Tuesday, March 06, 2007

Tories Told to Scrap Tax Breaks for Oil

A special committee of the House of Commons will table a report telling the Conservatives to end of federal tax breaks to oil sands development and implement hard caps on the sectors greenhouse gas emissions.

"The mounting environmental and social costs associated with oil sands activities ... make it increasingly clear that it would be irresponsible to continue on a `business-as-usual' course. It is time to being the transition toward a clean energy future," says the report, dated Feb. 28 and marked "Confidential."

The opposition dominated natural resources committee drafted the report calling for an end to the $1.4 billion in tax subsidies that go to the oil industry and asserts that for every dollar the government invests in the oil sands, the private sector kicks in just $1.18 - a ratio the committee says should be roughly 3:1 on the side of private investment.

However, the report was delayed in being released, and now that MPs are to begin their two week spring break it risks coming too late. The Conservatives will soon be announcing their emission reduction target for the sector, which is expected to be an intensity based target. This means that reduction targets are based on per unit production, not overall pollution. With Canada's rapidly expanding oil production, this will likely mean huge increases in greenhouse gases.

See this handy equation for further explanation of intensity based targets.

Regardless of the delay, the report will add further fuel to this ongoing fire. Most recently before these announcements we saw the Pembina Institute report that stated the oil sands could be carbon neutral by 2012 with a cost increase of just $1 per barrel.

Here's a thought. If you need $1.4 billion dollars to get a business off the ground, maybe you're the wrong businessman for the job.


Mike Charbonneau said...

Didn't the MPs just get back from holidays? BTW, great site. Please keep up the good work.

kitimat said...

"Intensity based targets" are meaningless. If the government tables a climate change plan supporting these targets, it would be a complete sham. We have to sacrafice short term economic growth for long term economic stability. The tar sands aren't going anywhere.
Hard caps are the only way to mitigate the effects of climate change. Our atmosphere will not factor in any "economic growth model" as it heats up.