Cablegate: New Liberal Leader Dion Likely to Push
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RR RUEHGA RUEHHA RUEHQU RUEHVC
DE RUEHOT #3561/01 3421218
ZNR UUUUU ZZH
R 081218Z DEC 06
FM AMEMBASSY OTTAWA
TO RUEHC/SECSTATE WASHDC 4585
INFO RUCNCAN/ALL CANADIAN POSTS COLLECTIVE
RUEAEPA/EPA WASHDC
RHEBAAA/DEPT OF ENERGY WASHDC
RHEHAAA/WHITE HOUSE WASHINGTON DC
UNCLAS SECTION 01 OF 04 OTTAWA 003561
SIPDIS
SENSITIVE
SIPDIS
DEPARTMENT FOR WHA, OES AND EB
EPA FOR OFFICE OF THE ADMINISTRATOR AND INTERNATIONAL
AFFAIRS
DOE FOR POLICY AND INTERNATIONAL
WHITE HOUSE FOR CEQ
E.O. 12958: N/A
TAGS: SENV ENRG PINR CA
SUBJECT: NEW LIBERAL LEADER DION LIKELY TO PUSH
ENVIRONMENTAL INITIATIVES
REF: A. MONTREAL 1205
B. OTTAWA 3423 AND PREVIOUS
C. MONTREAL 826
Sensitive but unclassified. Please protect accordingly.
1. (SBU) Summary. The victory of former Environment Minister
Stephane Dion in the federal Liberal leadership battle seems
certain to keep the environment and especially the Kyoto
Protocol squarely in the center of domestic political
discourse. As Environment Minister, Dion was closely
identified with the Kyoto Protocol. He has consistently
criticized the Conservative government's decision to abandon
Canada's Kyoto commitments as unachievable and just as
regularly insisted that his own climate change and energy
program, outlined at length but missing many specifics, would
allow Canada to meet those commitments if implemented by
"early 2007." Even though Dion received generally good
reviews as Environment Minister, his record is not without
blemish, particularly since the Martin Liberal government
made little progress in reducing greenhouse gas emissions. A
Dion-led government seems certain to focus greater attention
on the environment and to pursue its environmental objectives
aggressively. End Summary.
2. (U) Stephane Dion's victory in the December 2 federal
Liberal Party leadership race (ref a) heightened focus on
Canada's already vocal environmental debate, specifically on
whether a Liberal victory in the next federal election
(expected in 2007) would see a re-commitment to the Kyoto
Protocol commitments Canada assumed in 1997. In any event,
Dion's rise seems certain to maintain the rhetoric on the
environment at a high level, perhaps highlighting the
Conservatives' relative lack of success in selling the
Canadian public on their own environmental and climate change
program.
3. (U) The environment was not Dion's sole focus during the
leadership campaign ) he says economic prosperity and social
justice shared equal billing ) but his tenure as federal
Minister of the Environment from July 2004 to January 2006,
and his regular campaign criticism of the Conservative's
Clean Air Act, seem to link him more closely to the
environment than these other elements of his platform. He is
strongly identified with Canada's commitment to the Kyoto
Protocol, and his campaign rhetoric on the environment was
notable for its focus on the Harper government's admission in
May that the Kyoto target was not achievable. He
consistently charged the Harper government with betraying its
"responsibility to live up to its international treaty
obligations" (i.e., the Protocol), and the first paragraph of
his Liberal leadership campaign's energy and climate change
plan, for example, accuses the Conservatives of having "cut,
postponed or simply abandoned every meaningful federal
initiative to combat climate change and increase energy
efficiency."
The Environment ) Important in Domestic Politics,
but not all Good News for the Liberals
--------------------------------------------- ----
4. (U) Polling data consistently provide evidence of the
importance Canadians attach to the environment, and one poll
taken early last month found that Canadians, for the first
time since 1990, claimed to be more concerned about the state
of the environment than (perennial front runner) their own
health. That data also point out regional differences, with
respondents in Alberta and Quebec, which has its own climate
Qrespondents in Alberta and Quebec, which has its own climate
change strategy (ref c), the most likely to cite the
environment as their greatest concern; and some aspects of
the environment, for instance climate change and energy
conservation, regularly claim greater attention from the
public. A mid-November survey of British Columbians, for
example, found that 72 percent agreed they were "desperately
concerned" that climate change required "dramatic action."
Analysis noted this figure was substantially higher than the
63 percent of respondents across Canada polled two months
earlier, probably due to "increased media coverage of this
issue in the last few weeks." (Note: That increased media
coverage was almost certainly the spate of publicity, much of
it negative (ref b), surrounding the tabling of the Clean Air
Act by the Conservatives in late October.)
