Premier of Canada’s BC backing down from 2018 carbon tax rise as other provinces drag heels

Published 00:55 on April 20, 2015  /  Last updated at 18:09 on April 20, 2015  /  Americas, Canada, Carbon Taxes  /  No Comments

The Premier of British Columbia on Friday said her government is not considering increasing the Canadian province’s carbon tax in 2018, when the current rate freeze expires, while the leaders of other provinces appear to be dragging their heels on taking ambitious action against climate change.

The Premier of British Columbia on Friday said her government is not considering increasing the Canadian province’s carbon tax in 2018, when the current rate freeze expires, while the leaders of other provinces appear to be dragging their heels on taking ambitious action against climate change.

BC’s Christy Clark said public consultations will be held instead over how the province can cut its emissions further towards its ambitious yet potentially unattainable 2020 reduction goal.

“I’m sure whether or not we take the freeze off will be something people talk about, but we’re not considering that at the moment,” Clark said Friday, according to the Vancouver Sun newspaper.

BC is one of three provinces to have a price on carbon currently, and the only one with an economy-wide, revenue-neutral tax on fossil-fuels.

Launched at $10/tonne in 2008, BC’s tax was to increase annually by $5/tonne, but it was frozen by Clark at $30/tonne in 2012 for five years over economic concerns.

Surprisingly, the tax has actually become more of a financial burden for the government than consumers.

The province’s GDP has grown and income taxes have fallen since 2008, while government revenues expected from the levy this year are falling short compared to the tax credits it has doled out.

“We have made more tax cuts than the carbon tax has brought in, that’s true, and I’m not ashamed to admit that,” Clark said.

However, while the measure is considered pioneering, it appears to have done little to dent the province’s greenhouse gas emissions.

BC has a goal to cut its CO2 output by 33% below 2007 levels by 2020, but the province recorded just a 6% fall by 2012, which the government last year said was in line with its interim targets.

ELSEWHERE IN CANADA

Christy’s comments follow last week’s climate summit held in Quebec City – a meeting of provincial Premiers that she declined to attend – and Ontario’s announcement that it would launch a cap-and-trade scheme and link it to Quebec and California’s under WCI.

BC’s neighbour Alberta is due to release a new provincial climate change plan in June to help it meet its target of cutting its emissions by 50 million tonnes per year below BAU by 2020.

The province, which currently accounts for more than a third of Canada’s total CO2 output and has amongst the world’s highest emissions-per-capita levels at 64 tonnes per person, in 2003 introduced a $15/tonne flexible carbon levy for its largest emitters.

Facilities with annual emissions over 100,000 tonnes have their output capped at 12% below a baseline calculated using average 2003-2005 levels. Those that exceed this must buy carbon offsets or pay the levy, which is used to fund a clean technology fund.

Alberta Premier Jim Prentice on Sunday said the province will “fine tune” its existing programme without increasing the levy, ruling out bringing in a BC-style carbon tax and reiterating his opposition to emissions trading.

Meanwhile on the other side of the country, Newfoundland and Labrador Premier Paul Davis this weekend said he was working on his own plan to price carbon, local media reported.

Davis called it “the best way” to cut emissions, but added that he had no plans to reduce fossil fuel development, and in fact would seek to expand the industry in the province.

A draft of the premiers’ declaration written during last Tuesday’s Premiers’ summit and seen by Global News had featured a paragraph stipulating that provinces should put a price on carbon, but the news outlet, citing an anonymous source, said it was crossed out at Davis’ request.

Newfoundland and Labrador has an emissions target of 10% below 1990 levels by 2020, and its 2012 output was 5.5% below that benchmark.

news@carbon-pulse.com