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Federal Budget Measures Fall Short of the Climate Challenge

March 26, 2019
By: 
Mitchell Beer
President
Smarter Shift
Publisher
The Energy Mix

The gap between incremental progress and the fast, transformative change we need on one of humanity’s toughest scientific challenges was on full display when Finance Minister Bill Morneau tabled his pre-election budget March 20.

A budget that contains major support for zero-emission vehicle (ZEVs) deployment, energy retrofits in homes and commercial buildings, and green municipal infrastructure should be cause for celebration. If any government of any political stripe had introduced the equivalent five, 10, or 20 years ago, it would have been an historic milestone of massive proportions.

But this was the first major statement of federal fiscal policy after the October, 2018 report on pathways to climate stabilization, in which the Intergovernmental Panel on Climate Change (IPCC) set an urgent, 12-year deadline to reduce global greenhouse gas emissions by 45%. Against that immutable, non-negotiable challenge, Budget 2019 falls far too short.

Particularly because the budget includes a $100-million extension of an existing fossil fuel subsidy, on top of the billions in new subsidies that federal and provincial governments have shelled out in recent months.

And even more so with the country on track to miss its 2030 emissions reduction target by a whopping 115 million tonnes, according to independent analysis. That’s the same, lame target the current government inherited from Stephen Harper’s Conservatives in 2015. The one that Prime Minister Justin Trudeau and Environment and Climate Minister Catherine McKenna have both repeatedly declared a floor, not a ceiling on the country’s climate ambition.

“At a time when the world is more keenly aware than ever of the need for urgent action to address the escalating climate crisis, this budget is a tepid response to a house on fire,” responded Climate Action Network-Canada (CAN-Rac), echoing the language youth climate activist and Nobel Peace Prize nominee Greta Thunberg has used to demand action from world leaders.

“Business as usual policy is no longer acceptable to respond to the climate crisis and the level of climate action that citizens, students, workers, and communities are urgently demanding,” CAN-Rac added.

“Subsidizing the very industries responsible for carbon pollution undermines the government’s efforts to put a price on carbon,” said Oil Change International analyst Alex Doukas, in a release on behalf of the four-member Stop Funding Fossils Initiative. “If Prime Minister Trudeau is serious about climate action, his government must end subsidies to the fossil fuel industry, yet instead the government is increasing its handouts” to the industry.

Doukas was referring to a $100-million “innovation” subsidy to the fossil sector, doubling down on promises to reduce production emissions in the Alberta oilpatch that have yielded little or no progress in recent years.

It wasn’t all bad news—not by a long shot.

On ZEVs, Ottawa set a series of targets leading up to a 2040 deadline for phasing out sales of new internal combustion cars, along with a $5,000 purchase incentive for electric and fuel cell vehicles and $130 million for charging and refuelling infrastructure.

The Federation of Canadian Municipalities, through its widely-respected Green Municipal Fund, receives just over $1 billion to boost energy efficiency in residential, commercial, and multi-unit buildings. The allocation includes financing for local home retrofit incentives, Property Assessed Clean Energy (PACE) programs, efficiency and onsite generation in affordable housing, and support for cities and non-profits to retrofit large or demonstration buildings.

$150 million in federal infrastructure funds will support economic diversification in communities affected by the federal coal phaseout, adding to the $35 million the government had already committed over five years for the worker transition centres recommended earlier this month by the federal just transition task force.

Statistics Canada receives $15.2 million over five years to establish a long-awaited and badly-needed Canadian Centre for Energy Information.

It adds up to a decent effort to lay a foundation that won’t deliver Canada’s fair-share contribution to getting climate change under control. That won’t happen as long as the same government that introduces earnest, step-wise ZEV and energy retrofit programs wastes billions per year to subsidize a fossil industry entering its sunset. That’s not even including the $4.5 billion the federal Cabinet spent last year to buy us all a leaky, 65-year-old pipeline that its Houston-based owner knew better than to try to expand.

In the end, pressure for a faster transition will come from other countries seizing their share of the US$26 trillion in post-carbon opportunities and more than 65 million jobs through 2030 spotlighted by the Global Commission on the Economy and Climate, while Canada lags behind. “Earlier this month, Prime Minister Trudeau wrote that ‘there is no issue more important to our future than climate change,’” said CAN-Rac Executive Director Catherine Abreu. “If he truly believes that, he needs to keep Canada’s promise—originally made a decade ago—and end fossil fuel subsidies.”