By Tim Kalinowski
Last Tuesday the provincial NDP government introduced the details of its long expected carbon levy, and other policy initiatives, which, it says, will help Albertans fight climate change and create new jobs in the renewable energy sector.
Bill 20, the “Climate Leadership Implementation Act,” will bring in a carbon tax on Alberta energy consumption at $20/ tonne of carbon produced starting in 2017. This will increase to $30/tonne in 2018. The new tax will be applied to all fuel, natural gas, and power consumption in the province. When all the numbers are tabulated, the government estimates it will cost the average middle class family of four in the province an additional $338 per year.
However, the government also said the carbon tax will actually be “revenue neutral,” as that same family will actually get back about a $360 energy efficiency rebate per year. Rebates will be returned to all individual consumers in Alberta at a set rate based on income. (Alberta farmers were exempted from having to pay the carbon levy on marked gas).
Bigger consumers of energy will pay more under the levy system, but extra funds will also be available for renewable energy start-ups and energy efficiency upgrades in existing industries. Some of those levied funds will also be allocated to help Alberta transition away from coal fire energy generation by 2030.
As part of educating the public on efforts that can be made on climate change and energy efficiency, the government is also creating an $165 million Energy Efficiency Agency.
Shannon Phillips, minister of Environment and Parks and the minister responsible for the Climate Change Office, said last week the government was opting to take a leadership role on one of the world’s most pressing problems, human made climate change.
“It is a win for our economy, for our environment and, indeed, for all Albertans,” she said in speaking of the government’s Climate Leadership Plan. “And, it’s a win for future generations. For too long governments in Alberta chose to ignore and deny the problem. That approach didn’t work.”
Phillips also insisted that the new carbon levy, and other government initiatives to fight climate change, will create new jobs and economic activity in the province.
“Alberta’s energy industry is the bedrock of our economy. And every Canadian benefits from a strong energy industry. Our Climate Leadership Plan builds on Alberta’s proud tradition of energy leadership and innovation. We can invest in green technology and infrastructure while protecting the family budget. Every penny raised by the carbon levy will be rebated to Albertans and reinvested in our economy.”
In response, Drew Barnes, shadow minister of Health and the Wildrose Party MLA for Cypress-Medicine Hat, said the government’s carbon levy will not live up to NDP’s expectations and rhetoric.
“It is going to hit Alberta families very, very hard; in a very regressive manner. The fact that it is seven cents a litre on gasoline about a year and a half from now. The fact that it is going to cost more for all our transportation, the fact that it is going to impact the heating of our homes—it’s a very regressive tax that is going to be a drag on the economy.”
Barnes was also not buying the government’s line on the tax being revenue neutral.
“If it was truly revenue neutral that would mean an Albertan could change their behaviour and save the tax. And, of course, driving (long distances) or heating your home in Alberta in the winter months is not optional. What they claim as neutral, means putting this money into expensive renewables, and solar and wind companies. This tax is not going to change the habits of Albertans.”
And the $165 million “Energy Efficiency Agency,” according to Barnes, should really be called the $165 million “NDP Propaganda Agency.”
“When you look at the history of the NDP, and their MLAs, the propaganda (coming out of this agency) is going to be so one sided. It’s going to be against our pipelines and against our industries. And that’s against job creation for all Alberta… This is money that could be better spent elsewhere.”
Despite the Wildrose Party’s objections, the NDP could also claim strong support for Bill 20 from other voices. Alberta’s oil and gas industry has been advocating for a carbon tax for several years as the best way, from its point of view, to help fund climate change initiatives without handicapping any one industry in the province.
Jim Campbell, VP Government and Community Affairs with Cenovus Energy, stood by Phillips side and restated this position last Tuesday.
“At Cenovus,” he said, “we share the public’s concern about climate change; one of the greatest challenges of our time. We believe one of the best ways to address this challenge is through an economy-wide carbon levy, as well as by supporting the development of carbon reducing technologies across the entire economy as the provincial government is proposing to do.”
Lynn Jacobson, president of the Alberta Federation of Agriculture, said he was happy to see marked gas for Alberta’s farmers exempted from the carbon levy. He said, politics aside, the NDP government had listened to the province’s agriculture industry in this matter, and seemed dedicated to further consultations.
“To a large degree here, I think the government got the balance right on this one,” said Jacobson. “There are still some things that we can look at down the road. It could have been a lot worse. And I think the government has been willing to listen to our concerns. Overall, I think we are being treated fairly.”
Jacobson was eager to hear more specific details from the NDP in the months to come.
“I don’t agree how some opposition parties are calling this ‘an assault on Alberta.’ That’s a little overblown, I think. But I will say we don’t know the full impact of some of these things yet, especially on the electricity and trucking costs end of things.”