CPA working with feds on needed changes to new carbon levy
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The CPA is working with the ministries of Environment and Climate Change Canada (ECCC) and Finance to urge the exemption of propane from the new federal carbon levy as it pertains to agricultural applications. The new levy or “Backstop” affects the provinces of New Brunswick, Ontario, Manitoba and Saskatchewan.
On March 7, CPA President Nathalie St-Pierre wrote to the Minister of Environment and Climate Change Catherine McKenna regarding CPA’s concern that propane is not excluded from the carbon levy for the purposes of agriculture applications under the Greenhouse Gas Pollution Pricing Act (GGPPA).
Currently the GGPPA provides that “a registered distributor can generally deliver, without the fuel charge applying, gasoline or light fuel oil (e.g., diesel) to a farmer at a farm…”
In her letter to the Minister, St-Pierre noted that “low-emission propane is an essential fuel used across Canada in many agricultural applications such as grain drying as well as primary and backup energy for hatcheries, greenhouse operations, etc. Propane represents a significant input for all agricultural sectors in Canada and this will have a major impact on farmers across Canada”.
St-Pierre added, “Given the fact that propane emits approximately 46 per cent fewer GHGs than gasoline and 98 per cent less particulate matter than diesel, it is a much cleaner fuel for energy use. Offering an exemption on gasoline or light fuel oil (e.g., diesel) will push farmers to revert to more polluting fuels, which we believe is not acceptable.”
The CPA is currently participating with ECCC and other stakeholders in a Technical Working Group on the design of the federal government’s Clean Fuel Standard (CFS). Through those discussions, propane is being recognized as an important fuel to help reduce carbon intensity relative to traditional fossil fuels such as gasoline and diesel. (Be sure to check out the upcoming issue of Energized for a deep dive into the CFS.) The fact that low-emission propane is not being offered the same exemption as gasoline and diesel for agricultural applications makes no sense for a government that has stated its intent to reduce GHGs and provide for cleaner air.
St-Pierre indicated to the minister, “as a low-emission fuel, it seems inconsistent that on the one hand, propane is recognized as a cleaner fuel that will reduce GHGs and particulate matter, yet on the other it not be listed as an exempted fuel for agricultural applications under the GGPPA.”
The CPA has been in contact with affected provincial governments and agricultural stakeholders. The Association has been pleased with the support it has received so far for its position and will be making that clear to the senior officials at ECCC and to the ministry of finance.
