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Budget promotes fossil fuel economy, fails to invest in future

VICTORIA, BC—The September budget update stimulates the old, fossil fuel economy while failing to invest in the new, green economy of the future, says Guy Dauncey, President of the BC Sustainable Energy Association.

“People are looking for leadership to move off the old, fossil fuel based economy,” said Dauncey. “Economic stimulus spending is a golden opportunity to invest in the new, green economy. Unfortunately, this budget falls back on highways and oil and gas development.”

“In spite of the hard economic times, two thirds of Canadians still rank the environment on a par with the economy,” said Dauncey, citing the Canadian Press Harris-Decima survey of July 2009. “Spending on highways is increasing more than 20% over the previous budget, yet funding for the highly successful LiveSmart BC program is not being renewed. This goes against what British Columbians say they want from government.”

“With the new Harmonized Sales Tax,” said Dauncey, “gasoline, diesel fuel and aviation fuel will be exempt from the full HST. The green economy approach would have ended this PST-exemption, and retained it for home insulation, energy efficient windows, heat pumps and renewable energy equipment, which will all jump in price by 7% next July, making it less attractive for homeowners to invest in efficiency.”

“The government showed good leadership when it brought in the carbon tax,” said Tom Hackney, Vice-President for Policy, “but this first step is being swamped by incentives to the oil and gas industry. We need urgent measures to reduce our fossil fuel use and urgent measures to build the green economy to replace it.”

Some budget highlights:

  • The budget of the Climate Action Secretariat is cut to $7 million per year for Fiscal 2010 through 2012, down from $16 million in Fiscal 2009. Core functions are maintained, but funds are removed for public outreach and climate change projects by other parties.
  • $60 million of LiveSmart funding to renovate 40,000 homes, including 17,000 low-income homes will be fully spent by Fiscal 2011 and not renewed.
  • Funding for the Innovative Clean Energy fund no longer be supported by a levy on utility bills. The program will be continued, but does not have assured funding.
  • The implementation of the Harmonized Sales Tax (HST) will tax increases of 7% on many goods that were previously exempted from the provincial sales tax, including bicycles and renewable energy products. Gasoline, diesel and aviation fuel will be exempted from the increased levy.
  • $1.2 billion in capital spending for highway expansions for: Kicking Horses Canyon, Sea-to-Sky, the Bennett Bridge, border crossings, the Gateway/Port Mann expansion, Okanagan Valley corridor, Cariboo connector and other highway programs, up from $983 in the February budget – over 20% higher spending.
  • Extended and increased oil and gas royalty reduction credits (cost booked with projected decline in royalty revenues: $1.3 billion in Fiscal 2009 to $522 million in Fiscal 2010) and $98 million in oil and gas rural roads upgrades over two years, plus $80 million in reduced taxes to the oil and gas sector through the switch from PST to HST.
  • Commitment to further the “Northern Energy Corridor” for oil and gas pipelines between Kitimat and Prince George (no specified price tag).

The BC Sustainable Energy Association (www.bcsea.org) is a non-profit society that envisions a future in which all of BC's energy needs are met with clean, efficient, renewable energies. We actively promote sustainable energy in BC through practical projects, education and policy development.

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For more information, contact:
Guy Dauncey 250-881-1304
Tom Hackney 250-381-4463