Supreme Court ends its hearings on carbon tax without a decision

After two days of hearing arguments for and against the federal government's carbon tax, the Supreme Court of Canada adjourned today without a decision.

The high court is to deliver a ruling on three separate legal challenges of the carbon pricing policy — launched by the provinces of Saskatchewan, Ontario and Alberta — at an unspecified future date.

The provinces argued that the law steps on provincial jurisdiction, while the federal government defended it as acting in the national interest.

Under the legislation, Ottawa imposes its own carbon price on provinces that do not have one that meets the minimum standards set by Parliament.

For the second day in a row, lawyers representing the provinces and their supporters faced tough questions from justices about why climate change shouldn't be considered a national concern requiring the federal government to implement a uniform, cross-country approach. 

Lawyer Rachelle Standing is representing the Attorney General of New Brunswick in court. She argued today that the federal government did not have to encroach on provincial jurisdiction to respond to the threat of climate change, citing the fact that it didn't do so to respond to the pandemic.

Justice Russell Brown pointed out that Ottawa still has the power to legislate national standards in response to the pandemic, or to invoke the Emergencies Act.

Justice Rosalie Abella added that the provinces have the option of shutting down their borders in response to the current health crisis;

"How do you do that with climate and the greenhouse gas emissions?" Abella asked.

Ballot box test

Standing and the other lawyers arguing against the carbon tax today didn't dispute the fact that climate change doesn't respect borders — but they argued it should still be handled at the local level and that if voters don't think their provincial governments are doing enough, they can vote them out.

Brown pushed back, citing an argument presented earlier by the attorney general of British Columbia. 

"The ballot box isn't going to help because the voters of province A aren't going to be terribly concerned about province B," Brown said.

Appeals courts in Saskatchewan and Ontario ruled in 2019 that the federal carbon tax legislation is constitutional, but in February of this year, the Alberta Court of Appeal said it was not.

The appeals filed by Ontario and Saskatchewan were to be heard in March but were delayed by the pandemic, which allowed enough time for the Alberta case to be added to the mix.

The carbon tax is a central pillar of the federal Liberals' climate change agenda, accounting for as much as 40 per cent of the emissions cuts it must make to reach its goal under the Paris climate change agreement.

Stewart Elgie, counsel for Canada's Ecofiscal Commission, warned that Parliament will miss its Paris targets if the carbon pricing law is struck down.

"If it's upheld, both orders of government can act effectively within their spheres to regulate GHG [greenhouse gas] emissions," Elgie said. 

Under the Paris Agreement, Canada is committed to reducing greenhouse gas emissions by 30 per cent below 2005 levels by 2030.

A 'steamroller' for some industries

The high court also heard from concerned Indigenous communities and special interest groups.

The Thunderchild First Nation in Saskatchewan argued the federal carbon policy has a negative effect on First Nations, who cannot afford to change their energy consumption behaviour due to factors outside of their control.

The Oceans North Conservation Society, a non-governmental organization that works with Inuit to conserve the Arctic, praised the carbon tax as an effective way to avoid the adverse effects of climate change the Far North.

The territories produce approximately 2.7 megatons of greenhouse gas emissions compared to 260 megatons produced by Alberta alone, said the society's counsel David Wu.

"The people of the Arctic, who are the least responsible for GHG emissions, will face the most adverse impacts and have absolutely no ability to address this problem through the polls, unless it's the federal polls," Wu said.

Saskatchewan Power Corporation and SaskEnergy Incorporated — two Crown corporations based in Saskatchewan — said the financial impact of the carbon tax on their businesses will amount to hundreds of millions of dollars, leaving the future of their operations at risk.

"This law is forcing SaskPower to face the possibility that the province may be required to give up on electrical generation entirely and attempt to rely on imported electricity," said David Stack, counsel for the corporations.

"So for this industry, the law may not be a sledgehammer, but it does act somewhat like a steamroller."