The carbon tax is often discussed with such politicized fear and anguish that it can be easy to lose track of the facts surrounding it and why it is being implemented.
The carbon tax will affect many industries and individuals, in what ways depends on how much carbon you depend on in your life.
The more carbon you use, the higher your carbon tax will be.
But how will the carbon tax affect me?
Is there anything I can do to reduce my carbon tax?
We will touch on all this and more. First let’s do a quick recap of the carbon tax.
Starting January 1, 2017 a carbon levy will be assessed at a rate of $20/t onto all fuels that emit greenhouse gases.
This rate will escalate to $30/t in in 2018.
If Alberta does not develop its own escalation beyond this then it will be forced to comply with the Federal Carbon Tax which stipulates that by 2022 price on Carbon shall be $50/t.
How will this tax affect every day goods and services? According to the Alberta government the effect on fuels will be as follows:
This means if you drive truck with an 80L tank and fill it once every week, that will result in an extra tax of $93/yr.
In addition to fuel price increasing, certain goods are expected to increase as well since there will be downstream effects of the carbon tax.
The CBC estimates that your grocery bill may go up by 1.5% in 2017 and 2.25% in 2018. This is based upon a 1.2% estimate from a 2012 article written by Ottawa economist Nicholas Rivers. This 1.5% is a fair estimation for our Alberta market given that many food items are brought in from out of the province and won’t be subject to the tax (only the downstream effects will such as the fuel to transport said items).
How this affects every Albertan will naturally vary.
CBC profiled 6 Albertan’s with an average carbon tax cost of $91.50/yr in ($7.63/mo), and $137.25/yr in 2018 ($11.43/mo).
Trevor Tombe, a University of Calgary economist outlines a similar story:
Although Trevor’s graph might look scary at a glance, his numbers and trends are not.
The average Albertan which earns 50k-60k/yr and does not pollute very much will be net positive. The top earners in the province (earning $100k-$120k/yr) will pay a net $7.5/month more in 2018 and the top TOP earners (>$140k/yr) will only have to pay $42/month which is not likely that big of a financial hindrance to those with six figure salaries.
$7.50/month is not that much. I am FAR from being in the 1%, but even I have a spare $7.50 every month. That’s only 2 Starbucks coffees/mo, or one burger at McDonalds/mo, or 1 fewer cases of beer every 4 months.
A very small price to pay for generating clean technology innovation.
If you make less than 47.5k per year you will receive a rebate, and similarly, if you have more kids or more dependents then you will receive a larger rebate. Over 66% of Albertan's will receive a carbon tax rebate in 2017.
Many Albertans will actually make money from the carbon tax since their rebate will be greater than what they pay. Granted, these are only a select few Albertans who truly need it the most.
But many people aren’t even concerned with the cost. They just want to know whether this will benefit the environment of be another cash grab from The Man.
This is one of the primary points of contention for carbon tax naysayers – will the revenue actually be spent on helping the environment?
Of the 9.6Bn which is expected to be generated:
-2.3 billion will go to rebates for low-income families.
-865 million will allow for the small business tax to be reduced by 33% from 3% to 2%.
-3.4 billion for large scale renewable energy and technology (like utility scale solar power)
-2.2 billion for green infrastructure like public transit which is moving in the electric direction
-645 million for a new provincial agency to support energy efficiency programs
-195 million to assist coal communities, indigenous communities and others transition to a green economy
From this breakdown by the GoA, it is clear where their intentions are.
This carbon tax is mean to provide an incentive to produce less emissions. Similar to how you get a ticket when you’re speeding so you have an incentive to not speed anymore. The carbon tax will stay in Alberta, and it will help the environmnet through indirect means such as investment in green technology.
There are a number of exemptions from the carbon tax which are often forgotten. The following list are fuels which will not be affected:
· fuels on eligible First Nations communities
· market gasoline and diesel on farms
· inter-jurisdictional flights
· fuel for export
· industrial exemptions where fuel is not combusted
· natural gas produced and consumed on site by conventional oil and gas producers
· heating fuels on sites specific to SGER
But most of these aren’t every day fuels that you and I run into, so let’s take a look at how we will be affected.
