Environment and Climate Change Minister Steven Guilbeault says Alberta Premier Danielle Smith is playing politics with people’s future, hours after she announced a plan to legally challenge the carbon price once more.
In an interview with Canada’s National Observer, Guilbeault said Canadians shouldn’t accept Smith’s brand of politics — upending billions of dollars of investment in clean energy while supporting the fossil fuel industry against climate policies — as the “new normal.”
“It's more posturing… for her own personal benefit,” he said. “It's so transparent. Everything she's been doing over the last few weeks is all in light of her leadership review that's starting this weekend.”
Alberta’s legal challenge comes days before Smith faces a leadership vote on Saturday by members of her United Conservative Party.
Former Premier Jason Kenney resigned in 2022 after a similar leadership review, though recent polling suggests Smith is more popular among the UCP base than Kenney was. But as The Globe and Mail noted last month, Kenney isn’t the only Alberta premier to be taken out by his own party. Others include Ralph Klein, Ed Stelmach and Alison Redford, which may explain Smith’s efforts in recent weeks to appeal to supporters, including entertaining conspiracy theories about chemtrails.
Even though Smith’s critics say battling with Ottawa wastes time, resources and ignores opportunities to align the province with climate goals, as the CBC reported earlier this year, polling suggests that fighting Ottawa is popular with Albertans.
On Tuesday, Smith told reporters the carbon price is “cruel and punitive” and “blatantly unfair.” As a rationale for launching the latest legal challenge, she said Prime Minister Justin Trudeau’s government is attempting “to divide our country,” by carving out home heating oil from the federal carbon price to lower heating costs predominantly for Atlantic Canadians.
“We're not going to sit back and let this unfair carve-out disadvantage Albertans for another winter,” she said. “We're asking the court to declare the exemption both unconstitutional and unlawful.”
Alberta’s charge that the decision to pause the carbon price on home heating oil is unconstitutional rests on how the Supreme Court of Canada ruled on the constitutionality of the Greenhouse Gas Pollution Pricing Act. In 2021, the court agreed the federal government had the right to address climate change using a carbon price because climate change causes harm beyond provincial boundaries and is a matter of “national concern” under the “peace, order and good government” clause of the Constitution.
But according to Alberta, the decision was limited to the federal government’s ability to create minimum national standards for carbon pricing, and by pausing the carbon price on home heating oil, the federal government violated those minimum standards. Alberta argues that Ottawa is unevenly applying the rules to favour one region and fuel over others.
“This exemption is not only unfair to the vast majority of Canadians, but it is also unlawful as the federal government does not have the authority to make special exemptions for certain parts of the country under the Greenhouse Gas Pollution Pricing Act,” said Mickey Amery, Alberta’s Minister of Justice, in a statement.
Smith clarified she isn’t looking for an exemption of the carbon price on natural gas, which is used by most Albertans to heat their homes, nor is she looking for the carbon price to be reapplied to home heating oil, which is used significantly more in Atlantic Canada. Her target is the carbon price itself.
“We hope this will force Ottawa to recognize the burden the carbon tax places on Canadians and eliminate the tax altogether,” she said, adding that she’s already in talks with freshly re-elected Saskatchewan Premier Scott Moe about joining the challenge.
Regardless of what happens with Alberta’s latest legal challenge, Smith said she intends to fight Trudeau until the bitter end. She described regulations like the proposed oil and gas emissions cap, and clean electricity standards, as undermining Alberta’s oil and gas sector and said she doesn’t believe Trudeau has the mandate to tackle an issue of such importance.
“He should seek a mandate to be able to do this, and that's why we would be quite happy to see an election called sooner rather than later,” Smith said, adding that even if Trudeau won again, she wouldn’t drop the fight.
“If he gets a mandate, then I guess we deal with it through the courts afterwards,” she said. “But if he doesn't get a mandate, then hopefully we'll be able to have a constructive conversation with the next government.”
On Tuesday, the Conservative Party of Canada issued a press release supportive of Alberta’s case, calling the carbon price “an expensive scam,” and citing Parliamentary Budget Officer (PBO) reports that seemingly confirm the Conservative position.
However, as previously reported by Canada’s National Observer, the PBO analysis of the carbon price has been roundly criticized for failing to consider the impacts of climate change in its study of whether people are better or worse off with it in place. Essentially, the PBO finds more people receive more money back through rebates of the carbon price than they pay, but also that the carbon price could be a drain on the overall economy, resulting in people having less money. It did not consider climate change’s impact on the economy, even though experts agree climate change is a significant threat.
The dual findings created the opportunity for political leaders to cherry pick facts to suit their narrative. Indeed, Parliamentary Budget Officer Yves Giroux took to the media after its report was published last year to say he was “concerned” about the political spin at play.
