A "Made-in-Canada" Approach to Global Warming

Dr. Roy Norton, Executive Director, International Relations and Protocol, Ontario Ministry of Enterprise, Opportunity and Innovation and Director, The Canadian Club of Toronto; Joseph James Rizzo, Academic Student Achiever of Proficiency in Math and Honours in Business, Grimsby Secondary High School; The Rev. Kim Beard, BA, BEd, MDiv, Rector, Christ Church, Brampton and Director, The Empire Club of Canada; Leslie Noble, Managing Director, Strategy Corp.; The Hon. Murray Smith, Minister of Energy, Province of Alberta; The Hon. Mike Harris, Chair, Ontario's Promise and Former Premier of Ontario; David L. Lindsay, President and CEO, Superbuild Corporation and Director, The Empire Club of Canada; Ken Whyte, Editor, National Post; Julian Nowicki, Deputy Minister of the Executive Council, Province of Alberta; Ron Munkley, Vice-Chairman and Head of Power and Utilities Group, CIBC World Markets Inc.; and Nancy Lockhart, President, The Canadian Club of Toronto, Chief Administrative Officer, From Development Group and Chair, Ontario Science Centre.

October 23, 2002

A joint meeting of The Empire Club of Canada and The Canadian Club of Toronto

Introduction by Ann Curran

The man beside me today probably needs no introduction but before we start into what I'm sure will be a lively address, let me take a moment to give you a little background on Premier Klein. This man has achieved a lot. I will give you an abbreviated version of his biography but if you would like full details including the many awards he has received, please visit our Web site.

Ralph Klein was elected leader of the Progressive Conservative Party on December 5, 1992 in the first one-member one-vote leadership race held in Alberta. He was sworn in as Alberta's 12th premier on December 14 of that year.

Several months later, Albertans gave his party a resounding victory in the provincial general election of June 15, 1993.

In the March 11, 1997 general election, Albertans returned Mr. Klein and his government to office for a second term, with an increased majority.

As premier, Mr. Klein has revamped and opened up the government's decision-making process, downsized government, balanced the budget, begun the orderly pay-down of debt and spearheaded a drive to develop the climate for private-sector job creation.

Ralph Philip Klein was born in Calgary November 1, 1942. Educated in Calgary, he interrupted his high-school studies to enlist in the Canadian Air Force. Upon leaving the service, Mr. Klein completed his high-school education, eventually becoming principal of the Calgary Business College.

From 1963 to 1969 Mr. Klein pursued a public relations career with the Alberta Division of the Red Cross and the United Way of Calgary and District.

For the next 11 years, he was the senior civic affairs reporter with CFCN Television and Radio:

On October 15, 1980 Ralph Klein was elected Calgary's 32nd mayor, one of only two mayors born in the city. Re-elected in 1983 and 1986 with among the largest pluralities in the city's history, Mr. Klein's major accomplishments included the 1988 Olympic Winter Games, Calgary's Light Rail Transit System and protection of the Bow River.

Ralph Klein was elected MLA for Calgary-Elbow March 20, 1989 and on April 14, 1989 was appointed Minister of the Environment. In that portfolio, Mr. Klein oversaw the development of the Alberta Environmental Protection and Enhancement Act, acknowledged as one of the most progressive environmental laws in Canada.

Since becoming premier in 1992, Mr. Klein has also served as Minister of Federal and Intergovernmental Affairs (1993) and Minister of Economic Development and Tourism (1994).

Premier Klein has joined us today to give us an update on what's happening in one of Canada's hottest provincial economies. A key focus will be the Kyoto Protocol and Alberta's own plan to tackle global warming. Premier Klein will emphasize that Albertans are serious about responding to climate change, and that the province has a plan.

Without further adieu, I give you Premier Ralph Klein.

Ralph Klein

Good afternoon, ladies and gentlemen.

For me, it feels right to be in a different part of Canada in autumn, because in many ways, fall is the truest "Canadian" season.

