An Act to amend the Income Tax Act (capture and utilization or storage of greenhouse gases)


Greg McLean  Conservative

Introduced as a private member’s bill. (These don’t often become law.)


Second reading (House), as of April 12, 2021

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This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment amends the Income Tax Act to establish a tax credit for the capture and utilization or storage of certain greenhouse gases.


All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.

Income Tax ActPrivate Members' Business

April 12th, 2021 / 6:30 p.m.
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Greg McLean Conservative Calgary Centre, AB

moved that Bill C-262, an act to amend the Income Tax Act (capture and utilization or storage of greenhouse gases), be read the second time and referred to a committee.

Madam Speaker, it is my honour to rise in the House today to present this private member's bill at second reading: Bill C-262, an act to amend the Income Tax Act regarding carbon capture, utilization and sequestration.

I want to start by acknowledging all the people in the riding I represent, Calgary Centre, who gave me the honour of being their representative in the House of Commons 18 months ago. Many of those Calgarians joined my campaign or lent me their support in the hope that there would be better options for the way in which our country deals with the myriad challenges we face together.

Greenhouse gas accumulation and its effect on the world's environment are large and complex issues we need to address as a society and as a world.

The accumulation of greenhouse gases and its effects on the global environment are among the vast and complex issues that we need to address as a society and as a planet.

I sought to represent my constituents in this place with the belief that Canadians were not well served by politicians who dwelled on trite slogans or divisive attribution, and avoided real solutions to these difficult and complex problems. This month I have heard the gross misrepresentation of my party's position on the necessity of lowering greenhouse gas emissions. I have heard the cheap, unconstructive and divisive repetitions of this misrepresentation from shallow voices, including in the House, as well as from members of the cabinet. Perhaps Canadians need to roundly tell the current government that the division it has created, and continues to create, in this country on this fundamental issue should be curbed. Climate change is an issue not to be addressed in a partisan and divisive fashion. That approach of division, regionally and sectorally, must stop.

Climate change must not be regarded as a partisan issue and cannot be dealt with in a confrontational manner.

It is not an issue that we can shrug our shoulders on and be smug toward Canadians whose lives and livelihoods are being ruined as the government chooses an approach, selectively and inadequately, to address this matter.

At the risk of sounding trite, which I would detest, I speak here today on behalf of 120 colleagues on this side of the House, all of whom are of one mind in our approach to tangibly address the underlying causes of climate change. Canadians have experienced over five years of broken environmental policies. The government is long on studies. It is long on expensive and connected insider consultants, virtue-signalling and extending regulatory timelines. It is long on pretend solutions: the latest expensive, subsidized, faddish non-solutions and new taxes wrapped in virtue, but it is short on any results for accomplishing reductions in greenhouse gas emissions.

I am not here now to dwell on the current government's failures, but I question the failed approach. As with its record on a multitude of projects, talk is cheap. Sooner or later we need to see results. In 2018, Canada emitted the highest amount of greenhouse gases since 2007. I will not give any previous government credit for the 9% reduction in GHG emissions in this country between 2007 and 2009, as the economy also shrank by 7%. As the Government of British Columbia has clearly learned, and the Government of Canada is learning now, a carbon tax has no discernible effect on greenhouse gas emissions despite notable academic input to the contrary, particularly when the carbon tax is a wealth-distribution mechanism and not a true tax on the use of carbon.

I would say the same for any reduction that occurred in 2020-21. I expect the numbers reflect a reduction, but it is not our actions that will have reduced these emissions. It is the pandemic that has shut down our economy. Bill C-262 is not about another speculative approach to greenhouse gas emissions. It is not another unaccountable money pit for taxpayer funds to provide another non-solution to climate change. It is not another mechanism to transfer funds from taxpaying, contributing, employment-generating, sustaining scientific sectors of the Canadian economy. It is not another mechanism to transfer funds to connected, virtue-signalling, speculative, non-transparent, ineffective, subsidized, self-interested actors with no accountable stake in the environmental outcome, who are protected from the devastating economic outcomes of the proposed new solutions.

Bill C-262 is about a real, tangible approach to address the causes of climate change. The bill is about obtaining real results in carbon reduction. The bill is about leadership: national leadership, financial policy leadership and environmental leadership.

