Table of Contents

Carbon Pricing

Carbon Pricing

Design, Experiences and Issues

Critical Issues in Environmental Taxation series

Edited by Larry Kreiser, Mikael S. Andersen, Birgitte E. Olsen, Stefan Speck, Janet E. Milne and Hope Ashiabor

Carbon Pricing reflects upon and further develops the ongoing and worthwhile global debate into how to design carbon pricing, and how to utilize the financial proceeds in the best possible way for society. The world has recently witnessed a significant downward adjustment in fossil fuel prices, which has negative implications for the future of our environment. In light of these negative developments, it is important to understand the benefits of environmental sustainability through well-documented research. This discerning book considers the design of carbon taxes and examines the consequential outcomes of different taxation compositions as regulatory instruments. Expert contributors assess a variety of national experiences to provide an empirical insight into the use of carbon taxes, emissions trading, energy taxes and excise taxes. The overarching discussion concludes that successful policies used by some countries can be implemented in other jurisdictions with minimum new research and experimentation.

Chapter 1: A template for the world: British Columbia’s carbon tax shift

Thomas F. Pedersen and Stewart Elgie

Subjects: economics and finance, economics of innovation, environment, energy policy and regulation, environmental law, law - academic, environmental law, tax law and fiscal policy, politics and public policy, environmental politics and policy


Throughout the nineteenth and most of the twentieth centuries, the Mountain Pine Bark Beetle, a relatively innocuous five millimetre-long member of the weevil family, was known to attack and kill a limited number of mature pine trees annually in the forests of British Columbia (BC). That changed in the late 1990s when the beetle launched an assault on British Columbia’s pine forests that by the mid-2000s had become ‘the most severe bark beetle infestation in recorded North American history.’ By 2012, approximately one-third of British Columbia’s 55 million hectares of forest had been afflicted by the pine bark beetle. Over 50 per cent of the stock of commercially valuable pine was dead, representing some 710 million m3 of wood. The harvest and processing of a cubic metre of timber in BC yields some $110–$130 to provincial GDP; hence, even though it was possible to harvest some of the dead pine trees, the net economic impact of the pine bark beetle has been severe. As concern about the economic, social and environmental implications of the beetle epidemic grew, the Government of BC accepted that the beetle outbreak had been facilitated by warming associated with greenhouse gas emissions. The strong-willed Premier of the day, Gordon Campbell, decided that BC had to take steps to contribute to climate change mitigation by reducing fossil fuel use.