Difference Between Canada's Cap And Trade System

Environmental Policy
Canada’s Cap & Trade System

TABLE OF CONTENTS
I. INTRODUCTION 3
II. THESIS STATEMENT 3
III. RATIONALE AND SUPPORTING EVIDENCE 4
IV. DISCUSSION OF NORMATIVE APPROACH 5
V. DISCUSSION OF POSITIVE APPROACH 6
VI. ECONOMIC ANALYSIS 9
VII. IMPACT ON CANADAIN BUSINESSES 12
VIII. CONCLUSION AND RECOMMENDATIONS 14
REFERENCES 16

I. INTRODUCTION
For this next session of parliament; as Minister for Environment, my cabinet proposes developing an environmental policy and legislation on a national cap and trade system which involves a great deal of research, consultation, analysis and time depending on the complexity of the issues and the impact it has on the ministry’s stakeholders.
The federal government should…show more content…
IMPACT ON CANADAIN BUSINESSES
What kind of an impact will the cap and trade system have on business? Is it good or bad for business? In the simplest terms, cap and trade is a market-based solution to an environmental problem. The government puts a cap on pollution (greenhouse gas emissions in this case) and allows businesses to figure out the most cost-effective way of keeping their combined pollution under the cap. However, within this broad framework, many details need to be worked out, and the costs and benefits to businesses will depend on how the government tackles these finer points (Horne, 2011).

At the core of a cap and trade system is the pollution permit (often called an allowance), which is essentially a commodity created by governments in recognition that the atmosphere cannot be treated as a free dumping ground. Businesses regulated by cap and trade are required to own one tonne’s worth of pollution permits for every tonne of pollution they produce (Horne, 2011).
If pollution permits are costly, businesses will choose to reduce their pollution so they need fewer permits. Like a carbon tax, this approach strengthens the economic case for investing in clean energy (Horne,…show more content…
(2011, July 01). Demystifying Cap and Trade in Canada. Retrieved November 30, 2011, from BC Business Online: http://www.bcbusinessonline.ca/policies-and-issues/environment/demystifying-cap-and-trade-canada
Kitze, R. (2011, May). Cap and Trade v. Cap and Dividend. Northfield, Minnesota, United States.
Lemieux, P. (2004, September). The Public Choice Revolution. Retrieved Novemeber 27, 2011, from The Cato Institute: http://www.cato.org/pubs/regulation/regv27n3/v27n3-2.pdf
The Pembina Institute. (2011, April 13). Climate Change: Cap-and-Trade / Carbon Tax. Retrieved November 12, 2011, from The Pembina Institute: http://www.pembina.org/climate/carbon-pricing
Washington State Department of Ecology. (2008, September 17). Economic Analysis of a Cap and trade Program. Retrieved November 30, 2011, from Washington State Department of Ecology: http://www.ecy.wa.gov/climatechange/2008docs/Combining_Cap_and_Trade_with_Other_Policy.pdf
Western Climate Initiative. (2007, February). About the WCI: History. Retrieved November 29, 2011, from Western Climate Initiative: