After 11 years of bringing you local reporting, the team behind the Vancouver Observer has moved on to Canada's National Observer. You can follow Vancouver culture reporting over there from now on. Thank you for all your support over the years!

Coal double-standard costs British Columbia's citizens billions

(Page 2 of 3)

Failing to put a price on climate pollution is what the UK government’s economic report by Lord Nicholas Stern famously called the "greatest failure of market capitalism ever".

The lack of a carbon price is fine with coal companies, and they lobby heavily to keep it that way. That corporations look out for their bottom line first and foremost shouldn’t surprise anyone. That is how the game is played.

But for everyone else in B.C., this huge coal exemption is a very bad deal.

First, it allows billions of tonnes of climate destabilizing pollution to be dumped into our atmosphere with no economic signal to cut back. And second, it foregoes billions of dollars in carbon tax payments to B.C. that could be used to help our families and businesses transition to low-carbon prosperity.


So B.C. got it right when it was an early adopter of a low, but constantly rising, price on the carbon pollution content of fossil fuels. But so far B.C. has got it wrong by exempting most of the coal dug up in B.C..

Instead people outside B.C. -- like residents and businesses in China -- get to buy our B.C. coal without paying the carbon price we do.

Is continuing this double-standard fair to B.C. residents and businesses?

Can it be reconciled with the science that shows the damage to B.C. climate, weather, economy and families will be the same regardless of where that B.C. coal carbon pollution is released?

If it is good policy to charge B.C. folks a carbon tax on the carbon pollution content of B.C. coal, isn’t it just as good a policy to charge people outside B.C. the same carbon tax for the same coal?


Consider this comparison.

All the CO2 emitted by the burning of all fossil fuels by all B.C. businesses and residents -- for all cars, trucks, natural gas, coal, power plants, ships, industry and every building and factory and everything else in B.C. -- adds up to 47 million tonnes of carbon pollution last year. Every tonne of that was carbon taxed at $20 a tonne by our B.C. government. B.C. businesses and residents paid close to a billion dollars in carbon pollution taxes.

In comparison, residents and businesses in China and other regions bought B.C. coal containing 50 million tonnes of carbon pollution. And every one of those tonnes of carbon pollution in B.C. coal was fully exempted from our carbon tax. These buyers paid zero dollars in B.C. Carbon Tax.

That’s a billion dollar tax loophole last year -- and it was available only to people outside B.C.. Next year as B.C.’s carbon tax rises to $30 and as coal production increases again, this B.C. coal exemption could cost B.C. nearly $2 billion a year in lost carbon tax revenues.

At that point, the average family of four in B.C. will lose out on $1,500 each year in government revenue that could be used to help them transition to low-carbon prosperity. By 2020, this coal double-standard will cost B.C. $20 billion or more at current trends.


The year 2020 is also when B.C. citizens and businesses collectively are legally obligated to have reduced our CO2 emissions by 33 per cent from 2007 levels. We are a long way away from that target and badly hurting for funds to help get us there.

One reason for the lack of funds is that while the B.C. government has collected close to a billion dollars in carbon pollution tax from B.C. citizens and businesses, it has kept nothing. All -- and more -- has been returned in tax cuts, which were written into B.C. law years ago. The decision to make the carbon tax “revenue neutral” has kept the carbon tax from being viewed as a tax grab and has boosted its popularity with many people. It was a political master stroke.

But it has also meant that B.C. can’t use it as a source of funds to help in the low-carbon transition.

B.C. needs to find a different source of funds to make public infrastructure changes like expanded public transit, energy retrofits for schools, hospitals and government buildings and increased public clean energy sources. B.C. is also short on funds to help less-wealthy citizens and families prepare themselves for a low-carbon future by retrofitting their homes, businesses and vehicles.

We could fund all this by raising taxes on ourselves. Or we could apply our carbon pricing to the carbon content of all B.C. coal regardless of who buys it.

Got a preference?


Ending this multi-billion dollar exemption for out-of-province buyers can create just such a revenue stream.

More in Climate Snapshot

"Carbon tsunami" lead by Enbridge Northern Gateway takes aim at BC

A flood of mega-carbon projects threaten to quickly turn British Columbia into one of the world's dirtiest economies.

Car Carbon series: cool new animation, plus the jaw-dropping impact it left out

What weighs sixteen billion pounds yet hides in plain sight?
Speak up about this article on Facebook or Twitter. Do this by liking Vancouver Observer on Facebook or following us @Vanobserver on Twitter. We'd love to hear from you.