Research Digest - December 2019

Bridging the Gap: Real Options for Meeting Canada’s 2030 GHG Target

(Ecofiscal Commission)

Governments should evaluate whether their policies are stringent enough to meet targets, and close any gaps.

If governments wish to meet their climate goals at least cost, they should rely on increasingly stringent carbon pricing.

If policymakers choose not to close the gap to Canada’s emissions target using carbon pricing, they should rely on increasingly stringent flexible regulations instead.

Tipping the Scales: Assessing Carbon Competitiveness and Leakage Potential for Canada’s EITIs

(The Conference Board of Canada)
Carbon leakage is an unintended consequence of a carbon pricing policy. It occurs when firms faced with incremental compliance costs transfer some of their activities to 2 jurisdictions with less stringent policies. The result is that global GHG emissions are shifted rather than reduced.