Canada think tank sees loophole in emissions plans

Thu Jul 29, 2010 5:54pm EDT
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By Ka Yan Ng

OTTAWA (Reuters) - Proposed Canadian regulations to cut emissions from cars and trucks may have little to no effect as early "action credits" banked by automakers may be able to carry them through the compliance period, an environmental think tank said on Thursday.

The Pembina Institute said its analysis of the planned measures showed that automakers might be able to avoid improving fuel economy beyond "business-as-usual" levels until 2016, or even for the full life span of the regulations.

The new standards are due to come into effect this fall for 2011 model year vehicles.

Early action credits, awarded to automakers if certain measures are exceeded in a specific time frame, may be collected in the lead-up to the new standards. In turn, these credits may be used at a later date. However, that effectively creates a loophole for automakers, Pembina said.

"It looks quite plausible ... (that) companies would manage to comply with regulations for the entire period, up to and including 2016, without having to make any changes to fuel economy beyond business as usual," said Matthew Bramley, director of the institute's Climate Change Program.

He cautioned that Pembina's analysis used the best available information, and that there were some inadequacies in some of the government's numbers.

"We didn't release our analysis immediately because, frankly, we were a little bit shocked by the conclusions," he added.

That is why Bramley is calling on Environment Minister Jim Prentice to publish a fully transparent analysis of the proposed regulations before they are finalized in the fall.   Continued...