Alberta premier rejects carbon targets that limit western growth

Alberta Premier Ed Stelmach on Thursday rejected a new report that says Ottawa can only achieve its greenhouse gas emissions targets by limiting growth in Saskatchewan, Alberta and B.C.

The Calgary-based Pembina Institute and Vancouver's David Suzuki Foundation conducted the study released Thursday.

It was partly funding by TD Bank.

The report says a massive restructuring of the Canadian economy will be required to meet the governments climate-change targets, with wealth flowing from the West to the rest of the country.

Stelmach told reporters there won't be another wealth transfer to Ottawa on his watch, saying that federal equalization programs have alreadytransferred $117 billion from the province to Ottawa over the last decade.

Stelmach said Alberta is sufferingthrough a recession just like every other province, and "you can't get blood out of a rock."

TD helped to pay forthe studybut has not endorsed any targets, though it has supported a national emissions cap.

Chief economist Don Drummond said TD funded the report to pull together for the first time in one studyhowproposed targets would be met and what the economic cost would be, especially in different regions of the country.

"No one has ever provided a regional perspective," he told CBC News."You don't get very far in this debate just looking at it at a national level. There's been no information on this until now."

The targetscould bemet through direct taxation or by capping emissions andrequiring companies to buy allowances amountingto $100 a ton by 2020 to emit carbon.

Would raise $46B in tax revenue

The federal government, in return, would receive approximately $46 billion or more in revenue and redistribute that through spending and cuts to personal taxes.

The study concludes that achieving the government target under one scenario wouldcumulatively reduce Canada's real GDP growth byabout 1.5 per cent by 2020. That amounts to losing one year's economic growth over the next decade comparedwith doing nothing.

"It's not devastatingly large," Drummond said, "but it is very significant."

Economicgrowth over the same period would be reducedin Alberta by 8.5 per cent, in Saskatchewan by 2.8 per cent and in British Columbia by 2.5 per cent.

"Alberta would still record the fastest growth," Drummond said, and of all the provinces would "still have the biggest per capita income, but nonetheless it does bear the biggest shock."

Benefit certain provinces

The report assumed all theemissions revenue would be redistributed to the public, resulting in massive investments in technology and public infrastructure, such as public transit, and a large personal income tax cut.

It also assumed there would be benefitsfor developing electricity generation that does not involve burning fossil fuels, which would benefit Manitoba, Ontario and Quebec.

The Pembina Institute's director of climate change, Matthew Bramley, presented the study Thursday to a Commons committee studying an NDP bill, C311, that would set deep emission targets for Canada.

Bramley said the study showed Canada could adopt C311 and "still have [a] strong growing economy,a quality of life higher than Canadians enjoy today and continued steady job creation across the country."

However, he said, that would only be possible if Ottawa immediately puts a price on emissions.

The report comes ahead of the United Nations climate summit in Copenhagen in December, where countries, including Canada, will attempt to at least make progress on a new global climate treaty to replace the Kyoto Protocol.

As Canada heads into what he expected would be difficult negotiations, Bramley told the committee, passage of C311 before the Copenhagen conference convenes "would send an important signal of Canadian leadership to the world."