The right idea in all the wrong places
Residents of Ontario began paying a premium on all fossil fuels as part of the province’s new cap and trade system on Jan. 1, 2017.
Since then, conversations with neighbours shoveling snow, friends at the diner, and strangers on the bus have resulted in an overwhelmingly negative response to instant rate hikes on everything from gasoline to home heating bills.
The purpose of a cap and trade system should be to force polluters to innovate in order to keep their prices down as the tax rises. Instead, Ontario’s new system had the immediate effect of passing the cost of purchasing carbon credits right on to the customer; regardless of their income status or personal carbon footprint.
As is often the case with poorly crafted legislation, low-income residents of Ontario are unfairly affected by its implementation. This section of the population often do not own cars, take public transit, are already frugal with their heating bills, and cannot afford to live in brand new energy-efficient homes.Yet these residents are still being asked to pay a premium to heat their homes and counter the effects of climate change; a global problem to which they have contributed very little.
Ontario Premier Kathleen Wynne has said that the revenues raised from the tax will be put back into government initiatives that will help fight climate change. Ontarians will then be able to reap the benefits through such public programs as home energy retrofits. This is another idea that will be squandered by market forces; particularly for those who cannot afford to buy a home and are renting instead.
Convincing a landlord to carry out labour intensive renovations can be a pain in the first place. This is especially true for many students who rent on a short-term basis. In a red-hot housing climate, there is little incentive for a landlord to bother going through the retrofit program, knowing that they will be guaranteed to find renters no matter how good the insulation in the attic is.
It’s hard to argue against the concept of a carbon tax or cap and trade system in principle. It’s a progressive, forward-thinking idea that conforms to most Canadians’ thoughts that we ultimately need to reduce our dependence on oil. It’s a great idea until the bill actually arrives in your mailbox.
A new system needs to take into account financial and employment status and apply a tax proportionally. It could even potentially look into a household carbon footprint. Of course, this would be a bureaucratic nightmare. Nationally, perhaps it’s time to abandon the idea of a tax and look into better funding for innovation in the energy sector, while simultaneously drawing down fossil fuel subsidies.
Unfortunately, as one of the first provinces to implement some form of the federally-mandated carbon tax, the Ontario Liberals’ system serves as a poor example and mires the reputation of a nationwide program. If backlash is bad enough, it may even end up costing their federal counterparts the next election.
It’s not as though the Premier is unaware of the economic hardships caused by rising electricity rates. Premier Wynne publicly apologized to the people of the province for raising hydro bills back in November 2016 saying, “It was my mistake.”
Let’s hope this means a solution is in the works.
Or instead, the Liberals could continue to run 30-second ads featuring smiling children telling the viewer, “Climate change is real.”
How’s that for accountability?
Photo by Mariah Bridgeman/The Ontarion