‘No more carve-outs coming’ says Wilkinson on carbon price exemption

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.

Despite that, Natural Resources Minister Jonathan Wilkinson says the federal pollution price will remain in place for other forms of home heating.

“There will be no more carve-outs coming,” Wilkinson said on his way into cabinet on Tuesday.

At the same time, Manitoba MP and Prairie Economic Development Minister Dan Vandal said the government would have “good discussions on this” when asked about a carve-out for Manitoba as he entered cabinet.

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.

Story continues below advertisement

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.

Click to play video: 'Saskatchewan to stop collecting carbon tax pending Ottawa decision'

Saskatchewan to stop collecting carbon tax pending Ottawa decision

Alberta Premier Danielle Smith said that she’s disturbed by the measure and that it creates further division in the country.

Story continues below advertisement

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.

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.”

Trudeau and several other ministers did not take questions on the heating oil carbon price exemption on the way into cabinet on Tuesday.

Click to play video: 'Wilkinson defends carbon pricing pause on home heating oil, rejects it only benefits Canadians in Liberal ridings'

Wilkinson defends carbon pricing pause on home heating oil, rejects it only benefits Canadians in Liberal ridings

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.

Story continues below advertisement

“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. 

More on Canada

&© 2023 Global News, a division of Corus Entertainment Inc.