Feds approve Alberta’s carbon tax on big industrial emitters

Tax will be applied on 10 per cent of emissions produced by the province’s biggest polluters

Liberal MP Jonathan Wilkinson arrives for the cabinet swearing-in ceremony in Ottawa on Wednesday, Nov. 20, 2019. The federal government is giving the Alberta government a passing grade for its industrial carbon tax. Environment Minister Jonathan Wilkinson says today his department agrees Alberta’s planned $30 a tonne carbon price on emissions from big industry meets federal requirements. (Adrian Wyld / THE CANADIAN PRESS)

Liberal MP Jonathan Wilkinson arrives for the cabinet swearing-in ceremony in Ottawa on Wednesday, Nov. 20, 2019. The federal government is giving the Alberta government a passing grade for its industrial carbon tax. Environment Minister Jonathan Wilkinson says today his department agrees Alberta’s planned $30 a tonne carbon price on emissions from big industry meets federal requirements. (Adrian Wyld / THE CANADIAN PRESS)

The federal government is giving the Alberta government a passing grade for its industrial carbon tax, avoiding at least one showdown with the province over climate change.

In late October, Alberta unveiled a system to impose a $30-a-tonne tax on greenhouse-gas emissions from big industry, including the oilsands. The tax will be applied on 10 per cent of emissions produced by the province’s biggest polluters starting in 2020.

Federal Environment Minister Jonathan Wilkinson said Friday his department agrees that plan will meet federal requirements that each province have a price on pollution from big industrial emitters. Provinces that don’t will have a federal version imposed on them. The government amended regulations to exempt Alberta from the federal system for industry on Friday.

“We are very pleased that Alberta has now agreed to commit to putting in place a price on pollution at least with respect to heavy emitters,” said Wilkinson.

But Wilkinson immediately noted Alberta does not have a carbon tax on consumer fuels like gasoline, natural gas and propane, and so the federal carbon tax for consumers, starting at $20 a tonne, will start being applied in the province on Jan. 1. And Alberta’s Environment Minister Jason Nixon said the province’s legal challenge over that, filed earlier this year, will continue.

READ MORE: Saskatchewan, Ottawa carbon tax case ‘monumental’ for Constitution — expert

Lower courts have already dismissed similar challenges from Saskatchewan and Ontario, and the Supreme Court of Canada is to hear the cases early in 2020.

Carbon taxes on big emitters are applied on a portion of emissions from major industry to encourage innovations that shrink their carbon footprints — more efficient processes that produce less waste, better capturing of greenhouse gases before they’re vented. The idea behind taxing only some industrial emissions is that technology doesn’t exist to reduce industrial emissions to zero, so the tax is generally only applied on the portion of emissions a company can reasonably be expected to eliminate.

In Alberta, more than half the province’s emissions come from industrial sources. More than 100 Alberta companies fall into the category that will pay the industrial carbon tax, including oil producers, coal and natural-gas power plants, fertilizer makers and chemical companies.

Consumer carbon taxes are applied based on all of the emissions produced by burning fossil fuels in cars and homes and small businesses. They are designed to encourage individuals to reduce their own emissions by driving less, making their homes more energy-efficient or buying zero-emissions technology like electric cars and home solar panels.

READ MORE: Alberta tables climate plan for industry; retains key parts of old legislation

The federal government rebates a year’s average carbon-tax payments at income-tax time, so people who produce lower-than-average emissions can come out ahead.

The federal consumer charge has been applied in Saskatchewan, Manitoba, Ontario and New Brunswick since April 1. Alberta was initially among the provinces exempted because it had its own emissions-related fuel tax but Premier Jason Kenney scrapped that at the end of May after his United Conservative Party defeated the Alberta New Democrats in an election.

As it is doing in the other provinces with the federal carbon tax, Ottawa will also begin compensating Alberta taxpayers for the cost of the carbon tax.

Alberta set the $30-a-tonne price in its industrial system specifically to meet the federal requirement, but Kenney said Friday he hasn’t decided yet if the fee will rise to $40 and then $50 a tonne over the next two years, as federal standards require. He said that would just push more capital out of Alberta and contribute to “carbon leakage,” where emissions just move from one country to another when companies try to avoid carbon pricing.

“So we don’t think that helps global emissions and it certainly hurts the Canadian economy,” Kenney said. “We’ll have to make a prudent judgement when it gets closer to that date. Because one thing we don’t want is the federal government big-footing into Alberta and enforcing their own separate regulatory regime.”

