View of the Syncrude oil sands extraction facility near the town of Fort McMurray in Alberta Province, Canada on Oct. 25, 2009. The federal government has released a climate change plan that includes steady increases to its carbon tax in each of the next 10 years. (Mark Ralston/AFP via Getty Images)

Liberal climate plan set to hike federal carbon tax to $170 a tonne by 2030

Prime Minister Justin Trudeau today released his government’s signature climate policy that would see Ottawa hike the federal carbon tax to $170 a tonne by 2030 and invest more than $15 billion towards meeting and exceeding Canada’s emissions reductions targets under the Paris Agreement.

Currently the carbon tax is set to hit $50 per tonne in 2022, but under the plan presented by the Trudeau government, it will continue to increase by $15 each year until it hits $170 a tonne.

Pricing pollution is one of the key measures presented by the government to meet and surpass Canada’s ambitious goal of reducing greenhouse gas emissions by 30 per cent below 2005 levels by 2030.

“Our plan will improve the energy efficiency of homes and buildings to cut energy waste while also helping people cut down on their bills,” Trudeau said.

“It will support sustainable food and farming practices. And it will make clean power available across the country,including in remote and Indigenous communities, while investing in clean and affordable transportation, including public transit and zero-emissions cars.”

The increase in carbon tax is expected to translate into dramatically higher prices at the pump and for home heating for Canadians. The price of gas is expected to increase by 37.57 cents a litre by 2030 as a result of this new plan, and the cost of light fuel oil for home heating, natural gas and propane will rise as well.

To offset these increases the federal government will continue to return most of the money collected by this program through rebates for individuals and families, Trudeau said.

Under the current system, the money is returned to individuals and families annually through the ‘Climate Action incentive payment’ when they file tax returns. Starting in 2022, the carbon pollution rebate payments will be distributed on a quarterly basis.

Trudeau also pledged to invest $3.16 billion over 10 years to finance the planting more than two billion trees across the country. The federal government will also invest $631 million over 10 years to restore and enhance wetlands, peatlands, grasslands and agricultural lands to boost carbon sequestration.

“We don’t have to choose between protecting the environment and growing the economy – they go hand in hand,” Trudeau said, adding that “that working with nature, instead of against it, is a win-win.”

‘Historically and globally significant’

Environmental groups welcomed the Liberal plan.

“This is a serious and well-thought out plan to achieve our 30 per cent reduction target, but we will need to do much more to fully decarbonize our economy, which is what climate science tells us is the way to protect our economy and ecosystems,” Keith Stewart of Greenpeace Canada said in a statement.

Stewart said he wants to see a detailed federal plan of transition from fossil fuels to renewables, “while creating green jobs and ensuring fair treatment for the workers and communities currently dependent on oil.”

Merran Smith, executive director at Clean Energy Canada, said the proposed climate plan is “historically and globally significant.”

“Most importantly, it’s a comprehensive and honest plan to get Canada to beat its 2030 climate target,” Smith said in a statement.

“The plan will also retool and position Canada’s economy to be increasingly competitive in a low-carbon world. It matches the level of effort we’re seeing among Canada’s largest trading partners: the EU, China, and the actions proposed by the incoming Biden administration in the U.S.”

With files from CBC News

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