By Chad Ingram
Published Jan. 12 2017
It’s expected that Ontario’s new cap-and-trade program – anticipated to increase the price or gasoline and home heating among other items – will negatively impact Haliburton County residents already living near the poverty line.
The province’s cap-and-trade system came into effect on Jan. 1. Cap-and-trade programs put a limit on the volume of carbon emissions companies are permitted to produce. Companies that exceed that limit can purchase carbon credits from companies whose emissions are below the threshold. It’s expected the increased cost of doing business for some companies will be passed along to consumers.
“Those that are living in energy poverty are going to continue to struggle” said John Teljeur of the Haliburton County Heat Bank. The Heat Bank assists those struggling to heat their homes through the winter and also provides help with electricity bills.
“A lot of these people rely on cars” said Teljeur noting they will be affected by increased gas prices. As of Jan. 1 gas prices throughout much of the province rose by four or five cents a litre.
“And if they don’t have cars they rely on taxi cabs” Teljeur continued adding that increase in the price of gas would likely be passed along to customers by cab companies.
Haliburton County has no public transit system.
The cap-and-trade program is expected to increase the cost of home heating as well as food due to transportation costs.
The Wynne government is heading into the new year with a promise to reduce Ontarians’ Hydro One bills. That rebate is expected to be an average of eight per cent although the government has said residents in some rural areas may see savings of up to 20 per cent.
“You have one small savings on one side but that’s going to be outweighed by increases in other areas” Teljeur said. “That’s my biggest concern.”
He says the Heat Bank was busy throughout December with eight calls from new clients in a single day before Christmas.
Local politicians say there’s been very little information from the province on how the program will impact municipalities.
“I’m disappointed on a couple of levels” said Minden Hills Reeve and County Warden Brent Devolin. “First of all the lack of information that’s come to municipalities on this issue is very concerning. Obviously what’s coming with this is the ability to buy carbon credits.”
Devolin believes the program could have ramifications for some projects Minden Hills township is embarking on this year – changes to the S.G. Nesbitt Memorial Arena the construction of a new fire hall – but at this point it’s unclear what those ramifications are.
“I’m reasonably certain we’re going to be able to earn carbon credits” Devolin said. However how that might work and any timelines that may guide that process are not evident which affects the township’s ability to plan projects accordingly the reeve said.
Devolin also believes a carbon tax would have been a better idea than a cap-and-trade system.
“I think the evidence from Europe California and other jurisdictions is that cap and trade is a poorer road to go down than a carbon tax” he said adding that a carbon tax doesn’t require new bureaucracies nor does it send revenues to other areas.
With California’s carbon market bringing in far less revenue than anticipated some economists do believe the cap-and-trade system is on the verge of economic collapse.
“I think municipalities are little short on details” said Dysart et al Reeve Murray Fearrey of the new program but added it seems there may be some tough ramifications for county residents. “At this point I believe individuals will pay and then pay again on the municipal levy.”
With the increase in fuel prices will likely come increased budgets for township roads departments.
“This compound taxation is double dipping many times on those less able to pay” Fearrey said. “I am hopeful there might be some relief however based on the green energy program and its implication on our hydro bills I am skeptical. I am all in favour of reducing the carbon footprint however not if it’s a tax grab and will hurt less fortunate individuals.”
Algonquin Highlands Reeve Carol Moffatt agreed that at this point it’s unclear what the ramifications of the program will really be for municipalities.
“We’ll have to consider incorporating the increased gas prices into our budgets but the guiding documents around both climate change and cap and trade are more than a little short in details” Moffatt said. “We really don’t know what we’re going to have to do – or plan for because of there’s been so little direction from the province. And with a provincial election coming it will be interesting to see who’s going to propose or promise what. There’s no point in forging ahead with our own plans or initiatives without direction and implementation strategies from upper levels of government. It’s literally wait and see.”
The cap-and-trade program is expected to provide about $2 billion in annual revenue for the province. Progressive Conservative leader Patrick Brown has already decried the program as a tax grab and is vowing to dismantle it if elected in 2018.