Manitoba thumbs nose at Ottawa, sets own carbon tax scheme

Manitoba's government has made public its own plan to fight climate change, saying the federal government's target for a carbon price would "impose an intolerable financial burden on Manitoba families and businesses."

The Pallister government's "made in Manitoba" plan, announced Friday morning, would set a carbon price of $25 per tonne — half the federal government's target of $50 per tonne by 2022.

"Our lower carbon price respects the massive hydro investments Manitobans have made over decades to build one of the cleanest electricity systems in the world," said Premier Brian Pallister.

The provincial government is asking for public feedback on the proposed plan before taking its next step.

The tax would add about five cents a litre to the price of gasoline and also increase the cost of natural gas and coal. The government says a couple with two children would pay about $356 a year more than they do now.

The federal government has demanded that provinces establish a carbon tax that would start at $10 a tonne next year and rise to $50 a tonne by 2022, but Manitoba says its $25 tax is fairer and would remain consistent.

The Manitoba government believes that from 2018 to 2022, its strategy "will achieve more than twice as many emissions reductions as the federal carbon tax."

Catherine McKenna, federal minister of environment and climate change, posted a statement on Facebook calling the plan "a big step forward." But she said the province will need to "up their game" after the first two years of the program, as carbon prices rise throughout the country to exceed the $25 per tonne mark.

Prime Minister Justin Trudeau said the federal government has laid out "very clear benchmarks" that it expects provinces to meet, and will evaluate to ensure "every province meets both the stringency and efficacy of the shared approach on pricing carbon."

Trudeau reminds Manitoba of how his carbon pricing will work

7 years ago

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Prime Minister Justin Trudeau spoke to reporters in St Bruno de Montarville Quebec Friday

"As we've said, there will be a federal backstop and if any province doesn't move forward in an appropriate way, the federal government will ensure that the equivalent price on carbon is applied to the specific jurisdiction — remembering, of course, that monies collected in one jurisdiction will always stay and be returned to that jurisdiction. That's something that's very important within our federation and will continue to be," Trudeau said.

Pallister sought out a legal opinion on the backstop plan earlier this year, which was delivered this month and concluded Ottawa could impose the tax, provided Manitoba's own system isn't at least as effective as the federal option.

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"I don't want to speculate on what Manitoba may or may not do," Minister of Natural Resources Jim Carr said when asked about a potential court case.

"We see the step they've taken today. We're glad that they realize that putting a price on carbon pollution's in Manitoba's interest. We agree with them. The price is not where we want it to be, but for the first two years we'll be in a good place and we'll work together beyond that."

Province says emissions reductions will exceed federal plan

Cumulative emissions are projected to drop by more than one megatonne over the next five years under the Manitoba plan – 80,000 tonnes more than with the federal carbon tax, Pallister and Sustainable Development Minister Rochelle Squires said at the announcement at Oak Hammock Marsh north of Winnipeg.

They say additional greenhouse gas reduction actions set out in the plan would reduce emissions by more than double the federal carbon tax alone.

Curt Hull, project manager at Manitoba-based Climate Change Connection, said the announcement is a good start. Whether it delivers results equivalent to a $50-per-tonne tax depends on other measures to make green alternatives more attractive, he said, calling them the "carrot" to the "stick" of a carbon price.

"When you've got a steamship that's headed towards an iceberg, and you've got the rudder at dead centre, well, you're in trouble. But this announcement today moves the rudder off of dead centre, and it moves us in the right direction. It remains to us as we go forward how much we're going to push that rudder," Hull said.

'This is a fluffy document'

But the Wilderness Committee, a national climate group with offices in Victoria, Winnipeg and Toronto, was less optimistic, calling the plan "half-hearted" and "self-defeating" in a news release sent to CBC News.

The committee criticized the proposal as lacking details and argued a flat rate wouldn't be as effective as one that increases over time.

"This is a fluffy document, with fancy graphics and blank pages. It seems the government is saying it could do these things, but won't commit to anything, and will just go back into hiding on the environment file. This is no way to lead," said Eric Reder, a wilderness and water campaigner with the group, in the release.

Manitoba civic and business leaders say questions remain about how funds generated from a provincial carbon tax would be directed within the province, and hope to see funding provided to support other green initiatives suggested in the plan.​

'Low-carbon government' initiative

In addition to the carbon tax, Manitoba proposes to become a "low-carbon government" by reducing emissions from buildings, transportation and waste while conducting government business, displacing propane heating use in Churchill with electricity, and mandating a new Crown corporation — Efficiency Manitoba — to reduce energy consumption across the province.

"Our vision is to make Manitoba the cleanest, greenest and most climate-resilient province in Canada," said Pallister.

"We are charting that course with a comprehensive plan based on Manitoba needs and focused on Manitoba priorities."

The climate and green plan was developed after more than a year of consultations with environmental, business, and expert stakeholders.

Proposed ways to reduce emissions:

• Require diesel fuel to contain at least five per cent biodiesel content.
• Set an organics diversion target of 100,000 tonnes from landfills.
• Phase out Manitoba's last coal-fired generation station.
• Replace 100 diesel city buses with electric buses.
• Retrofit heavy duty diesel trucks through a rebate program.

The plan contains agricultural exemptions, which means the carbon levy would also not be applied to marked fuels used by farmers for their farming operations.

Agricultural operations would also be able to contribute to carbon sequestration and offset trading systems to be established in Manitoba and other provinces.

Large industrial emitters would be able to reduce their emissions while having their competitiveness concerns addressed through an output-based pricing system of performance standards, offsets and credit trading.

There are six specific facilities in Manitoba that qualify as large emitters and they account for approximately 10 per cent of carbon emissions in the province, the government said.

Companies such as Koch Fertilizer in Brandon and the Minnedosa ethanol plant would have to meet standards — either national or international. If they meet or exceed the emission standards, they would get a credit. If they exceed, they would pay.

The Manitoba plan also sets new initiatives to protect wetlands and watersheds, water quality, and wild species and habitats. Low carbon economy jobs would be encouraged through green infrastructure, clean technology, innovation financing, and skills and training, Squires said.

The government plans to set up a fund that would collect the climate change taxes, though it hasn't determined yet where the money would be spent to mitigate emissions and potentially provide rebates for some industries or individuals.

A full review of the carbon pricing plan would take place in 2022.

Manitobans are invited to give their views on the climate and green plan through an online survey.