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Carbon Tax

Carney now prime minister of Canada after trying for years to defund it

Published

4 weeks ago

8 minute read

From the Fraser Institute

By Ross McKitrick

Conservative Leader Pierre Poilievre is very concerned about financial conflicts of interest that Prime Minister Mark Carney may be hiding. But I’m far more concerned about the one out in the open; namely that while Carney is supposed to act for the good of the country he’s lobbied to defund and drive out of existence Canada’s oil and gas companies, steel companies, car companies and any other sector dependent on fossil fuels. He’s done this through the Glasgow Financial Alliance for Net Zero (GFANZ), which he founded in 2021.

Carney is a climate zealot. He may try to fool Canadians into thinking he wants new pipelines, liquified natural gas (LNG) terminals and other hydrocarbon infrastructure, but he doesn’t. Far from it. He wants half the existing ones gone by 2030 and the rest soon after.

He has said so, repeatedly and emphatically. He believes that the world “must achieve about a 50% reduction in [greenhouse gas] emissions by 2030” and “rapidly scale climate solutions to provide cleaner, more affordable, and more reliable replacements for unabated fossil fuels.” (By “unabated” he means usage without full carbon capture, which in practice is virtually all cases.) And since societies don’t seem keen on doing this, Carney created GFANZ to pressure banks, insurance companies and investment firms to cut off financing for recalcitrant firms. “This transition to net zero requires companies across the whole economy to change behaviors through application of innovative technologies and new ways of doing business” he writes, using bureaucratic euphemisms to make his radical agenda somehow seem normal.

The GFANZ plan (outlined on page 9 of the final report) puts companies into four categories. Those selling green technologies or engaged in work that displaces fossil fuels will be rewarded with full financing. Those that still use fossil fuels, or have investments in others that do, but are committed to being “climate leaders” and have set a path to net-zero, will also still be eligible for financing. Those that still do business with “high-emitting firms” but plan to reach net-zero targets on an approved time scale can get financing for now. And companies that own or invest in high-emitting assets must operate under a “Managed Phaseout” regime or may be cut-off from investment capital.

What are “high-emitting assets”? Carney’s group hasn’t released a complete list but a June 2022 report (p. 10) listed examples—coal mines, fossil-fuel power stations, oil fields, gas pipelines, steel mills, ships, cement plants and consumer gasoline-powered vehicles. The finance sector must either sever all connections to such assets or put them under a “Managed Phaseout” regime, which means exactly what it sounds like.

So when Carney jokingly suggested it doesn’t matter if his climate plan drives up costs for steel mills because people don’t buy steel, he could have added that under his plan there won’t be any steel mills before long anyway. Or cars, gas-fired power plants, pipelines, oil wells and so forth.

GFANZ boasts at length about its members strong-arming clients into embracing net-zero. For instance, it extols Aviva for its “climate engagement escalation program… Aviva is prepared to send a message to all companies through voting actions when those companies do not have adequate climate plans or do not act quickly enough.”

To support these coercive goals Carney’s lobbying helped secure the implementation in Canada of rule B-15, the Climate Risk Management Directive from the federal Office of the Superintendent of Financial Institutions (OSFI), which requires banks, life insurance companies, trust and loan companies and others to develop and file reports disclosing their “climate transition risk.” This requires asset holders to conduct extensive and costly research into their holdings to determine whether value may be at risk from future climate policies. The vagueness and potential liabilities created by this menacing regulation means that Canada’s largest investment firms will eventually decide it’s easier to divest altogether from fossil fuel and heavy industry sectors, furthering Carney’s ultimate goal.

Yet Carney will become prime minister just when Canadians face a trade crisis that requires we quickly build new coastal energy infrastructure to ensure our fossil fuel commodities can be exported without going through the United States. I have listened to him say he will take emergency measures to support “energy projects” but I assume he means windmills and solar panels. He has not (to my knowledge) said he supports pipelines, LNG terminals, fracking wells or new refineries. Unless he disowns everything he has said for years, we must assume he doesn’t.

