The federal government will pause applying carbon pricing to home heating oil for three years in a bid to accelerate Canadians’ switch to more environmentally-friendly heat pumps, Prime Minister Justin Trudeau announced Thursday.
Flanked by Atlantic Liberal MPs, Trudeau said the government will be rolling out incentives to Atlantic Canada households who are more reliant on heating oil, including enhanced payments and grants to lower the cost of installing a heat pump. Those incentives will be piloted in the Atlantic beginning in two weeks and then rolled out across the rest of the country.
Rural communities across Canada will also see a doubling of the top-up afforded to them as part of quarterly carbon pricing rebates, the prime minister said.
“We have to make sure we’re fighting climate change in ways that support all Canadians,” Trudeau told reporters in Ottawa.
The temporary, three-year carbon pricing pause for home heating oil deliveries will take effect from Nov. 9 until March 31, 2027, and apply to every jurisdiction under the federal fuel charge. Only Quebec, British Columbia and the Northwest Territories are not part of the regulations.
Atlantic premiers have said since the summer — when the four provinces switched to the national carbon levy — that the pricing scheme disproportionately impacts their region, where home heating oil is still used by almost one-third of households.
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The carbon price is higher on heating oil than natural gas, which is more commonly used in other provinces.
Trudeau said he has heard similar concerns from his Atlantic caucus.
“We are nothing if not a government that listens to people, that is focused on our goals and is willing to adjust as necessary,” Trudeau said.
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Conservative Leader Pierre Poilievre has hammered the Liberal government on its carbon pricing program and has repeatedly toured Atlantic Canada to highlight its effect on the rising cost of living. He’s due to return to the region this weekend.
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As part of the changes announced Thursday, low- to median-income households in Atlantic Canada that use heating oil will be eligible for a $250 up-front payment if they sign up for a heat pump through a joint federal-provincial program like the Oil to Heat Pump Affordability Program.
Maximum grants afforded through that program will also be raised from $10,000 to $15,000 to match provincial contributions.
The federal government says the increases will make an average heat pump free for lower-income households.
More to come…
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