Canada alarmed over Kyoto costs

energy

Kyoto targets would hit Canada hard, says John Baird

Canada could see a deep recession if it were to meet its Kyoto targets for reducing emissions, the country's environment minister has warned.

John Baird claimed petrol prices would leap and thousands of jobs would vanish if Canada tried to reduce greenhouse gases by 6% from 1990 levels by 2012.

Canada was one of the first countries to adopt the Kyoto Protocol in 1998.

But the ruling Conservatives have tried to ditch the treaty, which was adopted by a previous Liberal government.

'Unattainable'

Prime Minister Stephen Harper, who came to power in January last year, has argued the Kyoto timetable is unattainable.

Yet his minority government could be faced with implementing the measures after an opposition Liberal bill was passed by the Canadian parliament's lower House.

It will now be considered by the Senate, the unelected upper house, which traditionally rubber-stamps legislation passed to it by the House of Commons.

Mr Baird told a Senate committee the only way the government could meet its Kyoto commitment was to impose costs on the entire economy and, in effect, "manufacture a recession".

A steep rise in natural gas prices, electricity and petrol, driven by the additional carbon price of generating fossil fuels, would have a huge impact on the cost of running a business and would lead to a 25% increase in Canada's unemployment rate by 2009, he said.

Some opposition MPs and environmentalists countered that Mr Baird's findings were based on assumptions chosen for their frightening conclusions.