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Canada

Canada

Customer credit for green buying -- Oil industry suggestion

A new alliance of oil companies, environmental groups and municipalities wants Canada's federal government to provide a tax credit to consumers who buy renewable energy. The Clean Air Renewable Energy (CARE) coalition suggests a two or three cents a kilowatt hour credit would be enough to encourage more Canadians to choose green power. The program would cost the government about C$42 million a year, says Gordon Lambert of Suncor, the Calgary oil giant leading the alliance along with the Pembina Institute for Appropriate Development. Lambert is Suncor's corporate director for sustainable development.

In addition to consumer incentives, CARE wants to see the tax breaks offered to renewables developers expanded, allowing them to write off more of their project development expenses. "We're trying to suggest to government that we need to look at something that creates both consumer pull and supply push. We think both of those pieces of the puzzle need to be in place to really create a sustainable, long term future in this whole area," says Lambert.

Canada's renewables lobby has long called for similar action from government, but Lambert thinks that CARE can add "some push" to the effort. "You're seeing companies that have historically been in other areas of the energy sector making a declaration around their commitment to get involved in the renewables sector, to try and make this a part of their businesses. That's one of the signals we were trying to send here, that interest in renewable energy is broadening."

Last year Suncor announced it would spend C$100 million over five years to develop an alternative and renewable energy business. Other energy companies involved in CARE, including BC Hydro, BP Canada, Enbridge, Shell, Toronto Hydro, TransAlta, and Westcoast Energy, have all made moves to include wind and other renewable generation technologies in their business portfolios.

Makes business sense

"We think, from an energy policy perspective, that diversification of energy sources in Canada makes a lot of sense," says Lambert. "As companies we wanted to be provided the opportunity to do that, for environmental benefit of course, but also we have to attract more private sector capital to get this industry at a scale where it can sustain itself. We're giving voice to companies that really could give a boost to the industry."

The CARE coalition also includes the Federation of Canadian Municipalities, with its 61 local governments representing nearly two-thirds of the country's population. It has taken a strong stand on clean air and climate change issues. A number of national and regional environmental groups round out the alliance.

CARE is in the process of initiating government contacts and plans to be involved in the consultations leading up to the federal government's annual spring budget. "The initial response from government, although we haven't had formal meetings at this stage, has been favourable. I sense we have an interesting convergence of circumstances," says Lambert, who points out that climate change concerns, coupled with rising fossil fuel prices, are forcing government to take a closer look at renewables. "With these things it's not just what you say, but when you say it."

The coalition is also extending its lobbying efforts to provincial governments, who have significant control over energy policy in Canada. Provincial electricity markets are at different stages of deregulation. While various utilities across the country are considering offering a renewable energy option to consumers, Alberta is the only jurisdiction where the green market has got off the ground.

"Alberta is, somewhat, pioneering the notion of consumer choice. It's a model we'd like to see duplicated elsewhere," says Lambert.

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