Month: October 2019

Canada’s Carbon Tax: Saving the Planet or Killing our Economy?

Prime Minister Justin Trudeau says Canada must fight climate change with a rising carbon tax. But several provincial premiers have attacked the federal carbon tax in court as an unconstitutional “tax grab” that will severely harm Canada’s economy. Saskatchewan has lost its case, as has Ontario.

A tax of the planned $50/tonne, with most of the revenue rebated, is unlikely to be either seriously harmful or seriously effective at this rate. But if it continues to increase, and is supplemented by policies that massively subsidize or otherwise compel greatly expanded solar and wind generation, the economy will be harmed. Premature, politically determined investments in the wrong green technologies will leave many Canadian families freezing in the dark.

The evil Dogbert mocks the current green technology:

dt_c110329

DILBERT © Scott Adams. Used By permission of ANDREWS MCMEEL SYNDICATION. All rights reserved.

To achieve Canada’s promised 30% emissions reduction by 2030 with current technology would be enormously costly. That cost can only be raised through much higher taxes (whether on income, sales or CO2), without rebates. No country can afford to get it wrong and blow a bundle on something that doesn’t significantly reduce CO2 emissions, then raise taxes even more to try plan B and then plan C, etc.

If our government decides to invest heavily now in the currently available technology, as was done in Germany, it can lead to stratospheric electricity prices and an unreliable electricity supply. In Germany, taxes, levies, and surcharges in 2019 account for nearly 53 percent of a total household power price of 44 cents Canadian per kilowatt hour, among the highest in Europe [cleanenergywire]. In Canada, the price in Montreal is 8.2 cents, and Toronto, 15.11 cents [nrcan]. And Germany has had to build new coal plants to restore the reliability of its electricity grid when the sun doesn’t shine and the wind doesn’t blow. Any Canadian government that gives us German electricity prices will be destined for electoral  defeat.

Lower and even middle income Canadians would find it increasingly difficult to pay for the very expensive electricity to heat their homes and cook their food electrically (no more gas furnaces or stoves) and keep the lights and appliances on, as well as the very expensive gasoline to drive to work.  During Canada’s National Energy Program (1980-1985), which was much hated in Alberta, there were many Alberta bumper stickers saying “Let the Eastern Bastards Freeze in the Dark.” If our energy transition is rushed with technology that isn’t yet up to the task, many Canadians all across the country will freeze in the dark.

Continue reading “Canada’s Carbon Tax: Saving the Planet or Killing our Economy?”