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Personal Carbon Trading and British Columbia's Climate Policy

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Beyond the Carbon Tax: Personal Carbon Trading and British Columbia's Climate Policy by Laura Isela Guzmán Flores B.A., Universidad Tecnológica de México, 1999 Thesis Submitted in Partial Fulfillment of the Requirements for the Degree of Master of Arts IN THE DEPARTMENT OF GEOGRAPHY FACULTY OF ENVIRONMENT Laura I. Guzmán 2014 SIMON FRASER UNIVERSITY Summer 2014 All rights reserved. However, in accordance with the Copyright Act of Canada, this work may be reproduced, without authorization, under the conditions for “Fair Dealing.” Therefore, limited reproduction of this work for the purposes of private study, research, criticism, review and news reporting is likely to be in accordance with the law, particularly if cited appropriately. Approval Name: Laura Isela Guzmán Flores Degree: Master of Arts (Geography) Title of Thesis: Beyond the Carbon Tax: Personal Carbon Trading and British Columbia's Climate Policy Examining Committee: Chair: Janet Sturgeon Associate Professor Alex Clapp Senior Supervisor Associate Professor Mark Jaccard Supervisor Professor School of Resource and Environmental Management Stephanie Bertels Internal Examiner Assistant Professor Beedie School of Business Date Defended: August 11th, 2014. ii Partial Copyright License iii Ethics Statement iv Abstract This thesis proposes a policy framing, communication and implementation model for personal carbon trading in British Columbia. Personal carbon trading is a scheme under which all individuals are allocated a number of free carbon allowances forming a personal carbon budget. Persons whose carbon emissions are lower than their carbon budgets can sell their surplus to persons who have exceeded theirs. As distributed allowances are reduced annually, consumers are encouraged to modify their behaviour and/or adopt technologies in order not to exceed their carbon budget. Personal carbon trading and carbon taxes are both carbon pricing instruments that, using different policy framings, aim to reduce greenhouse gas emissions. Comparative experiments in the United Kingdom tested the hypothesis that, due to economic, social and psychological drivers, personal carbon trading would have greater potential to deliver emission reductions than taxation alone. This thesis explores that hypothesis in the context of British Columbia’s climate policy. It builds on an analysis of the BC carbon tax, international examples of carbon pricing instruments, and strategies for behavioural change such as social networking, loyalty management, apps development and gamification. Interviews were conducted with experts in financial services, energy efficiency, and the green economy, as well as with specialists in climate, health and taxation policy. They offered opinions on the potential of personal carbon trading to increase individuals’ participation in carbon emission reductions in BC. Their input, together with a review of the theoretical literature and practical case studies, informed the proposed design of a personal carbon trading system for BC. The thesis concludes with policy recommendations for increasing individual engagement, carbon budgeting and collective action by linking personal carbon trading to social, financial and health incentives. Keywords: Carbon Pricing; Personal Carbon Trading; Carbon Tax; Behaviour; Behavioural Change; Gaminification. v Dedication and Acknowledgements I would like to dedicate this thesis to: In Spanish: Quiero dedicar esta tesis a: My family for their support, encouragement and unconditional love, mum, I remember when I told you about this idea some years ago while vacationing at the beach in Acapulco, it was very gratifying when you understood and liked the idea and when you said you wanted to be part of this system…maybe one day it will become a reality! Yadira, my adorable sister and best friend, without your constant support and help in every aspect of my life, this project would have never been possible. Dad, I hope you smile when you see your girl defending this thesis, thanks for your inspiration to always try to make a difference for our world. Please send your blessings from heaven. In Spanish: Mi familia por su apoyo, motivación y amor incondicional, mami, recuerdo cuando te platiqué acerca de esta idea hace algunos años cuando vacacionamos en Acapulco, fue muy gratificante cuando entendiste y te gusto la idea y cuando dijiste que querías participar en este sistema… ¡tal vez algún día será realidad! Yadira, mi adorada hermana y mejor amiga, sin tu constante soporte y ayuda en cada uno de los aspectos de mi vida, este proyecto no hubiera sido posible. Papa, espero que sonrías cuando veas a tu niña defendiendo su tesis, gracias por la inspiración que siempre me diste para aportar ideas y crear un mejor entorno global. Manda bendiciones desde arriba. Alex, my senior supervisor at SFU, for your incredible patience in giving shape to my ideas. And in helping me to overcome the challenges of improving my English and academic writing. I am so much more comfortable and conversant and I have you to thank for that. Thanks for believing in me and encouraging me to continue every time I felt it was too difficult. Mark, my co-supervisor, your deep knowledge, and contributions to the field of climate change, were a real inspiration. Thank you for challenging and improving my ideas and accepting me into your research group. It means a lot. vi My dear friends in no particular order: Sergios, Scott S., Scott D., Mel, Jess, Emma, Anca, Sharon, Martin, Hurrian and Stu, for your encouragement and friendship, and for believing in me. You instilled the confidence in myself that I needed to create this project and bring it to fruition. For your help through my first years of school in Canada when my grammar wasn’t great and understanding of academia was very limited, for your great ideas, for your example, for your patience and for all the times that you did not get mad at me when I could not go out and play ;-). My work colleagues at the Climate Action Secretariat, in particular to Tim and Jess for your flexibility in allowing me the time to conduct this research and for sharing your expertise in the areas of public policy and climate change. And to all the incredible people I had the opportunity to meet and interview during this research. Thanks for all your ideas, for the time and energy that you put into helping me to mold this policy proposal. For your constructive criticism and for referring me to relevant people, jurisdictions and companies. The culmination of these ideas snowballed into the research contained in this policy paper. vii Table of Contents Approval .......................................................................................................................... ii Partial Copyright License ............................................................................................... iii Ethics Statement ............................................................................................................ iv Abstract ........................................................................................................................... v Dedication and Acknowledgements ................................................................................ vi Table of Contents .......................................................................................................... viii List of Tables .................................................................................................................. xi List of Figures................................................................................................................ xii List of Acronyms ............................................................................................................ xiii 1. Introduction .......................................................................................................... 1 2. Methods................................................................................................................. 9 2.1. Research Design and Procedures ........................................................................ 10 2.2. Interview Sample .................................................................................................. 12 2.3. Data Analysis ....................................................................................................... 13 3. Theoretical Approaches to Carbon Pricing and Behaviour Change: Economic, Psychological and Social ................................................................ 15 3.1. Economic Approach to Behaviour Change ........................................................... 15 3.1.1. Tragedy of the Commons, Public Goods, Negative Externalities and Pigouvian Taxes ....................................................................................... 16 3.1.2. Carbon Pricing .......................................................................................... 18 3.1.3. Fixed Carbon Pricing Mechanisms: Carbon Tax ....................................... 19 3.1.4. Emissions Trading Mechanisms ................................................................ 22 3.1.5. Personal Carbon Trading .......................................................................... 24 3.2. Social and Psychological Approaches to Behaviour Change ................................ 31 3.2.1. Social Acceptability ................................................................................... 34 3.2.2. Consumer Behaviour and Commodity Fetishism ......................................
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