Moe responds to carbon tax ruling with five strategies, including small modular reactors

Saskatchewan’s fight against the federal carbon tax was lost on March 25, when the Supreme Court of Canada ruled 6 to 3 that a federal carbon tax is indeed constitutional.

It’s been a long haul for Premier Scott Moe, who recounted the fight going back to his days as environment minister, prior to assuming the leadership of the Saskatchewan Party and premiership.

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Speaking to a press conference at the Legislature in response to the court loss, Moe said that back in October 2016, he and the other environment ministers were meeting to discuss reducing greenhouse gas emissions “while respecting provincial jurisdiction and recognizing the unique characteristics of each region across this great nation.”

“At the very moment that we were meeting in 2016, at that very same time, when we sat down in Montreal, Prime Minister Justin Trudeau, he rose in the House of Commons to announce that the federal government would unilaterally impose a carbon tax on all of the provinces and territories. This was a stunning betrayal of the prime minister's promise to premiers to work in a cooperative fashion on climate change. A promise that He had made just a few months prior, at the first ministers meeting in Vancouver, where all 13 of the provinces and territories they signed the Vancouver Declaration, an agreement to work together as Canadians to address climate change and to respect provincial diversity.”

Moe said, “We saw the federal carbon tax for quite frankly what it was and what it is today, a blunt ineffective instrument that kills jobs and threatens our energy-intensive industries. We knew that we had to do all that we could to stop this federal carbon tax or at least we had to do everything that we could to try because standing up for Saskatchewan people, it's always a fight that's worth having.”

Thus, Saskatchewan launched a constitutional challenge in the Saskatchewan Court of Appeal, where it lost in a split decision. Ontario did the same in its own Court of Appeal, and Alberta won it its Court of Appeal, setting the stage for the final battle at the Supreme Court of Canada.

Moe said, “Today, the Supreme Court has released its judgment. The court has ruled that the federal government does have the constitutional authority to impose a carbon tax on the hardworking people that I represent in this province of Saskatchewan. The ruling does come with a strong dissenting opinion, one that warns that the decision has far-reaching implications for further federal intrusion into areas of provincial jurisdiction. For example, in his dissenting opinion Justice Brown wrote and I quote, ‘This is a model of federalism that rejects our Constitution and rewrites the rules of Confederation.’

“He goes on to say, ‘Its implications go far beyond the carbon tax law, opening the door to federal intrusion by way of the imposition of national standards into all areas of provincial jurisdiction including interprovincial trade and commerce, health, and the management of natural resources.’ He goes on, “It is bound to lead to serious tensions in the Federation,’ end quote. It's a very sobering warning from a Supreme Court justice,” Moe said.

“While today's decision does effectively end our legal avenues as a province, it does not end our opposition to this costly and ineffective tax. And just because Prime Minister Justin Trudeau has the legal right to impose a carbon tax, I would say that it doesn't mean that he should.”

He added that, “This decision does not in any way invalidate our government's position that there is a much better way to address climate change,” referencing the province’s “Prairie Resilience” climate change strategy.

Five strategies

So what now? Moe said, “Here are some of the measures that we will take in the months ahead to ensure that we can forge our own path, as we deal with those imposed consequences. First, we will bring electrical generation and our natural gas transmission, our SaskPower and SaskEnergy companies, under the provincial greenhouse gas emissions regulations that are now under development. Currently SaskPower and SaskEnergy operate under the federal rules. Under provincial legislation we will have more control over the regulations that they operate under. And we will have more flexibility in how carbon tax revenues are then distributed. A request has already been made, dating back to February 4, to the federal environment minister for this to occur, and to occur retroactively, dating back to January 1, 2019.

“Second, the government will submit a proposal that will see Saskatchewan design its own carbon pricing system for fuel; a system that will be similar to the one the federal government has approved in the province of New Brunswick, and it would be our expectation that the federal government would approve Saskatchewan’s proposal. This would provide an immediate rebate, right at the pump, to Saskatchewan people.

“Third, Saskatchewan will develop a greenhouse gas offset program as an option for regulated industries to meet their annual emission reduction target. Under the program companies could buy carbon credits from farmers, from ranchers, from our forestry operators, from municipalities and other businesses that may have the opportunity to sequester carbon.

“The Ministry of Environment is conducting these consultations and will continue throughout this year, and the program should be in place sometime in 2022.”

In a strategy that seems to be gaining steam in four provinces, Moe said, “Fourth, we will be asking the federal government to support the development of small modular nuclear reactors in this nation. As you know, Saskatchewan and Ontario are teaming up with New Brunswick, and very shortly, Alberta, to advance small modular reactor technology. This literally is game changing technology, and one we would ask the federal government to participate in.”

Moe said, “And finally, we are asking the federal government to provide Saskatchewan with its fair share of funding from the federal Low Carbon Economy Fund, which to this point, has not been provided. It's been withheld. Each and every province and territory has benefited from this initiative, Saskatchewan has not, because we chose not to sign a pan-Canadian framework agreement that included the imposition of a carbon tax. By our estimate, our province should now receive $126 million from the Low Carbon Economy Fund, and we would ask for that to be submitted shortly. We've already submitted a number of projects that would reduce greenhouse gas emissions by nearly 190 million tonnes over their lifespan. The federal government, I would say, should treat all Canadians fairly. We should not treat Canadians differently, and we would ask that they provide this Low Carbon Economy funding to the province of Saskatchewan immediately.”