{"id":81599,"date":"2021-07-12T15:07:00","date_gmt":"2021-07-12T15:07:00","guid":{"rendered":"https:\/\/resourcework2.devstudio.work\/?p=81599"},"modified":"2024-11-11T16:18:41","modified_gmt":"2024-11-11T16:18:41","slug":"oil-gas-subsidies","status":"publish","type":"post","link":"https:\/\/resourcework2.devstudio.work\/?p=81599","title":{"rendered":"The oil-gas subsidies that aren\u2019t"},"content":{"rendered":"\n

A remote northern community has no effective way of generating power other than using a diesel-fuelled generator provided by government.<\/p>\n\n\n\n

Now: Is that a subsidy to the oil industry?<\/p>\n\n\n\n

Some of the anti-petroleum activists in Canada think so and happily definite it as such.<\/p>\n\n\n\n

Do roads and airports count as fossil-fuel subsidies? Sure. Just ask the activists  that have a hate-on for \u201cbig oil.\u201d<\/p>\n\n\n\n

Once more, such wild definitions \u2014and questionable math \u2014 are in the daily headlines.<\/p>\n\n\n\n

Mainstream media are citing them as the result of a report carried by news outlets without any stated effort to investigate if the report is accurate and fair.<\/p>\n\n\n\n

They quote from the latest \u201creport<\/a>\u201d from the International Institute for Sustainable Development (IISD) on three pipeline projects: Trans Mountain, Keystone XL and Coastal GasLink. <\/p>\n\n\n\n

IISD insists: \u201cOil and gas pipelines in Canada received over CAD 23 billion in Canadian government support over the past 3 years \u2014 including CAD 10 billion since COVID-19 began. \u201c<\/p>\n\n\n\n

And it adds: \u201cCAD 23 billion is likely an underestimate because calculating full levels of subsidies and other government support is impossible due to a lack of government transparency.\u201d<\/p>\n\n\n\n

We probably don’t have to point out that IISD gives thanks for \u201csupport and advice\u201d on this report to such helpers as BC\u2019s Tzeporah Berman, international program director at Stand.Earth, chair of the Fossil Fuel Non-Proliferation Treaty Initiative, and a media-star of the current anti-logging protests on Vancouver Island.<\/p>\n\n\n\n

If IISD had consulted the industry, then Jack Middleton of the Canadian Association of Petroleum Producers (CAPP) would have replied:<\/p>\n\n\n\n

\u201cGroups like IISD often take aspects of tax measures and royalty programs \u2013 tools that generate revenue for governments \u2013 and mischaracterize those as subsidies, which creates confusion. Things like roads, airports, and reductions in vehicle registration fees are often included. It seems they can\u2019t make up their minds on what to keep in and what to exclude when it comes to claiming what constitutes a subsidy. . . .<\/p>\n\n\n\n

\u201cResource production in Canada is subject to royalties, charged by the provinces that own the resource, and taxes from every level of government. The exact opposite of a subsidy, these are significant drivers of income for municipalities, provinces, and the federal government. From 2017 to 2019, the upstream oil and natural gas sector contributed an average of $10 billion per year to governments across Canada through royalties, taxes, and other revenues.<\/p>\n\n\n\n

\u201cSince 2003 when B.C. introduced the Deep Royalty Credit program, the natural gas and oil industry has invested $90 billion into the province, which has, in turn, generated $24 billion in direct provincial government oil and natural gas revenues \u2013 an average over $1.3 billion of direct resource revenues every year.\u201d<\/p>\n\n\n\n

\"\"\/<\/figure>\n\n\n\n

To be fair, IISD<\/a> does mention that the federal government has made \u201cclimate investments\u201d of nearly $54 billion.<\/p>\n\n\n\n

Ah, but that $54 billion is in \u201cinvestments\u201d while the claimed $23 billion amounts to \u201csupport\u201d to the pipeline sector in the form of loans, loan guarantees or liabilities.<\/p>\n\n\n\n

Now, IISD did not use the word \u201csubsidies\u201d because the elements of \u201csupport\u201d may not have been, technically, subsidies as defined by the World Trade Organization.<\/p>\n\n\n\n

But, without any qualm or qualification, IISD absolutely used the word \u201csubsidies\u201d for these various kinds of support in a 2020 article: \u201cUnpacking Canada\u2019s Fossil Fuel Subsidies. . . . Their size, impacts and why they must go. . . . Fossil fuel subsidies hold us back and incentivize pollution.\u201d <\/p>\n\n\n\n

And it said those \u201csubsidies\u201d amounted to \u201cat least CAD 4.8 billion per year.\u201d<\/p>\n\n\n\n

Then there\u2019s the Environmental Defence group, a partner in the latest IISD report. It\u2019s promoting a petition these days, with this message:<\/a><\/p>\n\n\n\n

\u201cOil and gas companies are wealthy, multi-billion dollar businesses with big lobbying power. And despite big earnings, they use their influence to extract tax breaks and handouts from the Canadian government. These payouts are called fossil fuel subsidies, and they make it less expensive for industry to pollute, and leave less money for public goods like education, health care, and clean drinking water. In fact, in our latest report, we were able to track nearly $18 billion in subsidies and support in 2020.\u201d<\/p>\n\n\n\n

But as the Canadian Energy News Network<\/a> notes: \u201cMost of their $18 billion claim comes from the Export Development Bank, an organization that is financially self-sufficient and raises money just like a bank, mostly through fees and global markets. This means that they aren\u2019t using public funds to finance these industries.<\/p>\n\n\n\n

\u201c(And) $3.2 billion of actual government funding was used for cleaning up wells and other environmental initiatives.\u201d<\/p>\n\n\n\n

The network also notes: \u201cThe oil and gas industry contributes an average of $26 billion per year in taxes which goes to important civil services like health care.\u201d<\/p>\n\n\n\n

It adds: \u201cThe oil and gas industry invests the most of any other industry in the expansion of clean technology to produce reliable energy while lowering environmental impacts.\u201d<\/p>\n\n\n\n

And with the headline \u2018No free lunch for taxpayers,\u2019 a new study<\/a> from the Alberta government\u2019s Canadian Energy Centre finds detailed research lacking on where green subsidies will come from and how much will be needed to achieve net-zero goals. <\/p>\n\n\n\n

We leave you with sage advice<\/a> from Jack Middleton of CAPP:<\/p>\n\n\n\n

\u201cWhen you see vague reports and claims about subsidies, dig a bit deeper. The oil and natural gas sector is vital to Canada\u2019s recovery and contributes to communities across the country. We need to think about ways to attract more investment, not drive it away.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

A new report claims Canada’s oil and gas pipelines received over $23 billion in federal subsidies. 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