Cash from carbon tax being spent in wrong places - or not at all, MLA says

Revenue from New Brunswick's carbon tax is helping fund long-term nuclear reactor research instead of being used to help more low-income people quickly reduce their energy consumption, says a Green Party MLA.

Megan Mitton told provincial officials at a legislative committee hearing that she also can't understand why $10 million in the provincial climate fund isn't being spent at all this year.

"I know people who want energy efficiency funding, especially seniors, people with low incomes and there's $10 million being left on the table," Mitton told senior civil servants from the Department of Environment and Climate Change.

And she said of the $25.9 million being used, much of it is going to projects that will have no impact on fossil fuel emissions for a long time, if ever.

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That includes $5 million to support the development of small modular nuclear reactors, which would not emit carbon dioxide.

Climate change secretariat executive director Jeff Hoyt said projects needed to be "actioned" in fiscal 2020-21 to get funding.

Emissions reductions are needed immediately: Mitton

But Mitton pointed out building and operating the reactors could be years away while emissions reductions are needed now.

"We could debate whether we should be doing that, whether that's good technology, but either way it doesn't come into effect, it doesn't exist yet really," Mitton said.

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"And it won't even have an impact on climate change, if it does work, for a decade, and we're on a timeline, a science-based timeline."

The current fiscal year is the first in which the Higgs government is collecting a carbon tax it implemented reluctantly to comply with a national climate change plan.

It was forecast to bring in $129 million this year but is now expected to collect only $114 million because of reduced consumption of gasoline during the COVID-19 pandemic.

Most of the money is being used to make up lost revenue from the province's reduction of the gasoline excise tax. Higgs cut that tax so that consumers pay only 2.2 cents per litre extra at the pumps rather than the full 6.6 cents.

The tax injected $36 million into the climate fund, but only $25.9 million ended up being spent.

Pandemic threw a wrench into approvals

At Thursday's hearing, the department's deputy minister Cade Libby said the COVID-19 pandemic made it a challenge to approve enough projects to use all the money.

"Recognizing that we are certainly in interesting times as it relates to the pandemic, we've proceeding cautiously and perhaps even a little bit more slowly than we would have liked," he said.

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"I guess I would argue proceeding cautiously when funding climate change wouldn't be my approach," Mitton answered.

Earlier this year, Libby confirmed that almost $4 million went unspent from the climate fund in 2018-19. In both cases the money went back into the province's general revenues.

I guess I would argue proceeding cautiously when funding climate change wouldn't be my approach.- Megan Mitton, Green Party MLA

On Wednesday, the province released the list of 96 projects receiving money from the climate fund this year.

Some involve mitigation of the impacts of climate change, such as $1 million to reinforce provincial infrastructure along shorelines and $2.9 million to help NB Power fund energy efficiency initiatives.

The province is also spending $50,000 on "initial work to explore" adding more electric and hybrid vehicles to the government fleet.

Last year officials acknowledged they had missed their target of having 2,500 electric vehicles on the roads by 2020 and had no targets whatsoever for the government fleet.

Some projects have only indirect climate-change impact

Some of the projects have only indirect impacts on climate change, such as $30,000 for new GPS devices for snow plows allowing the government "to monitor fuel and salt and sand distribution."

Mitton said some initiatives, including repair and replacement of dyke and culverts, looked like projects "that were already existing in departmental budgets before the climate change action plan existed, and I don't know why they're here."

She also complained about only $1.5 million going to help low-income people make energy-efficiency renovations to their homes, which is aimed at reducing electricity consumption and thus greenhouse gas emissions.

Hoyt said that funding is only part of the financial support, with other money coming from NB Power and the Department of Social Development.

The money is "intended to do exactly what you're talking about, which is to get at that wait-list of folks who are on the low-income list. It's a significant investment."