Long story short. You don’t know what you don’t measure. Know because you checked.
Short story long. Back in March of this year when it was capturing most of the headlines at that time and had been a consideration in our then recently completed tax returns to claim the Climate Action Incentive, I was curious to know what the effect of the proposed Carbon Tax would be in our household. Because I had the data to make a calculation, I created a spreadsheet to find out how the Carbon Tax was going affect us. Would we be out of pocket if the Fuel Charge portion of the Carbon Tax strategy exceeded the Incentive, or vice versa?
I maintain an accurate record of the fuel that our two vehicles consume, and with the benefit of the information that our natural gas provider has on their website, I had enough data to start upon the task. My intention was to use the 2018 calendar year data immediately at hand as a test case; that is, only the readily available figures from our vehicle fuel consumption and household natural gas consumption. This information, along with the publicly available Fuel Charge rates (https://www.fin.gc.ca/n18/data/18-097_1-eng.asp), would give me a head start on what I would see in the spring of 2020 when the first full year of Carbon Tax was under our belt. There is an additional indirect Fuel Charge that should be included to provide a more accurate picture of the net effect, impossible to accurately calculate, but more on that further on.
The Fuel Charge that would have been attributable directly to the two commodities included in our 2018 test case calculation (gasoline and natural gas) amounted to $243.48. That amount eerily compares to the $244 that the federal government cited for direct and indirect Fuel Charges for the average Ontario household (https://www.theglobeandmail.com/canada/article-canadas-carbon-tax-a-guide/). I have to say that I was quite satisfied with our initial numbers and that comparison! Our 2018 test case showed that we would have been out of pocket $12.48, direct Fuel Charge versus Incentive. There had been no compelling conservatism in our driving habits in 2018, and we had an insulation anomaly in our house that needed to be addressed, so I felt comfortable that with a little effort we could narrow the gap between the direct & indirect Fuel Charges and the Incentive.
During the summer our insulation anomaly was addressed and at the same time we had our attic insulation increased to an R-value that exceeds the current standard. We try as much as practicable to patronize farm gate produce in addition to the Owen Sound Farmer’s Market so numerous trips throughout the year to destinations such as Wiarton for fresh fish, Saugeen Shores for fresh fruit and veg, the Beaver Valley for apples as well as a sideroad farm just north of Markdale all added to our vehicle fuel burden. In 2020 we’ll try to latch on to Eat Local Grey Bruce to have some of our fresh local groceries delivered to the home which will no doubt reduce our direct Fuel Charge to some degree.
Still, there’s that nagging indirect Fuel Charge to consider. You know, that indeterminate Fuel Charge attributable to getting items to our local shops and stores. At best, it could only be a wild-assed guess, but I wanted to apply some rationale that I would be comfortable with and which would be reasonably defensible. I decided on Montreal, half way to the Atlantic Ocean and from Owen Sound about 720km. What if all of the other consumable stuff that came into our house over the year was all loaded on a highway transport and shipped to Owen Sound from Montreal? This is a generous assumption since the bulk of our groceries are grown/ raised/fished in Southern Ontario and shipped from farm to somewhere in the Golden Horseshoe and then on to Owen Sound. Yes, there is wheat made to flour that comes from the Canadian Prairies, and dish detergent from who knows where, and besides, our stuff would only be a very small fraction of the capacity of a highway transport. And the Fuel Charge attributable to a full highway transport from Montreal to Owen Sound? It’s $15.47 using the appropriate Fuel Charge for diesel fuel at 40 litres/100km for that Montreal/Owen Sound trip. For a full truck, that is, where at generous guess and worst case we would use one-twentieth of capacity of that transport trailer over the course of a year, so $0.77! I generously rounded up to the nearest $10 for that indirect Fuel Charge. So that’s $10.00, using a safety factor of 13 for allowable error.
The final result of my effort is this; our household Climate Action Incentive amounts to $231.00 and our direct Fuel Charge is $243.48 with an indirect Fuel Charge generously estimated at $10.00. We were out of pocket $22.48 in our 2018 test case. Out of pocket $22.48, that is, without really trying. Now, we’re trying.
Putting a price on carbon emissions will work to mitigate Climate Change. There’s been a Nobel Prize awarded that says this statement is true (https://www.iisd.org/library/nordhaus-nobel). I’m grateful we have adopted the Carbon Tax strategy here in Canada. Alternatively, no prize of any sort has been awarded by implementing a strategy to reduce carbon emissions by investing in green technology funded in part by polluters who fail to meet new and as yet unspecified standards, as one political party in Canada would have us do.
You don’t know what you don’t measure. In this instance I made the measurement, and I know because I checked.
source: correspondence
