Moe concerned feds’ ‘social cost of carbon’ could lead to much higher carbon tax, pave way for Clean Electricity Standard impossible for SK to meet

 

REGINA – On April 19, federal Minister of Environment and Climate Change Steven Guilbeault announced a new “social cost of carbon” which would be $247 a tonne for CO2 equivalent.

He called it “a new tool that the federal government is going to use in the fight against climate change.”

This had Saskatchewan Premier Scott Moe respond on social media the April 20, saying, “What does Minister Guilbeault mean by a “social cost on carbon”?

“He is now saying the “social cost on carbon” (his term) is now $247/tonne – 5X higher than they previously thought – and that this is “a new tool the federal government is going to use.”

“Is this not just a 5X higher carbon tax?”

Guilbeault replied, “Social cost of carbon is not “my term” & it’s not new. It comes from the @EPA and @theNASEM. It’s simple: pollution costs us all & we should understand those costs to help us make smart policy choices. The price on pollution & the direct rebates to Canadians remain the same!”

All of this has Moe concerned not only about Guilbeault floating a trial balloon about a possible higher carbon tax, but how this “social cost of carbon” could be used by the federal government as justification for its proposed Clean Electricity Standard. If implemented in its current form, that standard would mean the end of natural gas and coal power production, except in exceptional circumstances, by 2035. There have been numerous days this past winter where up to 86 per cent of Saskatchewan’s power generation came from natural gas and coal combined.

Pipeline Online spoke to Moe about this by phone from Regina the morning of April 20. Here is that interview, verbatim:

 

Pipeline Online: 

Regarding this social cost of carbon, were the provinces or Saskatchewan consulted on this beforehand?

Scott Moe: 

No.

(We were) consulted to an equal amount as we were on, any of the regulations that have been brought forth, the regulations and policies that have been brought forth over the course of the last number of years. Whether it be the carbon tax coming in at $50 and never going higher, whether it be the carbon tax now, possibly going up to the social costs, so-called ‘social cost of carbon,’ whether it be any of the policies that were listed in the in the white paper that we released last fall. Or any of the policies that we see, forthcoming like. obviously, it’s been discussed, that there’s going to be Clean Electricity Standards coming forward, or even targets. There was a target of net zero by 2050. That was bumped up to net zero by 2035. I mean, these shifting sands that are beneath our feet, make it incredibly difficult for us, in this province, to work with our natural resource companies that are providing energy and food security to not only Saskatchewan people and Canadians, but North Americans and people around the world

And so, no consultation, which is an equal amount of consultation has occurred on virtually all of these federal policies that are causing this very uncertain environment for all industries to operate across the nation.

Pipeline Online: 

So what does this quote ‘social cost of carbon’ mean?

Scott Moe: 

I don’t know if anyone knows the answer to that yet.

And here again and lies the difficulty. No consultation with provinces. No consultation with industry. We have a government that has made a commitment that the carbon tax would never go above $50. They’ve broken that commitment and now they’re laying the groundwork to not only break that commitment again, but quite likely trying to lay some parameters and some groundwork for what the regulations are going to look like later this spring or summer around the Clean Electricity Standard.

And those shifting sands are problematic for our natural resource companies in this province. They are problematic for our Saskatchewan Power Corporation as we try to lay out a plan as to how we’re going to generate electricity. Much of that has been and will continue to be generated in the in the Estevan area. And that’s why you’re seeing a provincial governments like ours looking at the environment of the shifting sands and saying, ‘Whoa, we’re just going to draw a line in the sand here.’

And that’s what the Saskatchewan First Act begins to do. And I think, over the next couple of months, you’re going to hear some more clarification as to how we’re going to utilize that act to protect our wealth-generating natural resource companies and their subsequent investment. And I think you’re also going to see how we’re going to use that act to protect our ability to provide energy security and access to affordable electricity in this province, for generations to come as well.

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Pipeline Online:

Do you see this as a possible federal justification for the proposed Clean Electricity Standard that would shut down not only coal, but natural gas for power production?

