A political science professor says the recent announcement that Ottawa will pause carbon pricing for home heating oil deliveries for three years will likely need to go further to boost the federal Liberals’ performance at the polls in the next election.
The federal government announced the measure on Thursday, along with other incentives to cut heating oil costs as affordability concerns have left the party flailing in the polls in Atlantic Canada.
Don Desserud, a political science professor at the University of Prince Edward Island, said it was a “positive announcement” for Atlantic-area members of Parliament, but could have “limited value” as a political strategy.
“Whether this has legs – in other words, whether any bump they get from this, or any goodwill they get from this lasts until the next election campaign – that, I think, is the big question,” he said.
“It really depends on when, of course, that election is called.”
The temporary, three-year carbon pricing pause for home heating oil deliveries will take effect in two weeks and last until March 31, 2027, applying to every jurisdiction under the federal fuel charge. Only Quebec, British Columbia and the Northwest Territories are not part of the national program.
Atlantic premiers have said since the summer — when the four provinces switched to the national carbon levy — that the pricing scheme disproportionately impacts their region, where home heating oil is still used by almost one-third of households. That’s a far higher proportion than the rest of Canada.
The carbon price is also higher on heating oil than natural gas, which is more commonly used in other provinces.
Desserud, however, noted that this program only targets one of the areas of major concern surrounding the carbon price. The others are the high price of gas at the pumps, and the impact of high fuel costs on food prices.
“Those are the reminders that the public gets, every time they fill up the car, every time they go to the grocery store,” he said.
“The other party, the (Conservative Party of Canada,) is telling them that the reason why those costs are high are because of the carbon tax, and that’s an effective message for the CPC.”
Lars Osberg, a professor of economics at Dalhousie University, said the shift won’t make a major dent in the higher cost of living for Atlantic Canadians. He said inflation is mostly due to higher food prices and housing costs, as wage increases have remained stagnant.
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“Perceptions of inflation are very much influenced by how often you purchase something and how visible the price is, and the price of gasoline at the pumps is very, very visible … but it’s not a large fraction of the average household budget,” he said.
“A bunch of governments want to deflect blame for the discontent of their constituents and Justin Trudeau is currently a convenient punching bag.”
Larry Hughes, a professor of electrical engineering at Dalhousie, said many Atlantic Canadians will remain interested in shifting over to heat pumps from oil, as Ottawa boosts the subsidies for the units.
“Many residents will look at going to a heat pump simply because of the rising cost of oil,” he said.
Political reactions
Atlantic premiers offered their reactions to Ottawa’s retreat from its carbon pricing policy in Atlantic Canada, saying while it will help the region cope with inflation, more is needed.
Nova Scotia Premier Tim Houston welcomed the measure as “a step,” but also said Friday that leaving the carbon pricing on gasoline “is still very punitive.”
“I think it’s an acknowledgment that the carbon tax is harmful to Nova Scotians, to Canadians,” he said of the new measure.
“We appreciate their initial step on this, but the fact that it’s still on fuel, it’s a real struggle for Nova Scotians.”
The Progressive Conservative leader says he’d hoped Ottawa would remove carbon pricing altogether and instead support the province on its initiatives to meet its emissions targets.
New Brunswick Premier Blaine Higgs offered no praise to the prime minister, saying it doesn’t go far enough as he urged Ottawa to cancel the carbon pricing altogether.
“It is costing us more money to live and work, and it’s the root cause of the situation we’re in. So, let’s get rid of it,” he said Friday at the legislature.
Prince Edward Island Premier Dennis King said in an interview Friday he’d been lobbying Ottawa for “months and months, trying to make them aware that adding 18 cents a litre to home heating fuel was going to put thousands of Islanders in a very precarious situation.”
King said until the province has better access to other fuel options, “all the tax does here is add to the cost at the pumps.”
Newfoundland and Labrador Premier Andrew Furey said in a written statement his Liberal government is pleased the prime minister was listening to the provincial premiers’ requests.
On a federal level, Conservative Party of Canada Leader Pierre Poilievre suggested in a tweet that the announcement was made because Trudeau was “plummeting in the polls.”
“He…panicked and promised to delay his home heating oil tax until after the election,” he said.
At a press conference in St. John’s, N.L., on Friday morning, he called the three-year suspension on home heating fuel a “tiny gimmick.” He noted that while those who heat their homes with oil will get a temporary break, the federal carbon pricing still applies to all other fuel.
“Remember, he (Prime Minister Justin Trudeau) is saying if he gets re-elected in the next election, a year later, he will put the tax back on home heating oil,” Poilievre told reporters.
Desserud said governments would be “foolish not to be paying attention to the polls,” but added that those in government “can’t win on this one.”
“If you do not respond to what members of your caucus are saying, then you’re arrogant, you’re aloof, you’re out of touch, you’re stubborn. If you do respond, then you’re flip-flopping, you’re not consistent. I mean, that’s the nature of politics,” he said.
“This move, I think, takes a little bit of the wind out of Poilievre’s sails, but that won’t last very long. He will simply now focus on gas prices and on the high cost of food.”
The political science professor said time will tell if Canadians remember this change when they head to the next federal election.
He noted that an effective strategy moving into an election campaign is to have a “very steady set of programs that are coming forward, not something all at once.”
“I think it’s a smart move, but I think it should not be the only move,” he said.
— with files from Global News’ Sean Boynton and The Canadian Press
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