What exactly will Bill 1 look like, and what will it mean?
By Ricardo Acuña
Now that Albertans have handed Jason Kenney and the United Conservative Party a decisive majority—both in terms of number of seats and popular vote—Kenney and his team will need to quickly move from campaign to governance mode.
This means facing the daunting task of figuring out how to go about actually implementing the myriad promises contained in the UCP’s 119-page platform, and what unforeseen impacts will arise out of that implementation.
Kenney’s promised Bill 1, the Carbon Tax Repeal Act, seems straightforward—get rid of Alberta’s carbon levy and the Climate Leadership Plan (CLP). How it is written and implemented, however, has the potential to trigger numerous other effects for the government’s larger goals to revitalize the economy: getting the TransMountain Pipeline Expansion (TMX) built, and improving affordability of life for Albertans.
It is a good bet that as soon as Alberta repeals its own carbon tax, the federal government will move quickly to implement its own carbon tax in the province. Albertans will continue to pay a carbon tax, only after Bill 1 they will be paying that tax to Ottawa rather than to Alberta.
Furthermore, the cancellation of the CLP will mean that the two-thirds of Alberta families that currently receive a carbon tax rebate will lose that revenue entirely.
It also means that all of the Alberta farms, families, and businesses that were benefiting from funding to install solar panels and undertake other energy efficiency measures will lose that funding.
It is unclear what exactly that loss of financial activity will mean for the economy—but the impact will certainly not be positive.
Kenney has promised that if the federal government imposes a carbon tax on Alberta, his government will sue the feds, but those kinds of suits are expensive, take years to wind their way through the courts, and rarely succeed in the end.
So barring a Conservative Party of Canada victory this federal election—which is possible but by no means a sure thing—Albertans will be paying the carbon tax for a long time to come, without the benefit of rebates or energy efficiency funding.
The larger unknown is what exactly the repeal of the CLP will mean for the prospects of the TransMountain Pipeline. When the federal cabinet approved the project back in 2016, Justin Trudeau made clear that the approval would not have happened were it not for Alberta’s comprehensive climate plan.
Given that assertion, there exists the possibility that scrapping the CLP could result in the federal cabinet revoking their previous approval of, and support for, TMX. That, combined with Kenney’s promised cancellation of the province’s crude-by-rail initiative, would seriously hamper the UCP’s ability to deliver on their promise of market access and expanded oil sands production.
This is all exacerbated by the fact that almost immediately after the Alberta election, the Quebec National Assembly unanimously reiterated their opposition to any new pipeline carrying Alberta oil traversing their province.
The government of British Columbia followed suit by making it clear that if Kenney implements the “turn off the taps” legislation, which he has promised to do, they will immediately challenge it in the courts as unconstitutional, a challenge that B.C. is very likely to win.
The one outcome that is certain from the passage of Bill 1 is that there will be a significant escalation in anger and vitriol from Alberta directed at the federal government, Quebec, and British Columbia.
Although that would be nothing new for Alberta, it would seriously jeopardize Kenney’s plans to work together with the feds and other provinces to rewrite the equalization formula.
There is clearly a high degree of uncertainty around all these issues. Repealing the Alberta carbon tax will likely end up having a negative effect on Albertans’ pocket books, and there is potential for it to result in negative economic impacts overall.
It might make sense logistically for Kenney to hold off on Bill 1 for a while, or at least write it in a way that puts off its implementation until some of the uncertainties are settled, but the political imperative is likely too strong for that to even be a consideration.
It is hard to see a tangible upside for Kenney, and for Albertans, from his proposed Bill 1, and it is likely to be only the first of many challenges he will face in figuring out how to operationalize the many promises of the UCP platform.
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