According to Canadian Prime Minister Justin Trudeau, the carbon tax exemption for home heating oil will last for three years, and individuals living in rural regions will receive larger carbon tax rebates. These initiatives provide some respite from the country’s skyrocketing living expenses.
In order to address climate change, Trudeau’s Liberal administration put a price on carbon in place. However, some members of his own party have demanded revisions to the program, particularly in the Atlantic Canada region, where a disproportionate number of households heat their houses with oil.
Trudeau stated that combating climate change necessitates supporting all Canadians while acknowledging the effects of high inflation.
“We’re modifying policies at this crucial juncture to ensure the desired results,” Trudeau informed reporters in Ottawa. “We are doubling down on our fight against climate change … (while) we are supporting Canadians.”
In 14 days, the carbon price on heating oil will be suspended; in April, larger refunds for Canadian rural residents will become available to individuals and families.
Additionally, Trudeau unveiled plans to encourage Canadians to install electric heat pumps. According to the government, switching from oil to heat pumps could result in annual energy cost savings of up to C$2,500 ($1,809.10) for homeowners.
The goal of Canada, the fourth-largest oil producer in the world, is to reduce emissions by 40–45% below 2005 levels by the year 2030. A significant component of their plan is a constantly increasing carbon price, which is expected to rise from C$65 per tonne to C$130 per tonne by 2030.
If the opposition Conservatives win the upcoming election scheduled for late 2025, they will remove the carbon tax.
Conservative leader Pierre Poilievre posted on social media platform X, formerly known as Twitter, saying, “After plummeting in the polls, a flailing, desperate Trudeau is now flipping and flopping on the carbon tax as I am holding a gigantic axe the tax rally in a Liberal-held Atlantic riding.”
Environment and climate groups responded to Trudeau’s statement in different ways.
While the Climate Action Network applauded the initiative to decrease energy poverty in Atlantic Canada and hasten the use of heat pumps, others cautioned that the temporary exemption of home heating oil from carbon price introduced ambiguity.
“It sends the signal to emitters – and investors – that policy can be weakened in the future, diluting the carbon price’s effectiveness in driving the long-term, low-carbon investments required to reduce emissions,” said Dale Beugin, Executive Vice President of the Canadian Climate Institute.
($1 = 1.3819 Canadian dollars)
