Canada’s energy minister says carbon pricing benefits families, environment
Rebate rebranding good messaging, Wilkinson says
Canada Energy and Natural Resources Minister Jonathan Wilkinson says the government must do a better job at selling its carbon pricing plan to the public.
As Conservative Leader Pierre Poilievre continues to hammer the Liberal government’s policy with his cross-country travelling “Axe the Tax” campaign, promising to remove it if elected, Wilkinson said despite the benefits of the carbon tax few people know what it’s about.
He said one study by Trevor Tombe, an economics professor at University of Calgary and the university’s school of public policy, revealed if the carbon tax and rebate were removed, it would harm lowerand middle-income households more than high-income people “so it is an affordability measure and it helps to reduce carbon emissions.”
“But Pierre Poilievre has been effective in somehow convincing people it doesn’t do that,” said Wilkinson in an interview. “The government needs to do better in communication. We have to make sure it is much more visible to people.”
But Niagara Falls MP Tony Baldinelli said rebranding “a harmful tax policy will not change Canadians’ views on it,” arguing most oppose the pricing, especially as the cost of groceries and other critical items continue to rise.
“But (Prime Minister Justin) Trudeau doesn’t care that this will make everything more expensive,” Baldinelli said.
Wilkinson, who was in Thorold March 8 to announce $15 million in funding to assist three Niagara-based companies as they build clean-energy facilities, said if the Conservatives and Poilievre win government in 2025, “he will likely eliminate it.”
“People should be concerned.” That means, said Wilkinson, the former federal environment minister, not only will the government’s “most economically efficient instrument” to reduce greenhouse gas emissions end, but it will also impact the most vulnerable individuals in society.
“The people who benefit the most from the rebates live on modest incomes,” said Wilkinson.
The Canada carbon rebate, formerly known as the climate action incentive payment, has been in effect since 2019. The price on carbon is designed to change people’s behaviour to reduce using fossil fuels. It consists of a fuel charge collected by the federal government and a rebate is issued on a quarterly basis that returns 90 per cent of that revenue to Canadian households. The other 10 per cent is sent to businesses, farmers and Indigenous communities.
People who use less fuel will pay less tax, but still receive the same rebate as someone who burns more fuel.
The government changed the name of the rebate for 2024-25 to “clarify its function, and make its meaning and relationship to the carbon pricing system more intuitive for Canadians,” a switch Wilkinson applauds. He said in the past Canadians were receiving a cheque through direct deposit from the federal government without even knowing what it was for.
“The rebranding of the carbon rebate was a step,” he said. “We have to make it much more visible to people. The government needs to do better communicating with Canadians and showing them they are benefiting. That is something we are thinking about a lot.”
The government last October opted to exempt home heating oil from the carbon pricing for the next three years, as well as double the rural supplement in the tax rebate program and added more incentives to help rural Canadians switch to electric heat pumps.
The hike is to begin on April 1, and it will increase fuel costs by about 3.5 cents a litre for regular gasoline and four cents a litre for diesel. The government’s plan is to increase the cost each year until 2030 from about 14.31 cents a litre to about 37.43 cents a litre. As of April, the tax in Ontario will be 17.71 cents.
“Trudeau’s decision to quadruple the carbon tax is the last thing Canadians need,” said Baldinelli. “A common-sense Conservative government under Pierre Poilievre will axe the carbon tax on everything for everyone, everywhere.”
Alberta has the highest total rebate for a family of four with about $1,800 annually, followed by Saskatchewan at $1,504, Manitoba at $1,200, Newfoundland and Labrador at $1,192 and Ontario at $1,120.
Saskatchewan Premier Scott Moe is eliminating the carbon pricing, which Wilkinson said will result in “making poor people poorer.”
“And that is what Pierre Poilievre will do,” added Wilkinson.
The federal government has set reducing the country’s greenhouse gas emissions by up to 38 per cent below 2019 levels by 2030, which is below what Canada committed to at the 2015 Paris Agreement of up to 45 per cent below 2005 levels by 2030.
Globally, burning fossil fuels account for more than 75 per cent of the greenhouse gas emissions that are driving climate change, according to the United Nations.
Despite not meeting the Paris targets, Wilkinson said Canada continues to invest in clean energy, including funding electric battery plants in Ontario, in an effort to transition to a decarbonized society.
“Anybody who thinks you can go back to the day where you are simply going to pump more oil and gas as an economic strategy, that’s just living in the past,” said Wilkinson.
Meanwhile, the Liberals are keenly interested in what happens in the United States presidential election this fall, which is pitting former president Donald Trump against President Joe Biden.
“If Mr. Trump comes to power, he will be very similar as before. There will be no action on climate change,” said Wilkinson.
But even when Trump was in power from 2016 to 2020, the U.S. government managed to establish climate change agreements with various state governments, such as with California.
Still, most of the countries in the world “are very much of one mind in driving forward with the energy transition” from fossil fuels to clean energy, said Wilkinson.
Regardless of who is president of the United States, Wilkinson said the “momentum will continue” in adopting clean energy.
“It’s like a boulder running downhill, even if Mr. Trump decides not to be part of the transition.”