Fuel levy not a carbon tax: O'toole
Conservatives change direction on climate plan
• Conservative leader Erin O'toole has released a climate platform that puts a $20-per-tonne carbon charge on fuel — a major change of direction for a party that has repeatedly attacked Prime Minister Justin Trudeau's federal carbon price on fuels.
The climate plan, which the Conservatives say will achieve equivalent emissions reductions to what the federal Liberals are promising, also includes an industrial carbon pricing regime and a package of regulations around zero-emission vehicles, a low carbon fuel standard, and renewable natural gas.
But it is the fuel charge that is certain to draw the most attention and will prompt significant blowback internally for O'toole, who has steadfastly promised to scrap Trudeau's “carbon tax.”
O'toole insisted on Thursday that his plan does not constitute a consumer carbon tax because the money will go into a personalized “low carbon savings account” that can be spent on environmentally-friendly purchases. The Liberal program, meanwhile, sees the money collected by the federal government and redistributed to consumers through tax rebates.
“Zero dollars go to government,” O'toole said about his plan. “This is not a tax at all, I have said it is a pricing mechanism for consumers. It will be one third the pricing of Mr. Trudeau's ever-rising carbon tax, but nothing goes to government. It is not a tax.”
However, the Conservative plan sees a fuel surcharge that consumers pay, rising to a maximum of $50 per tonne. That's lower than the Liberals' price, which is set to rise to $50 per tonne in 2022, and then jump annually until it reaches $170 per tonne by 2030. But it's still high enough for some critics to slam O'toole for backtracking on his pledge to scrap the carbon tax.
“It's outrageous that O'toole is now planning to hammer Canadians with higher fuel bills through his very own carbon tax,” said a statement from Franco Terrazzano, Alberta Director for the Canadian Taxpayers Federation. “When he was running for leader, O'toole pledged to taxpayers that he would fight carbon taxes. If he goes through with this scheme, he will be breaking his promise to Canadians.”
In introducing the plan, O'toole cited his inspiration as coming from former prime minister Brian Mulroney, who had called for “innovative Canadian leadership on climate change” in 2019.
“He reminded us that there is still a place for daring in the Canadian soul when it comes to climate change,” O'toole said. “Daring means that we must take serious action on climate change.”
O'toole's move to include a carbon charge on fuel was welcomed by Clean Prosperity, a non-profit that advocates carbon pricing.
“I think this is actually a really positive news story because it brings the Conservatives into the conversation around what we need to do in Canada around climate policy,” said Michael
Bernstein, the organization's executive director. “I definitely have some significant concerns about the way the policy's designed. But if I'm zooming out to 30,000 feet, I think O'toole deserves some credit here for putting them in the conversation with a real plan.”
In the document, the Conservatives compare the carbon savings account to a rewards program, saying it could be managed “by a consortium of companies as the INTERAC system is.” It does not include an estimate of how much it will cost to set up and run this program.
“Canadians will pay into their Personal Low Carbon Savings Account each time they buy hydrocarbon-based fuel,” the document says. “They will be able to apply the money in their account towards things that help them live a greener life. That could mean buying a transit pass or a bicycle, or saving up and putting the money towards a new efficient furnace, energy efficient windows or even an electric vehicle.”
Experts scratched their heads at this policy, describing it as gimmicky, administratively complex and ineffective as an incentive, since the more you spend on fossil fuels the more you get in your savings account.
“It's very complicated,” said Bernstein. “I wouldn't be shocked if they rethought it if they were to form government.”
But they also credited the rest of the plan with being a serious, credible effort to achieve emissions reductions.
“The carbon pricing stuff is going to get all of the headlines because it's politicized,” said Blake Shaffer, a University of Calgary professor specializing in climate policy. “But the real takeaway from someone who's worked in climate policy for a while is: This is a serious plan. This is light years ahead of what (Andrew) Scheer put forth in the last election.”
The Conservatives included modelling from non-partisan consulting firm Navius Research concluding that altogether, the Conservative plan “can achieve comparable greenhouse gas reductions in buildings and transport” to the Liberals' carbon tax increase to $170 per tonne by 2030.
The plan calls for an industrial carbon pricing program that is essentially the same as what the Liberals have in place. But it also promises items such as requiring 30 per cent of light duty vehicles sold are zero-emissions by 2030, and a clean fuel regulation that aims for a 20 per cent reduction in carbon intensity for transport fuels.
It also says the Conservatives will study policies such as “a carbon border tariff which would reflect the amount of carbon emissions attributed to goods imported into Canada,” and “the potential for introducing new taxes on frequent flyers, non-electric luxury vehicles and second homes to deter activities that hurt the environment.”
“The regulations are doing the heavy lifting here, the carbon pricing is just lipstick,” said Shaffer, adding he was a little surprised by that since such regulations are typically opposed by free-market conservatives.
“Overall, I think people should take away that this is a good step in the right direction,” he said.
IT IS A PRICING MECHANISM FOR CONSUMERS.