, but in Alberta and Saskatchewan, it’s about 18 per cent.

“To not do anything for these sectors is to increase their costs and then walk away, and then let them shrink,” Ragan said. “The goal of climate policy isn’t to reduce emissions by shrinking our economy. The goal is to reduce our emissions by maintaining a healthy economy…but get cleaner.”

Ragan believes the government’s approach to pricing within sectors is the right way to address this problem, and says the changes in the threshold for emissions intensity are “pretty small” and “in a good direction.”

He, like Turcotte, believes government could be doing more to publicly defend the importance of a carbon tax.

The lack of a real push makes implementation harder politically than it needs to be — and opens the door for opposing parties and jurisdictions to reject the tax in favour of less elegant solutions.

“It is not well enough understood [by the public] why carbon pricing is economically the best way to do this, relative to the alternatives,” he said.

If Ottawa proceeds with its draft plan and allows for an 80 per cent threshold for most industries’ emissions intensity, Turcotte and Ragan say the next step should involve gradually lowering the cap as other trading partners introduce their own carbon pricing systems.

Essentially, this would provide incentive for companies to gradually improve operations — or face higher taxes.

There is not currently a plan to lower the cap, but an increase in the tax rate itself is built in, from $20 per tonne to $50 per tonne by 2022.

*This article has been updated to reflect this fact that Scott Moe is the current premier of Saskatchewan, not Brad Wall.

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Canada provides more government support for oil and gas companies than any other G7 nation and is among the least transparent about fossil fuel subsidies, a new report reveals.

“Fossil fuel subsidies undermine carbon pricing, work against the achievement of Canada’s climate targets, encourage more fossil fuel exploration and production, and allocate scarce public resources away from other priorities like health care, education and renewable energy,” says the report, which ranks the progress of G7 countries in meeting their pledge to phase out fossil fuel subsidies by 2025.

The report comes as Canada prepares to host this week’s G7 summit in Charlevoix, Quebec, only days after Prime Minister Justin Trudeau announced federal government plans to purchase the Kinder Morgan pipeline, which will ship diluted bitumen from Alberta’s oilsands to B.C.’s coast for export.

The study was co-authored by the International Institute for Sustainable Development, Natural Resources Defense Council, the Overseas Development Institute (a London, U.K.-based independent think tank) and Oil Change International, a Washington-based research and advocacy organization focused on the transition to clean energy.

Canadians support phase out of fossil fuel subsidies

Accompanied by a new Ekos poll, the research found a large majority of Canadians are strongly opposed to using public money to support oil and gas companies and want to see billions of dollars a year in subsidies phased out.

The exception was Alberta — the heart of Canada’s oil and gas industry — where people polled were concerned about the economic impacts of removing government support for oil and gas corporations.

Even so, 48 per cent of Albertans polled disagreed with public subsidies for oil and gas companies.

“We need to be attentive to these perspectives and concerns of the workers and the communities that are most impacted by efforts to reduce carbon pollution,” said Patrick DeRochie, climate change and energy program manager for Environmental Defence, one of the groups that sponsored the new poll.

DeRochie said targeted programs should be put into place to ensure workers who depend on the oil and gas industry are front and centre in the transition to “clean jobs in a low-carbon future.”

He said the positive economic impacts of using public money for initiatives that combat climate change must also be better communicated.

“That means building up the green economy, clean air and water, improved public health outcomes and new economic opportunities,” DeRochie told The Narwhal.

“A strong argument can be made even to oil and gas producing regions that public money can be better spent than subsidizing this sunset industry, especially when you consider the costs that are growing every year in terms of the climate damages, health costs and growing liabilities for the mess left behind by the oil and gas industry.”

DeRochie defined a subsidy as “any tax provision, or benefit from the government that has the effect of giving one sector an advantage over another in the economy.”

Fossil fuel subsidies are provided by the federal and provincial governments.

According to the report, federal subsidies include the Canadian Development Expense, the Canadian Exploration Expense and the Accelerated Capital Cost Allowance for Liquefied Natural Gas assets.

Export Development Canada, a crown corporation, provides financing to fossil fuel companies, including more than $10 billion in 2017, according to the report. The fossil fuel industry also has access to additional federal tax provisions and policies.

Provincial programs include Crown Royalty Reductions in Alberta and the Deep Drilling Credit in British Columbia.

The report says most of these subsidies were put into place decades ago and fail to take into account the costs of climate change to human health, communities and the economy.

On the good news front, Canada has ended public finance for coal-fired power and restricted subsidies to fossil fuel-based electricity, helping it achieve an overall ranking of third place among G7 nations.

Canada’s oil and gas subsidies lack transparency

But Canada remains the largest G7 provider of support for oil and gas production per unit of GDP, according to the report, which also highlights serious concerns over Canada’s lack of transparency on spending.

“Canada has refused to open up its books to the Auditor General himself,” DeRochie pointed out.

Auditor General Michael Ferguson noted in his May 2017 annual report that he was unable to obtain key documents and budget analyses from Finance Canada to determine what progress had been made toward Canada’s commitment to eliminate subsidies to fossil fuel companies.

