221 Ethanol and Biodiesel in Canada: Can They Help Meet Canada’s Kyoto Commitment?1

This paper was presented at the annual meeting of the Canadian Agricultural Economics Society (Halifax, June 2004) in a session entitled “Bio-Energy in North America: Problems, Policies and Potential”. Papers presented at CAES meetings are not subject to the journal’s standard refereeing process. The Issue The Canadian government ratified the Kyoto Protocol in December 2002. The protocol calls for greenhouse gas emissions to be reduced by 6 percent below the 1990 level (approximately 35 percent below what they are expected to be in a business-as-usual situation) by 2008–2012. To help meet this target, both federal and provincial governments in Canada have developed programs (in some cases mandates) for ethanol and biodiesel production and use in fuel blends. Various subsidy schemes have bee