Growing quicker with a carbon tax. A new report on the impact of the carbon tax introduced in the Canadian state of British Columbia four years ago shows the state’s GDP has grown faster than the rest of the nation that doesn’t have one. The report, prepared at the University of Ottowa, says BC’s GDP growth has outpaced the rest of Canada’s (by a small amount) since the carbon tax came into effect — suggesting that it has not adversely affected the province’s economy, as some had predicted. This finding fits with evidence from seven other countries that have had similar carbon tax shifts in place for over a decade, resulting in neutral or slightly positive effects on GDP.

BC’s carbon tax is a central component of the province’s climate change strategy, as BC aims to reduce its greenhouse gas (GHG) emissions by 33% below 2007 levels by 2020. The tax applies to almost all fossil-fuel use in the province, including petrol, diesel, propane, natural gas, and coal. The charge for each fuel type is calibrated to the amount of carbon released by burning it. The tax covers three quarters (77%) of the province’s GHG emissions from residential, commercial and industrial sources.

When the tax was introduced in 2008, it was set at $10 per tonne of carbon dioxide equivalent (CO2) (2.4 cents per litre for petrol), and was designed to rise by $5 per year thereafter. It does not cover emissions from non-combustion sources, such as landfill methane emissions, fugitive emissions, and certain industrial processes.

Québec, the only other North American jurisdiction to implement a carbon tax, charges an equivalent of $3.20 per tonne of CO2e (less than 1 cent per litre).

From 2008 to 2010, BC’s per capita greenhouse gas emissions declined by 9.9% — a substantial reduction. During this period, BC’s reductions outpaced those in the rest of Canada by more than 5%.

When the carbon tax was brought in, there were some predictions that it would harm BC’s economy. Four years later, the data show that BC’s economy has outperformed the rest of the country over the period that the carbon tax has been in place.

The report notes that the difference in GDP change is small (0.1% from 2008-11); moreover, the carbon tax is just one small factor in BC’s overall economic picture. Therefore, while it would be a stretch to claim that the tax shift has had a positive impact on the economy, the data appears to indicate it has not had a negative effect.

“That is a very significant result. BC has brought in a serious policy to curb fuel use and GHG emissions. It has a carbon price that is higher than anywhere else in North America, and most other countries in the world — one that seems to be effective in curbing fuel use and GHG emissions. Yet there is no evidence at this point that it is harming BC’s economy.”

Low point reached. It seems that Sunday September 16 marks the low point for ice in the Arctic Ocean — the lowest minimum in the satellite-measured record with barely half the ice coverage of the 1979 to 2000 average. The National Snow and Ice Data Centre says sea ice extent dropped to 3.41 million square kilometres. This appears to have been the lowest extent of the year although a shift in wind patterns or a period of late season melt could still push the ice extent lower.

This year’s minimum was 760,000 square kilometres below the previous record minimum extent in the satellite record, which occurred on September 18, 2007.  Overall there was a loss of 11.83 million square kilometres of ice since the maximum extent occurred on March 20, 2012, which is the largest summer ice extent loss in the satellite record, more than one million square kilometres greater than in any previous year.

News and views noted along the way: