{"id":287760,"date":"2023-11-13T09:33:55","date_gmt":"2023-11-13T08:33:55","guid":{"rendered":"https:\/\/climatescience.press\/?p=287760"},"modified":"2023-11-13T09:33:57","modified_gmt":"2023-11-13T08:33:57","slug":"awkward-canada-creates-a-brand-new-fossil-fuel-subsidy-just-in-time-for-cop28-a-reminder-that-sticks-hurt-and-carrots-are-healthy","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=287760","title":{"rendered":"Awkward \u2013 Canada creates a brand new fossil fuel subsidy just in time for COP28, a reminder that sticks hurt and carrots are healthy"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

From The BOE Report<\/a><\/p>\n\n\n\n

Terry Etam<\/a><\/p>\n\n\n\n

Upon hearing about the federal government\u2019s decision to roll back the carbon tax on heating oil, I rolled up my sleeves. The point of writing about energy at all is to try to illuminate some aspect of an energy topic from a viewpoint inside the energy sector; to explain some energy nuance that the general population, which cares little for the nuances of energy, may find valuable. Energy is not simple, and there are a lot of loud storytellers out there, selling magical beans and wishful thinking.<\/p>\n\n\n\n

To me, the carbon tax rollback was an annoyingly flagrant bit of vote-buying, yet another irritant from the federal government but one that, on centre-stage, seemed to have far less potential for cross-country histrionics than, for example, the time the prime minister threw his talented and principled First Nations minister under the bus. Now that was a shockwave.<\/p>\n\n\n\n

This carbon tax vote grab? Ha. SNC Lavalin, Jody Wilson-Raybould, the WE Charity scandal, foreign interference\u2026 a heating oil subsidy doesn\u2019t even crack an annual top-ten list of federal governance dirty diapers.<\/em><\/strong><\/p>\n\n\n\n

Or so I thought. Hoo boy. The Hail Mary scheme has blown up, blown up real good. Critics are everywhere, from across the political and environmental spectrum. Liberal heavyweights are attacking Trudeau; economists that love the carbon tax for its \u2018efficiency\u2019 are declaring the carbon tax dead. Incredulously, premiers have voiced a unanimous opinion that the entire country needs to be treated consistently.<\/p>\n\n\n\n

Upon further thought, it shouldn\u2019t be a big surprise that even the hard core climate crowd is displeased. The federal government has been lavish with announcements and proclamations about eliminating fossil fuel subsidies, that they would do so faster than imaginable, that, well, read their words<\/a> for yourself: \u201cCanada is the only G20 country to phase out inefficient fossil fuel subsidies ahead of the 2025 deadline. We are the first country to release a rigorous analytical guide that both fulfills our commitment and transparently supports action.\u201d<\/p>\n\n\n\n

\u201cWhat the hell is this?\u201d appears to be the consensus among a disparate group of voices that reaches consensus on nothing.<\/p>\n\n\n\n

Be very clear why there is outrage: this is a shallow, obvious vote grab that crumbles the pillars of this government, and it most definitely is a creation of a brand new fossil fuel subsidy \u2013 so much for international credibility after all the hectoring this government has done globally. (If you have any doubts that this is anything but a political maneuver, consider that almost exactly a year before, in October 2022, the Conservatives tried to pass a motion<\/a> to exempt home heating oil from the carbon tax, and all Liberal MPs save one brave Newfoundlander voted against it.)<\/p>\n\n\n\n

Since the whole topic of the carbon tax has now come up though, here is a critical point that warrants some thought.29dk2902lhttps:\/\/boereport.com\/29dk2902l.html<\/p>\n\n\n\n

Canada and the US have chosen two different strategies to reduce emissions. Canada has, of course, the carbon tax \u2013 if you use or burn hydrocarbons, you\u2019re going to pay (certain rural maritimers temporarily notwithstanding). Governmental, and government friendly, economists contort themselves into pretzels to demonstrate that the rebates handed back by the federal government \u201cmore than compensate\u201d for the carbon tax, but every citizen that goes to a grocery store and realizes that every item in the industrial chain that handled any of those products in this country paid their own carbon tax, and that all that is rolled into the end product, has a very strong real-world suspicion that the government\u2019s equation is laughable. <\/p>\n\n\n\n

Beyond that, there is a big problem with Canada\u2019s \u2018stick\u2019 approach to carbon reduction. Canadians can choose to limit the impact of the carbon tax by switching to something less carbon intensive, or spending to otherwise limit emissions. You don\u2019t want to pay the carbon tax, you or your business? \u201cNo problem!\u201d Says the federal government; just spend some exorbitant amount of capital, based on frameworks and guidelines that are not yet even ready.<\/p>\n\n\n\n

In the US, the government long ago (2008) introduced something called 45Q, a carbon credit which was recently beefed up significantly under the Biden Inflation Reduction Act energy policy. 45Q is a carrot. If you are a carbon emitter, well, no one likes the emissions, but go ahead and carry on with your business. <\/p>\n\n\n\n

If you choose to reduce your carbon emissions however, the government will hand you a cheque (sorry, check) for doing so \u2013 $85 per tonne CO2e, to be precise. You can start a new business that generates emissions credits, and if you can do it for less than $85\/tonne, you have a new profit centre. There is a companion credit called 45X; credit revenue can be generated from it by manufacturing components that go into various energy technologies including structural fasteners, steel tubing, critical minerals, pretty much any battery component, etc.<\/p>\n\n\n\n

In short, an existing business can carry on as before, or embark on a new venture with a guaranteed revenue stream from carbon credits generated.<\/p>\n\n\n\n

In Canada, the stick is, like, really big, and for real. If you exist and consume conventional energy, you will pay, and pay dearly, and the amount will go up every year until either 2030 or until you cry uncle, whichever comes first.<\/p>\n\n\n\n

Want to avoid paying the tax? Again, you will pay dearly, but differently; you will pay for capital expenditures on whatever means are available to you, using whatever policies are worked out by governments at all levels (Not a secret: a great many of the regulatory bugs are not yet worked as to potential solutions to limit emissions, capture\/store carbon, etc.).<\/p>\n\n\n\n

In Canada, either way, you pay through the nose. In the US, you have options to go into another line of business, or to find potentially unrelated ways to reduce emissions, with a \u2018guaranteed revenue stream\u2019 in the form of credits.<\/p>\n\n\n\n

Guess in which direction businesses will thunder?<\/p>\n\n\n\n

Economists love Canada\u2019s carbon tax because it is \u2018efficient\u2019. Well, yes, that is true in an oddball sort of way, just as I can guarantee you that I can \u2018efficiently\u2019 reduce local vehicular traffic by blowing up every bridge and overpass. How\u2019s that for efficient? I could cut traffic levels by greater than 50 percent within hours of delivery of the ACME Dynamite.<\/p>\n\n\n\n

At the end of the day, the federal government\u2019s backpedaling on the carbon tax is symptomatic of a cornerstone of the entire movement failing, because it was made of styrofoam and the building upon which it was constructed will only work with carefully engineered cement.<\/p>\n\n\n\n

Europe is no different, celebrating emissions reduction successes while not wanting to talk much about how the industrial sector has been hollowed out. \u201cStick\u201d taxes force companies to shut down and\/or leave, and just plain punish citizens for things like heating their homes.<\/p>\n\n\n\n

The carbon tax is a solution to the extent that there is readily-trimmable fat in the system. But it has to be designed to go after that fat, not after everything that moves. Autos are a perfect example. The federal government could have mandated a switch to hybrids, and banned sales of 500-hp SUVs and whatever (don\u2019t yell at me free marketers; I\u2019m pointing out real-world pathways that are possible). They could have mandated a rise in corporate average fuel economy in one way or another.<\/p>\n\n\n\n

That is trimmable fat. Attacking home heating fuels is not.<\/p>\n\n\n\n

This isn\u2019t to say the US\u2019 program is sheer genius. However, it is worth noting that 45Q has been around for fifteen years; what has happened recently is that it has been beefed up in a way that makes sense. (The US is also doing nonsensical things like forcing companies into carbon capture and sequestration, at the same time that, as US Senator Joe Manchin points out<\/a>, \u201cCCUS and DAC developers have submitted more than 120 applications to EPA [Environmental Protection Agency] for Class VI well permits to sequester carbon since the IRA passed, and there are 169 total pending applications, and not one approval has been made by the Biden Administration.\u201d)<\/p>\n\n\n\n

The energy transition as envisioned by the \u2018climate emergency\u2019 crowd was doomed to fail because it was based on a \u2018too fast, too soon\u2019 transition game plan \u2013 which was actually not a plan at all, more of a command \u2013 and, equally as relevant, was based on the tenuous fear instilled in citizens by bad weather (an entire generation is now being raised to 1)<\/strong> be terrified of the weather, and 2)<\/strong> be convinced that their actions can influence it. Stop it.). <\/p>\n\n\n\n

