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Canada May Reach Emissions Goal Without Tax

[ September 26, 2024   //   Gary G Burrows ]

Canada could meet its 2030 emissions target without a carbon tax on consumers, some analysts say, as the Justin Trudeau’s government faces mounting political pressure to remove it, Reuters reported.
Canada’s opposition Conservative Party has vowed to “axe the tax” if it wins control, as support for the tax has eroded even among its former backers.
The carbon tax is intended to help Canada cut emissions of climate-warming carbon dioxide by 40 percent to 45 percent below 2005 levels by 2030. The next election will be held by October 2025, and polls show Prime Minister Justin Trudeau’s Liberal party trails the Conservatives.
Nonetheless, Canada could reach its 2030 goal by leaning on other policies, even if Ottawa scraps its carbon tax that consumers pay on gasoline and other fuels, said Mark Zacharias, executive director at think-tank Clean Energy Canada.
The portion of carbon tax that applies to industrial sites such as oil sands mines and cement plants is less contentious than the consumer tax, Reuter said. The industrial tax will play a larger role in cutting emissions, along with a proposed oil-and-gas emissions cap and regulations to reduce methane pollution, Zacharias said.
The tax on consumers will deliver only 8 percent or 9 percent, or 19 million to 22 million tonnes, of the emissions cuts Canada plans to achieve by 2030, according to the Canadian Climate Institute.
“The consumer carbon tax is a political albatross right now and I don’t know if there’s going to be any recovery from the damage and misinformation around it,” Zacharias said.
The Conservatives blame the carbon tax for contributing to inflation, even though it is designed to be revenue-neutral and about four out of every five Canadians receive more in rebates than they pay in tax.
The consumer carbon tax applies to much of Canada’s emissions from transportation and buildings, but government rebates for electric vehicle purchases and building retrofits are also helping trim emissions from those sectors, said Dale Beugin, the climate institute’s executive vice president.
Kathryn Harrison, a political science professor at the University of British Columbia, said however that Canada cannot reach its 2030 goal by targeting big industrial polluters alone.
There is risk that the industrial tax, which will account for 39 percent of emissions cuts by 2030 according to the institute’s estimates, will also become a political target, Beugin said.
British Columbia’s left-leaning premier David Eby said he would scrap the province’s carbon tax if Ottawa dropped its legal requirement for one. The same day, federal New Democratic Party Leader Jagmeet Singh said he favored a different approach to addressing climate change when asked if he supported the consumer carbon tax, without giving details.
The Conservatives have not said whether they will maintain the industrial carbon tax if they win power.
In related news, Canada’s natural gas prices slumped to their lowest level since 2022, and are expected to remain under pressure for weeks due to weak demand across North America.

Tags: Canada Emissions