Eleven days ago, I had the pleasure, along with five colleagues, to visit a CO2 utilization sequestration facility in Clive, Alberta, hosted by my colleague from Red Deer—Lacombe. The Alberta Carbon Trunk Line is one of Canada's projects that has shown the world how we will lead in carbon reduction. That is the objective of Canada's commitment to the Paris Agreement: to reduce our carbon emissions. It is not to reimagine the economy, tear down what we do, displace productive Canadian jobs in industries or ignore how Canadians can contribute best to the world's efforts to decarbonize.

This is how we contribute. We will lead the world in a technological approach in which we led the world for a decade until 2018. How did we lose this environmental leadership?

The United States recognized the need to move forward on carbon capture utilization and sequestration, and implemented a tax credit known as 45Q to move these investments forward. Such was the success of the tax measure that the sectors participating in capturing and sequestering carbon increased significantly. The tax measure effectively allows a sharing of the tax credit associated with the expenditures required for the successful capture, utilization and sequestration carbon. Economic modelling shows that for every dollar of tax revenue that the government would forgo through this tax credit, it would see $4 of added economic activity. This is crucial as Canada looks toward economic recovery post-pandemic.

Illustratively, one can see that carbon emitters, industrial entities that contribute to Canada's economy, are not always the same entities that have the ability or the option to utilize and store carbon, or transport it to utilization or storage, or verify permanent sequestration, yet they are the entities that must obtain the equipment to capture the carbon. Captured carbon is not worthwhile unless we utilize it or sequester it effectively. Hence there is an ability to split the credit among various entities.

This tax innovation led entities that had started and advanced in Canada to move to projects in the United States. With one piece of smart legislation, the U.S. effectively led an industry, which Canada had led for a decade, to its jurisdiction, all with the objective of reducing carbon emissions and contributing to the world's efforts to decarbonize.

I should point out that the United States has met its Paris targets, whereas Canada has not. I admit there were different starting points between our countries and much of the U.S. success has been the result of moving away from using thermal coal for its power. Canada needs to step back into the lead and ensure that Canadian entities have the opportunity to retake their leadership in this technology and contribute to the world's decarbonization efforts with Canadian leadership.

The International Energy Agency recognizes carbon capture utilization and storage as the third most important measure for the world to attain its Paris Agreement targets. I will also note that the legislation and approach embodied in the bill align with the U.S. in an era when Canada's approach to climate change needs to be in lockstep with our trading partners, or it will lead to the concept of carbon leakage. This will mean no reduction in carbon, but a clear reduction in Canadian jobs. This reality should be at the forefront of our concern.

I will close by telling the House that this legislation is over two years late. Losing two years of economic and environmental leadership to our major trading partner means that we have been asleep at the wheel on advancing climate solutions and leading the world as we once did. The economic benefits are clear. The environmental benefits are proven and clear.

The leadership needs to be clear. Let us wait no longer.

Income Tax ActPrivate Members' Business

April 12th, 2021 / 6:45 p.m.
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Patrick Weiler Liberal West Vancouver—Sunshine Coast—Sea to Sky Country, BC

Madam Speaker, it is an honour to rise today to speak to my colleague's bill on the important issue of carbon capture and utilization or storage. He is a fellow member of the Standing Committee on Natural Resources.

I would like to begin by recognizing the news from a few weeks that the Supreme Court of Canada dismissed the challenge of Jason Kenney, Doug Ford and Scott Moe in a clear ruling that it is within the ability of the federal government to put a backstop price on pollution if the provinces and territories fail to act. This is important because, as written in the decision, “The evidence clearly shows that establishing minimum national standards of GHG price stringency to reduce GHG emissions is of concern to Canada as a whole. This matter is critical to our response to an existential threat to human life in Canada and around the world.”

It is well settled by climate policy experts, and particularly economists, that any credible climate plan needs to price pollution. It is necessary, but alone it is not sufficient. Investing in technology alone is a gamble, at best a calculated gamble, the results of which can be speculative, while to rely on regulations alone is known to be a significantly more costly approach to achieving the same levels of emissions reductions.

Utilizing market-based mechanisms is a conservative idea by origin, one adopted by a Conservative-leaning government in my home province of B.C. over a decade ago and accepted by Conservative governments in places all around the world. It bears questioning why any party that believes in the free market and is honest in its commitment to addressing climate action would reject it.

I raise this because Bill C-262 lives within this policy context in seeking to provide a tax credit for carbon capture utilization storage, which I will refer to as CCUS henceforth. While a majority of focus of carbon pricing in Canada has been situated on a consumer-facing pollution fee and dividend model, industry faces a price on pollution through the output-based performance standard, which approximates a cap and trade model.