Our entire world is built on oil, natural gas, coal (in some parts of the world) and hydrocarbon energy systems in general. Sue \u2018Big Oil\u2019 all you want; that won\u2019t change anytime soon. <\/p>\n\n\n\n

Energy illiteracy is the slow-moving black plague of our time.<\/p>\n\n\n\n

Canada\u2019s efficient carbon tax pits citizens against their heating needs, against their business interests, and against inescapable realities. <\/p>\n\n\n\n

Here\u2019s the sad part: All the federal government is doing here is facing reality, or starting to. Europe did the same last year, spending hundreds of billions in brand new fossil fuel subsidies to shield consumers from rocketing energy prices. When push comes to shove, governments will wilt under pressured voter pocketbooks.<\/p>\n\n\n\n

Boneheads will at this point insert the oft-heard refrain \u201cSo you\u2019re saying we should just do nothing.\u201d I\u2019ve heard that so often it sounds like mosquitoes in summer. It\u2019s the only attack some people have. <\/p>\n\n\n\n

It is actually an amazing time to see new energy technologies take shape, with the best minds in the entire energy industry pushing in that way. We are seeing the creation of hydrogen hubs, development of new technology like fuel cells, greater use of methane capture from landfills, etc. A great many great minds are making significant progress. <\/p>\n\n\n\n

But even those geniuses can\u2019t change the laws of reality. Eight billion people are now alive at the same time due to a certain system, and it will take a very long time to change that system if all of those people stay alive and try to live like the west does.<\/p>\n\n\n\n

Energy wise, we need better, much better. Canada\u2019s government is paying the price for heedlessly listening to ideological cheerleaders. Just like Canada\u2019s citizens have been.<\/p>\n\n\n\n

Energy conversations should be positive and, most of all, grounded in reality. Life depends on it. Find out more in  \u201cThe End of Fossil Fuel Insanity\u201d at <\/em>Amazon.ca<\/a>, <\/em>Indigo.ca<\/a>, or <\/em>Amazon.com.<\/a> Thanks!<\/em><\/p>\n\n\n

\n
\"\"<\/a><\/figure>\n<\/div>\n\n\n

Read more insightful analysis from Terry Etam\u00a0here,<\/a>\u00a0or email Terry\u00a0here<\/a>.<\/em><\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

