Saskatchewan's electricity utility to pay into nuclear fund,

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Saskatchewan's electricity utility to pay into nuclear fund, clean electricity costs

[ https://ca.news.yahoo.com/saskatchewans ... 50012.html ]

The Canadian Press December 4, 2023 Jeremy Simes

REGINA - The Saskatchewan government says the province's electrical utility is to remit carbon charges into a nuclear energy investment fund.

The province says the fund would be used to help Saskatchewan deploy its first small modular reactor.

It also says carbon charges would go toward clean electricity operating costs to keep power rates affordable.

SaskPower, which is the province's electricity utility, collects carbon charges from ratepayers, and the province has authority over how to invest the money.

The province says carbon charges from other heavy emitters are to be deposited into a technology fund for projects that reduce, sequester and capture emissions.

It says it's to track carbon revenues and expenses from heavy emitters through the provincial budget.

Environment Minister Christine Tell says Saskatchewan plans to transition to net-zero electricity by 2050.

“The changes announced today will support clean electricity transition priorities while maintaining affordability and competitiveness for all Saskatchewan households, businesses, industry and farms," she said in a news release Monday.

Last week, Saskatchewan announced it won't collect carbon charges on electrical heat starting Jan. 1.

The province said Monday those eligible are to see a 60 per cent reduction on the rate rider portion of their electricity bill, amounting to an average savings of $21 per month.

The government expects the savings will apply to 30,000 customers. It said it already knows which customers are eligible, but people can apply online for an exemption.

Premier Scott Moe has also said SaskEnergy plans to not remit carbon charges to Ottawa at the beginning of the year.
The move would break federal law, potentially resulting in fines and jail time for SaskEnergy executives.

The province has introduced legislation to shield executives from being punished and puts the burden on the minister.
The federal government has said it expects all provinces to follow the law.

It says carbon pricing offers rebates, putting more money back into the pockets of most Canadians, and proceeds are returned to the provinces where the charges are collected.

Ottawa has exempted those who use home heating oil from having to pay the charges, a move Moe says is unfair as it largely helps those in Atlantic Canada.

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All part of a well-orchestrated scheme from the outset . . . .

SUCKER-PUNCHED!!!!!

[Oscar]

Explainer: What happens when Saskatchewan stops collecting carbon tax?

[ https://leaderpost.com/news/saskatchewa ... carbon-tax
]

University of Calgary professor Martin Olszynksi says Saskatchewan's defiance here is "political theatre" likely to see the province end up in court.

Larissa Kurz Leader-Post - December 11, 2023

Since Saskatchewan announced it will be matching Ottawa’s carbon tax carve-out for oil heating for electric and natural gas heat, questions have lingered about what exactly the refusal means in terms of compliance with federal emissions regulations.

Premier Scott Moe has said the refusal intends to afford relief to consumers, even passing a bill amending the SaskEnergy Act in November to allow it.

So why is legislative protection needed for SaskEnergy’s top brass but not for SaskPower, which have been instructed to undertake the same actions as of Jan. 1?

Carbon pricing on electricity is paid into a provincially administered Output-Based Pricing System (OBPS), per an agreement under the federal Greenhouse Gas Pollution Pricing Act (GGPPA).

Saskatchewan’s plan was affirmed in 2022, meaning all dollars from 2023 onward stay in the province, earmarked for investment into clean energy and capital costs for a nuclear reactor.

Natural gas emissions pricing, in comparison, is still paid into the federal system because Saskatchewan is one of four provinces still without a provincial plan in place.

The legality of either refusal rests on where coming remittance payments do or don’t go.

Around 30,000 customers use electric heat in the province, says SaskPower. Once the province stops collecting, estimated savings for natural gas users are an average $400, and electric users about $84 per household annually.

University of Calgary economics professor Trevor Tombe says phrasing this move as an affordability measure offers some issues.

Carbon pricing contributes a “very small fraction” to increasing costs for Canadians — a total of 0.6 per cent on indirect household costs, according to his recent research with public policy and economics associate professor Jennifer Winter.

Cutting out the levy is not a “silver bullet” solution, said Tombe, and “we shouldn’t be under the impression that if we were to eliminate it, our affordability challenges would change all that much.”

If Saskatchewan goes through with refusing payments, he posits it may actually see people feeling cuts to their rebates.

