Ottawa (October 23, 2018) – Today, the Canadian Electricity Association (CEA) responded to the Government of Canada’s Carbon Pricing System (CPS), which will directly impact the provinces of New Brunswick, Prince Edward Island, Ontario, Manitoba and Saskatchewan in 2019. While CEA is pleased with some of the elements of this framework, CEA is concerned with the overall cumulative impact on the electricity sector.
“The electrification of the economy is vital to the decarbonization of the Canadian economy and Canada’s transition to a clean growth future. However, CEA is concerned with the negative impact on electricity sector investments that could result from the cumulative impact of the Carbon Pricing System with other federal, provincial, and territorial legislative/regulatory measures, including the ongoing federal reviews of the Fisheries Act (Bill C-68) and the Impact Assessment Act (Bill C-69),” noted the Honourable Sergio Marchi, President and CEO of CEA.
The proposed CPS introduces a more stringent performance standard on natural gas compared to the existing natural gas performance standard. Natural gas is an important transitional fuel to a low carbon economy and enables greater integration of intermittent renewables. However, natural gas will now be more expensive under this proposed system which could disincentivize investment in intermittent renewables.
“While there was inadequate consultation on this new, more stringent standard for natural gas leading up to today’s announcement, we ask that the Government be open to making necessary adjustments,” added Marchi.
On a more positive note, CEA has advocated that diesel-fired electricity generation for Northern communities be exempt from a carbon price, and we are pleased that today’s announcement reflects this recommendation. While investments are made in renewable energy sources, diesel will continue to play a large role into the foreseeable future in the North.
Further, residents in the provinces of New Brunswick, Ontario, Manitoba and Saskatchewan will receive an annual “Climate Action Incentive”. CEA commends the government for working to reduce the burden on ordinary Canadians. That said, large industrial electricity consumers may bear a larger cost for their electricity, which will negatively impact their business competitiveness.
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