Environmental groups say Canada’s attempts to set a price on carbon are being undercut by subsidies to the fossil-fuel industry.
They say tax exemptions, investment credits and royalty breaks add up to the equivalent of $19 per tonne of carbon dioxide.
That’s almost exactly the same as the price on carbon Alberta plans to implement next year and is double the proposed federal price.
Dale Marshall of Environmental Defence says governments should be working to gradually scale down the industry, not encourage its growth.
Energy economist Mark Jaccard says most of those subsidies are part of tax policy designed to aid the overall mining industry.
He says it makes more sense to keep raising the cost of carbon, either through a tax or regulations.