Ontario says provinces will lead climate change fight

TORONTO - Canada's battle against climate change is now in the hands of the provinces, Ontario's environment minister said Monday.

Ontario, Quebec, Manitoba and British Columbia will have to forge ahead with a regional cap-and-trade system now that efforts to reduce greenhouse gas emissions appear to have stalled in Ottawa and Washington, said John Wilkinson.

Talks to develop a regional system will "accelerate" in the wake of the Republican midterm victory that's dashed hopes for new climate change legislation from the United States, he said.

"I think those discussions over the next few months will be intensified as it becomes clear that we're going back to the situation that we had prior to 2008, which is the need for individual states and provinces to create a system," Wilkinson said in an interview from St. Marys, Ont.

The recent Republican victory has effectively turned back the clock to the days of the Bush administration, when there was zero interest in developing a cap-and-trade system, he said.

Cap-and-trade places a ceiling on greenhouse gases and lets participants buy and sell emissions permits within that cap. Those who don't meet the emissions targets can buy credits from others with a surplus instead of lowering their emissions.

Obama, who was elected in 2008, would have difficulty passing any legislation now, Wilkinson said. And since the federal Conservatives won't move before Washington does, there's little hope that Ottawa will take the helm.

However, the four provinces -- along with seven U.S. states -- are partners in the Western Climate Initiative, which plans to set up a cap-and-trade system by 2012. Saskatchewan, Nova Scotia, New Brunswick and the Yukon are observers.

"It is important for us to signal to the federal government that provinces representing the vast majority of the economy of Canada are prepared to enter into a cap-and-trade system," Wilkinson said.

A continental system would be far more effective in curbing harmful emissions, but Ontario will keep trying to create a bigger trading market, Wilkinson said.

The province is already making efforts to reduce its emissions by investing in public transportation, protecting the greenbelt and reducing its dependence on coal-fired generation.

"Cap-and-trade is just one of the arrows in the quiver, and we'll be reaching out to willing partners in other states and provinces," he said.

The midterm elections may have shelved Obama's environmental agenda for the time being, but it also produced a minor victory for environmentalists, said Ontario's environmental watchdog.

California's Proposition 23, which would have delayed the state's greenhouse gas emission reduction targets, was defeated. Voters also elected Democrat Jerry Brown, who supports WCI, as their next governor.

That sends a clear signal that California, a major player in WCI, will be front-and-centre in implementing cap-and-trade, said Ontario environmental commissioner Gord Miller. But they need to pick up the pace.

"These jurisdictions have to start moving pretty darn fast now," said Miller, who regularly blogs about climate change developments.

"We're at the end of 2010. So there are steps that still have to be taken to get everything ready for the market in 2012."

Time is of the essence, he said. Some industries seem to be more open to a carbon tax. Meanwhile, the European Union is already talking to China about emissions trading.

"North America could find itself caught offside on this whole thing if it can't come to terms with the price of carbon," Miller said.

But opposition critics say Ontario needs to get its own house in order first.

Miller acknowledged that unless the Liberals take drastic action, they won't meet their own emission reduction targets.

There's no provincewide energy conservative plan and Premier Dalton McGuinty has put off closing Ontario's dirty, coal-fired plants three times since the 2003 election, said NDP environment critic Peter Tabuns.

"I think it's a bit rich for them to pretend to be real leaders on this file, when they're neglecting so many of the fundamental things you need to do to be effective," he said.