B.C.’s carbon tax is jeopardizing cement plant jobs by giving unfair advantage to U.S. imports, critics say.
On Friday, B.C. Conservative Leader John Cummins added his voice to those in business and industry who have already called for the tax to be repealed.
Cummins said hundreds of high-wage jobs are imperilled.
“Foreign-made cement, which does not pay the carbon tax, now sells at a sharp discount to our own B.C.-made product,” he said.
Cummins said imported cement has soared from 6.5 per cent of the domestic market in 2007 to 34 per cent in 2012, while exports of B.C. product have plunged by at least half in the same period. B.C.’s three cement-kiln operations, including the Lafarge Canada plant near Kamloops, have had to reduce operation by as much as half as a result, Cummins said.
Environment Minister Terry Lake questioned the accuracy of those figures. Lake said the emission figures for those plants show no corresponding reduction.
“I’ve not seen anything to indicate production is down because of the carbon tax itself,” he said.
Lake said the finance ministry is reviewing the carbon tax, specifically looking at the issue of competitiveness. The results of that review are expected to be included in the February’s provincial budget.
The cement industry has high energy costs, which makes it particularly vulnerable, Lake noted. Absorbent Products, another Kamloops manufacturer, faces a similar situation.
“These are industries that have high energy needs and that are competing with other jurisdictions that don’t have the same costs.”
Some businesses have looked to alternative fuels or other means of cutting costs to compensate, he added.
Since the carbon tax was introduced in 2008, cement manufacturers have maintained that it threatens to wipe out the B.C. industry.
“We certainly have seen an increase in the market share coming in from the U.S.,” said Kevin Balfour, an Interior sales manager with Lafarge. “We have some big concerns over this.”
The Canadian Cement Association has been lobbying to have the playing field levelled through an import tax, he said.
“Our product is being penalized.”
Lafarge Canada’s plant on Shuswap Road employs about 50 workers but there are many more spin-off jobs in transportation, Balfour noted.
Last year, Kamloops Chamber of Commerce submitted a resolution to the B.C. chamber calling for the carbon tax to be scrapped.
Peter Aylen, president of Absorbent Products and past-president of the chamber, said half of B.C. chamber delegates voted to have the tax killed.
“We in B.C. are losing jobs to people in Alberta, Washington and China,” Aylen said
B.C. was seen as a trendsetter when it enacted the carbon tax, but the problem is that other jurisdictions haven’t followed the leader.
“The expectation was that everyone else was following suit,” Aylen said. “Nobody has.”
Lake said Australia enacted a carbon tax last year while emission regulations brought in by Ottawa are a form of carbon pricing. Alberta preceded B.C. by imposing a carbon tax on companies that emit more than 100,000 tonnes of greenhouse gases annually. Washington State is also considering a carbon tax, he said.
Aylen said the tax places a cost burden on everyone in B.C., including taxpayers, since government pledged to become carbon-neutral by purchasing credits.
“People do not realize how much it really affects them.”
Lake said the B.C. Conservatives haven’t explained how they would replace revenue if the tax were scrapped. Other taxes, such as income tax and the small business tax, would have to be increased to compensate.