By: Dana Wagner on
Stephen Harper, Prime Minister and Conservative MP for Calgary Southwest, during Question Period on December 9, 2014
It took one country to disprove this statement: Norway.FactsCan Score: False
In response to a question in the House of Commons from NDP environment critic Megan Leslie, the Prime Minister defended his decision not to have a carbon tax to control greenhouse gas (GHG) emissions by arguing that Canada cannot pursue a unilateral set of regulations. Stephen Harper said, “Nobody in the world is regulating their oil and gas sector.”
To check if this statement is true, we must consider what counts as a regulation of the oil and gas sector.
Methods for regulating this sector for the purpose of controlling GHG emissions include cap and trade systems, and carbon taxes – both forms of carbon pricing. Other approaches include subsidies reductions, general fuel taxes, energy efficiency standards and labeling programs to help consumers make informed decisions, but policy makers tend to implement these economy-wide and not in one targeted sector. Sticking with sector-specific regulation then, let’s assume Harper meant either cap and trade or carbon taxes.
Second assumption: that Harper meant national governments by “nobody,” even though in many countries, including Canada, both national and sub-national governments have the jurisdiction to implement regulations in the oil and gas sector.
And we find that more than one national government has carbon pricing for oil and gas.
Norway has implemented carbon prices that vary by sector, but the highest peg is at $71 per tonne for the oil and gas sector. The price covers an estimated 50 per cent of total GHGs and was expected to generate $1.42 billion in 2013. A fun fact from Norway: revenue gets deposited in the Government Pension Fund. A second and more significant fact from Norway: it is among the top natural gas exporters in the world.
Mexico’s carbon tax, implemented in 2014, is a tax on the additional emissions (on sales and imports) from using certain fossil fuels over natural gas.
And the European Union has a cap and trade system introduced in 2005 that covers a range of industrial facilities including oil refineries and power stations. Among the countries bound by this are oil and gas producers like the UK, the Netherlands and Denmark (and non-EU member Norway).
Even in the most limited interpretation of Harper’s statement, it is false that “nobody in the world is regulating their oil and gas sector.” Mexico has implemented carbon pricing that impacts the oil and gas sector, and Norway’s offshore petroleum sector is that country’s highest taxed.