While Canada slashes budgets for research, education and public broadcasting, there is one part of our economy that enjoys remarkable support from the Canadian taxpayer: the energy sector.
These figures are found in the appendix of a major report released last year estimating global energy subsidies at almost $2 trillion. The report estimated that eliminating the subsidies would reduce global carbon emissions by 13 per cent. The stunning statistics specific to this country remain almost completely unreported in Canadian media.
Contacted by The Tyee, researchers from the IMF helpfully provided a detailed breakdown of Canadian subsidies provided to petroleum, natural gas and coal consumption. The lion's share of the $34 billion are uncollected taxes on the externalized costs of burning transportation fuels like gasoline and diesel -- about $19.4 billion in 2011. These externalized costs include impacts like traffic accidents, carbon emissions, air pollution and road congestion.
The report also referenced figures sourced from the OECD showing an additional $840 million in producer support to oil companies through a constellation of provincial and federal incentives to encourage fossil fuel extraction. This brought total petroleum subsidies in Canada in 2011 to $20.23 billion -- more than 20 times the annual budget of Environment Canada.
In comparison to other countries, Canada provides more subsidies to petroleum as a proportion of government revenue than any developed nation on Earth besides the United States and Luxembourg.
What could Canada do with an extra $34 billion a year?
Both Vancouver and Toronto are struggling with how to fund long overdue upgrades to public transportation. Subway construction comes in at about $250 million per kilometre, meaning we could build about 140 kilometres of badly-needed urban subway lines every year. Light rail transport (LRT) is about one-quarter of the cost of subways, meaning for the same money we could build about 560 kilometres of at-grade transit infrastructure.
The proposed Vancouver subway line to the University of British Columbia could be built using less than two months of the subsidies provided every day to the energy sector. Forty kilometres of rapid transit in Surrey could be had for about the same amount.
What about green energy infrastructure? Adding solar and wind capacity provides some of the best job-generation per dollar of any option available -- more than seven times the employment from an equivalent investment in oil and gas extraction. Extrapolating the findings from a 2012 report on green jobs, $34 billion could create 500,000 person years of employment and install more than 150,000 megawatts of clean generating capacity. Canada currently ranks 12th in the G20 on green energy investment and has been steadily falling behind our competitors.
Canada's infrastructure deficit of crumbling roads and outdated water and sewage treatment is pegged at $171 billion. This backlog could be wiped out in five years with the revenue we are subsidizing to the energy sector.
Of course, not all things of value can be measured by bricks and mortar. Thirty-four billion dollars each year could provide $10-a-day childcare for 5.5 million children ages 0 to 5. Canada's child care costs are currently the highest in the OECD.
The Tyee â€“ IMF Pegs Canada's Fossil Fuel Subsidies at $34 Billion