Conservatives Pitch Consumer Carbon Pricing Through Savings Account

OTTAWA—Conservative Leader Erin O’Toole is pitching a loyalty-card style of carbon pricing where consumers would see what they pay on fuel stored into an account that can be used for green purchases later.

The so-called “personal low carbon savings account” is a signature policy of the party’s plan to tackle climate change, which was unveiled Thursday.

Making consumers pay a carbon price represents a major shift for the party, which has long campaigned on scrapping the program introduced by the Liberals under Prime Minister Justin Trudeau.

O’Toole emphasized his plan would indeed rid the country of Trudeau’s program, and characterized his consumer carbon price as being “a smart, market-based transparent approach to reduce emissions” to similar levels by 2030.

“This is not a tax,” O’Toole said.

Instead of collecting what residents pay through a fuel charge when they gas up and rebating it back to them through cheques after their income taxes are filed—which is how consumer carbon pricing works under the Liberals’ program—the Conservatives said that money would go into a tax-free savings account.

“Not a cent goes to Ottawa,” said O’Toole.

The party said the accounts would be managed by companies similar to how a debit-card system works. The plan says it would work like other loyalty rewards programs, so that over time users would save up money to buy products that help them “live a greener life,” such as a bike or transit pass.

During a technical briefing, an official said that government would provide oversight to the program, for example, having an allowable list of items that can be purchased using the low-carbon bucks.

The official also acknowledged the program is more targeted to those who drive than those who already bike or walk for their commute.

“I’m sure many Canadians, if they look on their smart phone or in their wallet, have many loyalty and point-systems that are actually less complex and very easy to administer,” said O’Toole.

“This will allow Canadians to feel in charge and then if they have modest savings in their low-carbon savings account, they may take a few years to upgrade that bike if they’re in a city.”

O’Toole said his plan is also cheaper for Canadians.

The Conservatives say their consumer price would start at $20 per tonne, and rise to no higher than $50 per tonne.

The Liberal plan—applicable only in provinces that do not have their own approved carbon pricing scheme—sets the price at $40 per tonne, rising each year until it reaches $170 per tonne by 2030.

The federal government’s plan could raise prices at the pump by nearly 28 percent over a decade, officials said in December.

An official said O’Toole had been planning to introduce a consumer carbon price for months, prior to the recent Supreme Court of Canada’s ruling that the Liberals’ federal backstop was constitutional.

And while Conservatives would be prepared to increase their carbon price on industrial emitters to $170 per tonne by 2030, it would limit what consumers pay to $50.

To offset that lower price, the party would look to reduce greenhouse gas emissions through other measures, like a renewable natural gas requirement and putting more zero-emissions vehicles on the road by requiring 30 percent of light-duty vehicles—cars, SUVs, pickup trucks —sold to be pollutant-free by 2030.

Other planks include proposing lower North America-wide industrial emissions standards to the Biden administration in the United States, improving fuel regulations to make burning gasoline cleaner and investing $3 billion over 10 years in “natural climate solutions” that focus on forests, farming and wetlands.

A tax credit to incentivize use of carbon-capture technology also factors in.

“While electric vehicles are quickly growing in popularity, the truth is that the world will still be burning oil and gas for decades to come,” states the Conservative plan, dubbed “Secure the Environment.”

In December, the Liberal government released a $15-billion plan to meet its climate change commitments that includes steady increases to the carbon tax.

It also pledges money to encourage heavy industry to reduce its emissions, for communities to make buildings more energy efficient and for remote communities to get off diesel-generated power.

The aim is a 32 percent reduction in emissions by 2030, slightly more than Canada’s 30 percent Paris agreement commitment. Ottawa hopes to reach 40 percent reductions when provincial programs are layered on.

By Stephanie Taylor