Experts interviewed by Canada’s National Observer say defenders of the carbon price are right that more people receive more money back than they pay, making it a useful tool to address climate change and affordability.
But defenders of the carbon price appear to be steadily dropping away. The federal NDP distanced itself from the carbon price in September, and shortly after, the British Columbia NDP, then in the midst of a close election, said it would ditch the carbon price if Ottawa allowed it.
Guilbeault said the Liberals will continue defending it, pointing to the federal government increasing the carbon price as scheduled in April even while still under intense pressure to scrap it. He also noted the party’s efforts to better promote the Canada Carbon Rebate.
“We've worked and will continue to work really hard to support and defend carbon pricing,” he said. “Frankly, and I would say unfortunately, we're one of the only governments in the country to be doing that.”
Comments
"Essentially, the PBO finds more people receive more money back through rebates of the carbon price than they pay, but also that the carbon price could be a drain on the overall economy, resulting in people having less money."
An overgeneralization.
In all backstop provinces, the first two quintiles (the bottom 40% of households by income) still come out ahead. The rebate still protects modest-income households. For the third (middle) quintile, the average net impact is positive or marginally negative.
Save your tears for the rich.
The fourth and fifth quintiles pay more because they consume more energy and have greater exposure to the O&G industry, through employment and/or investments. The rich can afford to pay the extra cost of their fossil-fuel intensive lifestyles.
All households have the option to reduce fossil-fuel energy use and exposure to the industry (jobs, stock market). Precisely the goal of carbon pricing.
P.S. The PBO's results are generated by a complicated model whose inner workings are not open to academic review. Righties generally detest models, unless they spit out results they like.
What they mean by "a drain on the overall economy" is that since it's a tax, and causes deviations from how money would get spent in a free market, then by free-marketeer definition it makes things less efficient, slowing economic growth compared to a free market situation . . . and this slowed economic growth would result in people having less money (if the fruits of economic growth weren't all going to billionaires anyway). That's the kind of assumptions these models make; it's bullshit because the efficient market hypothesis is false.
Under the federal carbon pricing levy and rebate (fee and dividend), Ottawa does not keep a cent of fuel charges, apart from GST. Hence, not a tax.
"free market situation"
Carbon pricing is an attempt to correct the market failure caused by externalizing the costs of fossil fuels.
There is no free market if fossil-fuel producers and consumers are allowed to download the health, environmental, and climate costs of fossil fuels onto the public purse, the environment, and future generations. Externalizing the costs makes fossil fuels artificially cheap. The true cost of fossil fuels is actually prohibitive. Such a market is rigged in favor of fossil fuels. Carbon pricing is a move towards restoring the free market.
If fossil fuel production and consumption are discouraged, there is less fossil fuel money — less illicit wealth — in the economy. But that GDP calculation omits what fossil fuels are actually costing us. Voodoo economics.
Besides milking governments for endless subsidies, the fossil fuel industry is increasingly downloading its costs for emissions reductions, clean-up, and reclamation to taxpayers. Hundreds of billions of dollars in unfunded liabilities. No wonder O&G is a profitable industry if it can dump its bills on taxpayers. Hundreds of billions of dollars for fake climate solutions like CCS.
Price in the damage, and fossil fuels become a losing proposition overnight. The fossil-fuel industry and system cease to be a profitable enterprise. Wealth that degrades our life-support systems is illusory.
Until then we subsidize our own destruction.
P.S. GDP is an extremely dubious economic metric.
Oil spill clean-up, carbon capture, health care, emergency response, flood rescue, post-hurricane reconstruction, rebuilding incinerated towns, replacing fridges in burned-out Jasper, fire prevention measures, building cooling centres, handing out N95 masks, air conditioner manufacture and installation, chemotherapy, funerals, and obituaries all boost GDP.
We have a province that considers trashing the feds a daily sport and that openly muses about sovereignty, and then hipocritically accuses the feds of "dividing the country."
One day this rhetoric will bite Albertans on their collective ass. That day will just happen to coincide with the peak in oil demand beyond Canada's borders, as early as the early '30s.
Next generation Albertans will wonder why their government did not act to diversify their economy when it had the chance well before the long predicted peak in world oil demand.
Being left with nothing to replace the diminishing fossil fuel industry and also with a huge environmental mess will not be fun. Some will still try to blame the feds for their own towering myopia.
As an ex-longtime Albertan with an outside perspective, there is no joy in any of that. Just sadness.
We in Alberta have a Premier who doesn't know anything but political posturing. She spends money on presently 12 court cases with the feds while workers in education struggle.
And she is predicting a 2025/26 budget deficit as they , the UCP have overestimated price of oil. OK UCP U R the big worrier about deficit, do something