Gas prices in Airdrie are lower today, as the federal government has set the fuel charge on gasoline and other fuels to zero.
The change occurred today, following a March 15 Order-in-Council amending the Greenhouse Gas Pollution Pricing Act to set fuel charge rates for all fuels and combustible waste to zero. While this adjustment temporarily halts the consumer fuel charge, the Act itself remains in force, allowing the federal government to adjust rates in the future without needing new legislation.
Days after the Order-in-Council was published, gas prices in Airdrie and other parts of Alberta climbed to 155.9 cents per litre at many stations, leading to frustration among residents.
At the time, Patrick De Haan, head of petroleum analysis for GasBuddy, said the spike had nothing to do with carbon pricing and was instead linked to the seasonal switch to summer gasoline blends. This annual change typically pushes prices higher in the spring due to stricter environmental regulations and more costly blending components.
"That big jump has to do with the changeover to summer gasoline, which has now occurred,” De Haan said on March 20.
He also forecast that, once the fuel charge dropped to zero, drivers could see a rollback of up to 18 cents per litre, though he warned that oil prices, refinery issues or global economic factors could offset some of that savings.
"I still think we will see sizable savings of probably well over 10 cents a litre by the time April rolls around," he said.
At the same time, De Haan cautioned that unforeseen factors could continue to influence prices at the pump, even with the federal rate now set to zero.
Political fallout and future uncertainty
While the current fuel charge has been set to zero, political and legal questions remain about how long the pause will last.
"Now the biggest question is, how long will that pause last? Will it be shifted? That’s going to be a bigger question, certainly subject to the eventual election, whether or not the entire carbon tax is rescinded by Parliament, or if the pause just continues, or if the carbon tax could be shifted in some way," De Haan said previously.
While the consumer fuel charge is now set to zero, industrial emitters remain subject to carbon pricing under the Greenhouse Gas Pollution Pricing Act. That could eventually affect consumers in other ways.
"There is already an industrial carbon tax; that is a legitimate question of: will the Canadian federal government decide, depending on who wins the election, whether this carbon tax will be shifted in some way or form?" De Haan said.
He explained that if the carbon tax burden is moved up the chain, consumers could still feel the impact.
"Because, if it is somehow moved up the chain, it will likely be funneled back to the end consumer, because oil companies do not make enough to offset a carbon tax," he said. "It would essentially be like your company, paying your taxes on your behalf. It just is unobtainable for oil companies to pay that tremendous amount of tax and be able to survive as a business entity."
De Haan warned that if this happens, the costs will not simply disappear.
"If the burden is shifted onto businesses, they likely would not be able to digest it, and again, it would end up being paid by the end consumer," he said. "So that is something we'll have to wait on. Obviously, right now, we can speculate all we want, but we really won’t have a firm answer on that for some time."
What Happens to the Canada Carbon Rebate?
One final rebate payment is still scheduled before the end of April.
For Alberta, the quarterly base rebate amount is:
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$225 for an individual
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$112.50 for a spouse or common-law partner
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$56.25 per eligible child under 19
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$112.50 for the first eligible child in a single-parent household
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$45 per quarter for rural Albertans (additional supplement)
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