The Policy Corner: Mental gymnastics and a carbon tax

Trudeau announces three-year carbon tax pause on home heating oil

Image supplied by: Noah Lee
Liberals search for votes in Atlantic Canada.

Last month, Justin Trudeau officially announced a three-year pause on carbon pricing for home heating oil in Canada. With Trudeau falling steadily in the polls, it seems this decision may be a direct result of waning popularity rather than the invocation of sound policy.

The Trudeau government implemented the Greenhouse Gas Pollution Pricing Act in 2018 to create a federal carbon pollution pricing system with the goal of lowering greenhouse emissions in Canada. Provinces could participate or implement a carbon pollution pricing system of their own.

Once a crucial part of Trudeau’s 2015 campaign, the act now threatens his party’s credibility.

Jerry DeMarco, Canada’s federal environment commissioner, said this week that Canada is on track to fall short of its 2030 emissions targets.

The majority of Canadians believe carbon taxes—which aim to put a price on greenhouse gas emission and levy taxes—are ineffective at tackling climate change.

Home heating oil is the most carbon intensive way to heat your home, but Trudeau’s government recently paused penalties for using it. Only three per cent of Canadians use home heating oil, with most users based in Atlantic Canada.

Here’s where politics come in. Trudeau’s Liberal party has been consistently down in the polls since this past summer—currently sitting at 27 per cent of the popular vote—while the Conservatives sit at a comfortable 40 per cent.

Liberals have historically been able to rely on votes in what’s considered the Atlantic “Red Wall” of Canada, but this support has started to dwindle. In a recent provincial byelection in a Nova Scotia riding held by Liberals for the last 20 years, Progressive Conservative candidate Twila Grosse won by a significant margin. 

Grosse’s win was attributed to Conservative healthcare policies and unhappiness over “punitive” federal carbon pricing. Trudeau’s announcement pausing the unpopular policy might render a few more votes in the area.

The on-paper intention behind this policy decision was to move low-income Canadians reliant on home heating oil to heating pumps, which the federal government would subsidize.

Pumps pull heat from inside a home and push it out in the summer, and vice versa in the winter. But these devices don’t always work in colder temperatures, with a shut-off threshold between -12 to -25 Celcius. While winters are by and large milder in Atlantic Canada, given its geographic location, heat pumps struggle in the more frigid conditions of Ontario and the rest of central Canada.

If anything, this reality gives further credence to concerns voiced by Jagmeet Singh, leader of the federal New Democratic Party (NDP), that this policy is dividing citizens at a time where a cost-of-living crisis is being observed coast to coast.

When the dirtiest form of home heating gets a carbon tax break but cleaner forms of heating don’t, carbon pricing becomes a lot more difficult to rationalize.

Given the goals behind carbon pricing are to reduce our overall emissions, the mental gymnastics required to justify the pause are challenging. When such a clear appearance of conflicting intentions is evident, people tend to take notice.

Nobody is being fooled here. This is a political play that has nothing to do with the environment.


Carbon Tax, Column, Policy, Politics, tax

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