Re: About LNG subsidies (published Oct. 19 online.)
When the government of B.C. introduced its LNG Framework in March 2018, it allowed the LNG industry to be treated the same as other industries in B.C.; the same as forestry, mining and the pulp and paper industry.
The LNG Framework means that LNG plants, which use clean, renewable energy from BC Hydro, will be charged the industrial rate for that electricity.
This means LNG projects will pay the same price for electricity as other large industrial customers in B.C.
It also means that B.C. can build some of the cleanest LNG facilities in the world. By powering its facility with electricity from B.C., Woodfibre LNG is reducing its greenhouse gas emissions by more the 80 per cent.
The LNG Framework removes the special LNG tax. This was a tax specific to only the LNG industry, and by removing this tax the B.C. government ensured the LNG industry also ensures LNG is being treated the same as all other industries in B.C.
The LNG industry will pay all of the same taxes as every other industry in B.C., including PST and the carbon tax.
It should be noted, B.C. is the only jurisdiction in the world, other than Norway to charge a carbon tax on its LNG industry.
British Columbians should want to attract industries to B.C. where they will operate within our province’s strong environmental regulations. If we discriminate against individual industries, we encourage them to set up elsewhere, with lower taxes and fewer environmental regulations.
This results in carbon leakage.
Carbon leakage happens when industries set up somewhere else because they can’t compete globally with other countries producing the same product. This doesn’t prevent carbon emissions, it just moves them somewhere else and could increase overall emissions because that industry will now operate without environmental regulations that would limit emissions.
We need to think globally when it comes to reducing emissions.
The fabricated industrial steel modules that are required for LNG facilities could not be built in time here in Canada to be ready in time for the projects that are now under construction or will be in the next year or two.
Tens of thousands of tonnes of Canadian steel and thousands of steelworkers and trades workers will still be needed in B.C. across Canada to build LNG facilities.
- Gillian Robinson
Director, BC LNG Alliance
