GLOBE-Net, September 13, 2012- Two new reports released today provide new insights on current and future economic opportunities in global carbon markets for British Columbia's carbon offsets plan. Pacific Carbon Trust (PCT), the provincial Crown agency mandated to deliver made-in-B.C. carbon offsets to help the private and public sector to meet their carbon reduction goals, released the reports today that confirm the benefits of carbon offsets and the Province's low carbon economy. 

The first, a report prepared by PricewaterhouseCooper titled Economic Analysis of British Columbia Carbon Offset Projects  - looked at the 31 carbon reduction projects from 2008 - 2012 in which the Trust has invested. It claims the total direct and indirect impact on the provincial Gross Domestic Product (GDP) exceeds $242 million, and is credited to have created an estimated 2,836 jobs. They have also generated an estimated $49 million in tax revenues for all three levels of government. 

"A cleaner environment and a strong economy can go hand and hand," said Pacific Carbon Trust CEO Scott MacDonald.

"For the first time in BC we have the data that shows how investing in carbon offset projects has opened the door to significant private investment and revenue generation." 

Pacific Carbon Trust estimates that, on average, for every dollar spent by Pacific Carbon Trust to purchase offsets, another $8 is spent in the private sector.

Capital spending of $317 million in sectors considered critical for reducing B.C.'s greenhouse gas emissions - forestry, clean technology, mining, oil and gas, agriculture, and waste management and manufacturing - could lead to an estimated 2,836 jobs and $49 million in revenues for all three levels of government.

The PricewaterhouseCoopers economic analysis of the 31 carbon reduction projects says that project spending on goods and services have had a positive impact on the Province's GDP, employment and tax revenues.

Carbon emission reduction projects in the waste management and manufacturing sectors accounted for most of the gains in employment, roughly 12.4 jobs per $ million invested, followed by forestry, clean technology and agriculture.  

British Columbia is a World Leader

The second report by Deloitte & Touche LLP -British Columbia: Balancing Opportunities and Risks in the Global Carbon Economy -reviews British Columbia's leadership role in the rapidly expanding global marketplace for carbon offsets and concludes B.C. is well positioned to thrive in an increasingly carbon-constrained global economy of the future.

The Deloitte & Touche report notes that the combined value of global carbon markets topped $US120 billion in 2008 and has remained steady, though a decline is forecast for 2012 due in part to international uncertainty related to the end of the Kyoto agreement's first phase and the ongoing European economic crisis, which has reduced industrial growth and associated GHG emissions.

As regional demand for low-carbon solutions increases, it states, B.C.s reputation for environmental responsibility can be capitalized upon to develop new export markets for clean technology and clean energy.  Further, by linking to other carbon markets, the province can decrease emissions even further while reducing associated costs.

"BC is a leader in clean technology, and Pacific Carbon Trust helps support clean tech and other carbon reduction projects throughout the province. These reports show how investing in carbon-reducing clean tech projects help drive our economy, and how we can capitalize on emerging opportunities to export our BC clean technologies to new markets." Jonathan Rhone, Chair, BC Cleantech CEO Alliance

"BC's existing infrastructure and extensive knowledge of standards and protocols development, combined with its increase in accredited greenhouse gas validation and verification bodies, situates the province as a potential leader in supporting the growth of other carbon markets globally," notes the report. 

"We are world leaders in striking a balance between protecting our environment and generating valuable jobs for B.C. families," said B.C.'s Environment Minister Terry Lake. 

"B.C.'s green economy is flourishing in large part because of the investments public and private industries are making in technology and infrastructure that reduces greenhouse gas emissions," he added noting that reports are "an endorsement of our province's carbon market and an outline of the positive impact it's having on our economy."

This view was confirmed by Deloitte partner Shayne Gregg. "With the establishment of Pacific Carbon Trust and other related green measures, British Columbia established a leadership position in North America," he said.

"However, it is clear that other jurisdictions and countries are also readying themselves to participate in the emerging global carbon marketplace. We believe that British Columbia is still in a strong position to leverage its early investments as these markets begin to link up and others seek our clean tech solutions, expertise and strong environmental brand," he added.

The Deloitte & Touche report notes the skills and knowledge the BC private sector has developed in pursuit of government carbon neutrality can be exported to organizations and firms participating in carbon markets throughout North America and the world.

Leveraging its early-mover advantage, BC is still in a unique position to benefit from such initiatives as:

• Creating linkages to other carbon markets;
• Export of cleantech solutions to meet needs generated from the transition to a low carbon economy;
• Building and disseminating knowledge gleaned from BC's early development of its carbon market; and
• Leveraging BC's environmental record and the export of the BC offset brand

B.C.'s Carbon Policy is Under Review

In 2007, the B.C. Government made a commitment to reduce greenhouse gas emissions by 33 percent less than the level of emissions in 2007 by 2020 and by 80 percent by 2050.

This commitment applies to all provincial public sector operations, including government ministries and agencies, schools, colleges, universities, health authorities and Crown Corporations, which collectively account for 1.2 percent of the 62 megatonnes of the Province's annual emissions (2010).

All projects funded by PCT must undergo an intensive validation and verification process to determine whether in fact the emission reduction potentials are real. The PWC report did not conduct a program review of the projects analyzed; it accepted that each project had been independently verified as having met all the criteria under the B.C. Emission Offsets Regulation.The Pacific Carbon Trust was created in 2008 as a commercial Crown corporation to make available carbon offsets to support the provincial government's requirement for carbon neutrality. In this role PCT is able to support development of B.C.-based clean technology.

As part of the 2012 Budget, the B.C. Government announced it will undertake a comprehensive review of the carbon tax and its impact on British Columbians.These reports come at an important time, as the provincial government is reviewing key elements of its carbon management strategies.

The review will cover all aspects of the carbon tax, including revenue neutrality and the impact on the competitiveness of BC businesses.

Last week The British Columbia Jobs and Investment Board (BCJIB), a body established in February 2012 to build on BC's post-recession boom in exports and the momentum of the BC Jobs Plan, released an interim report that calls for, among other things, the elimination of BC's milestone carbon tax.  (See GLOBE-net article "British Columbia's Carbon Tax - Are its Days Numbered?".