If companies exceed the level of emissions established for their sector, they need to buy credits from counterparts that have been able to reduce their emissions through offsets from the market more widely. Carbon leakage of emitting projects moving to jurisdictions without carbon pricing systems is mitigated by how these standards are set. These standards get stricter over time, providing an incentive to cut pollution in the most affordable way possible. The proceeds collected from industry are used to support industrial projects that cut emissions and use cleaner technologies and processes, so it reinforces this transition.

The clean fuel standard rounds out these market-based systems by requiring liquid fuel suppliers to gradually reduce the carbon intensity of the fuels in Canada by 2030 or else purchase carbon credits from the market. Given that the oil and gas industry is the largest source of Canada's emissions, at about 25%, with transport coming in at second, it is critical we have measures like these to have any hope in meeting our 2030 goals and to set ourselves on a path to get to net-zero emissions by 2050.

These market-based mechanisms are the stick, so to say, but they can also be the carrot. With the Supreme Court's affirmation a few weeks ago, businesses have the certainty there will be a steadily increasing cost associated with polluting in Canada, so they can plan appropriately to reduce their emissions through actions they can take within their own operations or by procuring more affordable emissions reductions elsewhere.

There are many ways emissions reductions can take place within our largest emitting sector such as switching to renewable energies to power operations, tightening leaks from facilities of methane and other pollution, and the subject matter of today, CCUS. We need to focus on the cheapest and best way of pursuing all of these angles and do so in a way that promotes Canadian ingenuity.

Innovation here can also create technologies and services we can sell to the world. This is why our government proposed to level the playing field for all technology by cutting corporate taxes in half for companies that make net-zero emissions technologies. Until these breakthrough technologies mature, commercialize and become cheaper, there is a role for Canada to support the most promising examples.

This is the approach in our government's strengthened climate plan, which is called “A Healthy Environment and a Healthy Economy”. This plan was released in December. In this plan, we reaffirmed our promise to develop a CCUS strategy and further reiterated our commitment to exploring every opportunity that will help keep Canada globally competitive in this growing industry.

Some of the actions will include launching a net-zero challenge for large emitters to support Canadian industries in developing and implementing plans to transition their facilities to net-zero emissions by 2050, making investments to support decarbonization through the strategic innovation fund's net-zero accelerator fund with an investment of $3 billion over five years, and investing $1.5 billion in a low-carbon and zero-emissions fuel fund to increase the production and use of low-carbon fuels.

More recently, on March 8, we announced a joint steering committee with Alberta on CCUS. Canada was an early mover in CCUS with the Boundary Dam carbon capture project, where many lessons were learned. Canada has made significant strides in this sector, which in part have been funded by Natural Resources Canada. The Alberta Carbon Trunk Line system, one of world's newest integrated large-scale CCUS systems, currently sequesters about 1.6 million tonnes of CO2 per year, and the Shell Quest facility has already sequestered over five million tonnes of CO2 to date.

The strategic innovation fund has funded Canadian clean tech companies that are world leading, most notably, Carbon Engineering, located in Squamish of my riding, which has been directly capturing CO2 from air since 2015. Carbon Engineering also recently partnered with Canada's largest company by market capitalization, which is Ottawa-based Shopify, to reduce its own emissions.

Carbon Engineering is now constructing the world's largest direct air capture plant in the Permian Basin of west Texas. Once operational, this plant will directly capture up to one million metric tonnes of atmospheric CO2 annually.

Other countries around the world are launching CCUS projects. In Norway, the $2.6-billion Northern Lights project will capture and sequester up to five million tonnes of CO2 per year, which was overwhelmingly funded by the Norwegian government. The U.K. is also investing about $100 million in its HyNet North West project, which will create hydrogen from natural gas and capture the carbon underground. I mention these projects to highlight that we are operating in a very competitive international environment.

It is important that we take advantage of the human capital from our existing projects, our infrastructure assets and the natural assets that we have. This is what informs the hydrogen strategy that we announced in December of last year. This strategy will pursue non-emitting, green hydrogen from renewable energy that can be produced from the 82% of our grid that is already non-emitting, and from future projects that will be built. For the purposes of today, it also seeks to leverage the natural gas resources we have throughout the west, the geology throughout sedimentary basins for capturing carbon, as well as the expertise of our energy sector workers to create low-carbon, blue hydrogen. In total, this sector could represent 350,000 jobs by 2050 and help ensure that Canada can provide the low-carbon energy resources that the world increasingly demands.

