The United States is deep in a debate about how to address climate change as people from five U.S. states and three Canadian provinces and the Yukon are in town for the 19th annual summit of the Pacific NorthWest Economic Region, a public-private partnership chartered by the legislative bodies of the provinces of British Columbia, Alberta and Saskatchewan and the states of Alaska, Idaho, Montana, Oregon and Washington.

The House passed a complicated bill which would cap greenhouse gas emissions by 17 percent and allow polluters to trade allowances to pollute to ease the impact. It called a “cap and tax" plan by Republicans who essentially are arguing that the way to address the problem is to provide incentives for all energy sources.

Regional leaders at the conference say they can learn from each other how to address the tough issues of the day. The most unique approach came a year ago from British Columbia. They were the first government in North America to institute a carbon tax.

Here’s how it works:

The provincial government taxes, carbon-based fuels — gasoline, diesel, natural gas, propane, coal and home heating fuel — at $10 per ton of greenhouse gases generated.
The carbon tax rate rises by $5 for years, until it hits $30 per ton of greenhouse gas in 2012.

The provincial government is expected to earn $1.85 billion over three years which it gives back to taxpayers in tax breaks.

BC cut income tax rates for the first $70,000 earned by five per cent this year and the corporate tax rate was cut one per cent. The province issued a $100 rebate to every adult and child last month to offset the cost of the carbon tax.

When it was started a year ago the new tax increased the price of gas 2.4 cents a liter and it gradually rises to 7.25 cents more by 2012. Natural gas and and fuel oil prices also rose.

So instead of putting in place a complicated trading system that opponents say could be manipulated, BC’s carbon tax simply makes using fossil fuels more expensive so consumers seek alternatives. So what happened to Premier Gordon Campbell and his Liberal Party when they passed this revolutionary system?

He and his government were reelected in May.