Laying It Out: You can hate the carbon tax without being burned by it

By Scott Schmidt on April 9, 2022.

The sixth wave is coming, the war in Ukraine is raging and the United Conservatives are divided, so let’s talk about carbon tax.

It looks like the federal government finally realized its marketing failure regarding the rebate, and will now cut cheques on a quarterly basis for residents in provinces under its pricing system.

Considering the provinces in question – Alberta, Saskatchewan, Manitoba and Ontario, conservative-run and without their own pricing plans – you’d think the Liberals might have foreseen a disconnect when rolling out the system three years ago.

Sure, as long as you filed taxes you received your rebate, and it was both open to more, and worth more than the NDP’s. But three years in and still so many, at least according to our extremely unscientific online News poll, have no idea how it works.

And while I enjoyed the added lump-sum bonus at tax time the past couple years, folks often respond to the physical holding of money, and if cutting everyone four cheques a year helps them better believe the rebate exists, then so be it.

This isn’t an endorsement of the carbon tax, per se, as any real effect it could have on climate change at this point is lagging well behind. And with premiers trashing it with half truths and mediocre pop culture references, or the Liberals making it look like trash through an underwhelming sales effort aimed at the voters most likely to already hate them, don’t expect widespread carbon reduction on the Prairies to take off en masse.

But the rebate is essential for most Albertans – single urban residents get $539 this year, a family of four will get $1,079, with rural residents getting an extra 10% – and its value should be maximized. While the Parliamentary Budget Watchdog says by 2030, under the current plan, the tax will have an overall negative economic effect on more households than not, that is not yet true today, nor is it set in stone for tomorrow.

At the current rebate under current per-capita carbon usage, the bulk of those receiving rebates get back more than they spend. That trend can continue through upcoming years as long as it’s met with efforts to lower carbon usage.

That doesn’t mean you have to transition your home to geothermal heating, or buy an electric vehicle the next time you swing past a dealership. It just means you should be aware of what you’re spending, what you’re getting back and how you can make the former work with the latter.

As of April 1, 11 cents per litre of gasoline cost is carbon tax, while the portion for natural gas is now $2.63 per gigajoule. It can be pointless to speak in terms of averages when discussing energy usage, because the fluctuation from top to bottom is so high, but it’s fair to assume energy usage correlates pretty well with ability to pay for it.

If you’re using a lot more than the average, as with anything else, it’s because you can.

But the average home in Alberta is said to use about 120 GJ of natural gas each year, so we’ll use 150 (The figure is 270 for rural, but that includes all agricultural usage, which is why averages are generally a bad tool). And, though it seems high, let’s say we’re using as many litres of gasoline each month to drive our vehicle(s).

At 150 GJ of natural gas, you will pay $394.50 in carbon tax this year. And at 150 litres in gas each month (another awfully high total), or 1,800 litres a year, your tax will be $198 for 2022.

Whomever this hypothetical energy guzzler is, they’d have to do all of that as a single resident in order to lose money on the rebate system, which is, at best unlikely, and even then, only $53.50 for the year.

And though costs are no doubt passed down through pricing for household items, the insanity we are seeing at grocery and retail stores is due to global events in a global economy, not a carbon tax that remains proportionately small.

And that’s the point.

Despite continued efforts of conservative premiers and wannabe CPC leaders to suggest carbon tax is why everything is so expensive, it’s just not the case. And it ignores the real problem, which continues to be an unsustainable and fragile economic system bad for consumers in tough times, and somehow even worse when times take off.

For or against a carbon tax, it can’t be denied that consumers have the option to calculate usage, compare it to the rebate, then make lifestyle choices to ensure at least a net-zero personal expense. There is no other rising cost in our lives that offers this, unless you’d rather skip meals than walk to the store from time to time.

The rebate you get is fixed – the only variable here is carbon usage. Using less means spending less, which, in turn means better rebates.

You don’t have to become a fan of the carbon tax to ensure it works in your favour right now, and its intention is to give people time to adjust to a low-carbon future.

That future is coming whether we’re ready for it or not, and even if you don’t believe that, there is still no reason to spend unnecessary money as you make your case. At this point, and moving forward, if you refuse to make carbon usage adjustments to offset the tax, you’re doing it out of spite.

And spite is about to get real expensive.