NDP's Carbon Math Is Wrong

I'm warning you, folks, stay away from the carbon tax debate.

It will drive you crazy.

You will hear people make arguments about the carbon tax and you will expect them to make sense and then you will realize that they don't make sense and you will start screaming like a debutante in rehab. You will try to make numbers add up and you will realize that they don't add up and you will punch the buttons on your calculator until you end up gibbering like a Sterno-swilling bonobo.

People are saying things about the carbon tax that aren't true. They are saying things that are kinda sorta maybe almost half-true. They are saying things that are going to rattle around inside your brain until you feel like you've snorted up a swarm of hornets.

I write a lot about the carbon tax. This means reading a lot of numbers about greenhouse gas emissions. Sometimes these numbers seem at first like they don't add up but then they do, kind of.

Sometimes these numbers really don't add up, though. And because I am a guy who likes logic and order, this bugs me. Like having a picture on your wall that just ... won't ... hang ... straight.

The figure 2.8 per cent is a number that bugs me.

The New Democratic Party likes the figure 2.8 per cent. They use it a lot when they talk about the carbon tax.

"Even the Campbell government admits that the fuel tax will barely make a dent on our overall emissions, reducing them by only 2.8 per cent by 2020," the NDP says in its climate change framework, released in June.

Opposition leader Carole James keeps repeating that annoyingly precise figure of 2.8 per cent when she kooks out on the carbon tax.

There are only two things wrong with 2.8 per cent:

1) The government has never used it.

2) It's based on weird NDP math.

Turns out the number they should be using is closer to four per cent.

Why it matters

So, you say, who cares? What's a few percentage points in the grand scheme of things?

You're probably right. Trying to fact-check a B.C. political debate is kind of like being the referee in a fencing match between two guys using chainsaws. You tend to get the feeling that you shouldn't worry too much about the fine points.

But let's just assume for a minute that facts and numbers count for something when we're discussing public policy. Even little numbers. Ones like 2.8 per cent.

And let's assume that it's important to know what the government did say about the impact of the carbon tax, back in last February's budget.

According to the budget:

"A preliminary estimate by M. K. Jaccard and Associates suggests that in the absence of other GHG reduction policies, the carbon tax could reduce BC's GHG emissions in 2020 by up to 3 million tonnes of CO2-equivalent annually."

You'll note some heavy duty qualifiers there. The tax "could" reduce emissions by "up to" three million tonnes. Presumably, it could reduce emissions by a lot less. I've been trying to get someone in the government to explain this sentence to me for more than a month. So far no luck.

So maybe it won't really be three million tonnes. But Opposition environment critic Shane Simpson told me that three million tonnes is what the NDP chose to work with when they calculated their 2.8 per cent figure.

How the NDP did its math

I've outlined the details in all their brain-cramping glory in a sidebar that runs at the end of this story. But here's the short version:

That 2.8 per cent is based on an NDP estimate that puts "business as usual" emissions in 2020 at about 105 million tonnes, Simpson said. That's the total amount of greenhouse gases that we'd be emitting in 2020 if we don't change our ways.

The NDP calculated that figure based on an apparent belief that the government's climate change targets call for a 33 per cent emissions reduction from those 2020 business-as-usual levels.

In fact, the targets call for a 33 per cent reduction from 2007 levels. This makes a significant difference when you do the math.

Calculating the impact of the carbon tax using various 2020 estimates produced by environmental groups and the B.C. and federal governments suggests that the carbon tax could bring an emissions reduction of up to approximately four per cent, rather than 2.8.

NDP off by 25 per cent

Now, this might sound like a lot of quibbling over a few percentage points. But, aside from the questions this raises about the NDP's understanding of climate change targets, it's worth noting that 3.5 -- the carbon tax reductions as a percentage of the highest business-as-usual number given by the province -- is 25 per cent greater than 2.8.

And, to put those three million tonnes in perspective, they are about eight per cent of the government's reduction goal for 2020, as calculated by the NDP.

Compare them to the 1.6 million tonnes in annual reductions the government expects to get from doubling transit ridership by 2020, a goal that Simpson said the NDP supports.

The projected annual emissions savings from the carbon tax, which Simpson described as "minuscule," are almost double the projected cuts from massively expanded transit, which he said is an important part of fighting climate change.

What are they trying to poll?

And it's not as if this example of fuzzy math is the only confusing aspect of the NDP's attack on the carbon tax.

An NDP-sponsored poll released last week found considerable opposition to the carbon tax.

Respondents were asked if they agreed with the following statement: "With the government's $100 climate change dividend, most British Columbians come out ahead on the tax."

Most people disagreed.

Then they were asked what they thought about this one: "It is unfair that major industrial polluters don't have to pay the carbon tax, while ordinary consumers do."

Most people agreed that this was unfair.

Their responses are understandable. Both questions echo NDP rhetoric used in their "axe the tax" campaign against the carbon tax. And both, to put it charitably, could lead to confusion about the facts.

