Ontario’s climate plan is policy on speed

Theglobeandmail.com
June 17, 2016
By Jeffrey Simpson

Complexity is the enemy of sound public policy, and subsidies are usually the least effective economic policy. Ontario’s Climate Change Action Plan offends both truisms.

This recitation will take a while, but patiently cast your eye through what follows.

This is a partial list of the subsidies and regulations in the plan: require more renewable content in transportation fuels; funding for distributors of these fuels; money to turn methane into a fuel source; subsidies for electric vehicles; subsidies for free overnight charging of these vehicles; money for low-income people to sell old cars and buy electric vehicles or plug-in hybrids; money for more charging stations; regulations requiring 50-ampere, 240-volt outlets in garages of new homes; lots of money for cycling infrastructure; subsidies for businesses to buy low-emission vehicles; subsidies for low-emission fuelling stations; money to retrofit social housing for energy efficiency; subsidies for retrofitting apartments and improving energy efficiency in schools, hospitals, universities and colleges; subsidies for homeowners to install low-carbon technologies and switch from older wood stoves, plus rebates for those who build their own net-zero carbon emission homes; subsidize the use of natural gas in industrial, transportation and building sectors; free (that is, subsidized) energy audits for presale homes; new training programs for building trades; subsidize community energy plans; subsidize companies to increase low-carbon technologies; give money to municipalities and large private employers to implement transportation demand management plans; establish a $250-million to $300-million challenge fund; subsidize the retrofitting of agricultural facilities; subsidize food and beverage processors to use innovative technologies to reduce emissions; support research into low-carbon technologies; offer more research and development tax credits; consider accelerated capital cost allowances; and so on and so on and so on.

This list, to repeat, is partial. The full exposition of the government’s intentions would take the rest of the available space in this column. But you get the idea.

The government’s plan is policy on speed - a massive, extraordinarily complicated, very expensive mélange of regulations, subsidies, tax expenditures, targets and green and challenge funds - paid for with the proceeds from a cap-and-trade system, the costs of which will eventually be wholly or partially passed on by companies to consumers/taxpayers, the proceeds of which will be disbursed by the Kathleen Wynne government into the programs listed above and many more - programs designed by civil servants and environmental advocates in defiance of sound principles of public management and at a per-tonne cost for emissions that exceeds other alternatives.

Moreover, the plan rests on assumptions that for the moment are highly implausible, the most obvious being that the enormous increase in electricity necessary to make this plan even remotely possible relies on intermittent sources (solar and wind), marginally useful ones (geothermal) or very expensive ones (biofuels), the supply of which for the foreseeable future will be inadequate or will be made adequate only at the cost (not mentioned in the plan) of even more subsidies.

Furthermore, the plan assumes the creation of a series of new bureaucratic institutions to organize and deliver the multiplicity of programs, with civil servants presiding over the expenditure of these new billions, and ministers (ministers now accounting for more than half the Liberal MPPs) putting their oars in the water to maximize the benefits for their constituencies, regions and favoured industries. After all, when billions of new dollars become available, no government can ever resist bending at least some of the spending for partisan purposes - an effort that has already started with the Wynne government’s television advertisements, paid for by taxpayers, touting the benefits of the plan.

The pity of it all, for those who take seriously the need to reduce carbon emissions, is that simpler, cleaner, less bureaucratic means were available; instead, taxpayers will see their money spent by others, inside government, rather than making their own choices in their own time and as they, and not the government, see fit.

The double pity, entirely predictable alas, was the alacrity with which the environmental lobby groups hailed the plan, because for them, the more programs the better, given what they see as the urgency of action - any action - without pausing to ask the most operative question: Was this the simplest, most practical and efficient way of achieving objectives?

Advocacy is great, except when it is blind.