If you buy a pipeline and charge market rates to use it, you are not subsidizing it, you are investing in infrastructure.

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Setting the record straight on the day’s top anti-oil and gas media stories

ACTIVIST CLAIM: International Institute for Sustainable Development again stretches the definition of subsidy to include government ownership of pipelines in their latest report.

THE FACTS:  If you buy a pipeline and charge market rates to use it, you are not subsidizing it, you are investing in infrastructure.

THE SOURCES:

Pipelines or Progress: Government support for oil and gas pipelines in Canada


Here are some talking points and sources to have a reasonable conversation about governments investing in infrastructure projects:

  • Keystone Pipeline, where the Government along with the private pipeline company are taking legal action to recover $1.5 billion.  The $6 billion dollar loan guarantee was returned before it was even used but the authors counted it as if it was a cash subsidy anyway.
    https://globalnews.ca/news/7939964/alberta-finance-minister-keystone-xl-loss/

  • The remaining balance of 500 million in misleading claims of subsidies comes from Export Development Canada in the form of a loan. However, Export Development Canada is an organization that is financially self-sufficient and raises money just like a bank, mostly through fees and global markets, not the public.
    https://www.edc.ca/en/about-us.html 

  • The real subsidies for energy unsurprisingly and overwhelmingly go to green energy.   A policy brief from the International Institute for Sustainable Development notes that Canada announced almost $15 billion in financial support for “green” initiatives in 2020 alone.
    https://www.iisd.org/system/files/2021-02/climate-canada-covid-19-response.pdf

  • The oil and gas industry contributes an average of $26 billion per year in taxes which goes to important civil services like health care and even subsidies to green energy.


Statistics Canada (2020b). Table 10-10-0017-01: Canadian Government Finance Statistics for the Provincial and Territorial Governments 
Statistics Canada (2020c). Table 33-10-0006-01: Financial and Taxation Statistics for Enterprises, by Industry Type Statistics Canada (2020d). Financial and Taxation Statistics for Enterprises, by Industry Type (x 1,000,000). Custom tabulation.
Statistics Canada (2020a). Table 10-10-0016-01: Canadian Government Finance Statistics for the Federal Government 

 


Stories that get it right.

Check out this graphic from Oil Sands Strong.

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