The first question might easily be taken to mean that the $100 dividend is the only money British Columbians are going to get to offset the carbon tax. There's no mention of the offsetting tax cuts.

And someone listening to the second question might be forgiven for thinking it means that industry doesn't pay the carbon tax. In fact, virtually everyone in the province who burns fossil fuels will pay the tax -- businesses and consumers alike. According to the government, two-thirds of all carbon tax revenues will come from business -- a figure that no one has challenged to my knowledge.

'Just plain wrong'

Economist Marc Lee, of the Canadian Centre for Policy Alternatives, has written about the NDP's tendency to muddy the debate.

"I have been frustrated that the NDP continues to play the carbon tax as not applying to industry," he writes.

"This is just plain wrong."

About 70 per cent of B.C.'s emissions come from burning fossil fuels. Some of the rest comes from agriculture and from landfills.

Then there are the gases described by a coalition of environmental groups as "emissions released intentionally or unintentionally during the production, processing, and transmission of fossil fuels in the oil and gas sector, such as leaks from natural-gas pipelines. Another example is the production of lime in making cement, which has carbon dioxide as a byproduct."

The groups figure these gases total about 16 per cent of all emissions. They aren't captured by the carbon tax; the government intends to regulate them under a cap and trade system that involves three other provinces and seven U.S. states. There's also a possibility these emissions will be included under the carbon tax once the government gets a better handle on how to measure them.

These industrial emissions are a significant part of the problem, to be sure. But that's not the same as saying that "major industrial polluters don't have to pay the carbon tax, while ordinary consumers do."

Crazy, isn't it?

SIDEBAR:

STILL WITH ME? TIME FOR SOME CARBON NUMBERS HOMEWORK

To understand the NDP's math, you have to know a bit about how greenhouse gas emissions targets are calculated. This is where the story starts to read like homework.

By provincial law, B.C. must cut its emissions by 33 per cent below last year's levels by 2020.

Unfortunately, we don't know yet what last year's levels were. We can guess though: probably they'll fall somewhere around 65 million tonnes.

If that turns out to be the right number, then the government will have to get emissions down to about 44 million tonnes -- 65 million minus 33 per cent.

But to do that, the government will have to do more than just cut 21 million tonnes of greenhouse gases. Without policies designed to cut emissions, economic expansion and population growth would cause a steady increase in emissions between now and 2020.

The number that forecasts what will happen if we don't change our ways is called a "business as usual" figure. The total amount of emissions that have to be cut equals the business-as-usual figure minus the 44 million tonne target.

There have been a number of different estimates of that 2020 business-as-usual figure. Numbers from the government and other sources range from 78 million tonnes to 85 million tonnes.

It's this 2020 business-as-usual figure that the NDP uses as a benchmark when it says the three million tonne reduction from the carbon tax will cut emissions by only 2.8 per cent in 2020.

The problem is, three million isn't 2.8 per cent of any of the business-as-usual numbers we just mentioned.

If you assume 2020 emissions will be in the range of 78-85 million tonnes, then the carbon tax represents a cut of about four per cent.

For three million tonnes to represent 2.8 per cent of total emissions in 2020, the 2020 figure would have to be 107 million tonnes.

That's 25 per cent above the highest number ever given by the government.

When he was asked about this, Simpson said he would check with NDP staff.

Here's the answer he came back with:

The NDP worked out the 2.8 per cent figure based on some numbers in a speech given last September by Premier Gordon Campbell, Simpson said. Campbell was talking about the government's progress toward its 33 per cent reduction goal.

The NDP calculated from Campbell's figures that the government believed it needs to cut "about 36, 37 million tonnes" in 2020, Simpson said. (It actually works out to 40 million tonnes, but as we shall see that doesn't really matter.)

"So then we said, 'OK, if it takes 36, 37 million tonnes to get all the way there and that's going to be a third of overall emissions, then what number are we dealing with?'" Simpson said. "We figured something about 105 million tonnes."

Three times 36 is 108 -- close enough to 105.

A three-million-tonne reduction, then, works out to roughly 2.8 per cent of the 2020 business-as-usual emissions as calculated by the NDP.

Which would make sense if the government's targets called for a one-third reduction from 2020 emissions levels.

But they don't.

They're based on 2007 emissions, as we've already noted.

Doing the math the NDP way produced a very big number for 2020 which, conveniently, made the three-million-tonne reduction projected for the carbon tax seem less significant in comparison.

And it's not as if the 2020 business-as-usual number was a secret.

Last October, The Vancouver Sun reported that the government was giving presentations that used the figure of 80-85 million tonnes for business-as-usual emissions in 2020. At around the same time, other sources, including the federal government and the Pembina Institute, were using similar figures.

Simpson acknowledged that there have been a number of estimates of 2020 emissions in the 78-85 million tonne range.

"As we put our final [election platform] piece together, we will adjust to that number," he said.