Prime Minister Justin Trudeau shut the door on similar exemptions for other types of home heating on Tuesday, despite criticism that the government’s three-year pause on the carbon price for home heating oil is unfair.
“There will absolutely not be any other carve-outs or suspensions of the price on pollution. This is designed to phase out home heating oil the way we made a decision to phase out coal,” Trudeau said on his way into question period Tuesday.
This comes as cabinet ministers are facing heat from premiers and the federal opposition over exempting home heating oil from the carbon price for the next three years, a policy that primarily benefits residents in Atlantic Canada.
Energy and Natural Resources Minister Jonathan Wilkinson first said the federal pollution price will remain in place for other forms of home heating on his way into cabinet Tuesday morning.
“There will be no more carve-outs coming,” Wilkinson said, who stressed Canadians on heating oil stand to save around $2,500 annually now.
Conservative Leader Pierre Poilievre spent question period pressing Trudeau on the exemption, accusing him of doing it for political, not environmental reasons.
Trudeau responded saying that eight out of 10 Canadians who use natural gas for heat get more money back from carbon rebates than they pay.
NDP Leader Jagmeet Singh says the approach is one that divides the country.
“It provides help to those that live in the ridings where the Liberals are worried about losing their seats and doesn’t provide help across the country. It’s a divisive approach,” Singh said.
As an alternative, Singh called on the government to remove GST from all forms of home heating, calling it an essential as winter approaches.
Premiers across the country are calling the federal carbon price exemption on home heating oil unfair as the policy announced last week primarily benefits Atlantic Canada. Prime Minister Justin Trudeau made the announcement of the pause flanked by Atlantic Liberal MPs, and said the pause would roll out first for Atlantic residents before being applied to the rest of the country.
Home heating oil is still used by almost one-third of households in that region, which is a far higher proportion than the rest of Canada.
In B.C., Premier David Eby says it is unfair that Atlantic Canada is being targeted for federal relief.
Saskatchewan Premier Scott Moe announced Monday that he would tell the Crown utility SaskEnergy to stop collecting the carbon price on Jan. 1 if Ottawa doesn’t offer his province a similar break.
The Supreme Court of Canada ruled that Ottawa does have the jurisdiction to impose its carbon price backstop on provinces that don’t meet federal carbon pricing standards.
When asked about the prospect of Moe potentially instructing SaskEnergy to break the law by not collecting the carbon price, Attorney General Arif Virani said he didn’t have anything to say on the matter as he left cabinet.
Alberta Premier Danielle Smith said that she’s disturbed by the measure and that it creates further division in the country.
Ontario Premier Doug Ford calls the policy “completely unfair.”
In addition to the three-year carbon price pause for heating oil, Trudeau announced on Friday that there will be rebates to help more homes switch to heat pumps with the program being piloted in Atlantic Canada. There will also be a doubling of the carbon price rebate in rural areas across the country.
Catherine McKenna, the former Liberal environment minister who helped implement the carbon price, called for Canada to “hold the course if we want to meet our targets.” She criticized the “historic, record, obscene profits” reported by oil and gas companies.
“Why are people concerned about oil and gas prices, or oil and gas costs? Because oil and gas costs more. It’s not carbon pricing, folks,” she said an Ottawa net-zero conference hosted by the think tank Canada 2020 on Tuesday morning.
Wilkinson defended the current policy, saying home heating oil is significantly more expensive than other carbon-emitting sources of heat like natural gas.
“Home heating oil is significantly more expensive. It has escalated significantly in the last couple of years. It is predominantly a rural thing,” Wilkinson said. “There is a lot of energy poverty concentrated with people who actually use home heating oil.”
Newfoundland MP and Labour Minister Seamus O’Regan says he spent the summer hearing from constituents who were “scared to death” about the rising costs of using heating oil. He says the goal is to get these people on heat pumps, potentially for free if they are low income.
As for provinces calling the policy unfair, he says he’s ready to work with them to get heat pump deals done with Ottawa.
“If we don’t have Alberta and Saskatchewan on side we never reaching net zero, that’s a fact. So whoever is there, I will work with them,” O’Regan said.
Employment Minister and Edmonton Liberal MP Randy Boissonault stressed that Alberta does have an exemption to allow electricity companies to use natural gas until 2035. Much of the country is working toward net-zero power, driven by renewable energy, by 2030.
“So, this isn’t the first time that we’ve seen exemptions across the country,” Boissonault said.
On heat pumps, Boissonault said that they are ready to work with other provinces if they want to partner with Ottawa on a subsidy program.
— with files from The Canadian Press and Global News’ Sean Boynton.
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