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12/19/2020

Atlantic provinces' appeal for delay in federal Clean Fuel Standard goes unheeded

A last-minute push by the Atlantic provinces to have Ottawa delay and further study its proposed new Clean Fuel Standard was not reflected in draft regulations published Friday.

In a joint letter sent Nov. 30, the energy ministers from the four Atlantic provinces had asked federal Environment Minister Jonathan Wilkinson to conduct more detailed analysis before presenting the national fuel standard.

The standard is intended to reduce greenhouse gas emissions by reducing the carbon in fuels people burn to run their cars or heat their homes. It's part of an overall federal climate strategy, including an increase in the federal carbon tax, that the Liberal government says will allow Canada to meet or exceed its Paris Agreement commitments.

Ministers on the East Coast are concerned about issues in their region where heavy industry has a much smaller presence but where other considerations such as the widespread use of home heating oil are top of mind.

The requirement “is expected to have a disproportionately negative economic impact on Atlantic Canadians,” the Atlantic ministers wrote in their letter, without offering specifics.

The region has few energy options. Only cities such as Halifax, Moncton, N.B., Saint John, N.B., and Fredericton have access to natural gas, so home heating oil dominates the market. It is used in 78% of P.E.I. homes, and most communities on the mainland are similarly reliant.

The draft rules acknowledge the region's challenges, including dependence on gasoline for transportation, a lack of renewable alternatives and oil use for home heating.

“It is estimated that provinces in Atlantic Canada would be more negatively affected by the proposed regulations,” government analysis accompanying the draft regulations reads. “This is largely because the Atlantic Provinces use more (light fuel oil) for home heating than other provinces.”

However, apart from an exemption for Newfoundland and Labrador that will not require renewable content in the province's fuel mix and a commitment to consider “measures to accelerate the transition” away from home heating oil in the Atlantic provinces, the four provinces' requests went unanswered.

Jinks O'Neil, a musician and chartered accountant in Sydney, N.S., has relied on oil for heat for more than 30 years and has seen energy transition before. His furnace was converted from coal burning to oil in the 1980s. He is willing to change again, but it is unclear what homeowners should do next to comply.

“I'm all for the green initiative, and I support all efforts to make our world greener for generations to come” he said in an interview. “But it has to be available and affordable.”

Without other options, the new rules “won't change the behaviours of people in my community,” O'Neil said.

The Atlantic provinces agree that consumers in their region have few alternatives. The ministers said in their letter that their provinces “have very limited ability” to make use of the greenhouse gas reduction opportunities proposed in connection with the new fuel standard.

Work on the Clean Fuel Standard began in 2016. According to Environment and Climate Change Canada's timeline, the publication of draft regulations marks the beginning of a 75-day comment period. They are due to be finalized in late 2021 before starting to come into force in 2022.

Collectively the Atlantic ministers requested that the federal government delay implementation and work to “mitigate the inequitable burden placed on the region,” but no delay is being proposed.

Teika Newton of the Climate Action Network acknowledges the fuel standard presents regional challenges but backs the proposal.

“We all have a responsibility . . . to collaborate to find ways to lower Canada's emissions,” she said. “We don't have time for delay any longer.”

Had Ottawa agreed to the Atlantic provinces' request, it would not be the first time regional circumstances were taken into account in relation to fuels. When the initial requirement for renewable content in motor fuels was introduced in 2010, exemptions were made for remote regions such as Newfoundland and Labrador and the North.

It's expected the Clean Fuel Standard would increase the cost of a litre of gasoline by up to 11 cents over the next decade. Officials say it would reduce carbon emissions by nearly 21 megatonnes by 2030.