Fossil fuel extraction and exports, and Canada’s overall greenhouse gas footprint, will be a major focus of the October 2019 federal election campaign. Advocates of fossil fuel production argue that Canada needs the economic boost provided by Big Energy projects like pipelines. Since rising carbon emissions are the critical driver for unchecked climate change, this argument is dubious on environmental grounds.
But pretending that the industry is purely a generator of economic benefits is naive at best, or totally dishonest at worst. This strategy comes with little-known economic costs, according to a study co-authored by the International Institute for Sustainable Development, Natural Resources Defense Council, the U.K. Overseas Development Institute, and Oil Change International, a Washington-based organization focused on the transition to clean energy, shows that Canada provides more government support per capital for oil and gas companies than any other G7 country, and is among the least transparent about fossil fuel subsidies.
“Fossil fuel subsidies undermine carbon pricing, work against the achievement of Canada’s climate targets, encourage more fossil fuel exploration and production, and allocate scarce public resources away from other priorities like health care, education and renewable energy,” says the report, released last summer only days after Justin Trudeau announced plans to purchase the Kinder Morgan pipeline expansion, which would ship diluted bitumen from the tar sands to the west coast for export.
Every year, the federal government and some provinces pay billions in hand-outs to coal, oil and gas companies. Fossil fuel subsidies to producers total $3.3 billion annually, which amounts to paying polluters $19/tonne to pollute. That’s enough to pay for 44,000 hospital beds, or the retraining costs for 330,000 workers. Across the entire G7, this figure adds up to about $100 billion every year. It’s long past time to end this shocking giveaway to some of the most profitable corporations on the planet.