The air is turning colder and we all know what that means for the months ahead. The new hockey season has begun, meaning that for now at least, the Flames, the Oilers, the Leafs, the Canadians, the Canucks and the Senators are still in the thick of the hunt for the Stanley Cup.

And the Grey Cup is just around the corner. As you might know, the Grey Cup is being played in Alberta's capital city of Edmonton this year. I hope that many of you here today will get a chance to come out to Edmonton for the fall classic because it's going to be an incredible event for the CFL and the country.

So, when there's frost on the pumpkins, as they say, the character of this country stands out the most.

In Autumn 2002, the Canadian spirit has shone as brightly as a harvest moon, thanks to the work of hundreds of people in Ontario and throughout central and eastern Canada who organized and contributed to the Hay West campaign to help western farmers and ranchers hit by drought. The campaign has seen almost 8,000 tons of hay shipped free to farmers in the West.

Friends, let me tell you, the people of Alberta have been moved beyond words by the generosity of the people of this province and your neighbours to the east. On behalf of all Albertans, I want to thank the people of Ontario for their kindness and hard work.

Though thousands of kilometres separate the farms of Alberta from the rail yards of Ontario, the warmth of the Hay West people has taken the edge off the fall chill and made us feel like closer neighbours. That's something that Albertans will not forget.

Hay West has been a uniquely Canadian approach to a tough Canadian problem. It has united people from across the country in a common purpose. I think that resolve can be applied to another challenge we face this autumn--the challenge of climate change.

For many Canadians, events of the summer and fall have made the threat of global warming seem very real. From the drought in the West to heat waves in Ontario, Canadians have had concerns about climate change. They want their governments to do something to be part of the solution.

Today, I want to talk to you about Alberta's approach to climate change that is designed with Canada's economic and geographic circumstances in mind. I want to lay out for you why Alberta thinks the Kyoto Protocol is not the best approach for Canada.

Let me begin with a simple point: Canadians have the know-how and the resolve to tackle this problem.

For proof of that, you don't need to look any farther than right here in Ontario. As we're all aware, there's a smog problem here in Toronto and elsewhere in the southern part of the province. In response, the Ontario government, working with industry and consumers, has introduced a set of actions that aim to reduce smog emissions. Combining steps ranging from vehicle emission testing to emission-trading mechanisms, the plan is an effective Ontario solution to a continental problem.

We've had a similar kind of success in Alberta. There, the problem was solution gas flaring from oil and gas operations. Flaring releases a number of gases into the atmosphere, and it was clear that those emissions had to be reduced.

So, under a partnership of government, industry, municipalities, consumers, and environmental groups, programs were designed that, in 2001 alone, reduced solution gas flaring by 53 per cent. The flaring reduction programs were designed in concert with the people doing the flaring and the people experiencing the impacts. Solutions were not imposed; they were negotiated. Industry was not threatened; it participated enthusiastically. Citizens were not ignored; they were heard and responded to.

Climate change is a different kind of problem, to be sure. But this same type of bottom-up approach can work in Canada's solution to the climate-change issue. Together, Canadians can come up with solutions that build on the country's strengths, and that make the best use of Canadian ingenuity and Canadian resolve.

In Alberta, our government has recently released a detailed plan to reduce greenhouse gas emissions. The plan is built around three basic concepts: making the best use of clean technologies; providing information to consumers; and setting firm, achievable targets for emission reductions. Under the plan, Alberta expects by 2010 to reduce its greenhouse gas emissions by about 20 mega-tonnes, with reductions of up to 60 megatonnes achieved by 2020.

We'll do so by negotiating sectoral agreements with industries and municipalities--backstopped by regulatory authority. We'll invest in new technologies that reduce emissions. We'll provide information to consumers so they can cut emissions from their homes and vehicles.