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5. (U) While most observers give Dion good marks on the
environment and expect this issue may benefit from greater
focus in the government agenda if the Liberals win the next
election, Dion's credentials as Minister of the Environment
and the most visible face of the Liberal's past environmental
stewardship, are not entirely positive, and he has come in
for some criticism for being too focused on the Kyoto
protocol. The apolitical Commissioner for the Environment
and Sustainable Development (the CESD is part of the office
of the Auditor General of Canada) in a report released in
September 2006 noted a stark contrast between Dion's vision
of a green Canada and what the Liberals actually implemented
during their reign in power. That report noted at the
"government-wide level, our audits revealed inadequate
leadership, planning, and performance," and "(t)he federal
government has done too little and acted too slowly on
Canada's commitments to address the challenge of climate
change". In a line sure to be used by Dion's adversaries in
the next election, CESD stated "(e)ven if the measures
contained in the previous government's 2005 plan had been
fully implemented, it is difficult to say whether the
projected emission reductions would have been enough to meet
our Kyoto obligations." (Note. More tellingly, Canada's
greenhouse gas emissions in 2004 stood at 27 percent above
their 1990 Kyoto base year level (and 35 percent above
Canada's Kyoto target). Emissions increased at a fairly
constant rate from the early 1990s through 2004, the last
year for which official figures are available and years when
the Liberal Party was in power (1993-2006). Dion certainly
does not bear individual responsibility for the whole of the
Liberal Party's record on emissions, but that record ) if
examined critically ) seems unlikely to provide his next
campaign with much comfort.)
6. (SBU) The CESD report on Climate Change also remarked on
the federal government's inability to act on its own in this
sphere and suggested that achieving success on a complex and
pervasive problem such as climate change requires "bringing
various players onside and in mobilizing concerted action."
While CESD was referring also to private sector stakeholders,
this concern is especially evident in provincial-federal
relations; the two levels of government in Canada share
responsibility for the environment and constantly wrangle
over who has jurisdiction (and who will pay the bills). Thus
there is no guarantee a Prime Minister could implement
effectively a vigorous and robust green agenda in the face of
provincial opposition. (Note. Typically national
environmental standards would be set by consensus among the
14 federal, provincial and territorial environment ministers
sitting as the Canadian Council of Ministers of the
Environment (CCME). The CCME cannot impose its conclusions
on provinces since it does not have the authority to
implement or enforce legislation, and each jurisdiction
decides whether or not to adopt CCME proposals.) The
Conservative government was reminded of this in October when
Ontario's Liberal Premier Dalton McGuinty, in response to the
Clean Air Act's push for tougher standards for vehicles by
2010, angrily exclaimed, "(t)he one thing we will not abide
is any effort on the part of the national government to
Qis any effort on the part of the national government to
unduly impose greenhouse-gas-emissions reductions on the
province of Ontario at the expense of our auto sector." (The
Clean Air Act proposes to require tougher fuel efficiency
standards, not tougher emissions standards. Perhaps McGuinty
misunderstood. In any event, the Conservatives seem to have
learned their lesson on this score from their relative lack
of success in rolling out the Clean Air Act, and are devoting
considerable attention to consulting with provinces and
industry stakeholders on the overall concepts of the Act.)
So what might a Dion Environment Plan Look Like?
--------------------------------------------- ---
7. (U) Dion called his campaign platform on the environment
(but covering energy and climate change more specifically)
"Building a Sustainable Future for Canada." The plan,
largely a repeat of the Project Green he pushed in 2005 while
Environment Minister, lays out aggressive targets for
emissions reductions throughout the Canadian economy, but
provides little detail on proposed programs and no estimates
of the costs needed to implement them. (His overall plan for
environmental sustainability also includes shorter elements
addressing health, clean air, and clean water.)
OTTAWA 00003561 003 OF 004
8. (U) Dion's energy and climate change plan promises
programs to provide individuals with tax credits for home
energy efficiency improvements and purchases of fuel
efficient vehicles, as well as committing Canada to matching
the most stringent vehicle emissions standards in the U.S.
(specifically California). On the energy side, Dion would
support research, development and deployment of green
technologies (by Canadian companies), make more stringent
efficiency standards for appliances, and mandate 10 percent
ethanol content for gasoline and biodiesel by 2010. Dion
would also adjust preferential cost recovery rules for oil
sands to promote "zero net impact development." Industry
would immediately face caps on emissions and trading, but the
price for verified reductions would be capped initially at
C$15 to ensure manageable compliance costs during the first
Kyoto commitment period (to 2012).
9. (U) To promote renewable energy, the plan would provide
incentives for wind and other renewable power production and
establish, in consultation with the provinces, renewable
portfolio standards. Owners of commercial buildings would
receive accelerated depreciation allowances for energy
efficiency investments, and communities would be eligible for
a variety of funds to support mass transit, weatherization,
and urban renewal. The government would not escape: Dion
would set targets for the federal government and crown
corporations to use at least 20 percent renewable energy
immediately, moving to 30 percent by 2010 and 80 percent by
2020. (Note. This ambitious target only makes sense if the
plan includes large scale hydro and nuclear in the renewables
category, which often is not the case. In 2002 hydro and
nuclear supplied 70 percent of Canada's electricity. Other
renewables, including biomass, solar, and wind, accounted for
a very small share of Canada's electricity that year.
