While Canada’s agriculture sector is alarmed by the known details in Environment Canada’s proposed Clean Fuel Standard (CFS), Canada’s energy sector and taxpayer groups have already denounced the proposed Clean Energy Standard as a guaranteed impoverishment plan.
“We have compelling research that this is bad policy,” says the president of Canadians for Affordable Energy, Dan McTeague, a former Liberal MP, adding that it will increase household heating costs by 60 per cent.
“Our analysis concludes the proposed CFS will lead to as many as 30,000 job losses nationally, putting in the order of $22 billion of capital at risk of exiting the country in order to avoid investment losses,” McTeague argues. “All this to drive an agenda of radical redesign: to get Canada off the use of some of the most affordable, reliable resources performing to some of the highest environmental standards on the planet.”
So, what is the Clean Fuels Standard? It is a Liberal government regulation designed to limit carbon dioxide emissions of all regulated fuels over their life cycle, from extraction to production and the end user, to achieve a 30-megatonne reduction in national carbon emissions by 2030. To achieve this, the federal government will impose emission constraints on all fossil fuels, from oil, coal and natural gas to diesel and gasoline. This will force producers to either find expensive ways to meet the target or buy emission credits to comply with the regulations. The government believes the Clean Fuel Standard is necessary to achieve the government’s top priority of stopping global warming.
The federal Environment Minister Jonathan Wilkinson is delighted with the new regulation, saying that it “will create opportunities for farmers and companies producing renewable fuels.”
Not so fast, Mr. Wilkinson, say pundits and industry stakeholders. They see another side to the proposed regulation.
“In September 2020, the Environment and Climate Change Canada presented seven new changes to the Clean Fuel Standard Regulation Design after the federal government announced the expansion of the previous 2018 regulations. These proposed guidelines raise concerns for farmers, as the regulations will introduce crop production constraints and do not discuss how compliance will be verified.”
— Ontario Federation of Agriculture president Keith Currie
“This is bad news. I don’t see anything positive behind the proposal. It is unacceptable to farmers in Ontario.”
— St. Isidore crop farmer and Grain Farmers of Ontario chair Markus Haerle
“Despite the bafflegab put out by certain anti-fossil-fuel activists and politicians, green jobs don’t generate anywhere close to the value-added per working hour produced currently in oil, gas, petrochemical and mining industries.”
— Jack Mintz is a president’s Fellow, School of Public Policy, University of Calgary and chairs the Alberta Premier’s Economic Recovery Council
“One important thing to understand about clean fuel standards is that they are akin to a carbon tax. Ottawa is simply imposing a tax on top of its proposed escalating carbon tax, which will bite, if one remembers, at $50 per tonne in 2022.”
— Kenneth Green, environmental scientist and senior Fellow, Fraser Institute
“It will be a disastrous policy. Anyone receiving these fuels is at the mercy of suppliers with no ability to effect the cost of compliance.”
— Bob Masterson, president of the Chemical Industry Association of Canada
“A clean fuel standard could have a large economic cost relative to pure emissions pricing, especially on energy intensive, trade-exposed sectors. Such a policy could also be a burdensome regulation and duplicative of existing renewable fuel mandates.”
— C.D. Howe Institute briefing
“The signal coming out of Ottawa … indicate(s) that the extra charges coming to consumers and businesses will be costly, as home-heating bills and the prices at the pumps dig even more deeply into Canadian pockets. Businesses, meanwhile, are potentially looking at double-digit percentage increases in energy costs. As Canadian individuals and business-owners are finally emerging from their COVID-induced hibernation, the Liberal government is putting together a plan to make their post-pandemic lives more expensive to meet, or even beat, its climate targets.”
— John Ivison, National Post
“Although the intention behind this energy policy may be laudable, its format will be detrimental to the Canadian economy, while its effect on the environment is far from certain. The standard is meant to contribute to Canada reducing its GHG emissions to 30% below their 2005 level by 2030. Canada would become the only country in the world to include natural gas and propane in such a policy, placing numerous Canadian businesses at a competitive disadvantage.”
— Miguel Ouellette, economist for the Montreal Economic Institute