Earlier I mentioned a conservative estimate for carbon tax effect will only be $13.25/month.
This value does not instill the fear that many carbon tax naysayers would like you to believe.
If you would like to calculate exactly how much your carbon tax will be check out the CBC’s Carbon Tax Calculator.
This is something people don’t often think about but it is very possible to reduce your carbon tax.
Quite simple really, all you have to do is reduce the amount of carbon emission-intensive fuels you use throughout your life. We broke it down into 2 categories, Driving/Travel and Home:
1. Drive Less – By using less fuel you will directly lower your carbon tax. We’re not suggesting you need to bike to work every day (although that would be a tremendous help, we realize it is not practical for everyone), but even carpooling to work once or twice a week or taking public transit every now and then will reduce your carbon tax.
2. Fly Less – Plan your vacations and holidays to minimize the amount of flying if possible. Obviously this is not applicable 100% of the time, but it all adds up when you can exercise it.
3. Ride Share – Uber has made it incredibly easy to ride share and carpool regularly. If you have never used Uber before, click this link and get your first ride for FREE.
4. Keep Tires Inflated – Keeping you tires inflated to the proper level can improve your mileage up to 3%. According to the US Department of Energy under-inflated tires can reduce mileage by 0.2% for every 1psi drop in pressure. When was the last time you checked your tires?
5. Drive an Electric Vehicle – Selling your current car and buying a Tesla is not very practical, BUT when it does come time to get a new vehicle, think about an electric one. Chevy, Nissan, Ford, and many other manufacturers have electric or hybrid options that won’t break the bank. Check out the good folks at Westgate Chevrolet if you're in the market for a new vehicle. Plus, if you charge your electric vehicle with solar panels, you will not be subject to any carbon tax.
6. Route Planning – Often we get stuck in our habits and set driving paths that may be inefficient. Plan your route to take the shortest path, double check with Google Maps to be sure.
7. Trip Planning – If your household has more than 1 vehicle, use the more fuel efficient one when possible. Combine trips whenever possible to minimize the amount of driving you do.
8. Smooth Driving – You’re not 16 anymore, no need to show off how fast you can go off the line. Accelerating sharply and braking hard will use more fuel than slow smooth driving by up to 33% according to the US Department of Energy.
9. Use Cruise – When you’re driving on the highway, use cruise control (weather permitting of course).
10. Don’t Speed – Mileage tends to start working against you at high speed. Keep your speed in check and you won’t have to worry about the carbon tax as much.
11. Remove your Thule – If you’re not actively hauling with your Thule, or roof mounted cargo box then remove it. The additional drag can reduce your fuel consumption by up to 25%.
12. Travel light – Haulingexcess weight will negatively impact your mileage.
13. Turn Engine Off – Try to not idle as much. We are all guilty every now and then of running our cars/trucks in the winter when it’s cold, but be mindful of how long you are idling for. More idling = more carbon tax.
14. Stay Tuned – Keep your vehicle tuned up will help its function all around. If you have a serious issue such as a faulty oxygen sensor it may reduce mileage by up to 40%.
15. Oil – Make sure you oil is the right type, especially during the winter months.
16. Keep it Warm – If you don’t have a garage, then keep your vehicle plugged in during the winter to reduce your carbon tax. It will start easier and won’t require as long to heat up.
17. Programmable Thermostat – Set your heat to your exact liking. Make it lower at night or when you’re away at work or on vacation.
18. Smart Thermostat – Smart thermostats allow you to set your heat to various temperatures on the fly or on a set schedule. Many can be programmed right from your phone.
19. Furniture Placement – Don’t block vents with pieces of furniture, allow for air flow and you won’t waste as much heat.
20. Get a Laptop – Elect for a laptop instead of a desktop computer. They’re more convenient and typically draw less power.
21. Go Electric – Convert your appliances, furnace and water heater to electric rather than gas. Electricity prices will not be subject to the same carbon tax that gas will be so if you have an electric water heater paired with solar energy, you won’t pay any carbon tax. Solar panels can reduce your fuel consumption by up to 100%.
