1. CANADA: Lack of nibbles has Ottawa reeling in its offer for continental climate deal (ClimateWire, 04/14/2009)

Evan Lehmann, E&E reporter

Canada blushed with enthusiasm when it proposed a sweeping climate marriage with the United States on President Obama's inauguration day. But now the northern nation plans to develop its own cap-and-trade program, leading some to question whether the request was premature.

One consultant with firsthand knowledge of the project said Ottawa officials "miscued" when they pitched a continental plan to target emissions. Other observers say Canada could gain politically from its early proposal but that otherwise, the publicized plan has floundered.

Environment Minister Jim Prentice introduced the concept of a "North American regulatory regime" on Obama's first day in office. He compared it to the "collective commitment" of the European Union, and described a sprawling climate program stretching from the Yukon Territory to Mexico's southern border.

But U.S. officials apparently never publicly acknowledged the idea. And in Canada, it seems, some within the government consider it a premature overture -- or even a case of mistaken wording.

"That was kind of a misnomer," said the consultant, who spoke on the condition of anonymity, noting that ratifying a single program under several countries could add complexities to the already daunting task of independent nations adopting emission caps.

"They thought, 'Well, gosh, we didn't mean a treaty, or if we did, we probably miscued,'" the consultant said. "What we really need is something sensible on each side of the border that is, if not in lockstep, are compatible and allow us to go forward together."

Establishing a treaty between two countries -- even friendly neighbors like the United States and Canada -- can take years. The U.S. Congress doesn't have that luxury. Democrats have a majority in both chambers now. Even so, they're having trouble leaping pitfalls associated with reducing emissions.

Republicans and conservative Democrats are questioning the financial cost. Add other countries to the experiment -- especially one with controversial oil sands development -- and the test tube could overflow with volatility.

"Trying to get a treaty with the United States is really, really hard," said David Biette, director of the Canada Institute at the Woodrow Wilson International Center for Scholars. "You're not going to get an international agreement ahead of a domestic agreement."

Ottawa arrives at a potluck with an empty plate

Critics of Canada's Conservative government see the continental proposal as one meant to hitch Canada to the popular American president.

Prime Minister Stephen Harper, who abandoned Canada's failing effort to meet its goals under the Kyoto Protocol, has sought to assert leadership on climate issues. But that effort has been haphazard. The government missed its deadline of 2008 to establish regulations to reduce industrial emissions 20 percent by 2020, as compared to 2006 levels.

The plan, called "Turning the Corner," did not set a hard cap on greenhouse gases. Instead, it proposed reducing the intensity of emissions on every unit of goods produced. That means overall emissions could continue to rise in fast-growing industries like the oil sands sector even as the amount of carbon dioxide drops in each ton of oil.

"Canada isn't really bringing anything to the table," said Clare Demerse, associate director of climate change with the Pembina Institute, a Canadian environmental think tank.

"Canada has positioned itself as a policy-taker, waiting to see what the U.S. will do," she added. "For us it's very frustrating. Canada is clearly the smaller partner here. But I don't think Canadians have ever believed we need to wait for the U.S."

But maybe Ottawa didn't wait. The government, for example, can point to its early proposal to create a North American cap on carbon when it attends the December U.N. conference on climate change in Copenhagen. Those assertions could be helpful during the next Canadian election, too.

"Maybe [Canada] can blame the United States," Biette, with the Canada Institute, said of the continental approach.

Pan-American program not 'too difficult'

Prentice has indicated since January that the Harper government might abandon its preference for intensity targets. That could make the Canadian plan similar to its U.S. counterpart, which calls for hard emission caps.

It also means that oil sands producers, currently overseeing one of Canada's strongest economic drivers, could face stricter emissions targets. That is one side by which Harper is being pulled. The other side is a U.S. administration that has signaled to nations considering weaker emission rules that they could pay penalties at the border.

A bill proposed recently by U.S. Reps. Henry Waxman (D-Calif.) and Ed Markey (D-Mass.) would impose tariffs on energy-intensive foreign companies in industries like steel, cement, glass, paper and chemicals. These companies could have to buy pollution permits, or allowances, in order to keep their American counterparts competitive.

Ottawa is planning to release regulations for its domestic climate plan later this year, in time to contribute to the United Nations' climate change conference in December.

"In the months to come, Canada will continue to work with the U.S. to develop a coordinated approach that will advance our respective environmental and energy objectives and renew the North American economy at the same time," Tristan Landry, a spokesman at Canada's embassy in Washington, said in a statement.

A White House spokesman declined to comment on Canada's proposal for a continental cap-and-trade program.

Not everyone agrees that the two allies should pursue separate routes.

Confronting emissions together -- under one banner -- could help integrate the economies of the United States, Canada and Mexico, said Paul Cellucci, the former Republican governor of Massachusetts and a former ambassador to Canada. That could give those countries an edge against China and India, he added.

"I think it makes sense to be working together ... to have a North American program," Cellucci said. "I don't think it's too difficult."

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