A few weeks back, I wrote a post discussing the carbon tax, particularly, what might happen in the absence of a carbon tax, making use of my location near a construction site in Toronto, where somehow generators hum and pollute just underneath power lines. Perhaps this is because diesel and gasoline used on a construction site is exempt from provincial fuel tax. Lets explore the counter argument, which centres on the increasing role oil and gas industries play in Canada’s overall carbon emissions. Yet somehow, pay only 6.7% of what Canadian drivers pay at the pump for their carbon emissions (source), despite being responsible for 28% of Canadas carbon emissions (source), more than the 22 % from all of transportation. Thus the story that targeting large emitters instead of hardworking Canadians does have some merit.
There is lots of polarization these days. I suppose in this context, if one is to be an environmentalist one must support the carbon tax, vote NDP or at least Liberal (presumably democrat if you live south of the border), and so on. To be fair, I do believe the carbon tax should stay, and as we have discussed before, if anything, should be at least quadruple its current level from $30/t to $120/t, and ideally an order of magnitude on top of that (source). As we discussed, that’s mostly to help cover the cost of climate change which burns and floods many parts of Canada every year. To speak nothing of the health impacts of fires and floods.
That said, there is an argument against the carbon tax. Mainly that it tries to squeeze more blood from the stone that’s already been squeezed dry. Let look at this in more detail. We begin with Canada’s 2022 carbon emissions by sector (data from https://www.canada.ca/en/environment-climate-change/services/environmental-indicators/greenhouse-gas-emissions.html):
Of these, Oil and gas pays no carbon tax. Heavy industry gets such a heavy discount, that they don’t really pay either (source). This is mostly to prevent leakage, e.g. say an Aluminum smelter deciding to uproot and move to somewhere where nobody cares for carbon pollution (or workplace safety say). So, Heavy industry + Oil and gas = 42 % of the carbon pie pays no carbon tax? That is a bit of a high in a historical context, looking at Heavy industry + Oil and gas share of emissions over the years, we see that it has increased from about 35% in 1990 to 42% now, mostly as Oil and Gas has climbed steadily while Heavy industry has actually shrunk slightly.
Thus, should Mr. Polivere get his wish and “axe the tax”, Canada’s emissions might actually reduce, provided something is done to reel in Oil and Gas.
Electric car adventures 