Federal carbon pricing scheme
In 2016 the Government of Canada announced a national price on carbon with the Pan-Canadian Approach to Pricing Carbon Pollution (the benchmark) to ensure that carbon pricing applies to a broad set of emission sources throughout Canada.
Anthesis had the pleasure of presenting a webinar for the Canadian Chamber of Commerce members on what the carbon price means for business and how they can work to gain a competitive advantage from addressing it. The discussion focused on actively preparing for rollout in 2018.
This proactive approach is matched in discussions with clients and through statements from the Smart Prosperity Initiative.
Since the original announcement a lot has happened, including various province-based initiatives and the release of the Pan-Canadian Framework on Clean Growth and Climate Change. The Government of Canada has also released several supporting documents laying out the Government’s plan for the Regulatory Framework and a supporting Technical Paper on how the federal backstop approach is being designed.
There are a number of key ways in which addressing your company’s carbon footprint can make you more competitive. Competitive advantage typically refers to being able to deliver the same value at a reduced cost or being able to charge a premium based on differentiating your product or service from your competitors. That same thinking applies to the carbon price discussion in the following ways:
Cost of compliance
By minimizing your carbon footprint you reduce your exposure to the carbon price, this benefit increasing as the price phases in with higher costs per tonne each year
Decreased material/production costs
Working with your supply chain to reduce their carbon footprint or choosing lower carbon options for key materials or services similarly reduces your cost of doing business. Improving energy efficiency or switching to lower carbon options for fuel, or other production needs, has the same effect
Increased value/unique offerings
A key objective of a carbon price is to drive or shift society towards low carbon options therefore creating a market for companies and products which can offer such solutions. As with any unique offering, being a first mover or early adopter provides a chance to capture a share of that new market
We have seen in other markets that the response to such regulation is often to find innovative ways to partner with suppliers/peers to drive down overall costs, or to find new solutions that become economically viable with a price on carbon
Please get in touch if you would like a free 30-minute consultation with our Canadian team to explore how you can start or refine the carbon management aspect of your business strategy. Please use the fill out form in the right hand sidebar.