Big Oil & Ecofiscal Colluding on Carbon Tax?

The carbon tax, once a non-starter with Canada’s oil industry, is now widely supported by its biggest players. The relatively recent about-face culminated in a 2015 industry show of solidarity with Alberta Premier Rachel Notley when she announced Alberta’s carbon tax. Although many received the news positively, some were left scratching their heads. Why did big oil make such a radical shift? A newly released private document exposes the plan – big oil is trying to buy the debate and is gunning to get our carbon tax dollars “recycled” back to them.

This industry push comes at a time when Prime Minister Justin Trudeau is prioritizing his plan to implement a federal carbon pricing plan while simultaneously seeking to appease the oil industry with support of the Kinder Morgan pipeline and middling statements like “…you can’t make a choice between what is good for the environment and what is good for the economy…. We can’t shut down the oil sands tomorrow. We need to phase them out. We need to manage the transition off of our dependence on fossil fuels.” Selling the patently contradictory goals of cutting our carbon footprint and building pipelines to extend the life of the tar sands is no easy task.

Enter Canada’s Ecofiscal Commission. Formed in 2015, the self-appointed “commission” frames itself as independent, non-partisan and designed to serve policy makers and government. Yet the group is neither a sanctioned Canadian government organization nor has it been “commissioned” by anyone. Rather, the group of carbon price advocates is made up of a combination of university economics professors, moneyed private foundations and tar sands proponents like Suncor Energy and TD Bank, with interests that are anything but “eco.”

Despite its funding sources, Ecofiscal has carefully crafted its advisory board and messaging to present itself as an impartial arbiter of facts, united by a belief in the necessity of some form of carbon pricing. Well financed videos, lengthy research reports and a steady flow of media releases have unquestionably portrayed the organization as an unbiased voice in Canadian carbon pricing policy.

But a brief from the oil industry’s lobby group – the Canadian Association of Petroleum Producers (CAPP) – obtained by Greenpeace Canada through a government of Saskatchewan freedom of information request exposes how big oil, its industry association and big oil funded think-tanks like Ecofiscal come together to try to influence public policy. Adopting Ecofiscal’s “revenue recycling,” CAPP argues in the brief that carbon tax revenues – designed to counter green house gas emissions caused largely by the oil industry – should be “recycled” right back to big oil.

CAPP’s brief on the use of carbon tax revenues troublingly states that “[a]ny pricing mechanism implemented should contribute to a vibrant and competitive oil and gas sector …” and “…recommends that any policy initiatives undertaken by the government should seek to not only preserve, but enhance the economic competitiveness of the upstream oil and gas sector” [emphasis added].

In response to the public release of the private document, Bruce Cheadle of The Canadian Press reported that CAPP’s Manager of Environment & Policy, Krista Phillips, said in a telephone interview, that the industry association is taking its cue from Canada’s Ecofiscal Commission and promoting the “recycling” of revenues back to big oil.

Is Ecofiscal acting as a front for big oil to provide legitimacy to diverting carbon tax revenues back to the oil industry and draw out tar sands exploitation? While CAPP reportedly suggests that they do, Ecofiscal is more opaque. In their 2016 report “Choose Wisely: Options and Trade-offs in Recycling Carbon Pricing Revenues,” they include “providing transitional support to industry” as just one of their six key “revenue recycling options” that they deem as a priority of the provincial governments in allocating carbon tax revenues.

What is clear is that Ecofiscal is not commissioned by any government, is not a Canadian government organization, is funded by big oil and is relied upon by oil advocacy groups. It’s time for Ecofiscal to come clean on their ties to dirty oil and to stop misleading the public with their phony name. That’s why we are calling on Commissioners and Advisory Board members to stand up to big oil by stepping down from Canada’s Ecofiscal Commission.

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