Alberta Premier Rachel Notley says she can’t support the federal government’s national carbon pricing until Parliament approves a plan to build a pipeline to transport Alberta’s oil to tidewater -- a step she considers crucial to supporting Canada’s hard-hit oil sector.
In an interview with Don Martin on CTV’s Power Play, Notley said she supports a national floor price on carbon “in principle,” but her support hinges on the approval and creation of a pipeline “or pipelines.”
“We can’t embrace that higher price until we get concrete action on the issue of a pipeline,” Notley said Tuesday.
Prime Minister Justin Trudeau announced the carbon pricing plan in the House of Commons on Monday. The plan proposes a $10-per-tonne price on carbon beginning in 2018, with the price indexed to increase by $10 per tonne each year until 2022, when it would cap at $50.
The Liberals’ plan was met with mixed reaction. Interim NDP leader Tom Mulcair called the target “woefully inadequate,” while Saskatchewan Premier Brad Wall said the plan “will damage our economy.”
Notley’s NDP government has already announced its own carbon tax of $20-per-tonne, set to begin on Jan. 1. The tax, which Albertans will pay in their energy bills and at gas pumps, will gradually increase to $30-per-tonne in 2018. Lower- and middle-income Albertans will be eligible for tax rebates.
Notley said the federal government must find ways to generate greater revenue from oil sales, such as the creation of a pipeline, in order to make its climate change plan more economically feasible.
“What we’re saying is, it needs to happen in conjunction with economic growth and prosperity and responsible decision making geared towards that objective,” she said.
The Trump factor
The federal carbon pricing plan could be thrown for a loop if Republican presidential candidate Donald Trump wins the U.S. presidency in November. Trump has openly opposed the idea of a carbon tax, which would make untaxed American oil cheaper to extract, produce and sell than Canadian oil.
Asked about the possibility of Trump in the Oval Office, Notley said it is important to “have an eye on the markets you are trading with” as Canada develops a national carbon tax.
“Which is yet another reason why in Alberta, where we have this vast non-renewable resource, we should not be solely trading with our greatest competitor, which is the U.S. We need to be able to diversify our markets, and that’s what happens when you build a pipeline to tidewaters,” she said.
Wildrose, Tories weigh in
Alberta’s economy has suffered as a global downward shift in oil prices has stripped the province of jobs. By building a pipeline to tidal waters, Notley hopes more international buyers will buy Canadian oil -- a step that could give the province a much-needed economic lift.
“Economic interests and environmental progress are not contradictory. They must be complementary,” she said.
Financial analysts predict Alberta will run a $10.9-billion deficit in 2016.
Notley’s conditional support for the federal carbon tax was met with harsh criticism from Opposition Wildrose Leader Brian Jean, who said it’s the wrong time to introduce a new tax to the jobs-strapped province.
"Tying a single pipeline approval to (carbon) taxation sets a dangerous precedent. Alberta needs to make it clear to Prime Minister Justin Trudeau this will never be acceptable," said Jean.
"Our province's economic interests should not be held hostage by politicians in Ottawa."
Progressive Conservative energy critic Rick Fraser expressed approval of Notley’s efforts to pressure Ottawa on pipelines. But he also raised concerns that the Liberals could boost the carbon tax higher than the proposed $50 cap.
"A lot of people are trying to figure out how this is possibly sustainable, politically and economically," Fraser said.
A Greenpeace Canada spokesperson said Notley’s call for a pipeline doesn’t fall in line with climate change leadership.
"It's incredible that the Alberta government would withhold its support for an action to combat climate change until it gets a new pipeline that further accelerates the problem," said Greenpeace Canada campaigner Mike Hudema.
"The Alberta government needs to realize that new pipelines aren't compatible with a climate-safe future."
With files from The Canadian Press
