Prime Minister Justin Trudeau today released the government’s strategy to dramatically reduce greenhouse gas emissions by 2030 â and its centrepiece is a gradual hikeÂ in the federal carbon tax on fuels to $170 a tonne by that year.
Beyond the carbon tax hike, the government is promising $15 billion in new spending on climate initiatives over the next 10 years â moneyÂ earmarked for improvements to the country’s electric vehicle charging infrastructure, rebates and tax write-offs for zero-emissions vehicles and funding for home retrofits, among dozens of other proposed policies.
The carbon tax will increase significantly from its current level â the tax is just $30 a tonne this year â as part of a push to meet and surpass Canada’s ambitious goal ofÂ reducing greenhouse gas (GHG) emissions by 30 per cent below 2005 levels by 2030.
In real terms, that wouldÂ mean lowering GHG emissions from 732 megatonnes to 513 megatonnes by 2030, a target initially pitched by the former Conservative government and agreed to by former environment ministerÂ Catherine McKenna at the Paris climate talks in 2015. With the plan announced Friday, the government now forecasts national emissions will hit 503 megatonnesÂ by 2030.
“Simply put, it would be much harder to cut pollution if it was free to pollute. The principle is straightforward: a carbon price establishes how much businesses and households need to pay for their pollution. The higher the price, the greater the incentive to pollute less, conserve energyÂ and invest in low-carbon solutions,” says the government’s new climate plan, titled, “A Healthy Environment and A Healthy Economy.”
The tax already was expected to hit $50 a tonne in 2022. With this new initiative, the tax will now increase by $15 a tonne each year for the next eight years in order to weanÂ consumers off fossil fuels in favour ofÂ cleaner energy sources.
The tax hike will result in higher costs for consumers when they buy gasoline. TheÂ price at the pump will increase by 37.57 cents a litre by 2030 as a result of this new plan, and the cost ofÂ light fuel oil forÂ home heating, natural gas and propane will rise as well.
To compensate for the cost-of-living increase, the government said it will continue to return most of the money collected by this program through rebates.
Under the current system, the money is returned to individuals and families annuallyÂ through the ‘Climate Action incentive payment’ when they file taxÂ returns. Starting in 2022, the carbon pollution rebate payments will be distributed on a quarterly basis.
The average family of four in Ontario will collect roughly $2,018 a year in climate rebates by 2030.
The chequesÂ will be higher in provinces like Alberta and Saskatchewan â $3,242 for a family of four in Alberta and $3,829 for a similar family in SaskatchewanÂ âÂ because the people in those provinces generate more carbon emissions per capita.
The carbon tax and the court
OttawaÂ imposed the carbon taxÂ on jurisdictions that have so far refused to implement their own carbon pricing scheme:Â Alberta, Ontario, Manitoba and Saskatchewan. The constitutionality of the federal carbon taxÂ is still before the Supreme Court of Canada.
Trudeau dodged questions Friday about what mightÂ become of his government’sÂ climate plan if the court decides Ottawa doesn’t have the right to impose such a tax on provinces.
“Unfortunately, there are some jurisdictions that still don’t understand that the only way to build an economy for the future is to protect the environment at the same time. There are still some places in this country that want to make pollution free again,” Trudeau said at a press briefing Friday.
Trudeau said Canada must take this sort of aggressive action now to stave off the worst impacts of global warming.
Global emissions will need to reach “net zero” around mid-century to limit global temperature increases to 1.5 C, according to the International Panel on Climate Change (IPCC). The 1.5 C target was aÂ goal of the Paris climate accord, signed byÂ almostÂ all countries, including Canada.
Reaching “net-zero” by 2050 wouldÂ meanÂ that emissions produced 30 years from now wouldÂ be fully absorbed through actions that scrub carbon from the atmosphere âÂ such as planting trees âÂ or technology, such as carbon-capture and storage systems.Â
Trudeau said that just as Canadians have relied on scientists to help the country out of theÂ COVID-19 pandemic, theyÂ must also heed their advice on the threat of climate change. He saidÂ science isn’t “a pick-and-choose buffet.”
“If we trust scientists with our health, as we do, then we must also trust their research and their expertise when it comes to other existential threats and that includes climate change,” he said.
“There is no vaccine against a polluted planet. It’s up to us to act because there is a real cost to pollution.”
The government also is moving ahead with a new clean fuel standardÂ â a plan to reduce the carbon intensity of fuels and energy useÂ in Canada â but is dropping a push to put similar regulations on gaseous and solid fuels.Â
The government says it will spend $2.6 billion over seven years, starting in 2020-21, to help homeowners improve the energy efficiency of their homes throughÂ about 700,000 home improvementÂ grants worth up to $5,000 each. The governmentÂ also says it will pay for one million free EnerGuide energy assessments.
The government also is promising toÂ invest $287 million over two years to continue an existing program that provides incentives to people who buy zero-emissions vehicles. The program provides a rebate of up to $5,000 to consumers who buy “light duty zero-emissions” vehicles.
Over the next four years, the government will also spend $964 million to modernize the country’s electricity grid to make it more conducive to renewable energy sources.