October 7, 2008

Cement, concrete bodies say consultation lacking on carbon-tax proposal

VINCE VERSACE

staff writer

As federal leaders debate the merits of a carbon tax, concrete and cement officials are calling for a further study of options in the climate-change fight.

“A carbon tax is a huge concern — it will harm all industries, whether its petroleum based products or cement products,” says John Hull, president of the Ready Mixed Concrete Association of Ontario and executive vice-president of the Canadian Ready Mixed Concrete Association. “Whatever the cost is, it will be added to the end cost of the product.”

A carbon tax is central to the Liberal’s Green Shift plan that raises taxes on most fossil fuels that emit carbon dioxide when burned and reduces personal and corporate income taxes to promote productivity, efficiency and innovation. The plan outlines a price on fossil fuels, like coal and natural gas, starting at $10 per tonne of carbon dioxide and rising to $40 per tonne over four years. No new taxes would be levied on gas at the pump.

“We are also concerned with how a carbon tax affects the competitiveness of our material with those from offshore sources — we do not know what the offshore rules are,” adds Hull. “No one has engaged our industry. There has not been ample opportunity to sit down with government and engage stakeholders on this issue.”

Prime Minister Stephen Harper and his Conservatives do not endorse a carbon tax concept. Harper has stated publicly that he believes a carbon tax would undermine the economy, national unity and concentrate money and power in Ottawa. Among items in the Conservative environmental platform is introducing national caps for industrial emissions of four air pollutants commonly associated with smog and acid rain.

The Cement Association of Canada (CAC) says there are both merits and concerns with any type of climate-change-fighting regulation. Whichever policy a federal party chooses, it cannot be a one-size-fits-all approach, it says.

“We are promoting a sector-by-sector approach, not just in Canada, but throughout the world,” explains Pierre Boucher, president and CEO of CAC. “At the end of the day, any goals have to be achievable and predictable.”

Provincial carbon taxes in British Columbia and Quebec have hit CAC members hard, notes Boucher. The B.C. carbon tax is expected to deliver a $60 million hit to cement producers over the next five years.

“We are concerned with safeguarding the competitiveness of our association and members in Canada,” notes Boucher.

“How do we see a light at the end of the tunnel? We have to sit down and discuss all our issues.”

The Green Party would also tax carbon emissions, along with other pollutants. The generated funds could be used to decrease payroll taxes and support seniors. Prices on carbon intensive items such as gasoline, electricity and heating fuel would rise with a carbon tax, admits the Green Party.

The NDP endorses a cap-and-trade system which rewards polluters who reduce emissions and punishes those who do not. The NDP has set an 80 per cent reduction target in greenhouse gas emissions by 2050.

The Ontario Road Builders’ Association (ORBA) says any carbon tax on petroleum or fuel products is not beneficial because it adds pressure on those responsible for infrastructure such as cash-strapped municipalities. An increase in product costs ultimately gets transferred to product purchasers and that tightens business conditions, says ORBA.

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