Canada can meet its climate goal under the Paris Agreement by adopting a carbon price without significantly affecting its economy, according to a report Wednesday from the Parliamentary Budget Officer’s Office. The Canadian government has committed to reducing the nation’s greenhouse gas emissions by 30 percent below 2005 levels by 2030.
“Using carbon dioxide pricing (defined generally), the cost of meeting the target could be between 1 per cent and 3 per cent of gross domestic product by 2030,” according to the report. “This would still leave incomes significantly higher than they are today, but lower than what they would have been in the absence of carbon pricing.”
According to the report, carbon pricing offers the most efficient means to reduce emissions. “A general principle for keeping the cost of abating carbon dioxide emissions to a minimum is that each source of emissions should face the same cost everywhere. Carbon dioxide pricing is preferred by most economists since it facilitates that outcome,” the report says.