I believe the end goal in growing the economy and supporting innovation while cutting emissions is one that I share with the member for Calgary Centre. However, Bill C-262 is fundamentally flawed in its approach. As written, the bill would undermine Canada's pollution pricing regime and would therefore undermine the stated purpose of the bill, which is fighting climate change. This is because Bill C-262 would create a situation where the government is heavily and perhaps fully subsidizing a project by tying the rate of tax credit to the pollution price, and as our pollution price steadily rises and our industry pricing becomes more strict, the tax benefit would grow disproportionately.

The bill would give an unfair advantage to CCUS as the choice for emissions reductions, whereas there may be much cheaper ways of achieving the same emissions reductions. I do not believe that is the most responsible use of the public purse. Rather than prejudge what the most efficient solution is, our approach is to utilize the market to decide for us. It may be CCUS, and we are developing a plan for that, but it cannot and will not be the whole plan.

Our approach is utilizing the stick of increasing the cost of pollution to encourage business to invest in greening their operations or to invest in emissions reductions elsewhere, and we are using the carrot through the competitive challenges to find the best solutions to reduce emissions from our biggest point sources. We are making calculated investments through the most promising technologies, through the strategic innovation fund's net-zero accelerator program, and our approach will ensure that we achieve the greatest results in emissions reductions at the lowest cost, while supporting Canada's clean tech sector to continue to punch well above its weight domestically and internationally.

For that reason, Bill C-262 would undermine this system and economical climate action overall and, as a result, I will be voting against it.

Income Tax ActPrivate Members' Business

April 12th, 2021 / 6:55 p.m.
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Monique Pauzé Bloc Repentigny, QC

Madam Speaker, I thank the hon. member for Calgary Centre for his bill, C-262, which gives me another opportunity to talk about the environment and impress upon members that climate action is urgent.

On March 8, Natural Resources Canada announced the creation of an Alberta–Canada carbon capture, utilization and storage, or CCUS, steering committee. My colleagues who spoke before me have mentioned it. According to the news release, the steering committee “will leverage Alberta's early CCUS leadership to advance climate goals”. It goes on to say that “Canada's strengthened climate plan calls for the development of a comprehensive CCUS strategy”, a technology that was developed thanks to 20 years of federal support.

The minister is also quoted as follows: “Carbon capture technology creates jobs, lowers emissions and increases our competitiveness. It’s how we get to net zero.” I have to say, I have my doubts.

We will continue to be vigilant with respect to the government's official line, as the government continues to claim that it is green and supports the environment while it spends billions in public money to finance and support energies of the past. The Conservative bill we are debating is a positive response to the pressure of the oil and gas industry, which made no effort and took every possible step to maintain the influx of public money in its business model.

With Bill C-262, the Conservative Party is proposing to socialize the environmental costs of economic activity while retaining the profits and benefits in the private sector, and portraying this as fighting climate change, which the party does not acknowledge exists. The Bloc Québécois will not be fooled especially since the 47 signatory organizations represent two million Canadians and Quebeckers who wrote to federal ministers abut this issue the very day the steering committee was announced. They clearly signalled their opposition to the tax measures to expand access to subsidies for enhanced oil recovery, which is what this is really about.

Although certain subsidies can be an effective way to combat climate change, the tax benefits proposed in Bill C-262 are not. The bill would do three things, all with public money. It would make it easier for the oil industry to go back to its dirty, carbon-intensive processes; it would discourage the industries that produce CO2 from adopting clean technologies; and it would extend the lifespan of aging reservoirs.

Sad to say, if there is one area in which Canada is a leader, it is in promoting the oil industry in every way with all kinds of economic and regulatory measures. There is no shortage of unfortunate examples. The government needs to stop with these cynical anti-democracy practices, these public actions that hurt the environment, jeopardize climate action, compromise biodiversity, and are ultimately aimed at keeping the oil industry alive.

Bill C-262 contains four clauses, and I will speak specifically to clauses 2 and 4. Clause 2 reads as follows:

The greenhouse gas stored for the purposes of the storage project must be captured, transported and stored in accordance with the laws of Canada or a province or the laws of the United States or any of its states.