It's not just government that has been working on the problem. The energy industry has made remarkable strides in reducing greenhouse gas emissions. At the two main oil sands plants, for example, they've invested billions in clean technologies that have helped them reduce emissions from synthetic oil production by 35 per cent over the last decade, while at the same time creating jobs and growing as reliable providers of energy.

While I'm on the subject, permit me to talk briefly about what is happening in Alberta's oil sands.

Those sands contain more oil than all of Saudi Arabia. Along with offshore reserves in Atlantic Canada and other recent finds, Alberta's oil sands are more than sand; they are the promise of energy security for Canada for decades to come.

Many people don't realize that the economic impact of the oil-sands stretches much farther than northern Alberta. The National Oil Sands Task Force estimates that 27 per cent of all economic benefits from the oil sands accrue to people right here in Ontario. Businesses here are leading suppliers of the steel, machinery, equipment, cable, high-tech gear, and other goods and services that keep the oil-sands operations running. Today, approximately 32,000 jobs in Ontario are directly related to oil-sands projects.

Continued oil-sands investment is expected to result in an extra $50-100 million annually in Ontario government tax revenue.

It's not just Ontario that benefits. Studies show that about 60 per cent of all economic benefits from development of the oil sands occur outside Alberta.

Even the federal government benefits, with about 20 per cent of the net cash flow from the oil sands going to Ottawa in the form of income taxes. That's billions of dollars for federal expenditures such as health care, environmental protection and equalization payments.

Right now, there are $60-billion worth of new investments planned for the oil sands over the next 10 years. Those are dollars whose benefits will ripple across Canada. Those investments, in fact, will likely result in over $16-billion worth of increased activity in Ontario alone.

If the tremendous potential of these economic drivers is dampened--as it will be if Kyoto goes ahead as written--then all of Canada will feel the impact. I don't think anyone here today wants that to happen.

Certainly, Albertans don't. That's why our climate-change plan has been designed to tackle climate change without compromising the economic potential of the province or country.

Later this fall or perhaps early next year, our government will introduce a bill in Alberta's Legislature to make adherence to this plan the law. We're serious about tackling climate change, and this law will prove that.

So, you might ask, if Alberta is ready and willing to take action on climate change, and if it can meet the Kyoto targets, why fight the Kyoto Protocol? Why not just sign the darn thing?

That's a very good question. And I've got a very good answer.

The protocol assigns to Canada the responsibility of reducing its greenhouse gas emissions to 6 per cent below 1990 levels by the year 2012. Under the protocol, international inspections of Canada's record will begin as early as 2005. Further reductions are called for in the later phases of the protocol.

So what's wrong with that, you might ask. Well, first off, the targets are not realistic. A 6-percent reduction from 1990 levels might not sound like a lot. But you have to realize that because of economic growth over the last 12 years, getting 6 per cent below 1990 levels requires a 30-percent reduction in today's emissions.

Thirty per cent is a lot. That would be like grounding every third airplane in Canada, or locking up every third car, or shutting down every third electrical plant. And, we've only got seven years and two months to start showing results, or our knuckles will be rapped by UN bureaucrats.

The second problem with Kyoto is that its targets ignore the realities of the Canadian economy. If Canada ratifies Kyoto, it will be the only country in the western hemisphere that must meet targets under the protocol.

With those targets come high costs. Canada's greatest trading partner and greatest source of investment capital, the United States, will not be bound by Kyoto targets. Nor will Mexico, a growing trade partner. Nor will Venezuela, Saudi Arabia or Nigeria, our major energy competitors. Under Kyoto, Canada will be competing globally with one hand tied behind its back because of costs inflicted by Kyoto that others won't have to bear.

I know that my critics have said that Alberta is opposing Kyoto only to protect its own big-energy interests. I don't deny--or apologize--that our concern as a province is in part for our energy sector.

What we're trying to protect, however, are the jobs of average Canadians, including Albertans, who have worked hard to build an energy industry that helps provide all of Canada with the cheapest, most stable source of energy in the world.

