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U.S. heading towards putting a price on carbon: now what about Canada?

According to conventional wisdom, the development and utilization of alternate fuels is slow to catch on because they remain too expensive when compared to fossil fuels. There is no shortage of ideas and products that employ new technologies to generate energy from renewable sources; however, much of it has failed to become a serious alternative to fossil fuel. The dominance of fossil fuels as the major source of energy is constantly attributed to the fact that alternatives tend to be very costly. Nevertheless when examining the facts, one can only conclude that renewables appear to be too expensive because governments have been indirectly subsidizing fossil fuels.

I am not referring to direct tax subsidies. I am suggesting that this government's failure to compel industries to account for the full cost of fossil fuels has led to a misconception about the production of fossil fuels as well as the industry itself.

Traditionally, industrial plants and consumers are expected to be responsible for costs of disposing of their waste. Manufacturers that generate waste from their processes, such as, chemicals or other products are always responsible for treating and or disposing of that waste. Waste management costs are then treated as a part of the manufacturing costs. However, fossil fuel emissions which have proven to be harmful to the atmosphere do not have the same rules applied to them.

Some have argued that renewable energy and other alternatives have not become viable in the free market because they cannot compete. The reality is, however, that renewable fuels have been denied access to the free market.

No one is disputing that green house gasses, attributed to major fossil fuel exhausts, are harmful to the environment. Until the costs of associated waste are accounted for, fossil fuels will forever have an unfair competitive advantage compared to alternative energy sources. Other pollutants and emissions are restricted, and it is about time that Canada restricts carbon emissions and treats them as unwanted waste. The planet's future rests on curbing those emissions.

The outlook of renewable energy sources is promising. Not only is the world waking up to the moral imperative of reducing green houses, but there is a growing recognition that there are significant economic opportunities in job and wealth creation in investing in greener forms of energy.

Carbon pricing is inevitable in a carbon constrained economy. Republican Presidential candidate, John McCain, has indicated his commitment towards that goal. Given this commitment coupled with the Democratic candidate, Barak Obama`s commitment, it is almost a certainty that the US is heading towards putting a price on carbon after the next election.

Europe and the rest of the developed world are also moving in that direction.

The only remaining question is what is the most efficient and effective way to price carbon while helping consumers and Canadian businesses adjust to the new 21st century economy? That is where Mr. Dion's Liberal green shift plan displays its power and simplicity. It proposes to shift taxes away from income and promote investment in green technology. Carbon pricing would be introduced uniformly and efficiently on all fossil fuels (gasoline is exempted because it already has an excise federal tax) and introduce certainty during this transitional period.

The green shift policy offers a carrot to environmentally friendly technologies such as renewable energy, and applies the stick to pollution and green house gases. The renewable energy industry is emerging as the fastest growing segment within the energy sector. It is creating countless jobs and unprecedented business opportunities. The Liberal plan would not only level the playing field for renewable energy, but would increase investment in it. Mr. Dion has committed to ensuring that 10% of Canada's total electricity output would be generated from low-impact renewable sources by 2015, thereby making Canada a global leader in renewable energy.

For too long, renewable energy sources have been deprived fair access to free markets, while governments ignore the environmental damage generated by fossil fuels. Embracing and adopting renewable energy would not only reduce harmful emissions, but would create billions of dollars of business investments and green jobs.

That is not to say that once we start accounting for pollution, renewable energy would become less expensive than fossil fuels. Costs will still vary from one technology to the other, but it would at least give renewables an opportunity to access a fairer marketplace.

The 21st century economy is heading towards less dependence on fossil fuels, more environmentally responsible consumerism, advanced manufacturing technologies, innovative forestry products, smarter farming tools, renewable energy and state of the art research and development. The federal government must play a role in preparing the Canadian economy for a leadership role. Canada has two choices at this crossroad; we can choose to be a world leader in innovation where our products and services would be sold locally and around the globe, or we can become followers in this new era of green technology and advanced economy.