It is one thing for Canadian oil industry lobbyists to copy tactics first used in the United States, but it is quite another to propose a bill that would be enforced on the basis of the laws of another country. The Conservatives' enthusiasm for U.S.-style deregulation is concerning, especially since the climate crisis did not get nearly as much consideration as it deserved over the past few years of Republican rule.

We know that Bill C-262 is inspired by the U.S. 45Q tax credit, which the member spoke about. This tax credit could increase oil production in the United States by 400,000 barrels a day by 2035, which equates to an annual increase of 5.7 million tonnes of CO2. As if we needed more CO2 in the atmosphere.

The other clause, which establishes the tax credit and how it is calculated, speaks for itself. It would appear that what the credit actually does is cancel out the price of the carbon tax levy. If that is the case, this confirms the true intent of Bill C-262: to attack the carbon tax, which has now been declared constitutional, and render it ineffective.

The Conservative Party is openly opposed to the carbon tax and lacks the credibility to claim that Bill C-262 will help fight climate change. The green veneer is not convincing, I am sorry to say. The fact is, the majority of delegates at the Conservative Party convention voted down a resolution calling for the party to acknowledge the very existence of climate change.

I will never stop repeating that the Bloc Québécois supports the polluter pays principle, the cornerstone of environmental policies. Quebeckers should not have to bail out Canadian oil companies.

The Canada Energy Regulator's numbers do not lie. Six of the seven carbon capture and storage facilities are primarily used for enhanced oil recovery. Just one of these facilities is dedicated to permanent CO2 sequestration.

As with any technology, this one can be used as part of a plan to reduce emissions, but it does not have to be. Experts have not proven these technologies to be effective, nor is there a consensus in the scientific community. People say that they want to make decisions based on the science, but that is not the case here. These facilities are astronomically expensive. Furthermore, there are fewer than 30 such projects around the world, and more than 80% of them are designed to help increase oil production. To put that into perspective, the International Energy Agency estimates that it would ideally take 2,000 facilities to meet the Paris targets.

As though what I just said were not enough, we must not forget the biggest risk associated with promoting these facilities, that of diverting attention away from the most important part of the collective effort to reduce greenhouse gas emissions and achieve net-zero emissions. I will just mention the need to reduce sources of emissions, to affect demand, by reducing it, of course, and to promote a 100% renewable energy supply. In short, we must take the necessary action to quickly and significantly reduce emissions.

The World Health Organization has said that the climate crisis is the greatest threat to health in the 21st century. I will repeat that over and over again. That is what we should be introducing bills about.

I must admit that I am bothered by the way words are manipulated and certain phrases are repeated in press releases in an attempt to make Canadians believe that Canada is taking measures to fight climate change, when the reality is that the fossil fuel industry is guiding the actions of both the government and the official opposition.

With the ear of the official opposition, the industry set everything up so that such facilities are able to accommodate increased production at taxpayer expense. This bill is a case in point.

The government itself has been giving the industry what it wants with ongoing federal subsidies since 2015, including a 200% increase from 2019 to 2020. Subsidies also went up from 2018 to 2019, and, judging from its convention this weekend, the Liberal Party certainly does not want to reduce fossil fuel subsidies.

The Bloc Québécois stands with Canadians when proposed solutions are reasonable and transition-oriented. The Bloc Québécois will firmly and resolutely speak out against government power and public funds being used to protect private interests at the expense of the environment and climate action.

All of Canada clearly has the potential to develop renewable energy. Mixed messages and fossil fuel subsidies need to end, and climate action needs to start right now.

Income Tax ActPrivate Members' Business

April 12th, 2021 / 7:05 p.m.
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Richard Cannings NDP South Okanagan—West Kootenay, BC

Madam Speaker, I am happy to speak this afternoon on Bill C-262, a measure that proposes to provide tax credits for the capture, storage and use of carbon dioxide put forward by the member for Calgary Centre. Under this bill, companies that capture carbon, for instance, at a coal power plant or oil refinery would get a credit equal to the amount of carbon dioxide stored multiplied by the current carbon tax price.

Off the top, I will say that I am not against carbon capture and storage in general. Many experts, including the Intergovernmental Panel on Climate Change, say that some form of carbon capture will be essential in the long run for the world to keep the global rise in temperature below 1.5°C, but the problem with carbon capture in this case is that it will almost entirely involve using that carbon dioxide storage for enhanced oil recovery. That is to say that the carbon dioxide that is captured will be stored by forcing it underground into underperforming oil wells, forcing oil to the surface that would otherwise not be recoverable.