“Canadians should be able to know what the government is using their money for, especially when it goes to something like oil and gas companies that are polluting, that are causing climate change and that are becoming a real liability in terms of tar sands cleanup in the future,” DeRochie said.

Germany and the U.S. scored the highest on transparency out of the G7 nations, while Canada is the least transparent nation after Italy.

The study found that G7 governments provide at least US$100 billion a year to support the production and consumption of oil, gas and coal, despite repeated pledges to end fossil fuel subsidies by 2025.

According to the Ekos poll 96 per cent of Canadians believe the federal government should disclose how much oil and gas companies receive in subsidies.

The poll also found that six out of 10 Canadians agree that oil and gas companies should not receive government assistance — on the basis that the subsidies exacerbate pollution and contribute to climate change — and a majority of Canadians would be more likely to support a political party advocating to phase out the subsidies.

Books closed on subsidy details

Canada, along with the other G20 nations, pledged in 2009 to phase out subsidies. The federal Liberals also made the same commitment in the party’s 2015 election platform, and re-affirmed it several times since then, including as recently as April.

Yanick Touchette, policy advisor with report co-author, the International Institute for Sustainable Development, an independent think tank based in Switzerland, the U.S. and Canada, said Canada and other G7 countries must develop a “road map” for phasing out subsidies by 2025.

Canada has not yet participated in a fossil fuel subsidy peer review process as part of the G7 and G20 countries’ commitments to phase out subsidies, Touchette noted.

In a peer review, countries open their books to the scrutiny of another country and international organizations such as the OECD (the Organization for Economic Cooperation and Development) to learn about action they can take to reduce fossil fuel subsidies, he said.

Germany, the U.S., China and Mexico have already undergone peer reviews, while reviews are underway in Italy and Indonesia, Touchette told The Narwhal.

“Generally countries will pair and then the scope is up to the countries who are doing it. Ideally in Canada you would have a broad scope. Basically you list all of your policies that are not only subsidies but any type of policies that are available to the industries and then you review them with your peers.”

 The report’s polling was commissioned by Environmental Defense, Oil Change International, Canada’s Climate Action Network, the International Institute for Sustainable Development, and Équiterre, Quebec’s largest environmental organization.

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In 2015, a pipeline was designed to cut through a sensitive wetland in B.C. The professional biologist reviewing the project told his company that there could be significant damage to the wetland and an extensive monitoring program would have to be set up to watch for effects.

The larger consultancy the biologist’s company worked for refused to submit the report to the pipeline company.

“They took it and rewrote it, basically,” he told DeSmog Canada. “It wasn’t my document anymore.”

The biologist, who spoke to us on the condition of anonymity, said he engaged in a protracted battle with the consultancy, with little effect.

Eventually the B.C. provincial environmental assessment office stepped in and recommended the same monitoring system he originally suggested.

That fight to alter the environmental impacts documented in a scientific report is just one example of the ways professional biologists, engineers, geoscientists and others across the country face pressure from a system with few legislated requirements for scientific rigour.

In interviews with several current and former consultants, the notion was raised again and again that strict rules for scientific integrity could provide a backstop for professionals who are being pressured to alter their recommendations to benefit a project.

That could be about to change, as the federal government introduces a new Impact Assessment Act to replace Canada’s controversial and much-maligned Environmental Assessment Act.

A large majority of Canadians want the new Act to include stricter rules around the inclusion of science, according to a new study released Monday in the journal Facets.

Looking at the comments from public, industry and government solicited by an expert review panel, researchers found the public overwhelmingly asked for more rigorous and transparent scientific analysis of projects during an environmental review.

“In the online questionnaire, people had to rank their top three concerns; science comes out way up there,” said Aerin Jacob, an author of the new study.

The sample of opinions — being drawn from written submissions to the standing committee — is admittedly self-selecting, leaving the paper open to criticisms of selection bias.

“These are people who care enough to be involved, whatever their views are,” Jacob concedes. But other surveys conducted in more traditional ways have returned similar results.

Coauthor Jonathan Moore says what makes the survey unique is that it’s a way of looking at what people are telling the government — thus allowing people to evaluate what the government actually does with that information.

For example, while industry, scientists and the public were aligned on some issues, such as transparency in the government’s decision making, one major area in which industry opinions differed from those of scientists and the public was how rigorous science should be in environmental assessments.

“I think what that means is that the degree to which the government tackled that or not will reveal the degree to which environmental assessment is created for industry or created for the rest of Canada,” Moore said.

Science often not made public

While language in Environment Minister Catherine McKenna’s mandate letter instructs her to “ensure that decisions are based on science, facts, and evidence, and serve the public’s interest,” there is no formal requirement for evidence to be made public before decisions are made.

The new study broke down that concept of evidence-based decision making in environmental assessments into five categories: openly sharing information, evaluating cumulative effects, scientific rigour, transparency in decision-making and independence between regulators and proponents.

“These results not only show there’s strong support across multiple sectors, they also give a road map of how to do it,” says Jacob.

