Canada's efforts towards greenhouse gas emission reduction: a case study on the limits of voluntary action and subsidies

Abstract

Canada has committed internationally to several agreements to limit climate change, most recently by ratifying the Kyoto Protocol in 2002. However, its domestic climate change policy is not reflective of these international commitments. In particular, federal government climate change policy over the last decade has emphasised noncompulsory policies such as voluntarism, information provision, and modest subsidies. These policies are designed primarily to engender minimal political resistance, and have been relatively ineffective in providing the incentives and regulatory structure for the dramatic technological and behavioural change required for significant greenhouse gas emissions reductions. Without a major change in direction towards more compulsory policies, it seems unlikely that Canada will achieve significant domestic greenhouse gas reductions over and beyond the Kyoto Protocol time frame. We suggest a more compulsory policy approach dominated by market-oriented regulations. When designed appropriately, this type of policy stimulates the development and commercialisation of new technologies without dramatically affecting prices of energy or goods.