Mia Rabson, The Canadian Press

READ MORE: Federal carbon tax coming to Alberta in January — environment minister

Like us on Facebook and follow us on Twitter

Just Posted

The City of Red Deer sits at 249 active cases of the virus, after hitting a peak of 565 active cases on Feb. 22. (Black Press file image)
Red Deer down to 119 active COVID-19 cases

Province identifies 179 new cases Saturday

Member Terry Parsons’ custom built track vehicle.
Forestburg’s Area 53 Racetrack gears up for action-packed season

Site will also host a portion of the ‘Miles of Mayhem’ event in July

Sabrina Wilde in front of a recently purchased monster truck. Submitted.
Thorsby business women a finalist for 2021 Alberta Women’s Entrepreneurship Award

Sabrina Wilde with Lone Wolf Mechanical is a finalist for the entrepreneurial award.

Grade 12 students at Wetaskiwin Composite High School took place in the annual water fight off school property on June 11, 2021. Shaela Dansereau/ Pipestone Flyer.
Graduating students in Wetaskiwin throw water fight after being told it could result in suspension

Students were told their participation could result in them being barred from graduation ceremonies.

At an outdoor drive-in convocation ceremony, Mount Royal University bestows an honorary Doctor of Laws on Blackfoot Elder and residential school survivor Clarence Wolfleg in Calgary on Tuesday, June 8, 2021. THE CANADIAN PRESS/Jeff McIntosh
‘You didn’t get the best of me’: Residential school survivor gets honorary doctorate

Clarence Wolfleg receives honorary doctorate from Mount Royal University, the highest honour the school gives out

Flowers and cards are left at a makeshift memorial at a monument outside the former Kamloops Indian Residential School to honour the 215 children whose remains are believed to have been discovered buried near the city in Kamloops, B.C., on Monday, May 31, 2021. THE CANADIAN PRESS/Darryl Dyck
‘Pick a Sunday:’ Indigenous leaders ask Catholics to stay home, push for apology

Indigenous leaders are calling on Catholics to stand in solidarity with residential school survivors by not attending church services

“They will never be forgotten, every child matters,” says Sioux Valley Chief Jennifer Bone in a video statement June 1. (Screen grab)
104 ‘potential graves’ detected at site of former residential school in Manitoba

Sioux Valley Dakota Nation working to identify, repatriate students buried near former Brandon residential school

Denmark’s Christian Eriksen receives medical attention after collapsing during the Euro 2020 soccer championship group B match between Denmark and Finland at Parken stadium in Copenhagen, Saturday, June 12, 2021. (AP Photo/Martin Meissner, Pool)
Christian Eriksen in stable condition, Euro 2020 match resumes

Eriksen was given chest compressions after collapsing on the field during a European Championship

As stories of the horrors of residential schools circulate after the Tk’emlups te Secwepemc First Nation announced it had located what are believed to be the remains of 215 children, Grand Chief Stewart Phillip of the Union of B.C. Indian Chiefs said he feels a connection with the former students. THE CANADIAN PRESS/Darryl Dyck
2 sides of the same coin: Ex-foster kids identify with residential school survivors

Grand Chief Stewart Phillip says the child welfare system takes Indigenous children from their families

Airport ground crew offload a plane carrying just under 300,000 doses of the single-shot Johnson & Johnson COVID-19 vaccine which is developed by the Janssen Pharmaceutical Companies at Pearson International Airport during the COVID-19 pandemic in Toronto on Wednesday, April 28, 2021. THE CANADIAN PRESS/Nathan Denette
1st batch of Johnson & Johnson vaccines won’t be released in Canada over quality concerns

The vaccines were quarantined in April before they were distributed to provinces

The arrest south of Winnipeg occurred before Bernier was to arrive at a protest in the city. (Twitter/Maxime Bernier)
Maxime Bernier arrested following anti-rules rallies in Manitoba: RCMP

He’s been charged with exceeding public gathering limits and violating Manitoba’s requirement to self-isolate

Prime Minister Justin Trudeau arrives for the G7 Summit, at the airport in Newquay, United Kingdom, Thursday, June 10, 2021. THE CANADIAN PRESS/Adrian Wyld
Details on Canada’s vaccine sharing plan coming Sunday, up to 100 million doses

Canada’s high commissioner to the UK says details will come after the G7 summit

Most Read