Nova Scotia has already met the national targets for reducing emissions, but not through the carbon pricing the federal government is now prescribing.
One of Prime Minister Trudeau’s many commitments at the COP21 climate conference held in Paris in December 2015 was to meet Canada’s intended nationally determined contributions (INDC) emissions reduction target. The target, originally specified by the Harper government in May 2015, states that Canada plans to reduce its greenhouse gas emissions by 30 percent from 2005 levels by 2030.
Despite the prime minister’s commitment, it is broadly accepted that Canada will not meet its 2030 INDC target. However, what may come as a surprise to many Canadians is that in 2014, Nova Scotia’s emissions were 29.4 percent below those in 2005, just shy of the INDC target.
In 2005, Nova Scotia’s emissions were 23.5 megatonnes (Mt), while a decade later in 2014, they had declined by almost 7 Mt to 16.6 Mt, just shy of a 30 percent reduction of 16.5 Mt. In fact, preliminary data for 2015 suggests that Nova Scotia’s emissions will have surpassed the 30 percent mark. Figure 1 shows Nova Scotia’s actual and preliminary emissions and the 2030 target.
Figure 1: Nova Scotia’s actual and preliminary emissions and the 2030 INDC target
About half of the 7 Mt reduction can be attributed to a decline in emissions from the province’s electricity supplier, Nova Scotia Power (NSP). Here’s how those reductions break down:
- A legislated emissions cap, part of the province’s Climate Change Action Plan, that requires Nova Scotia Power to reduce its emissions from 10 Mt in 2010 to 7.5 Mt in 2020. By 2015, Nova Scotia Power had already met its 2020 target with emissions of 6.77 Mt by using less coal and a combination of natural gas and renewables.
In early 2015, the Canada-Nova Scotia Equivalency Agreement was signed, allowing Nova Scotia Power to continue operating its aging fleet of coal-fired thermal generating stations to meet Nova Scotia’s demand for electricity. In exchange, NSP is required to meet a 2030 cap of 4.5 Mt. This means that by 2030, the company’s total emissions of 4.5 Mt will be considered equivalent to the federal per-facility limit of 420 tonnes per gigawatt-hour.
(Despite the success of the emissions cap, the federal minister of environment and climate change, Catherine McKenna, has made no commitment to maintaining the equivalency agreement.)
- Nova Scotia also passed climate-change legislation requiring NSP to increase its use of electricity from renewables from 9 percent in 2010 to 25 percent in 2015, annual production must remain above 25 percent from 2015 until 2019, and finally, increasing to 40 percent in 2020. In 2015, 26.6 percent of NSP’s electricity came from renewable sources, mostly wind.
- Emissions also declined because the demand for electricity between 2005 and 2014 in the province fell by over 10 percent because one of the province’s paper mills closed and another reduced its operations and the manufacturing sector is experiencing an ongoing slowdown.
The other half of Nova Scotia’s 7 Mt reduction during this period was the result of a 23 percent decline in energy demand for most types of transportation, the closure of the province’s oil refinery, and changes to the ways buildings are heated (for example, from fuel oil to natural gas or electricity).
The total reductions achieved are undoubtedly impressive. For example, per-capita emissions in Nova Scotia have fallen from 25 tonnes per person in 2005 to 17.6 tonnes per person in 2014. However, this has come at a price.
Electricity consumers have been subject to a demand side management tax to offset the cost of home-energy retrofits for low-income Nova Scotians and reduce the price of energy-efficient appliances. This, coupled with the costs of NSP switching from coal to natural gas and the institution of a feed-in tariff that pays producers a premium for electricity from renewables, has since 2005, contributed to a 62 percent rise in the cost of electricity for residential consumers.
Nova Scotians face the prospect of further rises in the cost of electricity prices as NSP increases its use of natural gas and connects to Muskrat Falls in Labrador in 2020 – the year it must show that 40 percent of its electricity comes from renewable sources.
The rising cost of electricity and other energy sources and the effects of the economic downturn in the first decade of this century have all contributed to the decline in Nova Scotia’s emissions,. The province’s GDP grew 7.6 percent between 2005 and 2014 – the second lowest in the country (only New Brunswick’s was lower at 3.6 percent) and less than half the national average.
Although the province does not have an official price on carbon, the rising cost of electricity and the stagnant economy are proving to be effective proxies.
Compounding this problem is the fall in oil prices. Albertan oil companies are laying off workers, including many from Nova Scotia who are no longer able to send remittances to their families in Nova Scotia. Moreover, the state of Nova Scotia’s economy means that workers returning to Nova Scotia are having increasing difficulty finding employment.
While there has undoubtedly been a small increase in the number of workers in “green” industries, their numbers have fallen far short of what the provincial government and other groups had forecast and have failed to offset the increase in the province’s unemployment rate.
Through a combination of accidents and design, Nova Scotia has already met the prime minister’s 2030 reduction target. If NSP continues to exceed existing regulations, the province’s emissions are expected to be about 45 percent below 2005 levels by 2030.
In light of what Nova Scotia has already achieved, it is possible to appreciate why Premier Stephen McNeil objects to the prime minister insisting that the province adopt carbon pricing.
Photo: Mike Dembeck / The Canadian Press
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