Carbon charges on large N.B. greenhouse gas emitters called 'surprisingly low'

The Irving Oil refinery and a group of other large facilities in New Brunswick that released up to 3.84-million tonnes of carbon dioxide in 2019 are being assessed federal carbon charges on less than two per cent of that amount, according to recent figures released by Environment and Climate Change Canada.

"I think it's a very low number," said environmental economist Dave Sawyer, who reviewed the New Brunswick carbon charges.

"It's quite low. Surprisingly low."

National carbon pricing in Canada began in 2019, but emission levels and charges to large industrial and other operations for that year have only recently been finalized and publicly released.

Carbon charges in 2019 were set at $20 per tonne of emissions, however, revenue from large New Brunswick facilities for that year, not including N.B. Power generating stations, is listed at $900,000.  

That is the price of levying a charge on just 45,000 tonnes of emissions, or 1.2 per cent of what the full group of New Brunswick facilities actually released

It is also equivalent to charging less than 30 cents per tonne on the group's total emissions. 

Irving Oil Ltd.'s refinery in Saint John, which has a production capacity of 320,000 barrels per day, is the dominant figure in the group. It had emissions of 2.98-million tonnes of carbon dioxide on its own in 2019, about three-quarters of the total.  

However, there is no specific information about how much of the $900,000 carbon bill, if any, belongs to it.   

The company did not respond to a request for information about its emissions and assessed charges.

Sawyer, a consultant with EnviroEconomics in Ottawa and an expert on carbon pricing in Canada, said the refinery is too large not to be the cause of the unusually low carbon bill for the group and suggested policy makers should review what is happening.

He said it is possible for the refinery to be emitting less than targets set for it by the federal government and paying no carbon costs as a result, which would raise a question about its targets.

"There's a lot of emissions coming out of there and we're not pricing them," Sawyer said. "On an average cost basis, we're not pricing them.

"There's an open question about whether or not, you know, is that the right benchmark? Do we have the right emission intensity for the facility? Is it over-performing whatever the benchmark is?"