What a Biden administration would mean for Trudeau’s climate agenda – Politico

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The line got more attention than any other uttered that night, and President Donald Trump has tried to make hay with it, calling it “the most shocking admission ever uttered in the history of presidential debates.”

While both Trudeau and Biden may have regretted their candor in those unscripted moments, a transition away from fossil fuels lies at the heart of both of their climate platforms.

In many ways, Trudeau and Biden are reading from the same script on climate change and the energy industry. Both are pledging to set their countries on track to reach net-zero greenhouse-gas emissions by 2050, and in the context of a global pandemic, both are selling their climate plans as opportunities for job creation. Both, too, are treading a fine line between vowing to cut emissions quickly and promising not to shut down oil and gas development.

Still, while a Biden presidency could put Canada and the U.S. back on the same page with respect to the climate, it could also present challenges — if Biden wants to move faster than Trudeau is ready for, perhaps, or if the U.S. starts competing with Canada for the same clean energy investment.

“Five years ago, you couldn’t imagine someone running on a platform as aggressive as Biden’s on climate,” said Gerald Butts, Trudeau’s former principal secretary and now vice chairman at the Eurasia Group.

A new way forward: On Wednesday, the U.S. will officially withdraw from the Paris climate accord, fulfilling a pledge Trump made more than three years ago. Biden has promised to rejoin the Paris Agreement on day one of his administration, and he plans to go further, promising a “major diplomatic push” to get other countries to up their climate targets. Like Trudeau, he has promised to chart a course toward net-zero emissions by 2050, with legally binding targets. He wants to achieve zero emissions from the electricity sector by 2035.

To help achieve those goals, Biden is promising to spend $2 trillion over four years on everything from clean energy and building retrofits to public transit and infrastructure. He wants to scale up electric vehicle production and build 500,000 charging stations across the country.

Though Biden has not promised a national carbon price, which the Liberals passed in Canada in 2018, he is planning to go after methane emissions from the oil and gas industry, and he’s promising new vehicle fuel efficiency standards.

Potential opportunities: “I really believe that if Biden is the president of the United States, then that will certainly help us here in Canada to move as quickly as we need to… because it will be easier to make the argument that North America is moving in one direction,” said former Ontario Liberal premier Kathleen Wynne in an interview. “I think it could embolden us as a country. I really do.”

Opponents of climate policy in Canada have consistently argued the country can’t get too far ahead of the U.S. because Canada risks losing its competitive edge when competing for foreign investment, Butts said. In fact, Canada has toned down some of its climate policies, including its federal carbon price on heavy emitters, out of concern for trade-exposed industries. However, Butts claimed that argument loses weight if Canadian and American climate policies become more closely aligned under a Biden presidency.

Josha MacNab, national policy director with the Pembina Institute, said Biden’s clean energy spending plans could open up big opportunities for Canada, which can export clean electricity and can look to ramp up domestic production of electric vehicles and building materials for retrofits.

At the same time, though, U.S. incentives could also draw clean tech investment away from Canada, MacNab acknowledged. “It’s both a risk and an opportunity,” she said.

Biden policies could challenge Canada: MacNab said there are some areas where Biden’s climate policies could actually push Canada to move faster, including the commitment to a carbon-free power sector by 2035. “It will put the U.S. ahead of Canada if they reach that goal,” she said, pointing out that Canada is aiming for 90 percent clean power by 2030 and 100 percent only in 2050.

Biden is also promising to make public companies disclose their climate-related financial risks, which Canada has not done, aside from making disclosures a condition of certain federal pandemic relief programs. “If this is implemented in the States, I think it would pretty quickly become incumbent on the federal government to consider how it could require this,” MacNab said.

One source of concern for many Canadian observers is the possibility that a Biden administration could impose “carbon-adjustment fees” on imports of emissions-intensive products from countries that aren’t meeting their climate obligations. It’s unclear whether Canada would be targeted by such a policy, but Richard Masson, an executive fellow with the school of public policy at the University of Calgary, said carbon border adjustments could present problems for Canadian oil exporters and the American refineries that rely on Canadian feedstocks. He said the tariffs would effectively be a trade barrier that could be difficult to justify under the USMCA. “But I wouldn’t be surprised to see a lot of people pushing for that to happen,” he warned.

However, Masson said other Biden policies, including promises to ban fracking on federal lands and to limit methane emissions from oil and gas operations, could help “level the playing field” for Canada’s energy sector. If Biden were to move on a national carbon price, he said, that could reduce the incentive for companies to move processing and upgrading facilities to the U.S. “We do face a challenge now because we have [a carbon tax] and they don’t, and capital is mobile,” he said.

Former B.C. Liberal premier Christy Clark agreed that carbon pricing needs to be “widely embraced” south of the border. In 2008, B.C. became the first jurisdiction in North America to adopt a consumer carbon tax. “Seeing some really cogent, well-executed policy around carbon pricing across the United States could be a real encouragement for Canada to do it better than we have,” she said.

Contemplating the alternative: Biden and Trump will take the U.S. down very different paths when it comes to energy policy and climate action. Trump has proudly withdrawn the U.S. from the Paris Agreement, and has spent the past four years rolling back environmental regulations. His party hasn’t published a 2020 platform, and is essentially promising more of the same.

So what would four more years of Trump mean for Trudeau’s climate agenda? “Obviously, things get easier when we’re rowing in the same direction as our biggest trading partner,” MacNab said. Still, she said, many states have enacted their own climate policies despite inaction in the White House. “Regardless of the outcome of the election, that action will continue,” she said.

Butts agreed: “At a macro level, the basic truth is the climate is changing and governments around the world are responding to it.”

When it comes to energy policy, however, there’s at least one area where a Trump administration could be a boon to Ottawa. Trump supports construction of the Keystone XL pipeline from Alberta to Nebraska, as does Trudeau. Biden, on the other hand, has vowed to kill it.

If Keystone doesn’t get built, that will “incent more oil to move by rail” — a worse outcome for safety and the environment, Masson said.

Still, that’s not to say Canada’s oil industry would necessarily prefer another Trump administration. “I would say that the values of most people in Canada, including most people in the energy sector, are that we have to tackle climate change and the better way to do that is to have some rules that we can count on,” Masson said.

The Democrats could provide that certainty, he added. “As long as they don’t get too carried away.”

Sue Allan and Lauren Gardner contributed reporting.

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