The Saskatchewan Environmental Society (SES) reacted strongly on Tuesday to news that Premier Scott Moe is cancelling industrial carbon pollution pricing, with SES board members saying that not only does the move leave the province weaker on its climate change strategy and less well-placed for future energy initiatives — it's also illegal.
Industrial carbon tax pollution pricing in Saskatchewan is administered through the Output-Based Performance Standards Program (OBPSP), which was approved in 2023. As of April 2, Saskatchewan's government media site still lists the OBPSP as a "key component of Prairie Resilience," and claims it has been highly effective.
“The cancellation of the Output-Based Performance Standards Program on industrial greenhouse gas pollution in Saskatchewan leaves a gaping hole in Saskatchewan’s climate change strategy, Prairie Resilience,” said Peter Prebble, an SES board member.
“It also brazenly violates federal law and undermines Canada’s commitment to the rest of the world to reduce nation-wide greenhouse gas pollution 40% by 2030.”
Under the OBPSP, big emitters only pay for greenhouse gas emissions that go above a certain threshold. Thus, the OBPSP creates incentives to cut emissions while keeping costs low for businesses. Large-emitter pollution pricing systems across Canada, like the OBPSP in Saskatchewan, are projected to be responsible for more than one quarter of Canada’s greenhouse gas emission reduction over the next five years.
By cancelling the program, the provincial government is set for a revenue loss of more than $400 million, less than two weeks after introducing a provincial budget it said had a razor-thin surplus of $12 million. It also leaves uncertain the fate of the Saskatchewan Technology Fund, which is funded by the OBPSP and announced its second intake of $50 million in January.
The Environment Society said that cancelling industrial carbon pollution pricing in Saskatchewan will create uncertainty for businesses and for investors who were planning clean technology investments. It could also undermine Saskatchewan exports to trading partners such as the European Union, which is bringing in carbon border adjustment tariffs to penalize jurisdictions with high greenhouse gas emissions, while giving low-carbon industrial producers a competitive advantage.
Premier Moe returns today from a trade mission to the UK and Germany, both jurisdictions that could react poorly to Saskatchewan's rollback of climate protection measures.
In January, Premier Moe’s government also signalled its plans to keep Saskatchewan’s conventional coal-fired power plants running well past 2030, a move the SES alleged is another violation of federal law:
Coal is the most polluting of all the fossil fuels. Alberta completed the phase out of coal-fired power stations last year. Ontario finished the job a decade ago. Saskatchewan is the only province refusing to comply with the 2030 deadline. And in February, the Saskatchewan government backtracked on its commitment to make new buildings more energy efficient. It has reverted to the very lowest standard in Canada’s energy efficiency performance tiers for low-rise residential buildings. Saskatchewan’s move will increase greenhouse gas emissions in the residential home sector and increase operating costs for homeowners.
“Sadly, Premier Moe’s government is ignoring all these distress signals of impending climate disaster. Saskatchewan already has one of the very highest per capita greenhouse gas pollution levels in the world,” says Glenn Wright, another SES board member. “With the policy changes of the last three months, Premier Moe is making Saskatchewan’s reputation on matters of the environment worse than ever.”
The SES is calling on the Government of Saskatchewan to reverse course and reinstate the Output-Based Performance Standards Program, with a greenhouse gas pollution price on the industrial sector that maintains alignment with other provinces. The Saskatchewan Environmental Society also calls on the provincial government to move forward with improved energy efficiency standards on new buildings and to comply with federal law by phasing out all conventional coal-fired power stations in the province by 2030.