Canadian journalists should insist he clear this up. Ask Carney if he supports the repeal of OSFI rule B-15. Show Carney his GFANZ report. His name and photo are on page vi, in case he has forgotten it. Ask him, “Do you still endorse the contents of this document?” If he says yes, ask him how we can build new pipelines and LNG terminals, expand our oil and gas sector, run our electricity grid using Canadian natural gas, heat our homes and put gasoline in our cars if his plan succeeds and the financing for all these activities is cut off. If he tries to claim he no longer endorses it, ask him when he changed his mind, and why we should believe him now if he seems to change his core convictions so easily.

I hope the media will not let Carney be evasive or ambiguous on these matters. We don’t have time for a bait-and-switch prime minister. If Mark Carney still believes the rhetoric he published through GFANZ, he should say so openly, so Canadians can assess whether he really is the right man to address our current crisis.

Ross McKitrick

Professor of Economics, University of Guelph
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2025 Federal Election

ASK YOURSELF! – Can Canada Endure, or Afford the Economic Stagnation of Carney’s Costly Climate Vision?

Published on April 14, 2025

By

From Energy Now 

By Tammy Nemeth and Ron Wallace

Carney’s Costly Climate Vision Risks Another “Lost Liberal Decade”

A carbon border tax isn’t the simple offset it’s made out to be—it’s a complex regulatory quagmire poised to reshape Canada’s economy and trade. In its final days, the Trudeau government made commitments to mandate climate disclosures, preserve carbon taxes (both consumer and industrial) and advance a Carbon Border Adjustment Mechanism (CBAM). Newly minted Prime Minister Mark Carney, the godfather of climate finance, has embraced and pledged to accelerate these commitments, particularly the CBAM. Marketed as a strategic shift to bolster trade with the European Union (EU) and reduce reliance on the U.S., a CBAM appears straightforward: pay a domestic carbon price, or face an EU import fee. But the reality is far more extensive and invasive. Beyond the carbon tariffs, it demands rigorous emissions accounting, third-party verification and a crushing compliance burden.

Although it has been little debated, Carney’s proposed climate plan would transform and further undermine Canadian businesses and the economy. Contrary to Carney’s remarks in mid-March, the only jurisdiction that has implemented a CBAM is the EU, with implementation not set until 2026.  Meanwhile, the UK plans to implement a CBAM for 1 January 2027. In spite of Carney’s assertion that such a mechanism will be needed for trade with emerging Asian markets, the only Asian country that has released a possible plan for a CBAM is Taiwan. Thus, a Canadian CBAM would only align Canada with the EU and possibly the UK – assuming that those policies are implemented in face of the Trump Administrations’ turbulent tariff policies.

With the first phase of the EU’s CBAM, exporters of cement, iron and steel, aluminum, fertiliser, electricity and hydrogen must have paid a domestic carbon tax or the EU will charge more for those imports. But it’s much more than that. Even if exporting companies have a domestic carbon tax, they will still have to monitor, account for, and verify their CO2 emissions to certify the price they have paid domestically in order to trade with the EU. The purported goal is to reduce so-called “carbon leakage” which makes imports from emission-intensive sectors more costly in favour of products with fewer emissions.  Hence, the EU’s CBAM is effectively a CO2 emissions importation tariff equivalent to what would be paid by companies if the products were produced under the EU’s carbon pricing rules under their Emissions Trading System (ETS).

While that may sound simple enough, in practice the EU’s CBAM represents a significant expansion of government involvement with a new layer of bureaucracy. The EU system will require corporate emissions accounting of the direct and indirect emissions of production processes to calculate the embedded emissions. This type of emissions accounting is a central component of climate disclosures like those released by the Canadian Sustainability Standards Board.

Hence, the CBAM isn’t just a tariff: It’s a system for continuous emissions monitoring and verification. Unlike traditional tariffs tied to product value, the CBAM requires companies exporting to the EU to track embedded emissions and submit verified data to secure an EU-accredited verification. Piling complexity atop cost, importers must then file a CBAM declaration, reviewed and certified by an EU regulatory body, before obtaining an import certificate.

This system offers little discernible benefit for the environment. The CBAM ignores broader environmental regulatory efforts, fixating solely on taxation of embedded emissions. For Canadian exporters, Carney’s plan would impose an expensive, intricate web of compliance monitoring, verification and fees accompanied by uncertain administrative penalties.

