Carbon pricing and the beef industry: how will Canadians feel the effects?

Businesses across Alberta are bracing for the new carbon tax, wondering what effects the levy will have on their bottom line. So, when Jennifer Winter joins us at the Alberta Beef Industry Conference to speak about the cost of emissions pricing, the interest will be high. Jennifer is the director of energy and environmental policy at the University of Calgary, and we asked her for a few insights into the potential costs for the beef industry.

Jennifer Winter at the Alberta Beef Industry ConferenceJennifer explained that, since 2007, emissions from large emitters have been subject to a levy, but starting in January 2017, this system changed to a broad-based carbon tax on emissions from the combustion of fossil fuels.

“This means that, across Alberta, individuals and companies are going to be paying more for gasoline, diesel, natural gas and other fossil fuels,” said Jennifer. “For the agricultural sector, farm fuel is exempt, and so the impact will mainly be felt through natural gas price increases and indirectly through increased pricing from suppliers as they respond to the carbon tax.”

“The impacts will depend on how much fossil fuels each operation uses, and it is possible the carbon tax will make some businesses unprofitable,” continued Jennifer.

In addition to the exemption on farm fuels, the government has also placed a cap on the price of electricity.

How the carbon tax will affect the beef on Canadians’ plates

The most likely cost to Canadians will be an increase in emissions-intensive goods and services, such as gasoline. As for beef? Time will tell how much of a price increase Canadians will see at the store, or whether supply will be affected.

Check out ‘5 feedlot issues to watch for in 2017’, to learn about other issues that could affect Alberta’s beef industry this year.