Dr. Qureshi: Provincial government uses taxpayer money to mislead public on Clean Fuel Regulations

June 30, 2023, Traditional territory of the Wabanaki Peoples/Fredericton – The Conservation Council of New Brunswick is deeply troubled by the provincial government’s inappropriate use of taxpayer money on a misleading advertisement in the June 29 edition of the Telegraph Journal regarding the federal Clean Fuel Regulations and the expected 8 cent hike in gas prices in New Brunswick on July 1.

“The 8 cent rise in gas prices New Brunswickers see in July is a direct result of the ‘carbon adjuster’ loophole put in place by the Higgs administration,” said Dr. Moe Qureshi, Manager of Climate Solutions at the Conservation Council of New Brunswick.“Yet, this same administration seeks to use misleading advertisements to blame the federal Clean Fuel Regulations, despite the fact that they were designed to give petroleum producers several options for eliminating pollution without the need to impose extra costs on middle-class consumers.”

The loophole created by the provincial government—known as the “carbon adjuster”—enables oil refineries to shift costs to consumers for cleaning up their fuel. The Energy and Utility Board approved this loophole less than a month ago, on June 13, authorizing oil refineries to charge consumers for the expenses related to pollution reduction, rather than investing in clean fuels, technologies, and processes themselves.

In the paid advertisement, the provincial government also deliberately lumps the Clean Fuel Regulations and federal carbon tax together, creating further confusion. These are two entirely separate regulations.

The federal carbon tax is a general tax on carbon that applies to anyone using fossil fuels. However, the revenue generated from the carbon tax is returned back to the provinces and territories where the tax was collected. In New Brunswick, this amounts to $368 in October 2023 and $184 quarterly payments in January 2024 for a family of four. In contrast, the federal Clean Fuel Regulations only apply to oil refineries and primary suppliers. Despite this, as a result of the province’s loophole, oil refineries are now allowed to pass on the cost to New Brunswickers.

“The decision by the provincial government and the New Brunswick Energy and Utility Board to allow petroleum producers to transfer compliance costs to consumers demonstrates a willingness to put industry interest ahead of the interests of New Brunswickers,” Dr. Qureshi added.“With energy poverty on the rise in Atlantic Canada and the impacts of climate change pressing urgently, New Brunswick needs to address the root of the problem – oil refineries that produce greenhouse gasses, not undermine federal climate policies.”

For further clarification, see our supporting evidence: 

  • From 2019 to 2022, New Brunswick oil refinery profit margins increased by 297 per cent. While consumers are being burdened with higher fuel costs, oil refineries enjoy excessive profit margins without any obligation to return the excess revenue.
  • More than one-third of New Brunswickers live in energy poverty, meaning they have to spend an unsustainable proportion of their monthly income on energy costs. It is both unreasonable and irresponsible for petroleum producers to pass on the costs of their inaction to consumers, particularly during a time when record profits are being reported.
  • The Clean Fuel Regulations only affect oil refineries and primary producers of oil. It does not affect distributors such as local gas stations.
  • Oil refineries have until July 2024 to comply with the regulations. In light of this, there is no immediate need to raise costs. They have a full year to make the necessary adjustments to meet compliance requirements or purchase credits to offset their emissions.
  • The Clean Fuel Regulations were the result of a seven-year negotiation process involving input from provinces, industry representatives (including Irving Oil), and environmental stakeholders. Oil refineries have known about these regulations for several years and had time to improve their operations.
  • The Clean Fuel Regulations only affect local oil consumption within Canada. It does not apply to exports. Irving Oil mentioned that 80 per cent of their oil is exported to the U.S. and that they are losing a significant portion of credits. However, this means they only need to clean up 20 per cent of their fuel which is used in Canada.

For more information or to arrange an interview, please contact:

Corey Robichaud, Communications Manager, Conservation Council of New Brunswick | corey.robichaud@conservationcouncil.ca | 506.458.8747

Moe Qureshi, Manager of Climate Solutions, Conservation Council of New Brunswick | moe.qureshi@conservationcouncil.ca | 506.458.8747

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