MEDIA RELEASE: Canada Budget 2017 Installment #1: The Trend To Clean Energy Is Irreversible

MEDIA RELEASE: Canada Budget 2017 Installment #1: The Trend To Clean Energy Is Irreversible


Canada Budget 2017 Installment #1:
The Trend To Clean Energy Is Irreversible

Media Contact: Cathy Orlando, , 705-929-4043

Sudbury, ON: Finance Minister Bill Morneau tabled on Wednesday in the House of Commons the federal budget in the first of two installments for 2017. Citizens’ Climate Lobby has reviewed the Liberal government’s budget through the lens of carbon pricing.

Since September 2010, Citizens’ Climate Lobby (CCL) members have been lobbying their federal and provincial parliamentarians for carbon fee and dividend: an upstream, national and incrementally rising revenue neutral carbon tax where 100 percent of the revenue collected by the government is returned to citizens on an equitable basis.

Serious commitments to address the climate crisis nationally have only just begun in earnest in the last year and half. The writing is on the wall: the trend to clean energy is now irreversible.  As it stands Canada is struggling to catch up in recapturing its share of clean energy business globally and is facing a possible $10 barrel of oil in just ten years’ time. The need for strong leadership in clean energy development has never been more urgent.

“Rome was not built in a day and neither will our low-carbon economy. This budget is setting the stage for transforming our economy by supporting needed infrastructure,” says Cathy Orlando, National Director of Citizens’ Climate Lobby Canada. “We welcome the new federal funding announced to modernize Canada’s electricity grid as well as for electric vehicle charging stations.”

Fossil fuel subsidies are a form of negative carbon pricing and CCL’s carbon fee and dividend policy includes eliminating fossil fuel subsidies. Minister Morneau’s mandate letter states the following: “Work with the Minister of Environment and Climate Change to fulfill our G20 commitment and phase out subsidies for the fossil fuel industry over the medium-term.” The current budget sees timid movement on eliminating fossil fuel subsidies.

Canada finally has an overarching national carbon pricing policy and we are pointed in the right direction with positive momentum. However, Canada’s current carbon price of $50 per tonne by 2022 won’t be enough to meet Canada’s goal of reducing GHG emissions to 30% below 2005 levels by 2030. As well, this goal is woefully inadequate.  If every country adopted Canada’s targets, this would not keep warming below 2oC.

It is unusual for two federal budgets to be announced in one year. It has been speculated that the election of US President Donald Trump may have played a role in Canada’s two-step budget in 2017. Also included in CCL’s carbon fee and dividend policy are border tax adjustments.

“It is understandable that President Donald Trump is somewhat of a wild card and Canada must currently proceed politely with regard to the climate and energy file.  It must be borne in mind that a “great” America needs Canada. Canada is the U.S.’s top global export destination. About nine million jobs in 35 states depend on exports to Canada. It should also be noted that Trump is touting border taxes,” says Orlando. “As more and more of the world prices carbon pollution, border tax adjustments for carbon pollution are inevitable and we expect to see them in future budgets.”

A border tax adjustment is legal through World Trade Organization rules if it does not discriminate against goods from other countries relative to goods produced domestically. Even if the border adjustment were discriminatory, the General Agreement on Tariffs and Trade allows for discriminatory border adjustments for environmental purposes.

CO2 is rising faster now than in other time in human history.  Going forward, Canada and the world needs a carbon price of at least $150 tonne by 2030, elimination of fossil fuel subsidies, and border tax adjustments to level the playing field with countries that don’t have equivalent carbon prices. Most importantly, carbon pricing must protect the poor and middle class and be impervious to cynical and populist attacks. Climate and energy are highly connected and complex files. Citizens’ Climate Lobby volunteers across Canada are here to help create political will one riding at a time.