Federal environment minister questions province's carbon price plan

A Facebook post by the federal environment minister appears to suggest that what New Brunswick's Liberal government announced Thursday for carbon pricing in its climate plan does not meet Ottawa's requirements.

"We will be assessing each jurisdiction's approach to carbon pricing against our standard next year. If a jurisdiction's approach doesn't meet our benchmark, we will apply our federal option there," wrote Catherine McKenna.

While the federal minister wrote in her post that she was happy to see "significant new investments in energy efficiency in the plan" she said the province's plan to proposal to take revenues from existing fuel taxes and invest them in climate action instead of putting a price on carbon across the economy, "does not create a new incentive to cut carbon pollution."

Amount not added to existing taxes

When the Liberals' Climate Change Act was introduced in the legislature Thursday morning, they announced New Brunswickers will start paying a 2.33-cent-per-litre carbon tax on gas in April.

The amount won't be added to existing taxes already paid at the pump, but will be diverted from the existing 15.5-cent-per litre gas tax.

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Environment Minister Serge Rousselle said the redirected money will go into a fund that will pay for government programs designed to reduce carbon dioxide emissions.

"We'll use the money to combat climate change. We'll use different ways — energy efficiency, things like that — and that, with the federal standards on industrial emitters, will be a start."

The increase is designed to meet the federal government's requirement that provincial carbon prices rise from $10 per tonne of carbon dioxide next year to $50 per tonne five years later.

Best tool to tackle climate change

But McKenna wrote while investing in climate action is great, a carbon price does more than that.

"It also changes economic decisions by sending a price signal that wasn't there before. That price signal makes pollution more expensive and rewards clean innovation," McKenna wrote. 

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The federal minister said carbon pricing is one of the best tools to tackle climate change because it's efficient, drives clean growth, and works. 

"That's why it's a key part of Canada's clean growth and climate plan. That plan gives provinces lots of flexibility about how they price carbon, so that they can design a system that makes sense for their circumstances."

The minister continued in her Facebook post, stating the federal government would keep working closely with New Brunswick and its Atlantic neighbours "to discuss a carbon pricing approach that reduces pollution, protects competitiveness and drives clean growth in the region.''

Critics of the Liberal plan questioned whether Ottawa would accept the shifting of existing tax money into a carbon tax.

"In the Paris agreement, the federal government, along with all the other nations of the world, said they would only count measures that were in addition to [existing measures]," said Lois Corbett, the executive director of the Conservation Council of New Brunswick.

"This is obviously not an additional move. This is a reshuffling on the decks. That might be a stickler." 

Progessive Conservative MLA Jake Stewart had his own opinion on the McKenna's reaction. 

"It's almost like they designed it to be blocked by the feds so they wouldn't have to take the blame for a now federal government imposed carbon tax in an election year."