The program, funded by federal carbon tax, aims to help farms cut energy consumption; one farm group calls it a bribe
Producer groups are expressing both interest and criticism for a new federal program that aims to reduce energy consumption on farms, given the initiative is funded by the contentious carbon tax.
The recently announced Climate Action Incentive Fund (CAIF) program would allow farms in jurisdictions without a provincial carbon tax to undertake energy efficiency projects, but one group views the initiative as a bribe.
In a news release May 31, the Western Canadian Wheat Growers Association said it is opposed to the plan, suggesting the benefits of the program don’t outweigh the costs of the carbon tax.
“The government simply does not understand that farmers cannot pass the carbon tax on to our consumers,” president Gunter Jochum said in the release.
“We sell our grain at world prices and our competition does not have to account for this expense.”
Grain Growers of Canada, however, greeted the plan with interest, saying it could provide relief for farmers in provinces that are paying the federal carbon tax.
The organization said it is still calling for the exemption of stationary and liquid fuels used on farms, given the tax eats into farmers’ bottom lines.
“As natural price takers, grain farmers are unable to pass along added costs which are the result of the federal price on carbon,” chair Jeff Nielsen said in a May 30 news release.
“Statistics Canada has reported significant decreases in farm incomes over the past year and we simply cannot afford to absorb any more costs.”
Despite concerns, Grain Growers said it wants the program to help reduce grain drying costs, though it added more information is needed to figure out how farmers could best benefit from the initiative.
The fund is expected to provide $218 million in the first year and will be divided into three streams.
One stream will focus on incorporated small- and medium-sized businesses (including farms), while the others will go toward municipalities, universities, schools and hospitals, as well as a rebate system for small and medium enterprises that purchase Energy Star equipment.
The funds will be available in Saskatchewan, Manitoba, Ontario, and New Brunswick.
Alberta, which recently cancelled its carbon tax on home heating and fuel, might be added to the list if the federal government imposes the levy on the province.
Grain Growers said it wants more clarity on how the funds will be shared between the three streams.
“It is unclear exactly how much of the monies will be returned to the grain farming community,” it said. “It can be expected that demand for these program dollars will be very high and no specific agriculture stream has been announced.”
However, Wheat Growers said it would rather the federal government eliminate the carbon tax and focus its supports on safeguarding Canada’s trade agreements.
“The United States government has contributed strong financial support to its farmers, whereas in stark contrast the Canadian government has increased our taxes and decreased our competitiveness,” said director Cherilyn Jolly-Nagel in the news release.
Grain Growers, however, said it would like to sit on the program’s advisory committee to ensure there is a strong agricultural voice.
“GGC appreciates the minister’s (Catherine McKenna) recognition of the significant costs that farmers incur when we invest in energy efficient alternatives,” Nielsen said.
“We look forward to continuing our work with her staff and officials to mitigate the impact of the carbon price on Canada’s agriculture sector.”