From The BOE Report Terry Etam Upon hearing about the federal government\u2019s decision to roll back the carbon tax on heating oil, I rolled up my sleeves. The point of writing about energy at all is to try to illuminate some aspect of an energy topic from a viewpoint inside the energy sector; to explain […]<\/p>\n","protected":false},"author":121246920,"featured_media":287763,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","_crdt_document":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"Upon hearing about the federal government\u2019s decision to roll back the carbon tax on heating oil, I rolled up my sleeves. 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Those pushing wind and solar keep telling us that the power they produce is \u2018free\u2019 and getting cheaper all the time. 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One of the main objectives for activists is to phase out fossil-fuels to allegedly stop global warming.\u2026","rel":"","context":"In \"70000 delegates\"","block_context":{"text":"70000 delegates","link":"https:\/\/climatescience.press\/?tag=70000-delegates"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/12\/0Screenshot-2023-12-05-183253.png?fit=963%2C560&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/12\/0Screenshot-2023-12-05-183253.png?fit=963%2C560&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/12\/0Screenshot-2023-12-05-183253.png?fit=963%2C560&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/12\/0Screenshot-2023-12-05-183253.png?fit=963%2C560&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":278781,"url":"https:\/\/climatescience.press\/?p=278781","url_meta":{"origin":287760,"position":3},"title":"IMF Mad Hatters\u2019 Notion of Hydrocarbon \u201cSubsidies\u201d","author":"uwe.roland.gross","date":"14\/09\/2023","format":false,"excerpt":"The recent IMF updated report on fossil fuel subsidies took on the appearance of the Mad Hatter\u2019s tea party (Alice in Wonderland) when you look into what is claimed to be subidizing hydrocarbon energy.\u00a0 Robert Lyman explains the tricks and dishonesty running through this ongoing narrative against conventional energy sources,\u2026","rel":"","context":"In \"Climate change\"","block_context":{"text":"Climate change","link":"https:\/\/climatescience.press\/?tag=climate-change"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/09\/0thumb-1920-246304.jpg?fit=1200%2C675&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/09\/0thumb-1920-246304.jpg?fit=1200%2C675&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/09\/0thumb-1920-246304.jpg?fit=1200%2C675&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/09\/0thumb-1920-246304.jpg?fit=1200%2C675&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/09\/0thumb-1920-246304.jpg?fit=1200%2C675&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":387402,"url":"https:\/\/climatescience.press\/?p=387402","url_meta":{"origin":287760,"position":4},"title":"Dr. Matthew Wielicki Torches the $7 Trillion Fossil Fuel Subsidy Myth","author":"uwe.roland.gross","date":"07\/07\/2025","format":false,"excerpt":"Dr. Matthew Wielicki\u2019s article, \u201cThe $7 Trillion Lie,\u201d is a scathing expos\u00e9 of what may be one of the most brazen accounting tricks in the climate policy playbook. For years, the International Monetary Fund (IMF) and its ideological allies have floated the claim that fossil fuels receive a jaw-dropping $7\u2026","rel":"","context":"In \"carbon taxes\"","block_context":{"text":"carbon taxes","link":"https:\/\/climatescience.press\/?tag=carbon-taxes"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/07\/0AQMlZ7IGASM24HbT3snlxXSFfUcfjWftL5ONGstam6oTFUv4wuSDj7Rl8Kz3glGK79MbOAlCBzHW_w80ephd-Ao-B8zVTuf5nHRwyYggKUYs_zi2CKoHuHSLG_bmBcKp2HC_Aczl6SfobUXkAqQqnFI2tT3U-Q.jpeg?fit=1200%2C1200&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/07\/0AQMlZ7IGASM24HbT3snlxXSFfUcfjWftL5ONGstam6oTFUv4wuSDj7Rl8Kz3glGK79MbOAlCBzHW_w80ephd-Ao-B8zVTuf5nHRwyYggKUYs_zi2CKoHuHSLG_bmBcKp2HC_Aczl6SfobUXkAqQqnFI2tT3U-Q.jpeg?fit=1200%2C1200&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/07\/0AQMlZ7IGASM24HbT3snlxXSFfUcfjWftL5ONGstam6oTFUv4wuSDj7Rl8Kz3glGK79MbOAlCBzHW_w80ephd-Ao-B8zVTuf5nHRwyYggKUYs_zi2CKoHuHSLG_bmBcKp2HC_Aczl6SfobUXkAqQqnFI2tT3U-Q.jpeg?fit=1200%2C1200&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/07\/0AQMlZ7IGASM24HbT3snlxXSFfUcfjWftL5ONGstam6oTFUv4wuSDj7Rl8Kz3glGK79MbOAlCBzHW_w80ephd-Ao-B8zVTuf5nHRwyYggKUYs_zi2CKoHuHSLG_bmBcKp2HC_Aczl6SfobUXkAqQqnFI2tT3U-Q.jpeg?fit=1200%2C1200&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/07\/0AQMlZ7IGASM24HbT3snlxXSFfUcfjWftL5ONGstam6oTFUv4wuSDj7Rl8Kz3glGK79MbOAlCBzHW_w80ephd-Ao-B8zVTuf5nHRwyYggKUYs_zi2CKoHuHSLG_bmBcKp2HC_Aczl6SfobUXkAqQqnFI2tT3U-Q.jpeg?fit=1200%2C1200&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":349685,"url":"https:\/\/climatescience.press\/?p=349685","url_meta":{"origin":287760,"position":5},"title":"The G7 virtue signals while China and India burn 70% of the world\u2019s coal","author":"uwe.roland.gross","date":"31\/10\/2024","format":false,"excerpt":"Back in April the Group of Seven (Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States) agreed on a time frame for phasing out coal-fired power plants in the first half of the 2030s. There was just one problem: Only the U.S. and Germany are among the\u2026","rel":"","context":"In \"China and India\"","block_context":{"text":"China and India","link":"https:\/\/climatescience.press\/?tag=china-and-india"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/10\/0China-India-Flags-1024x683.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/10\/0China-India-Flags-1024x683.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/10\/0China-India-Flags-1024x683.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/10\/0China-India-Flags-1024x683.jpg?resize=700%2C400&ssl=1 2x"},"classes":[]}],"_links":{"self":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/287760","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/users\/121246920"}],"replies":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=287760"}],"version-history":[{"count":4,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/287760\/revisions"}],"predecessor-version":[{"id":287765,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/287760\/revisions\/287765"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/media\/287763"}],"wp:attachment":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=287760"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=287760"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=287760"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}