Ontario and the carbon tax on industry

by Maj (ret'd) CORNELIU. CHISU, CD, PMSC, FEC, CET, P. Eng. Former Member of Parliament Pickering-Scarborough East It is worth mentioning that Ford and his government have been opposed to all forms of carbon pricing since taking office in 2018. Nice and good but…… However, the Supreme Court of Canada upheld the federal carbon pricing law, so the provinces faced a choice: either put a price on emissions (and collect the revenue) or Ottawa imposes a carbon price anyway (and the feds get to collect the revenue). The latter is what happens with the carbon tax that has drawn the most public attention: on fuel at the pumps. The Trudeau government has collected that revenue in Ontario, Alberta, Saskatchewan and Manitoba, handing it back to taxpayers in those provinces through income tax rebates. While that isn't changing in Ontario, the province is taking over collecting fees for CO2 emissions from large industrial producers, at prices set by Ottawa: $65 per tonne for this year, climbing by $15 each year, to reach $170 per tonne in 2030. Ontario's industrial carbon pricing system applies to the biggest producers of greenhouse gas emissions, including auto manufacturers, steel mills, cement makers, chemical plants and oil refineries. In conclusion, Ontario is supposed to collect $2.2B from industrial emitters over the next 8 years, as new reliable estimates show. However, the three biggest industrial emitters of CO2 in Ontario are a trio steel plants. The province's steel industry is aiming for a dramatic reduction in its pollutant gas emissions by converting to lower-carbon sources of energy, funded in part by nearly $2 billion from provincial and federal taxpayers. Let's think a little: 2 billion from taxpayers money and 2 billion will be collected by the province from them. The province led by Ford and his finance minister still hasn't said what it will do with the revenue. That has everyone from corporate lobbyists to environmental groups calling on the province to clarify its plans for this new source of income. The question is why this revenue should not be spent in favour of taxpayers, who have already forked out a lot of money to improve the industry by reducing their pollutant emissions. So Ontario is poised to start collecting what it calls "compliance payments" from the biggest industrial producers of greenhouse gas emissions, including auto manufacturers, steel mills, cement makers, chemical plants and oil refineries. This marks the transition from the federal program for industrial carbon pricing that has been in place since 2019, imposed by Ottawa when the Ford government scrapped Ontario's cap-and-trade system. In an announcement, saying nothing, so typical of the public service, Gary Wheeler, a spokesperson for Ontario's Ministry of the Environment, Conservation and Parks, wrote the following in an email to CBC News: "We are developing an approach for the use of proceeds collected under the program," As usual, there is a lot of advice given to the province by different interest groups, but all the advice is centered around only one subject; the eternal climate change hysteria and nothing else. For example Dennis Darby, president and CEO of Canadian Manufacturers and Exporters, says the government should put the money back into the industries that pay the fees in ways that help them reduce their greenhouse gas (GHG) emissions. "I think Ontario's got a great opportunity," said Darby in an interview. "If they do it right, this can be net beneficial to industry, but also of course net beneficial to the environment." For industries to decarbonize, Darby says governments need not only to show them the stick of carbon pricing but also the carrot of funding for technologies that reduce emissions. "I think we have an opportunity right now to do this in a way that will ultimately lead to the outcome we want, which is helping companies improve their GHG performance," he said. Jason Wang, senior analyst at the Pembina Institute, said the government should look at investing in new or emerging technologies, such as low-emission production of cement. "Revenue from carbon pricing should be spent on clean economy initiatives," said Wang in an interview. Lana Goldberg, Ontario climate program manager at Environmental Defence, said she supports the province providing clean-technology funding to help companies electrify their operations, but opposes any funding for fossil-fuel companies. "The best use of the funds would be to invest in renewable energy projects like wind and solar to ensure that Ontario is replacing the many gas plants that are currently being used to generate electricity." Noticeably, all these people are concerned solely with their own narrow self interests. None of them is concerned with spending taxpayers' money for the benefit of the community; in health care for example, which is a disaster in this province. You can judge for yourself how taxpayers' money is being wasted, or is to be wasted again, on nirvana projects, rather than the immediate needs of the community. I sincerely hope that the Ontario government will do the right thing, but I have my doubts, especially in view of how Ontario finances are managed.