Hence, any serious pivot to the EU to offset trade restrictions in the U.S. will require a transformation of Canada’s economy, one with a questionable return on investment.  Carney’s plan to diversify and accelerate trade with the EU, whose economies are increasingly shackled with burdensome climate-related policies, ignores the potential of successful trade negotiations with the U.S., India or emerging Asian countries. The U.S., our largest and most significant trading partner, has abandoned the Paris Climate Agreement, ceased defence of its climate-disclosure rule and will undoubtedly be seeking fewer, not more, climate-related tariffs. Meanwhile, despite rulings from the Supreme Court of Canada, Carney has doubled down on his support for the Trudeau governments’ Impact Assessment Act (Bill C-69) and confirmed intentions to proceed with an emissions cap on oil and gas production. Carney’s continuance of the Trudeau governments’ regulatory agenda combined with new, proposed trade policies will take Canada in directions not conducive to future economic growth or to furthering trade agreements with the U.S.

Canadians need to carefully consider whether or not Canada can endure, or afford, Carney’s costly climate vision that risks another “lost Liberal decade” of economic stagnation?

Tammy Nemeth is a U.K.-based strategic energy analyst.

Ron Wallace is an executive fellow of the Canadian Global Affairs Institute and the Canada West Foundation.

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Carbon Tax

Trump targets Washington’s climate laws in recent executive order

Published on April 12, 2025

By

From The Center Square

By 

President Donald Trump signed an executive order on Tuesday targeting state-level climate policies – including Washington state’s Climate Commitment Act – calling them unconstitutional and harmful to domestic energy production

The executive order directs attorneys general to take action against state laws and policies that address climate change or involve environmental justice, carbon or greenhouse gas emissions, and funds to collect carbon penalties or carbon taxes.

That includes Washington’s CCA that requires emitters to either reduce their carbon footprint or purchase “allowances” via a cap-and-trade program, which sets a limit on emissions from the state’s largest polluters: oil refineries, utilities, and manufacturers.

The CCA’s cap lowers over time with the goal of getting to carbon neutrality by 2050. While the program has generated billions in revenue, only 11% directly funds emissions-reducing projects, with the rest supports climate resilience, public health programs, and infrastructure planning, as previously reported by The Center Square,

According to a press release from The White House, the executive order targets these state laws and policies because they “burden the use of domestic energy resources and that are unconstitutional, preempted by federal law, or otherwise unenforceable.”

Gov. Bob Ferguson does not believe the executive order has enough teeth to impact the state’s CCA.

“Voters upheld the Climate Commitment Act by a landslide, with 61% approval,” Ferguson told The Center Square in an email. “I am confident we will be able to preserve this and other important laws protecting our climate and investments in clean energy from this latest attack by the Trump administration.”

The Washington Department of Transportation told The Center Square it is working with federal and state partners to seek clarification about the implications and next steps of federal funding actions.

The Department of Ecology did not respond to The Center Square’s request for comment.

If U.S. Attorney General Pam Bondi does go after the CCA and other environmental policies, Washington officials may argue that it’s within the state’s authority to regulate emissions for public health.

For example, The federal Clean Air Act allows states, including Washington, to adopt more stringent motor vehicle emission standards than the federal minimums in certain circumstances.

The 2007 Supreme Court decision Massachusetts v. EPA affirmed states’ standing to sue over carbon emissions, ruling that greenhouse gases endanger public health and are subject to regulation under the Clean Air Act.

This wouldn’t be the first time the state defended its environmental laws against federal challenges from the Trump administration.

Washington also fought emissions rollbacks during the first Trump administration when Ferguson was state attorney general.

One key victory came in 2024, when Washington helped defend California’s right to set stricter vehicle emission standards.

While Ferguson has not commented on the executive order, New York Governor Kathy Hochul and New Mexico Governor Michelle Lujan Grisham – co-chairs of the U.S. Climate Alliance – issued a joint statement on Tuesday that states that the federal government cannot “unilaterally strip states’ independent constitutional authority.”

“We will keep advancing solutions to the climate crisis that safeguard Americans’ fundamental right to clean air and water, create good-paying jobs, grow the clean energy economy, and make our future healthier and safer,” the statement said.

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