Thickening Carbon Border

(Globe and Mail)

Jim Prentice, the federal Minister of the Environment, was right to warn in a speech in Washington last Wednesday against “trade protectionism in the name of environmental protection.” But trade and environmental motives may be difficult to disentangle, and Canada must be ready to defend its vital interests as an exporting nation by adopting a serious policy to reduce carbon emissions.

Mr. Prentice was specifically directing his speech at a draft bill in the U.S. House of Representatives, called the American Clean Energy and Security Act. Even more particularly, he is justifiably worried about provisions in the bill for “international reserve allowances” that could well have the effect of protective tariffs.

The draft bill in the House energy and commerce committee would charge these so-called allowances, at the border, to exporters into the United States from other countries that do not have greenhouse-gas-emissions regimes “commensurate” to the one that the U.S. would adopt under this same bill.

Though Mr. Prentice had some fun saying, “Like beauty and fairness, the definition of ‘commensurate’ will apparently lie in the eye of the American beholder,” the bill does elaborate on this word, if only in two paragraphs. Read more here.