“Rather than just saying you should use science or you should do evidence-based decision making — what does that actually mean? — here, we’re showing, here are five fundamental components of having a scientific approach to environmental assessments, and truly follow up on that commitment.”

Currently, the federal cabinet has a high degree of discretion once assessments have been presented to the government, and the factors that were or were not considered are not made public.

Increased transparency was one of the categories on which almost everyone agreed. For industry, it could mean saving time on environmental assessments, by knowing what was coming ahead of time. For the public, it could mean being able to hold politicians accountable for not taking into consideration promises they had made, or priorities they had professed to have.

Just three submissions were opposed to increased transparency in decision-making, compared to more than 150 in favour.

That’s reflected in the recommendations made by the expert panel: that “information be easily accessible, and permanently and publicly available.”

While the proposed new Act uses the word “transparent” several times, it does not require that data be made public by default, just that there be instructions on how the information can be obtained.

“That kind of redirection is not useful,” says Martin Olszynski, a lawyer at the University of Calgary Faculty of Law.

“You know that the agency has an internal file that contains all of that information, and we basically just say, all of that information should be on the public registry.”

“What if there’s a little bit of harm on my project, and there’s a little bit of harm on somebody else’s project, which is right downstream…Who’s looking at the big picture?” https://t.co/iyVNkwLqJy

— DeSmog Canada (@DeSmogCanada) May 7, 2018

No interconnected knowledge

That lack of transparency also means there are limited opportunities to consider cumulative impacts.

Commenters from the public and even many in industry also asked for more consideration of cumulative effects. Whether through greenhouse gas emissions, air or water quality degradation or wildlife habitat destruction, Jacob said the piling up of effects from different projects is what pushes consequences past a point of no return.

“No one project is going to do that. But together, they do,” she says.

A second professional biologist who spoke to DeSmog Canada on the condition of anonymity said cumulative impacts are among the most insidious, because without specific laws around watching for them, it’s easy to feel pressured to overlook how one project’s impacts stack on those of another nearby.

“What if there’s a little bit of harm on my project, and there’s a little bit of harm on somebody else’s project, which is right downstream…Who’s looking at the big picture?” she asked.

That gap in legislation means that industry-hired professionals have little in the way of recourse when asked to make determinations that they might otherwise feel uncomfortable making. British Columbia is currently conducting a review of the system through which paid consultants are relied upon by the province in environmental decision making (known as professional reliance). The province is also reviewing its environmental assessment process with an eye toward cumulative impacts.

Pressure on professionals

In December of 1980, David Mayhood sent in a report evaluating damage CN Rail had done to a forest in Jasper National Park. It had diverted a stream into the forest to protect its railbed. He found the stream had become impassable for fish because of logjams, while 10 hectares of forest had been wiped out.

“I was fairly graphic in the description about the damage that had been done there,” he said. But there was little appetite for graphic descriptions at the consultancy that had hired him.

“When I got the final copy of the report back with our section in it, it had been drastically changed,” he said. “Where I said an area had been devastated, they said it had been ‘altered.’ ”

Mayhood wrote a letter of protest, but the report was submitted.

He says that kind of pressure to water down language, and consequently undermine the science behind it, has persisted throughout his career.

“The fundamental issue is that biologists…should be independent,” he says. “They aren’t. They’re objectively not independent; they work for a government that has a political agenda, and private industry that also has its own agenda.”

Alana Westwood, science and policy analyst with Yellowstone to Yukon Conservation Initiative, experienced that lack of independence as she began her career as a junior biologist at a consulting firm. She said that although most experiences met the standard of science, there was one particular firm that went far outside what could be considered objective science.

The consulting company was dominated by one client, an electrical generation company, which held an inordinate amount of power over the quality of science Westwood and her colleagues could do.

“I was routinely asked to do things I had no experience for or training in,” she said. For example, she was asked to conduct a bird survey in what she now knows is the off-season for the birds she was ostensibly looking for, using methods she now knows would never be effective.

And it got worse, when she was asked to do a literature review of the known effects of a particular monitoring technique the firm’s sole client wanted to use.

“Then my boss came to me, and said, of the 20 or so papers you found, how many found no effect, or found it didn’t harm them?” she recalls. There were four papers among the 20.

Her boss was clear on what needed to be done, in order to please the client upon which the entire business turned — like so many biologists before and after her, she would be asked to compromise her training, ethics and better judgment to make life easier for a client whose priority was delivering value to shareholders, rather that protecting the environment.

“Use only those four,” Westwood recalls being told.

As the interview comes to a close, co-author Jonathan Moore loops the conversation around to hockey. In recent years, the NHL — concerned that team doctors were facing conflicts of interest as they assessed players for concussions — decided to change their system.

Today, that assessment is done by outside doctors who wouldn’t face pressure to put unfit players back on the ice.

Moore sees the same possibility for environmental assessment reform to take the pressure away from professionals to deliver what their clients want.

“I find that if Canada can do it for hockey, I would hope they could do it for making these huge decisions that affect the environment and people that rely on the environment.”

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