Rebuffed by feds, P.E.I. determined to cut pollution — and payments to Ottawa

P.E.I.’s Atmosphere Minister Steven Myers proposed a three-year “ease-in” interval to begin making use of the province’s carbon tax on house heating oil in an e-mail to his federal counterpart Steven Guilbeault dated Sept. 14. Ottawa rejected that proposal.

That was 12 days after Ottawa’s deadline for the provinces to submit new plans for carbon pricing, and per week after the feds had instructed P.E.I. its preliminary proposal might result in Ottawa imposing its federal backstop program within the province.

Final week, Ottawa introduced it will just do that in P.E.I., Newfoundland and Labrador and Nova Scotia.

Myers’s earlier proposal, in line with a collection of emails the minister shared with native media, sought to keep up heating oil’s exemption from carbon pricing within the province, and to freeze carbon pricing on different fuels in P.E.I. on the 2022 degree of $50 per tonne of emissions “till prices turn into cheap once more.”

“Within the current months, we’ve seen file excessive gasoline costs on Prince Edward Island — but consumption has elevated,” Myers wrote to Guilbeault in an e-mail dated Sept. 2, “which exhibits that transitioning Islanders to cleaner strategies of transportation is required if we actually need to cut back emissions.”

In the identical e-mail, Myers stated P.E.I. is not against a carbon tax. “In truth, we help the federal coverage initiative.”

However he stated charging the carbon tax on heating oil, which this 12 months has reached record-high costs, “will put low earnings households at an financial drawback.”

The identical day P.E.I. switches to the federal carbon backstop program for gasoline pricing on July 1, 2023, the worth on carbon will bounce to $65 per tonne.

Meaning the tax as utilized that day on heating oil, which is able to now not be exempt on P.E.I., will probably be 17.4 cents per litre.

Offsetting that, Islanders will begin receiving quarterly carbon rebates from the federal authorities. These funds will begin off at $960 per 12 months for a household of 4.

Warmth pump program

P.E.I. has a program to supply free warmth pumps to households with incomes beneath $55,000, and final week the federal authorities introduced an analogous program of its personal.

However Myers stated it will take one other three or 4 years to finish the province’s transition from oil to electrical warmth.

His pitch to Guilbeault — after the province’s preliminary proposal was shot down — was to begin charging $30 per tonne of emissions on furnace oil in 2023, which might begin the tax off at eight cents per litre, doubling that in 2024 earlier than catching up with the federal carbon worth in 2025, which by that time can be $95 per tonne.

Among the many circumstances Ottawa was insisting on if P.E.I. was to keep up management of its personal carbon pricing regime:

• that the province drop exemptions not simply on house heating oil but in addition for propane.
• that the province handle a decrease carbon worth charged on marked fuels utilized in farming and fishing.
• that the province present a dedication “that income collected beneath Prince Edward Island’s carbon worth is not going to be used to dampen or negate the carbon worth sign.

In 2019 and once more in 2020, P.E.I. dropped its provincial excise tax on fuel and diesel to cut back the impression of the brand new carbon levy.

Over two years, the provincial fuel tax was lowered by 4.6 cents per litre. For diesel, the drop was 6.1 cents per litre.

Ottawa will not be capable of acquire income from P.E.I. if we cease emitting, which is what our final purpose is.— Steven Myers

Ever since, the province has stated it was making use of income from the carbon levy to offset the drop in excise taxes.

For the 2022-23 price range 12 months, the province stated that allocation was value $13.2 million, greater than a 3rd of all income from the carbon tax and by far the one greatest allocation from the tax.

Myers instructed reporters Friday it was his understanding Ottawa would require P.E.I. to reinstate the drop in excise taxes. However a spokesperson for his division instructed CBC Monday there was no plan to take away the “provincially-funded” discount in gasoline taxes.

On Friday, Myers additionally dedicated to persevering with to fund the environmental packages the province has stated it was paying for by way of the carbon tax, though these revenues are actually being returned to Islanders.

“Our local weather packages will assist defeat [the] carbon tax in any case as a result of individuals will not have to pay a carbon tax if they don’t seem to be polluting,” stated Myers.

“Ottawa will not be capable of acquire income from P.E.I. if we cease emitting, which is what our final purpose is.”