Revenue from the national carbon pricing system – sometimes referred to as the carbon tax – will be available to support fleets that invest in environmentally friendly trucking technologies, the Canadian Trucking Alliance (CTA) reports.
Technologies to be included in the program, and related funding amounts, have yet to be set.
The CTA had asked for carbon pricing funds during consultations before the release of the 2019 budget this spring.
“From the beginning of the carbon tax discussions, CTA consistently stated any mechanism used to collect revenue under the carbon pricing system must make sense for the industry,” said CTA chairman Scott Smith. “By investing a portion of the revenues generated from the carbon pricing system in a way that encourages market penetration of carbon-reducing technologies for diesel trucks, the Government of Canada has achieved an environmental policy that assists businesses of all sizes in purchasing clean energy technology while also supporting our collective goal to reduce carbon emissions.”
The alliance has expressed several concerns with carbon pricing in general, not the least of which was a dramatic increase in carbon pricing within a short period of time without factoring in overall economic conditions. It was also said to create competitive issues between Canadian and U.S. carriers.
The federal tax is now applied in Saskatchewan, Manitoba, Ontario, and New Brunswick, all of which have failed to meet federal benchmarks for carbon pricing. Alberta is set to repeal its provincial tax this week, following the election of a Conservative government. Other provinces have programs of their own, while Nunavut and the Yukon will adopt the federal pricing mechanism on July 1.
Ontario estimates the carbon tax will increase diesel prices in its jurisdiction by 5.37 cents per liter this year and 13.41 cents by 2022.
During a recent briefing at Challenger Motor Freight, Ontario Premier Doug Ford said the carbon tax will add $750 million to the price of his province’s longhaul trucking operations between 2019 and 2022. A tractor-trailer consuming 88,000 liters of fuel per year could see $3,500 in extra fuel costs in 2019, and as much as $11,200 by 2022.