Recently, the federal government released a paper that predicts that job losses from Kyoto will range from 67,000 to 240,000, and that most of those jobs are ones that haven't even been created yet. "That's not too bad," they say. "We can live with that."

Well, I can't live with that. Each one of those jobs is a Canadian's future. Whether it's 67,000 or 240,000, whether it's a current job or a job that might be there in a few years for a kid who's in school today, sacrificing those jobs is entirely unnecessary. Friends, these jobs will be from all across the country. Kyoto will affect agricultural producers, manufacturers, small businesses and many others in every corner of Canada.

Canada's auto manufacturers, based right here in southern Ontario, have gone on record with their concerns about the impact of Kyoto. The Canadian Vehicle Manufacturers' Association has said: "If Canada ratifies the Kyoto Protocol in the absence of its major trading partners, this action would have no measurable impact on global carbon dioxide emissions, but could have a very negative impact on our businesses in Ontario." Based on the federal government's own numbers, which are considered optimistic, the automakers predict that 40,000 to 80,000 jobs could be lost in their industry if Kyoto is ratified.

There are many other problems with Kyoto. The protocol is not about clean air; it's about carbon dioxide emissions. It isn't designed to address the problem of other emissions into the air across the globe, emissions that create the smog that worries so many of us. Any residual benefits from Kyoto in dealing with smog will be minimal at best.

Further, it moves dollars out of the country. As it stands right now, Canada could potentially spend from $2-6 billion in purchasing international emission credits. That's money that'll leave the country forever, without reducing emissions whatsoever.

What do I mean by that? The biggest source of credits under Kyoto will be the countries of the former Soviet Union. They will have surplus emission rights to sell to countries like Canada. Under Kyoto, we'll send cash to those countries in exchange for their credits, while no emissions are actually eliminated.

What Alberta proposes is keeping that money here in Canada, using it to develop cutting-edge technologies, and getting those technologies into countries where emissions are much higher than they are here, so that those emissions can be reduced.

These facts are why Alberta says: "Let's not go the Kyoto route." Let's take on global warming in proven ways, that protect the jobs of Canadians and the future economic growth of every region of this country. That balance can be attained, as governments in this country have proven over and over again.

I've often said I don't want a fight with the feds over Kyoto. What I'd like, and what I think all provinces would like, is the chance to sit down with the feds and have a meaningful, substantive dialogue about climate change in this country that respects jurisdictional differences and responsibilities.

The feds can't do it without the provinces, the provinces can't do it without each other, and no one can do it without the participation of Canadians.

Now I have to say that the federal government is expected to formally present an implementation plan to the provinces next Monday. That will at least give us something to examine and evaluate. Over the next couple of weeks, Alberta will take a close look at what Ottawa has proposed.

But I'm still very concerned about having a plan imposed on us. That isn't working together. And, considering that provinces have the constitutional jurisdiction over resources, and share jurisdiction over the environment, I don't think it's a fair way.

Friends, the issue before Canadians is not Kyoto versus nothing. Don't let anyone tell you that Alberta is recommending that Canada do nothing on climate change. No, the issue is Kyoto versus a made-in-Canada approach.

This great country is more than capable of contributing to the global-warming solution. The resourcefulness of this country is unmatched in the world. If we come together, if we commit ourselves to realistic goals, then we will make a difference in the battle against global warming. We will reinforce our position as a world leader in environmental stewardship, and we will contribute in a way that makes every Canadian proud.

Ladies and gentlemen, thank you for your kind hospitality today, and for the opportunity to meet with you.

The appreciation of the meeting was expressed by Nancy Lockhart, President, The Canadian Club of Toronto, Chief Administrative Officer, From Development Group and Chair, Ontario Science Centre.

The Hon. Ralph Klein, Premier of Alberta and The Hon. Mike Harris, Chair, Ontario's Promise and Former Premier of Ontario.