Home » News » Harper cited as obstacle to ending fossil fuel subsidies
News
Harper cited as obstacle to ending fossil fuel subsidies
News Articles | Post Media News | Mike De Souza | November 04, 2010
Read the full article on the originating site
OTTAWA — Prime Minister Stephen Harper is resisting calls from within his government and abroad to scale back fossil fuel subsidies, says a report released Thursday.
The assessment, Fueling the Problem, released by Climate Action Network, says that billions of dollars in subsidies for oil and gas companies are helping drive up emissions that cause global warming.
“In a time of fiscal constraint, the federal government could generate hundreds of millions of dollars in extra revenue by ending unfair tax breaks to some of the richest companies in the world,” said the report. “Eliminating handouts to oil and gas corporations operating in Canada would also help the country take a step towards a cleaner energy economy.”
The report also follows an analysis released earlier in the week by the International Institute for Sustainable Development which estimated that the industry received $2.84 billion in tax incentives from the different levels of government across Canada in 2008 through 63 different subsidy programs.
The institute’s analysis found that the federal government’s share of those subsidies was $1.38 billion, followed by Alberta at $1.05 billion, Saskatchewan at $327 million and Newfoundland and Labrador at $83 million.
It also concluded that the emissions from the oilsands sector, in particular, are about 12% higher than they would be without any subsidies or incentives.
Alberta government officials told the Calgary Herald that the estimates were based on “goofy” numbers, arguing that they were trying to find a balanced approach to ensure capital doesn’t go elsewhere.
The Climate Action Network report suggests that capital should be going toward more sustainable forms of energy with a lower environmental footprint.
“Globally — artificially low costs of fossil fuels have been shown to encourage wasteful consumption, distort energy markets, and allow for increased greenhouse gas pollution, thereby fueling the climate crisis,” said the report. “Subsidizing oil extraction also makes investments in oil more attractive compared to lower carbon, lower risk alternatives, thereby increasing the lock-in of economies into fossil fuels.”
It also noted that Finance Minister Jim Flaherty was urged by his own department, as well as Environment Minister Jim Prentice, to eliminate some tax incentives for investments in fossil fuel development and exploration last spring. Senior Finance Department officials provided options that would help the government generate revenues while honouring a commitment made by G20 countries to phase out fossil fuel subsidies.
But at the time, Mr. Flaherty chose to “minimize the commitment” made by Canada, focusing instead on a 2007 commitment to eliminate incentives for oilsands companies that are starting new projects.
“Since that time (2007), the Canadian government has taken no additional action to reduce, phase out or eliminate other fossil fuel tax breaks or subsidies and continues to give up well over a billion dollars in revenue to the oil, gas and coal sector each year,” said the report.
The report suggested that Mr. Harper is to blame for policies that favour oil and gas companies.
“It’s no secret that Prime Minister Harper meets frequently with oil and gas companies operating in Canada, many of which make billions of dollars per year extracting dirty oil from the tar sands,” said the report, referring to a recent Postmedia investigation of Harper’s meetings with lobbyists. “A look at the billion dollar revenues of some of these companies makes it difficult to understand why our government hands out around a billion dollars a year in tax breaks to oil and other fossil fuel companies.”
Tagged with: harper, fossil fuels