22. Water Tank Insulation – Wrap your water tank with an insulated covering to reduce amount of heat dissipation.
23. Solar Hot Water – Use a Solar Thermal system to reduce the amount of energy you use to heat your water.
24. Appliance Choice – Use electric appliances when possible over gas appliances.
25. Appliance Replacement – When it does come time to replace your appliances, go for the more energy efficient option, preferably electric.
26. Window Replacement – When its time, look into high efficiency or triple-pane windows.
27. Curtains – Having (thick) curtains over poorly insulated windows can help reduce the amount of heat energy that escapes
28. LEDs – LED lights have come down in price in the last few years making them cheaper in the long run compared to standard bulbs. Although electricity isn’t subject to the carbon tax as sharply as gas, it is good practice to use LEDs.
29. Get an Energy Audit– If you want to find out where your house could be more efficient an energy audit is right for you. If your windows or building envelope are leaking heat, then you are using more fuel and paying more carbon tax than you have to.
30. Unplug – When devices aren’t in use, unplug them. Devices such as computers, TVs and phone chargers have a ‘phantom load’ which means they draw power even when sitting dormant.
31. Grill Usage – Watch how long you preheat your grill for. Like idling you vehicle, this is a fuel waster. Make sure you turn off your grill dial AND your valve to reduce your chances of leaking fuel.
32.Grill Type – Use an electric range when possible for certain items like vegetables as the more propane you use, the higher your carbon tax will be. You don’t need to stress about this too much though, as the amount of barbequing most of us do pales in comparison to some of the other carbon emission intensive habits we have.
33. Green Energy – If you don’t want to install solar panels on your home you can offset your energy with Green credits. Many energy retailers offer this service.
34. Green Gas – Using green natural gas is a newer fuel that will directly reduce your carbon tax.
35. Don’t Waste Food – It is predicted that food prices may increase by 1-2% due to downstream effects of the carbon tax. If you waste less food, you won’t be paying extra carbon tax for nothing. Doing smaller trips to the grocery store will help alleviate this (See point 6 to ensure this doesn’t work against you).
36. Buy Fewer Products – Use this list of DIY Green Cleaning Recipes to reduce the amount of products you purchase.
37. Waste Less – Using cloth napkins as oppose to paper towel will mean you buy fewer products and are subject to less carbon tax.
38. Save Paper – Print using double-sided setting. This will save paper and in turn result in less spending which may be subject to downstream effects of carbon tax.
39. Save Water – Don’t buy bottled water, use a pitcher and keep it in the fridge. Purchasing more items will only further your risk of paying more carbon tax than you need. The excess plastic does not help the environmental issues at hand either.
40. Cold Water – Use cold water for washing your clothes and dishes. Less heat = less carbon tax.
41. Less Water – Take shorter showers to reduce the amount of hot water you use. If you take cold showers then this won’t directly help your carbon tax, but it will reduce the amount of water you use which is good anyways.
42. Air Dry – Air drying your clothes will use less energy to heat your dryer.
43. Have a Child - Technically you could have another child to reduce your tax by increasing your rebate, but I don’t recommend having a child to become more financially secure. Although not a practical means of generating more money, this is now a hidden bonus of having a child.
44. Farm Incentives - If you’re a farmer, take advantage of the many Growing Forward 2 incentive programs, including Growing Forward 2 – On Farm Solar PV.
45. Home Incentives - For homeowners, keep your eyes on Energy Efficiency Alberta. This new agency will be releasing efficiency and energy incentives for homes such as
a. Free installation of efficiency products (lighting, water fixtures, etc.)
b. Rebates for efficient appliances, lighting and insulation
c. High efficiency retrofits of lighting and heating/cooling,
The carbon tax revenue will be directly spend on benefiting the economy and environment, both which are in a terrible downturn.
Given our current emissions generation profile we need to take some steps in the right direction and like it or not the carbon tax is just that.
There are plenty of tangible measures you can take to reduce your carbon tax, we hope you use our list of 45 suggestions on how to reduce your carbon tax.
Clean air, a green economy and innovative technology has its price, and that price is less than $10/month.
Questions, comments or concerns? We would love to hear your thoughts on this.
Hit the buttons below to contact us/get a free solar quote or to read more articles.