By Maximilian Kniewasser, Pembina Institute.
Four years ago, the government of British Columbia bet big on the prospect of liquefied natural gas (LNG) exports creating overseas markets for the province’s shale and tight gas resources.
LNG development would deliver 100,000 jobs, a $100-billion Prosperity Fund, and over $1 trillion in economic activity, British Columbians were told. Since then, however, the economics of LNG have shifted, and the predicted LNG boom has yet to materialize.
In order to attract LNG investment, the provincial government has provided myriad incentives, exemptions, and direct transfers to the natural gas industry. Financial incentives that shield the emissions-intensive industry from current and potential future increases in carbon costs are of particular concern to the Pembina Institute.
For one thing, these measures lessen the incentive to reduce carbon pollution — as the world increasingly demands that polluters pay for their emissions. Furthermore, such incentives use scarce public dollars to support the fossil fuel sector at a time when government should be removing barriers to clean innovation and investing in green jobs.
Here is an overview of six carbon-related incentives that benefit LNG projects and the natural gas industry in B.C.