Once again we are faced with the rather Orwellian view that we cannot fight climate change without subsidizing the oil industry. It is like the Liberal Party's line that the Trans Mountain pipeline is an essential part of a climate action plan, when it is a pipeline project designed to significantly increase oil production in Canada. We have to shake our heads because enhanced oil recovery is very profitable for the oil industry: more oil from the same well, more profits. On top of that, as I will expand on later, the oil produced through EOR will produce more carbon dioxide when it is burned than if it is stored underground to produce it. It is one step forward and two steps back.

The tax credits the bill proposes are similar to the 45Q tax credits given industry in the United States, so it is useful to look at their experience. First, I will point out that one difference between the U.S. credits and the proposal before us today is that the U.S. tax credits for carbon capture projects that do not involve enhanced oil recovery are $50 per ton, while those that involve enhanced oil recovery are given credits of $35 per ton. In Bill C-262, there is no difference for the two processes in the credits proposed.

Oil production in some parts of the U.S. oil patch have been using carbon dioxide for 50 years to get more oil out of the ground. Findings there show that these operations are carbon negative, i.e., that they store more carbon than they produce for the first few years of production, but within a few years go carbon positive. There is a good article in Vox online written by David Roberts in 2019 that I think presents all sides of the enhanced oil recovery debate very well and I will read a lengthy quote from it. It states:

...this kind of analysis depends on quantifying exactly how much new EOR oil will displace other, dirtier forms of oil — versus simply adding to the amount of oil consumed. Those kinds of predictions are notoriously dodgy; no one truly knows how much boosted oil supply from EOR might simply increase the world’s oil addiction.

Until [life cycle analysis] becomes more standardized and reliable, policy crediting EOR for [carbon dioxide] reductions involves a fair amount of hope and faith.

He goes on to say:

But the core of the climate case against EOR is simple: Climate change is an emergency. We need to bury lots of carbon, but it is crazy to let the oil and gas industry set the pace and the terms. EOR under certain rarified circumstances may be carbon negative, but you know what’s always carbon negative? Burying CO2 without digging up a bunch of oil to burn.

Sooner or later, we’re going to have more carbon to bury than EOR can handle anyway. We’re going to have to figure out how to bury it in saline aquifers. From a climate perspective, it makes sense to figure that out, and start doing it, as soon as possible.

Rather than slowly luring private capital into the enterprise by subsidizing oil and gas production—putting one foot on the accelerator and one on the brake—we should just cough up the public money necessary to do [carbon capture and storage] at scale, just like we did with public sewer systems to dispose of a different kind of waste.

Blending carbon capture and storage and enhanced oil recovery is basically another narrative that to fight climate change, we have to pump more oil out of the ground when actually that added oil will put more carbon dioxide into the atmosphere when burned than the amount put underground. Let us look at that in more detail.

According to the International Energy Agency and other expert analysts, between 200 and 600 kilograms of carbon dioxide is stored in enhanced oil recovery per barrel of oil produced. In Canada, an average barrel of oil produced and burned results in roughly 600 to 750 kilograms of carbon dioxide in total emissions. If we consider that, it is clear that the full life-cycle budget of carbon dioxide for enhanced oil recovery will always be negative.

There is a strong opposition in Canada to any proposal that subsidizes enhanced oil recovery. Last month, 47 groups sent an open letter to the Minister of Finance asking the government not to subsidize this technology. The groups included Environmental Defence Canada, The Council of Canadians, the Canadian Public Health Association, Canadians for Tax Fairness, Équiterre, the Canadian Association of Physicians for the Environment, Amnesty International, the Wilderness Committee, the West Coast Environmental Law Association and many more.

The letter cites an analysis of the impact of enhanced oil recovery tax credits on the environment and the cost to American taxpayers. It could result in at least an additional 400,000 barrels per day of carbon dioxide enhanced oil production in the United States in 2035, which would directly lead to as much as 50.7 million metric tons of net carbon dioxide emissions annually, and possibly far more. The portion of the bill that benefits the oil industry could alone cost American taxpayers as much as $2.8 billion U.S. every year.

Furthermore, the fossil fuel industry has attempted to gain the tax credit in the U.S., where 87% of the total credits claimed, amounting to nearly $1 billion U.S., were found not to be in compliance with the Environmental Protection Agency, according to an investigation by the U.S. Internal Revenue Service. Meanwhile, oil companies in the U.S. have successfully pushed back against monitoring, reporting and verification, making it impossible to know which companies have claimed credits and to what extent.

