Wednesday, July 24, 2013

New report claiming BC's Carbon Tax is working is actually full of hot air!

Sustainable Prosperity report runs out of gas when you check with Statistics Canada

Gasoline consumption in BC has NOT dropped 19% as claimed
When it comes to the alleged success of BC's unique Carbon Tax, the old adage that there are lies, damn lies and statistics comes to mind.

I have said it before and I will repeat it now - the Carbon Tax introduced by the BC Liberal government in 2008 is not having the predicted and desired effect that its fervent environmental supporters keep claiming.

The latest study comes from a group called Sustainable Prosperity, a network of economics and environment professors.

These good doctors certainly deserve points for putting the best possible spin on the BC Carbon Tax and getting their message out in the media.

"BC just had the guts to try it. And it's working," Elgie claimed to the CBC, which along with most other media duly repeated the study's conclusions without verifying them.

To be fair, here's what they say in their study:

"It finds that in the four years since the tax was introduced, BC’s per capita consumption of fuels subject to the tax has declined by 19% compared to the rest of Canada."  

"Based on a review of the available evidence, this paper concludes that BC’s carbon tax shift has been a highly effective policy to date. It has contributed to a significant reduction in fossil fuel use per capita, with no evidence of overall adverse economic impacts, and has enabled BC to have Canada’s lowest income tax rates. 

But I argue otherwise.

First, let me be clear that I strongly opposed the unfair and regressive Carbon Tax when introduced by the BC Liberal government under former Premier Gordon Campbell, including starting a Facebook protest group called "Axe the BC Gas Tax" that at one point had about 10,000 members.

Remember that not a penny of the Carbon Tax goes to environmental projects, public transit improvements or anything "green" - the only green is the colour of money that came from personal and corporate tax cuts to balance the cost of the Carbon Tax.

What is clear is that Sustainable Prosperity has cherry-picked numbers that appear to justify its arguments in favour of the Carbon Tax.  Note that it is using "per capita" consumption not actual consumption.

Here's the biggest single factor - and major target - for the Carbon Tax - the gas you use in your car, truck or motorcycle.

As you can see below from easily available Statistics Canada data, BC's gas consumption has dropped by a minuscule 26.2 thousand cubic metres since 2008. 

You can also see that gasoline consumption was higher in 2011 than in 2008 by a small margin - despite the Carbon Tax being at almost full strength by that point!

Most importantly, you cannot see an 18% drop in gas consumption, or it would have fallen by a massive 860.66 thousand cubic metres!

Here's the data:

Motor Gasoline consumption - British Columbia in thousands of cubic metres, from Statistics Canada:

2012 - 4,503.6 

2011 - 4,536.8

2010 - 4,695.7

2009 - 4,636.0

2008 - 4,529.8

2007 - 4,629.9

2006 - 4,581.5

2005 - 4,638.1

2004 - 4,892.4

There's another major factor at play - the international oil market and it's effect on gasoline prices in BC.

The folks at have very useful charts on historical gas prices in this province.

If you look at their 5-year chart you will find that gas prices have skyrocketed from a low of 77 cents a litre in November 2008 to current rates in July 2013 of 140 cents a litre - a whopping 63 cent a litre difference - or almost 10 times the total of BC's current 7 cent a litre Carbon Tax.

BC gasoline price per litre:

November 2008 - $.77 

July 2013 - $1.40

So if consumption did go down - even if slightly - it's far more attributable to huge price increases than to the Carbon Tax.

That's without considering the effects of other factors - particularly the changing economy that reduces consumption when times are tougher.

Those who believe in the BC Carbon Tax will, of course, disagree with me and keep pumping up a tax that hurts lower income earners and northerners the most while doing nothing to keep people from driving.

But the numbers are clear - gasoline consumption fluctuates a little year to year but keeps at a very high level indeed, with the Carbon Tax having effectively no impact on use.



DPL said...

How could gas consumption drop that much? Still need to go to town, work etc. The transit system are years behind where they should be.Just more BC Liberal BS. I seem to recall the folks in the interior who were against the tax, majority voted Liberal

Anonymous said...

Carbon offsets has little to do with it.
Major recession over the last 5 years.
Significant increase in fuel effeciency in vehicles.
Tons of folks buying south, including me.
Nothing but minimum wage McJobs left thanks to the Libs and Fed NeoCons.

Anonymous said...

AND ... you pay 5% GST on your Carbon Tax!

(I thought this was incredible so I e-mailed my MP in late May who nearly two months later confirmed it)

Anonymous said...

Reason why they voted Liberal in the interior is that they did not want to lose good paying jobs in mining and also the stupid move that Adrian Dix made to appease Lower Mainland eco-freaks in saying he would not support the Kinder-Morgan pipleline expansion did the NDP in.

Had nothing to do with the carbon tax.

I'm against this tax but would not vote NDP. No way.

The NDP in the 1990s did not rescind the layered taxes on gasoline in the Lower Mainland. Infact they did add and increase gas taxes in the GVRD to benifit their own creation Translink.

Anonymous said...

and how many went to wa state for gas thats about a dollar less a gallon.?

Stephen Leahy said...

Bill you compared total gas consumption not per capita which is what the study did. Secondly gas prices went up across Canada over past 5 years and per capita gas consumption went up 1.5% despite the high prices.

Anonymous said...

The province of British Columbia does not set world oil prices and carbon comes from more than one source. Using November of 2008 as a comparison is nonsense as the world economy, and oil prices, were both in a free fall.

Bill, what will your NDP do about the carbon tax if you are elected in 2016?

Anonymous said...

What would the NDP do? Simply tell the voters it would be cancelled (to get votes) but after 10 months they're elected they will approve some similar tax based on the idea that BC must be green to reduce car useage on Lower Mainland streets.