Carbon tax impact 'relatively small,' government report suggests

The opposition is slamming ahastily-released, one-pageAlbertagovernment report that suggeststhe impact of the carbon tax on the Alberta economy is"expected to be relatively small."

The report says the negative impact on real GDP will be 0.05 per cent a year over the next six years, resulting in an overallreduction of 0.3 to 0.4 per cent by 2022.

"If Alberta carbon policy leads to improved market access, the estimated positive economic effect would be significant," the report states.

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"The immediate approval of at least one major pipeline is estimated to raise GDP by about one per cent by 2022. This is expected to offset the costs of moving to a higher carbon price."

The numbers were generated by Alberta Treasury Board and Finance using the same macroeconomic forecasting model used to prepare the budget.

However, the government will not release the longer analysis that led to these new figures, as it is considered confidential briefing information for cabinet ministers.

The figures are also considered preliminary as they don't take into account the effect of policies still under development such as carbon levy regulations and ways revenue will be reinvested in the economy.

Knee-jerk reaction?

The report was released late Monday afternoon after Premier Rachel Notley referred to it in the legislature while answering a question from Wildrose Leader Brian Jean.

Jean challenged Notley to release an economic analysis, saying the only thing he's seen is a government memo from a year ago leaked to the media that suggested the carbon tax could kill 15,000 Alberta jobs.

Earlier this month, the Manning Centre posted heavily-redacted documents obtained througha Freedom to Information request.

An internal Alberta government email contained in the documents suggested electricity priceswere projected to rise 20 per cent for small and large industrial users between 2021 and 2025, and by 10 per cent between 2026 and 2030.

Wildrose MLA Don MacIntyre, the party's renewable energy critic, said the analysis omits key information such as the cost of the government's plan to accelerate the shutdown of coal-fired electricity plants, and the impact of lost jobs.

He thinks the report was rushed out to counter bad news.

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"This report, in my opinion, is nothing more than a quick rollout as a knee-jerk reaction to the Manning Centre's announcement regarding a FOIP document that they got," MacIntyre said. "That's why this document is so lacking in actual numbers."

'Billions' in new investment

Environment Minister Shannon Phillips said the report doesn't take into account how the government plans to reinvest carbon tax revenue, nor does it look at the cost of doing nothing.

"What that doesn't take into account is the tens of billions of new investment that are going to come into Alberta by the renewable energy procurement," Phillips said, adding there is also additional investment coming from the federal government.

"So there are major pieces of this puzzle that have yet to be put into place."

The federal government plans to impose a national carbon tax on all provinces that don't already have a plan in place starting in 2018.

Phillips said there would be economic consequences to having a tax imposed on Alberta. That's why it's good her government has its own plan, she said.

"We are designing a program that works for Alberta," Phillipssaid. "That approach is a much better fit for this province and ensures that we've got some of the job protections in place, ensures that we have protections for our export-oriented economies."

Phillips said the report that was leakedearlier this year was a "snapshot" in time, usingassumptions that are no longer valid.

"So it was of limited usefulness to anyone," she said.