Oil Change International

Exposing the true costs of fossil fuels

REACTION: Trudeau Government finally getting the message on fossil fuel subsidies

FOR IMMEDIATE RELEASE
March 22, 2017

CONTACT:
Alex Doukas, alex[at]priceofoil.org, +1 202 817 0357
Adam Scott, adam[at]priceofoil.org, +1 416 347 3858

Trudeau Government finally getting the message on fossil fuel subsidies: Oil Change International  

Today, the Trudeau Government is finally starting to make good on their promise to phase out dangerous fossil fuel subsidies. The Trudeau Government is taking its first concrete actions to fulfill campaign promises to end handouts to oil and gas companies in line with Canada’s commitment under the G7 and G20.

In response Alex Doukas, Senior Campaigner at Oil Change International, released the following statement:

“Today’s budget finally starts to chip away at the $1.6 billion in public money the federal government gives to oil and gas companies each year. The government estimates its plans to reduce handouts to oil and gas companies will save taxpayers roughly $150 million through 2022.

“But the Trudeau government will need to do more to fulfill its promises: as the impacts of climate change accelerate, it feels more and more like our home is burning. Continuing to hand out public money to fossil fuel companies is like spraying jet fuel on the fire.

“Today’s step to reduce handouts to oil and gas corporations is undoubtedly positive, but the government should work quickly to release a plan and timeline to phase out Canada’s remaining fossil fuel subsidies.”

“Fossil fuel subsidies pull in the opposite direction of a carbon price. Continued subsidies to oil and gas companies yank the rug out from under Trudeau’s nation-wide price on carbon. Today’s budget claws back some of the money taxpayers fork over to oil and gas companies each year, but we’re still paying polluters to pollute.

“Canada has a long way to go in demonstrating it understands the scale of the climate challenge. These early steps are encouraging, but Prime Minister Trudeau’s stubborn refusal to reject new fossil fuel infrastructure is holding him back from being the climate leader Canada needs.”

 

Additional background:

  • According to recent analysis, subsidies to oil, gas, and coal producers in Canada average $3.3 billion per year, $1.6 billion of which are subsidies from the federal government (the remainder from provincial and territorial governments).
  • The budget begins to address federal fossil fuel subsidies by trimming tax benefits that incentivise oil and gas production – most significantly, the Canadian Exploration Expense tax provision, as well as the tax treatment of flow-through shares (see the summary table on p.6 of the Tax Measures: Supplementary Information budget document)
  • An analysis published last year showed Canada’s continued subsidies to fossil fuel production could undermine plans to price carbon across the country. The analysis found that federal and provincial subsidies to fossil fuel producers were equivalent to paying polluters $19 / tonne of CO? to pollute.
  • The Trudeau government promised to phase out fossil fuel subsidies in line with Canada’s G20 commitment (p.81 of the 2015 Liberal Party of Canada platform), and committed at the 2016 G7 and North American Leaders’ Summits to phase out fossil fuel subsidies by no later than 2025.

 

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Comments (6)

  1. ken says:

    Reporting this as $ “roughly 30 million dollars per year through to 2022” puts this meagre step forward in the context of the average yearly subsidies of $3.3 Billion. in other words this reduction of subsidies is merely a “rounding” number.
    It’s a BIG mistake on the part of this report to give the Government ANY credit for “finally getting the message.” Im not sure “Leadnow is getting the message.” This press release misses the point.

  2. J Gean Hemming says:

    Fossil fuel subsidies undermines universal climate change. Wake up. and smell the roses …not petroleum fumes. We owe it to our children! Think ahead. Don’t become mired in the past-tense

  3. Gary Champagne says:

    The “good news” in this article is purely There for optic purposes given that $50 million given to Alberta, with little fanfare, to close wells Big Oil should be paying to cleanse Up. Once again, privatising profits and socialising costs.

  4. Yvon A Moreault says:

    I believe Canadians only receive social assistance when they live under the poverty level.
    How come a booming industry, paying millions to their shareholder and administrators, are given subsidies by the Canadian people through complacent governments?
    Disgusting!

  5. •”Large Sections of Australia’s Great Reef Are Now Dead, Scientists Find”
    •”Record-breaking climate change pushes world into ‘uncharted territory’”
    •”The big melt: Global sea ice at record low”
    •”U.S. scientists officially declare 2016 the hottest year on record. That makes three in a row.”
    •”Flooding of Coast, Caused by Global Warming, Has Already Begun”

    Meanwhile, Trudeau hands over $30 million of our hard-earned tax dollars to Alberta’s oil & gas industry for orphan well cleanup: an industry that fails to set aside cash for a rainy day; fails to demonstrate financial capacity before drilling; fails to clean up after itself; and needs no charity.

    AB Premier Notley today: “We believe it’s important for us to diversify our markets moving forward in the responsible development of oil and gas”

    Coral reefs, the most biodiverse areas on the planet, are dying — and all Premier Notley can talk about is pipelines.
    In the context of rapid man-made climate change, what does “responsible development” of oil and gas — building fossil fuel infrastructure, expanding markets, adding to the global oil glut — mean, anyway?
    How will Notley and Trudeau defend their legacy to their grandchildren?

  6. Mark says:

    So long as the oil patch and the economies of Alberta and Sask remain depressed, the federal gov’t will not invite the ire and condemnation of these two provinces and the Con opposition by curtailing the major subsidies and incentives to the petro industry. The political downside is too great – It just won’t happen. Climate and treasury be damned!`

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