Enhanced oil recovery is obviously a benefit for the oil and gas industry. More oil means more revenue. Using captured carbon dioxide in enhanced oil recovery is indeed a way to reduce the carbon intensity of Canadian oil. It works out to about 37% per barrel. However, do we need to subsidize the oil industry to accomplish this?

If we are going to spend Canadian taxpayer dollars to incentivize carbon capture and storage, we should stick to projects that simply put carbon dioxide into the ground and store it forever. There are projects in Canada that are doing this. Norway is planning to do this on a big scale with its Northern Lights long ship project. It will provide the infrastructure to take carbon dioxide from European industrial sources and store it safely underground. When asked whether enhanced oil recovery would be a similar solution, a proponent of the Norwegian project said that enhanced oil recovery is not carbon capture and storage; it is just oil business 101.

Canada's price on carbon dioxide pollution is scheduled to rise to $170 per tonne by 2030. With that significant price on carbon, industry will have real incentive to cut down on carbon emissions. We should not have to spend more taxpayer dollars to add to the profits of fossil fuel industries in an initiative that could easily simply delay our climate actions.

Successive federal governments have consistently failed to eliminate inefficient fossil fuel subsidies. The present government has yet to even define what an inefficient subsidy is. The proposal in the bill would be yet another taxpayer subsidy for the oil and gas industry. For that reason alone, I will not be supporting the bill.

Income Tax ActPrivate Members' Business

April 12th, 2021 / 7:10 p.m.
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Warren Steinley Conservative Regina—Lewvan, SK

Madam Speaker, I am pleased to rise to speak to my friend and colleague from Calgary Centre's private member's bill, Bill C-262, an act to amend the Income Tax Act, capture and utilization or storage of greenhouse gases.

I am so curious; why do we care about human atrocities and abuses when it comes to where our coffee is sourced, but not our oil and energy? I have listened to my friends and colleagues speak about the energy sector. I thank my NDP colleague for his speech. I am a proponent of the Canadian energy sector and the oil and gas that is produced in Canada because I believe it is done in a more environmentally friendly way than anywhere else in the world. I believe the workers in our energy sector are treated better than anywhere else in the world. I will continue to be a proponent of Canadian energy as long as I have the honour to represent the people of Regina—Lewvan because I believe that Canada and the world need more Canadian energy not less, despite what the NDP member just said.

Canada is a country where respectful laws have been enacted by the government, where human rights and dignity are enjoyed by all individuals. When oil is extracted in Canada, it removes a need for oil from other countries that have no environmental regulations and no respect for human rights. On a global scale, Canadian oil is the cleanest and most sustainably sourced oil available.

Saskatchewan is a leader is carbon capture and storage. In 2014, the Boundary dam carbon capture project located near Estevan was brought online and became the first power station in the world to successfully use carbon capture and storage, CCS, technology. My Conservative colleagues and I will continue to highlight the incredible work that is being done in our home province of Saskatchewan, as well as in the rest of Canada.

Bill C-262 would harness the ingenuity of Canadian individuals and companies. The positive economic and environmental impact will be felt for decades to come. Just one CCS project over four years would generate $2.7 billion in GDP across Canada and support over 6,100 jobs. At a time when we are looking at economic recovery and how we can create more jobs for Canadians, this is not the only answer, but one of the answers that could be used by the government.

When the Canadian energy industry succeeds, we all stand to benefit. I believe in green innovation and in technological solutions to fight against climate change. This private member's bill does exactly that. This bill would return Canada to the international stage as a leader and innovator in GHG reduction initiatives. It will simultaneously incentivize individuals and companies to explore ways to reduce their own emissions to make everyday life more affordable. This is a made-in-Canada solution to reduce our greenhouse gas emissions.

This bill incentivizes investment and gives due recognition to our companies that are making an effort in caring for the environment. These companies do not need government telling them what their environmental goals and targets should be. They realize how important it is to be environmental leaders and also how it affects their bottom line when taxes come into play, like the carbon tax, clean fuel standards and other regulations. These companies are making these moves on their own because it is the right thing to do, not because they are being punished by more and more taxes by the Liberal government.

