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CANADA AND AUSTRALIA DIVERGE ON CARBON PRICING

12/12/2016

As countries around the world begin to implement their nationally determined contributions under the Paris Agreement, there is a demonstrable rift between liberal and conservative governments. As of Friday, Canada’s government, led by Prime Minister Justin Trudeau, and 10 provinces were set to agree on a national price for carbon. The plan allows provinces to implement either a carbon tax or a cap-and-trade market; those provinces not willing to choose will have a carbon tax imposed by the national government. For provinces choosing to implement a carbon tax, the price of carbon will gradually increase from $7.60USD per ton in 2018 to about $38US per ton in 2022. Meanwhile, the more conservative government in Australia rejected proposals for pricing carbon emissions from energy generators, both in the form of a carbon tax and an emissions trading scheme. Many now doubt Australia’s ability to meet its carbon reduction goals. Although action has been proposed at the state level—many Australian states are proposing renewable electricity generation targets of more than 50% by 2020—energy companies doubt the ease of compliance. For the full story on Canada’s decisions, see http://uk.reuters.com/article/us-canada-environment-idUKKBN13W2RS. For the full story on Australia’s, see http://uk.reuters.com/article/us-australia-politics-climatechange-idUKKBN13W0JY.