Canada wants North America cap-and-trade system

OTTAWA (Reuters) - Canada’s Conservative government, shifting positions in the wake of Barack Obama’s election as U.S. president, said on Wednesday that it would work to develop a North America-wide cap-and-trade system to limit emissions of greenhouse gases.

The Conservatives, who walked away from the Kyoto protocol on climate change after taking power in 2006, have until now focused on cutting the intensity of emissions rather than imposing outright curbs.

“We will work with the provincial governments and our partners to develop and implement a North America-wide cap-and-trade system for greenhouse gases,” the government said as it unveiled plans for the new session of Parliament.

Obama favors much tougher greenhouse gas reduction targets than those set by the Conservatives, and says he will start a cap-and-trade system.

Environment Minister Jim Prentice told reporters that Canada’s policy in part reflected Obama’s election.

Green groups said the Conservatives’ new positioning is largely academic as Canada would likely go along with whatever approach the new U.S. administration takes because the U.S. economy is around 10 times the size of Canada’s.

“I think we will be forced into a North American-wide cap-and-trade system that will basically be dictated by Washington.... It’s the only system that can work. We’ve got an integrated economy,” said Stephen Hazell, executive director of Sierra Club Canada.

The Conservatives’ approach to climate change to date has been much closer to that of President George W. Bush.

The Kyoto protocol committed Canada to cutting emissions by 6 percent from 1990 levels by 2012, a target the Conservatives say is totally unrealistic.

Last year Ottawa released a plan calling for a 20 percent cut in 2007 emissions by 2020. This compares with Obama’s much more stringent target of cutting emissions to 1990 levels by 2020.

Last week, Prentice said a U.S. cap-and-trade system could coexist with a Canadian approach of targeting emissions intensity.

“I think the Canadian government is just trying to con the Canadian public into believing that it’s going to do something about climate change,” said John Bennett, chief spokesman for the Green Party.

He said Canadian and U.S. environmentalists would “make very clear to the U.S. administration that it’s apples and oranges” when it comes to comparing both plans.

Although Canada is the single largest supplier of energy to the United States, Obama’s team has expressed reservations about U.S. imports of oil from the oil sands in the western province of Alberta.

The process of removing oil from the sands produces vast amounts of emissions.

Alberta -- the bedrock of the Conservative party -- strongly opposes the idea of a cap-and-trade system, and Ottawa’s plan was quickly attacked by provincial Premier Ed Stelmach as too risky.

“We’ve just come through the world’s worst financial crisis where people were not telling the truth about the risk ... who’s thinking here?” said Stelmach, complaining that Alberta was not told in advance about the announcement.

Stelmach said the province would continue to pursue its own plans that focus on efforts to capture carbon emissions and store them underground.

Ottawa also said it would set an objective that 90 percent of electricity needs by 2020 be met “by non-emitting sources such as hydro, nuclear, clean coal or wind power.”

It also said it would reduce various regulatory barriers to make it easier to build natural gas pipelines into the Arctic, which has rich reserves.

Reporting by David Ljunggren, Allan Dowd; editing by Rob Wilson