Top court upholds federal carbon pricing policy

Farm groups, fearing unsustainable costs, press for next steps

(Strickke/E+/Getty Images)

Calgary/Ottawa | Reuters — Canada’s Supreme Court ruled in favour of the federal government’s carbon pricing policy on Thursday, upholding a central pillar of Prime Minister Justin’s Trudeau’s climate plan and infuriating some provinces that opposed it.

The country’s top court said climate change is a threat to Canada as a whole and upheld the legality of the Greenhouse Gas Pollution Pricing Act, which had been challenged by Alberta, Saskatchewan and Ontario.

Carbon pricing, often called a carbon tax by opponents, is the lynchpin of the federal government’s plan to ultimately reach net-zero emissions by 2050. Ottawa will steadily ramp up the price of carbon to $170 a ton by 2030, from $30 currently.

Canada is the fourth-largest oil producer in the world and the fifth-largest greenhouse gas emitter on a per capita basis.

“Parliament has jurisdiction to enact this law as a matter of national concern,” Chief Justice Richard Wagner wrote in the ruling. “All parties to this proceeding agree that climate change is an existential challenge. It is a threat of the highest order to the country, and indeed to the world.”

Under the carbon pricing act, Ottawa can impose a federal levy on provinces that do not have an adequate carbon pricing system of their own. Opposing provinces argued this infringed on their jurisdiction, but the Supreme Court ruled federal intervention was justified.

The ruling was backed by six members of the nine-member court, with three dissenting opinions.

“Today’s decision by the Supreme Court of Canada does not change our core conviction that the federal carbon tax is bad environmental policy, bad economic policy, and simply wrong,” Saskatchewan Premier Scott Moe said in a statement.

Saskatchewan will unveil its own climate measures to avoid being subject to the “punitive and ineffective” federal tax, he added.

Alberta Premier Jason Kenney told a news conference the “disappointing” ruling undermined provincial authority, and set a dangerous precedent that allowed the federal government to overstep its constitutional powers.

“Team Alberta,” a coalition of Alberta farm groups, said Thursday it would call on that province to move on setting up “a ‘Made in Alberta’ climate plan that will ensure the economic sustainability of Alberta farmers.”

While some farm fuels are exempt from the tax, others, such as for grain drying and barn heating, are not. The federal carbon tax, Team Alberta said, “will exceed the cost of the propane and natural gas used to operate grain dryers within the next two years.”

A Conservative private member’s bill seeking further exemptions is before the House of Commons, but the federal Liberals last month signaled they would introduce their own bill offering tax relief for grain drying fuels. Details and timelines for that bill haven’t yet been announced.

Ontario on Thursday released a statement outlining its own environment plan, and Finance Minister Peter Bethlenfalvy said the province would not stop investing in a green economy.

Canada needs to cut emissions by 30 per cent below 2005 levels by 2030 to fulfil its international climate commitments, which would involve slashing annual emissions to 511 megatons, compared with 729 megatons in 2018.

The Liberals unveiled a strengthened climate plan last year aimed at reducing emissions to 503 megatons.

“This decision is a win for the millions of Canadians who believe we must build a prosperous economy that fights climate change,” Environment Minister Jonathan Wilkinson said in a statement.

Canada’s National Farmers Union (NFU) served as an intervenor in the case at the Supreme Court — “not because our organization endorses the federal government’s current greenhouse gas pricing measures, but because the NFU strongly supports the federal government’s constitutional authority to create national policies to reduce emissions,” NFU president Katie Ward said in a separate release.

The top court’s ruling in the government’s favour “clears the way for the federal government to expand efforts to support farmers in reducing emissions,” Darrin Qualman, the NFU’s director for climate crisis policy, said in the same release.

“Farmers want to lead in the struggle to safeguard the climate and food system and reduce emissions, but we need strong federal partnership.”

Senior Liberals have said they expect a snap election in 2021, two years ahead of schedule, and the Supreme Court ruling is a boon for Trudeau ahead of a possible vote. The opposition Conservatives have said they would repeal federal carbon pricing, if elected.

Reporting for Reuters by Nia Williams and Steve Scherer; additional reporting by Fergal Smith in Toronto. Includes files from Glacier FarmMedia Network staff.


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