Since 2019, SaskPower has paid $744 million in carbon pricing levies. Of that, $490 million has gone to the federal OBPS system. Estimated 2024 payments, the first into the provincial OBPS, are to be $263 million.

Saskatchewan consumers received a tax-free Climate Action Incentive (CAI) payment of $550 for a single adult, up to $1,100 for a family of four, in 2022-23. For 2023-24, those rebates are estimated to go up to $780 and $1,360.

Should the province not remit, Ottawa’s calculations for the year may consider that loss of revenue and lower rebate values accordingly.

“That would have a disproportionately negative effect on lower and middle income households who do receive more in rebates than they pay in taxes,” said Tombe.

“You pay less, in aggregate, on the carbon tax; you receive less overall on the rebate. The two are linked in that way.”

Then-Education Minister Dustin Duncan speaks at the Legislative Building on Thursday, March 9, 2023 in Regina. He has since been appointed Minister Responsible for Crown Corporations. PHOTO BY TROY FLEECE /Regina Leader-Post

How legal is this refusal?

The federal law only mandates remittance, not collection, which Minister responsible for Crown Corporations Dustin Duncan says means the directive breaks no rules.

Saskatchewan residents’ SaskEnergy and SaskPower bills will no longer collect on the carbon tax beginning Jan. 1, but in SaskPower’s case, the Crown is still going remit into the OBPS.

“We don’t want to jeopardize the federal government coming in and saying you’re not compliant with our agreement, and therefore we’re going to take the entirety of those dollars back,” Duncan said.

Electricity levies alone will equate to “in the neighbourhood of $3 to $4 million, from January to end of April,” he estimated. Instead of coming from people’s bills, it will be pulled from the Crown’s bottom line.

SaskPower just marked a net $172-million loss, or a $242-million decline from projected earnings, in 2022-23, according to annual reports released in July.

As for SaskEnergy, because remittance is due at the end of the following month for the prior month’s consumption, the metaphorical piper won’t be calling on Saskatchewan’s missing payment until the end of February.

Duncan said that’s the deadline to make a final decision on “what we do next.” If the choice is not to remit, Saskatchewan will be contravening the federal act and could result in fines or jail time for those responsible.

Duncan said he doesn’t anticipate any legal action. University of Calgary law professor Martin Olszynski disagrees. He considers it inevitable this ends up in court, and he thinks Saskatchewan will face a losing battle.

Olszynski said these types of jurisdictional clashes have to play out in court, where there’s already clear precedent that will rule in the favour of federal authority.

“The basic rule is that the provinces can’t interfere with the operation of federal legislation and regulations,” he said.

“If the province tries to insert itself into any of that machinery, then it’s either on its face unconstitutional, in the sense that they don’t have the authority to pass those kind of laws, or if the effect is to frustrate that system, then the law is not applicable.”

The Saskatchewan First Act, touted as the province asserting jurisdiction over its natural resources, will carry no weight because the framework seeks to modify behaviour, not production, said Olszynski.

Neither will Section 33, the notwithstanding clause, invoked earlier this year in Bill 137 to override sections of the Charter of Rights and Freedoms.

“When you don’t like a federal law, your choices are to challenge it in court or to have it repealed through Parliament. There is no magical third option,” Olszynski said.

Saskatchewan has tried that, to the tune of $500,000 in legal costs.

“The price on pollution framework has been upheld by the Supreme Court of Canada,” reminded spokesperson Katherine Cuplinskas from Minister of Finance Chrystia Freeland’s office, in an email response to the Leader-Post.

Duncan said he is aware Saskatchewan cannot “arbitrarily change federal law with a provincial act,” but that it is “well-within our constitutional and legal rights” as owner of the Crown to change the registered energy distributor. This is how the SaskEnergy bill intends to shield executives.

SaskEnergy has already written to the federal Minister of National Revenue Marie-Claude Bibeau, advising it intends to delist and government apply for approval instead.

Duncan said the “sooner we get clarity” on whether that will be acknowledged, “that will dictate next steps for us.”

“We don’t expect that it will be challenged,” he told reporters.

Olszynksi says this means the effectiveness of the bill relies on federal officials playing along and that without that, Saskatchewan’s play may be dead in the water before it begins.

He said the Saskatchewan government doesn’t meet the guidelines to be a distributor, making approval slim.

Olszynski called it all “performative, political theatre,” on Saskatchewan’s part.

“It’s a disservice to Canadians, because it creates this misperception about the basics of our Constitution,” he said.