Canadian voters will continue supporting controversial climate programs that raise the price of fuels, Canadian environmental minister Steven Guilbeault said today.
Regulators have pursued programs to lock in a course of greenhouse gas (GHG) emissions reductions that would outlive any single administration, Guilbeault said in a discussion for the Center on Global Energy Policy at Columbia University in New York. But voters have recognized the need for at times painful approaches targeted by conservative party opposition, he said.
"They have lost two elections on carbon pricing, so I guess they didn't get the memo," Guilbeault said. "Happy to fight them on the third election on carbon pricing."
Canada's next federal election, to come no later than October 2025, may test voter resolve on climate policies that are beginning to bite into the nation's natural resources extraction industries and affect prices at the pump.
Canada in 2019 began a carbon tax policy requiring provincial programs to set a price for GHG emissions. The country in July began enforcement of its Clean Fuel Regulations, a low-carbon fuel standard requiring yearly reductions to carbon intensity of road transportation fuel. That program has already added 3-6¢/l in compliance costs passed through to drivers, Guilbeault said.
The program met protest from provincial leaders in eastern Canada, where a federal fuel surcharge associated with the previous carbon tax policy also took effect in July.
"That's what those tools are designed to do — make fossil fuels more expensive," Guilbeault said. Communicating the goals and approach were important for voter support, he said. Quarterly climate incentive payments also help ease the transition, he added.
"That's how we make it more politically palatable, but it is controversial, and politically challenging," Guilbeault said.
Guilbeault expects the administration to soon advance methane reduction requirements for the oil and gas sector — a policy tailored to allow continued production so long as technologies deliver the required cuts.
Canada continues to pursue a program for contracts for difference (CFD) to give companies more certainty about investments to reduce emissions. CFDs lock in a future carbon price between a company and the federal government in a binding agreement that lasts even if a future government unwound the climate policies driving emissions reductions.
"They could do it, but they would have likely billions of dollars on their books the first year," Guilbeault said.
