Subsidies to Fossil Fuel Companies

Year
2019
Number
B138
Sponsor(s)
Victoria

Whereas the Federal government recently released a scientific report that reveals that Canada is warming at twice the global rate, the Provincial government recently approved a 5.35-billion package of tax incentives for a 40-billion LNG Canada megaproject, supported by 1.275 billion from the Federal government, and, according to a 2015 report by the International Monetary Fund, the annual Federal government subsidy to the fossil fuel industry is 46 billion; And whereas the funding formula for local governments has changed little since 1867 with local governments receiving roughly 8 cents of every tax dollar leaving them unprepared for the emerging and significant costs of mitigation and adaption to climate change: Therefore be it resolved that UBCM call on the Provincial government to end all subsidies to fossil fuel companies and to invest the money instead in climate change mitigation and adaptation activities being undertaken by local governments in a predictable and regularized funding formula; And be it further resolved that the UBCM through the FCM call on the Federal government to end all subsidies to fossil fuel companies and to invest the money instead in climate change mitigation and adaptation activities being undertaken by local governments in a predictable and regularized funding formula.

Provincial Response

Ministry of Energy, Mines and Petroleum Resources The Government of British Columbia is actively supporting local governments to address climate change through initiatives under CleanBC. TheCleanBC Communities Fund supports cost-sharing of infrastructure projects in communities across the province. These projects will focus on the management of renewable energy, access to clean-energy transportation, improved energy efficiency of buildings and the generation of clean energy. In 2019, both the Federal and Provincial governments committed up to 63 million in funding for projects under this program. CleanBC outlines the British Columbias strategy to shift away from fossil fuels and towards clean and renewable energy and at the same time foster jobs and economic growth. The British Columbia Government does not provide subsidies to the fossil fuel industry. Royalty credit programs are used to encourage oil and gas investment in all jurisdictions and are mechanisms to recognize the additional cost associated with expensive resource development in remote and uncertain areas by receiving a reduced share on the Crowns production. The British Columbia Government is encouraging investment in LNG without giving subsidies or imposing significant costs on future generations. In March 2018, the British Columbia Government made a commitment subject to receiving LNG Canadas LNGC notice of positive final investment decision FID by November 30, 2018 to implement a framework to improve the competitiveness of the LNG sector. This framework did not involve the expenditure of public funds rather it allowed the province to attract 40 billion of new investment and 23 billion in new revenues over 40 years prosperity that will help pay for services for people. LNGC announced and gave notice of a positive FID October 1, 2018. The commitment was to prepare for Cabinet or Legislatures consideration 4 Measures intended to help improve the Projects competitive position: 1. Access to BC Hydros industrial instead of LNG electricity rate. 2. Provincial Sales Tax exemption for the construction of the LNG facility, along with separate Operating Performance Payments Agreement with the British Columbia government. 3. Repeal of Liquefied Natural Gas Income Tax Act and re-introduce a natural gas income tax credit. 4. Allow LNG facilities to participate in Clean Growth now CleanBC Industrial Incentive Program.

Convention Decision
Endorsed