MONCTON, N.B. – Earlier this month, Prime Minister Justin Trudeau announced that all Canadian provinces and territories have until 2018 to have some sort of carbon pricing plan in place. The goal of the plan put in place by the Liberals was an effort to solidify its stance on reducing greenhouse gas emissions and climate change.
This decision will directly affect transportation companies, said Joe Rogers of the Delphi Group who spoke at the Atlantic Provinces’ Trucking Association’s transportation summit earlier this week.
Rogers said that the Liberals who have a “rockstar” approach to climate change are serious about carbon pricing and changing Canada’s environmental footprint.
“Climate change is but one of the sustainability factors that is fundamentally changing the way we do business,” Rogers said. “The Liberal government really ran on a platform of significant change…They’ve publicly said that this is a priority. The Ministry of Environment is now the Ministry of Environment and Climate Change.”
As an indication that the government is serious, one can look at the federal budget, Rogers said, where the Liberals put a $2 billion low carbon economy fund into place.
“People are going to be looking at transportation and engaging with how that sector can reduce emissions,” Rogers warned.
Transportation contributes to 23% of all of Canada’s GHG emissions, which works out to close to 171 megatonnes. And freight trucks alone contribute to more than half (54.7%) of those emissions, which means in total, 6.5%-7.5% of Canada’s annual GHG emissions come from transport trucks.
“That’s significant,” Rogers said.
Trudeau explained back in early October that a minimum price of $10 per tonne would be set in 2018, rising $10 a year until $50 a tonne in 2022. Provinces that do not have direct price on carbon or a cap-and-trade system in place by 2018 will have an imposed carbon priced place in that jurisdiction.
“Essentially the first impact of carbon pricing is simply the cost of diesel,” Rogers said. “At $10 a tonne, you’re looking at 3 cents a liter. But at $50 a tonne, you’re looking at 14 cents a liter.”
Rogers said going forward fleet executives should keep these costs in mind and continue to keep an eye out on what their province is going to do in terms of carbon pricing.
“This is truly getting implemented this time around,” Rogers said. “Ottawa is eager to demonstrate progress at the next UN climate conference.”
Currently, just three provinces – B.C., Alberta and Quebec – have a carbon pricing plan in place.