Generation from these sources is expanding rapidly, but from
a very low base.)
10. (U) And certainly, Kyoto played prominently in Dion's
plan, which claims that enactment of all of its measures by
early 2007 would still put Canada on track to meet its Kyoto
Protocol commitment to reduce greenhouse gas emissions by 6
percent from their 1990 level by 2012. Dion estimates his
plan would cut greenhouse gas emissions by between 238 and
308 million tons by 2012, enough to meet those targets. In
Dion's words, "the Kyoto Protocol is the only credible
international tool to fight the coming climate crisis, and
Canada must honor its commitments under the agreement, while
leading the negotiations to extend it past 2012."
11. (SBU) Dion's ambitious plans (including the 2005 Green
Plan) have taken their share of criticism. On one hand, Dion
is criticized by some environmentalists for borrowing heavily
(and in many instances word for word) from the work of David
Suzuki, one of Canada's leading and most vocal environmental
personalities. On the other, Dion has never made a secret of
his plan's reliance, at least in the initial stages, on the
purchase of credits internationally (either from transition
economy "hot air" or from actual reductions from Joint
Implementation or Clean Development Mechanism projects),
prompting charges that Canada could spend as much as C$5
billion yet see no benefit domestically. Then too, Dion's
Qbillion yet see no benefit domestically. Then too, Dion's
plans have provided little detail on project specifics or
costs to implement or sources of funds.
Does it Differ from the Conservative's Clean Air Act?
--------------------------------------------- --------
12. (U) Certainly the Conservative Clean Air act also lacks
detail on program specifics, at least partly because the
government is still in the process of consulting with
provinces and industry. (This extensive round of
negotiations, in fact, draws criticism from both the
political opposition and some environmentalists who claim it
only delays effective action, since the Liberals had already
done "enough" consulting.) And, the Clean Air Act does have
longer time frames than Dion's plans. It envisions absolute
reductions in greenhouse gas emissions of 45-65 percent (from
2003 levels), but not until 2050. On the other hand, the
Tory legislation does contain specifics on a number of
programs to regulate pollutants, to gain provincial support
through enhanced use of "equivalency agreements" that focus
on outcomes rather than specify technology, and to set
mandatory fuel economy standards and efficiency standards for
OTTAWA 00003561 004 OF 004
appliances.
13. (SBU) However, the Harper government's ability to
implement its own clean air and climate change plans is
complicated by the Clean Air Act's status in Parliament (ref
b). Not only are there two other competing climate change
bills before the House, but the Clean Air Act has been
assigned to an ad hoc drafting committee for revision before
it comes back to the House for a second reading. GOC
contacts will not (and really cannot) speculate on the form
of the bill that will be reported out by the drafting
committee, but they do expect required short-term targets for
emissions reductions will feature prominently.
Interestingly, they believe the re-worked bill may not call
for meeting Kyoto commitments. What sets the Tory plan apart
though, is the degree to which it relies not on the passage
of new legislation, but on the existing Canadian
Environmental Protection Act of 1999. With respect to air
pollutants ) but not greenhouse gases ) the Clean Air Act
would enhance the GOC's ability to regulate, but the legal
authority to do so derives from CEPA and thus does not depend
on the new legislation.
What if?
--------
14. (SBU) There seems to be little doubt that a Dion-led
government would focus greater attention on the environment,
and likely on climate change specifically. Certainly this is
what the public expects (another poll in taken in early
November found that 70 percent of Canadians think the Clean
Air Act is not tough enough), and Dion himself in his first
press conference as Liberal leader, stressed the
environment's importance to him on a personal level. He
announced that he would pull together the best environmental
plans from the party to develop "the best for energy and
climate change that you can have in Canada."
15. (SBU) And how would he approach pursuing his
environmental goals as prime minister? Dion himself
acknowledges a "rather willful temperament" and was regarded
as very aggressive when he was Environment Minister, both on
issues and in promoting Environment Canada's bureaucratic
interests. He had the reputation among some of pursuing his
objectives without too much regard for balance and for
discrediting the arguments of those who disagreed, and
sources report that he was surprisingly not always well
briefed on environmental issues and ignored facts that did
not support his position. And, he was known to display
remarkable insensitivity to U.S. views on most environmental
issues. While it is far from certain that Dion will be
Canada's next prime minister, the odds of him gaining the
office at some point are in his favor, since every Liberal
Party leader since 1896 has served as Canada's prime
minister. The exact environmental and climate change
programs a Dion-led government would pursue are also
uncertain, of course, but expect their pursuit to be
energetic and assertive.
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