As a member of the Standing Committee on Agriculture and Agri-Food, I have had the pleasure to meet with many stakeholders from the agriculture sector. On every occasion, the individuals, companies and associations I had the opportunity to meet with were already actively engaging in modernizing and innovating. Those in the agriculture industry are working hard to come up with transformative and technological solutions. This is not, nor should it ever be, an “Ottawa knows best” approach. Individuals, provincial governments and companies are working hard on their own to create solutions. The ranchers, farmers and dairy producers know their land and are the best caretakers of their environment

We need a government that will harness that knowledge and incentivize innovation. We need a government that will champion industry-driven solutions, a government that will use CCUS technology to lead the world without the economic burden. In other words, we need a Conservative government.

I am and always will be a champion and advocate for our energy sector. The carbon capture and storage of greenhouse gases will result in 30 million tonnes of CO2 being removed from our atmosphere. The technology is effective and will lead to real world emission reduction in the short term if we embrace it. Shell Canada has analyzed its quest project on carbon capture. It is using this new technology in the province of Alberta to build and grow its energy industry.

In Saskatchewan, an estimated nine million tonnes of carbon is sequestered each year. The boundary dam project does use CCUS technology and it leads the way in expanding the measures allowing the industry to increase the number of participants in carbon capture and utilization. This will, as I said before, create jobs and have a truly meaningful impact on our climate and our environment. It will keep our air cleaner, our water fresher and our environment more pristine.

These CCUS projects demonstrate Canadian leadership in technology and put Canada in a competitive position for future CCUS investments. It also addresses a specific barrier that may be hindering the private sector investment. This is in opposition to the Liberals' carbon tax plan. We cannot afford to be a country that self-sabotages ourselves on a global scale. We all know that the Liberal government's plan is to raise the carbon tax to $50 per tonne in 2022. By 2030, Canadians are looking at living with $170 a tonne of carbon tax. What is the result of this? It results in penalizing innovation and uses of technology of our businesses and individuals across the country.

The Province of Manitoba's Minister of Environment, Conservation and Climate, Sarah Guillemard, in a statement said:

The federal government’s high carbon tax plan will penalize Manitobans for having invested billions of dollars in clean hydro-electricity. We will continue to pursue our made-in-Manitoba climate and green plan with a low, flat carbon price — not a high and rising carbon tax...

That results in companies leaving and technologies being developed in other countries. Canadians, as a result of the federal government, will continue to be left behind by higher and higher taxes on companies and these companies will continue to leave our country.

We need a government that will recognize the work that continues to be done by our agriculture and energy industries. We need a government that will recognize the efforts of our farmers who are leading the way in solutions to reduce their environmental impact. This bill would allow co-operation from those entities that are unable to capture carbon dioxide and storage. The energy industry needs the support of their federal government.

Canada should be a country that others look to for viable green energy solutions and we can be that leader again on the world stage. Canada has a science-based solution that will help meet our environmental goals, a plan that will align our industries with those of our largest trading partner.

Canada has been a leader in countless green innovation projects before. I am proud that this bill would allow us as a country to continue to do so. This bill, utilizing CCUS technology, would build on Canadian strengths, increase economic growth and job opportunities.

I am happy to second the private member's bill of my colleague, the member for Calgary Centre. I ask all my hon. colleagues to support it. When it comes down to it, Canada and the world need more Canadian energy and this is one of the bills that would lead us to be even more innovative and use technology to reach our climate goals. One thing that needs to be said is that this shows that we can incentivize people to be even more environmentally friendly. We do not need punitive taxes that make life more costly for all Canadians like the carbon tax that has been implemented by the government.

Once again, the constituents of Regina—Lewvan cannot afford $170 carbon tax in 2030. It just makes life much too expensive.

Income Tax ActRoutine Proceedings

December 11th, 2020 / 12:15 p.m.
See context


Greg McLean Conservative Calgary Centre, AB

moved for leave to introduce Bill C-262, An Act to amend the Income Tax Act (capture and utilization or storage of greenhouse gases).

Madam Speaker, every environmental report that addresses the concept of how we mitigate greenhouse gas emissions speaks strongly to the necessity of carbon capture, utilization and storage. The reason is simple. All human activity results in greenhouse gas production. Capturing that output and using it effectively is the only real path forward.

The bill I present today brings forth the means to incentivize carbon capture, utilization and storage by working with Canada's strengths, which are its world-leading environmental industries.

This will set a new path for Canadian businesses in the fight against global warming. Like all Canadians who will benefit from advancing technologies, I ask everyone here to join us in building a better strategy to achieve our environmental targets.

(Motions deemed adopted, bill read the first time and printed)