Supreme Court of Canada’s carbon tax decision alters landscape for Canada’s climate law: Queen’s Law

While the ruling in Reference re Greenhouse Gas Pollution Pricing Act, 2021 SCC 11 was widely welcomed, this will probably not be the last word on climate policy, Cherie Metcalf, associate professor at Queen’s University Faculty of Law, has said.

Metcalf has shared her insights on the decision’s impacts and on the resulting challenges that federal, provincial and territorial governments now face in the area of climate change. The decision of the Supreme Court of Canada to uphold the constitutionality of the national carbon tax scheme under the Greenhouse Gas Pollution Pricing Act alters the landscape for the country’s climate law and gives the federal government unambiguous constitutional authority to establish an effective national greenhouse gas (GHG) pricing scheme, while allowing for flexibility and cooperation with provinces, Metcalf said.

The ruling also gives the Canadian government the federal authority to promote certain goals of its GHG mitigation strategy through the legislation, including using a national minimum GHG price, advancing coordinated action on climate change with other jurisdictions, implementing or resisting carbon tax border adjustments and providing incentives for investment in less GHG-intensive alternatives at scale, Metcalf said.

Metcalf noted, however, that the ruling did not substantially rebalance Canadian federalism, so the federal government will still need to cooperate with provinces to tackle policy challenges and structural modifications.

Metcalf also called attention to other caveats, including that the legislation’s impacts would depend on its implementation, that there is uncertainty regarding what would be deemed an equivalent provincial pricing scheme and that the legislation’s pricing mechanism does not cover numerous dimensions of climate change mitigation and adaptation.

While the highest court gave “a rare nod” to the federal government’s “Peace, Order and Good Government” power, the decision was confined to the minimum national standards of price stringency for GHG emissions and did not extend to a general federal authority to regulate climate change, GHG emissions or even minimum national GHG emissions standards, Metcalf said.

Metcalf’s work focuses on climate policy, constitutional law, public law, law and economics and international environmental and resource law.

Others in the legal community have also commented on the highest court’s greenhouse gas pricing decision.

“The Supreme Court is, of course, not the first to point out that Canada would have met (or come close to meeting) some of its climate targets but for emissions from Alberta and Saskatchewan (although frankly ordinary residents of the two provinces aren’t the problem – it’s the massive increases in emissions from the oil and gas industry),” said Andrew Gage, staff lawyer at the West Coast Environmental Law Association. “However, maybe the fact that the Supreme Court of Canada is calling out laggard provinces will have more of an impact.”

“The decision will also have significant ramifications for the scope of Parliament’s power within the Canadian federal system and specifically those matters that fall within Parliament’s jurisdiction as being of national concern,” said a blog post authored by Selina Lee-Anderse, Joanna Rosengarten, Kimberly Howard, William Horne and Ashley Wilson of McCarthy Tétrault LLP.

“Now Canadians can rest assured that all provinces will do their fair share to tackle the climate crisis, getting Canada on the path to meeting our Paris commitments and net-zero emissions by 2050,” said Josh Ginsberg, a lawyer at the University of Ottawa’s Ecojustice law clinic.

“This is a tremendously important decision for our national and global fight against climate change, paving the way for the federal government to continue to introduce strong legislation that supports climate solutions,” said Priyanka Vittal, legal counsel at Greenpeace Canada.