British Columbia Crown corporation Pacific Carbon Trust still drawing fire, not least over qualifying energy giant as an offset vendor

VANCOUVER, B.C. , September 16, 2011 () – It sounds like the provincial government is starting to get the message that the Crown corporation it set up to get into the carbon-trading business has become a major embarrassment.

The Pacific Carbon Trust has come under fire from across the political spectrum for taking money collected from taxpayers for schools, hospitals and core government services and passing it on to profitable corporations, including one of the largest producers of greenhouse gases in the province.

Part of the outrage is aimed at how the PCT is carrying out its assigned role in selling "offsets" to anyone who wants them, including the government, and buying them from qualified vendors.

Among the vendors qualified by the PCT as being able to provide offsets this year was the energy giant Encana, a major emitter of greenhouse gases.

But part of the outrage also is aimed at the role the PCT was assigned and the very notion behind it, that there is a public benefit in creating a mechanism that allows one party to continue to pollute while getting credit for reducing greenhouse gas emissions by paying someone else to do it for them. The PCT was set up in 2008 as part of then-premier Gordon Campbell's climate change strategy, which also called for the public sector - government agencies, schools, hospitals, universities and municipalities, to become "carbon neutral."

Organizations that haven't been able to reduce their emissions to zero through their own efforts are required to purchase offsets from the PCT.

In 2010, while complaining that they didn't have enough money to pay for librarians and teachers, B.C.'s school districts had to pay almost $4.5 million for offsets.

Health authorities spent $5.4 million that would otherwise have been used for treating patients.

Post-secondary institutions paid $3.7 million to offset their emissions, with $1.5 million of that coming from the University of B.C.

Crown corporations, including ICBC and BC Hydro, used $2.3 million from their customers to settle their carbon tab.

The government argument has been that if the private sector is going to be asked to invest in reducing emissions, the public sector also has to do its part.

What's galling in the case of Encana in particular, is that in doing their part, taxpayers are paying for something that should be EnCana's responsibility, which could have been mandated through regulation.

Making a bad situation worse, serious questions have been raised over whether all of the offsets actually produce the benefits for which they are being credited.

Respected forestry researcher Ben Parfitt, in an analysis that I have yet to see refuted anywhere, found that the reduction of emissions that would result from a $4-million deal involving the preservation of forestry land in the B.C. Interior earlier this year were vastly overstated.

In an interview last month with Tom Fletcher of Black Press, Environment Minister Terry Lake suggested changes may be coming.

"I'm not sure where we'll end up with it, but I think generally what we'll see is some sort of fund within the Pacific Carbon Trust that's dedicated to schools, to hospitals, so that money comes back to them to help reduce their carbon footprint," he said .

Setting up a system under which tax dollars are used to make reductions in public-sector emissions would certainly be a good start.

There is no shortage of worthwhile projects in the public sector, including funding for public transit, that can have a measurable effect on emissions.

Then we need to look at whether the PCT is worth keeping as a separate bureaucracy, since the lion's share of its revenues now come from the public sector and the private carbon trading market it anticipates has become a lot less certain.

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