Scott Moe: 

I see that as a potential of what this might be floating some of the some of the groundwork for where, the federal government, the Trudeau Liberal government, the coalition, the Liberal-NDP coalition, that may be laying for some of the regulations that would come into the Clean Electricity Standard

Again, unconsulted targets and regulations that are constantly being put forward by this administration, I referenced net zero by 2050. They bumped that up to net zero by 35 on our electrical system, here in Saskatchewan. That simply isn’t possible, with any investment. And so, we’re faced in this province, do we attempt to achieve something that is unachievable, and invest literally billions and billions of dollars making electricity in this province essentially unaffordable?

Or do we charted a course, a provincial course, that most certainly is positive for the environment, but it’s also positive for affordable electricity for Saskatchewan residents, far into the future, and is also positive, I would say, for the folks that live and work in communities where we traditionally have produced electricity.

And so, we have some tools, now, at our at our disposal, and most notable among those is the Saskatchewan First Act, to ensure that we’re going to be able to charge our own course here, in this province, and we’re going to have more to say on that in the next couple of months.

But I would say that, yes, we would harbor some concern that the federal government is floating out language like this and the advent of the Clean Electricity Standards, which concern us as they continue to shift those sands, and make affordable, accessible electricity, more unachievable in this province.

And we’re not the only province. There are other provinces that are facing similar challenges into the future and we’re just not going to let that happen to the folks that we represent in this province.

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Pipeline Online: 

On any given day, Saskatchewan can see up to 86% of its power from coal and natural gas. And we could potentially replace that coal natural gas, but if we lose it, we lose the ability to keep the lights on and we’ve had two days in January, where wind actually went negative.

Scott Moe: 

Thus the unreasonable, and unachievable targets that are being put forward by the federal government that are not being consulted, there were provinces and power generating entities across the nation that are not being consulted with.

And so it’s time for us, as a province, to understand that the federal government is going to continue to shift the sands beneath our feet, but to chart our own course. And we’re doing some work on that as we speak. We most certainly are going to be communicating some of the results of that work to folks across this province, including folks in the traditional areas that generate power for us in the months ahead.

We need to preserve our opportunity to have accessible, affordable power in this province. The federal plan is unachievable, and most certainly, even attempting to abide by the federal plan is not going to keep our rates affordable in this province, or a number of other provinces, I might add. And so, we’re going to chart our own course and use the tools that we have available to do so.

Pipeline Online: 

Do you think that’s $247 and then that $294 he references, do you think that maybe where the federal government is aiming for the carbon tax?

Scott Moe: 

I will I think it’s possible that’s why they’re floating these dollar figures out. And again, when it comes to taking this federal coalition at their word, again, this is a government (that), back in the day when I was an environment minister, openly committed that the carbon tax would never go above $50 a tonne. It’s simply, as now been announced, they broke that commitment that they’re moving towards $170 a tonne, actually breaking out of that commitment officially this year, moving to $65 above the $50 benchmark. And now floating it out that they may go as high as #250 or $300 a tonne at some point in the future.

You’ll also remember the commitment and the scenario that was taken right to the Supreme Court of Canada and the federal government’s defense of this is ineffective policy was that ‘This is the tool.’

They were not going to use regulations alongside the carbon taxation. They were going to use carbon taxation as a tool to reduce emissions. Well, it hasn’t reduced emissions. Emissions continue to climb, albeit at a slower rate. And that is not due to the carbon tax. That is due to innovation in our industries, much of that innovation in Saskatchewan.

But the federal government has now introduced, alongside the carbon tax, a number of regulations in which they said they wouldn’t do that are having an equally harmful impact on industries that are creating wealth, not just in this province, but across the nation.

And really, when you look at what this government committed to – doing a carbon tax to $50 and not doing other regulations, and you look at what they’re doing – taking that carbon tax far beyond $50, is now suggesting it would go five times that amount, and introducing regulation after regulation after regulation, including fuel standards, Clean Electricity Standards, caps on oil and gas emissions and production, potentially discussing a 30 per cent reduction in fertilizer usage across this nation.

We are putting at risk our energy security, and could potentially put at risk our food security in this nation. And that’s something simply that the government of Saskatchewan is not going to partake in.

We are in the midst of this environment of shifting sands. We’re going to chart a course. As I said, we’re going to communicate that course in the very near future, and where you’re going to draw a line in the sand as to what the what impact the federal government is ultimately going to have on the people in this province, when it comes to us securing our energy future and securing our access to food future.

 

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