Guest Post by Willis Eschenbach
Supporters of the British Columbia (Canada) carbon-based energy tax that I discussed in my last post have made claims that the data shows this tax was a success … so being a suspicious-type fellow, I thought I’d take a look at the data myself. I didn’t figure the tax was having much effect, but I was prepared to find anything. Reality’s funny that way, I like not knowing which bush hides the rabbit … anyhow, here’s a typical claim:
MOTOR GASOLINE (DRIVING)
The above figures show changes in overall use of all petroleum fuel products (subject to the carbon tax). To gain some insights specifically into how the carbon tax has affected the behaviour of drivers, one can examine just the changes in motor gasoline consumption (one component of the overall fuel use numbers). Since 2008, per capita gasoline use in BC has declined by 7.3% more than in the rest of Canada (Table 4) – a substantial difference. Gasoline use in BC was already declining faster than in the rest of Canada from 2000-2007 (see Figure 4).
The tax covers all carbon-based fuels, heating fuel, jet fuel, kerosene, natural gas, all of them. Data is unavailable for some of them, so I have looked at the consumption of the highway fuels, gasoline and diesel, to see if the tax has any effect on how people are driving up in the frozen North.
Statistics Canada has an excellent website, from which I got most of my data about the fuel use. First, here are the raw changes in per capita diesel and gasoline use (combined) by Province for the years 1993-2011. This analysis is only the gasoline and diesel used on the roads, not the use of those fuel for off-road vehicles and farm tractors and the like. (Note that off-road and farming fuel, and indeed fuels for all purposes and users, are all subject to the BC carbon-based energy tax.)
Figure 1. Per capita Canadian diesel plus gasoline use by Province. Only fuels used on the highway are counted. Thick red and black lines show British Columbia and Canadian average per capita fuel use. Nunavut and Northwest Territories are not included due to lack of data for the earlier years, before Nunavut was created. DATA SOURCE
Now that’s interesting, but it doesn’t really allow us to look at the subtle year-to-year changes. For that we need to look at the percentage changes in emissions by province, to see who is going up and who is going down.
In looking at a percentage change in anything, the first question of interest is, percentage change from what starting point? Because the tax was instituted in 2008, I looked at the percentage change from that time. Figure 2 shows that result, and given the claims of the proponents of the tax, it’s quite funny … well, it’s funny except if you live in BC, I guess when the joke’s on you it kind of loses its humor. Anyhow, here’s the percentage change in per capita use of highway fuels by province:
Figure 2. Percentage change in fuel use, with the year 2008 used as the base from which the percentages are calculated. Blue line shows the corresponding percentage change in the real (inflation-adjusted) Canadian GDP. 2011 is the most recent year for which StatCan has data.
The first thing that stands out is what I found in my analysis of the US driving habits—Americans drive more miles in good economic times, and cut back on the driving in tough economic times. Similarly, the highway fuel used in both British Columbia and also the rest of Canada has moved roughly in parallel with the national economic situation.
The next thing I noticed was that from 1993 to 2008, BC had the slowest growth in highway fuel use of all of the Provinces.
Next, the changes in highway fuel use after the imposition of the tax are interesting. Figure 3 shows a closeup of Figure 2, highlighting the recent period from 2004 to 2011.
Figure 3. Closeup of Figure 2, showing the post-tax changes in road-fuel use. The BC carbon-based energy tax was instituted in 2008.
So … just like the rest of Canada (thick black line), BC road fuel use dropped from 2004 to 2008, when the BC tax was instituted … except it was dropping faster than the national average.
Again just like the rest of Canada, the BC road fuel use bottomed out in 2009, the year following the imposition of the carbon based energy tax. I can only assume that this is related to the blue line, showing the real GDP for Canada.
And just like the rest of Canada, since then British Columbia road fuel use has risen to the end of the record … except it’s risen faster than the national average.
Now here’s the funny part. From 2004 to the tax year of 2008, BC road fuel use was showing nearly the fastest decrease in fuel use in the country. Fuel use dropped about three times as much as the rest of Canada during that period. That was before the tax.
After the tax, BC road fuel use dropped, but for only one year. So did the rest of Canada, and the US, showing that the drop was at least in part due to the global financial meltdown.
And since 2009, BC is tied with the Yukon territory and Newfoundland/Labrador for the fastest increase in fuel use in the country. Highway fuel use rose five times faster in BC than in the rest of Canada since 2009.
Finally, since 2008 when the carbon-based energy tax was imposed, energy use on the road has risen in BC, not fallen. And not only has it risen, since the tax took effect BC has risen faster than all but three of the other provinces.
Can we say that the carbon-based energy tax hasn’t changed fuel use in BC? Nope, all I’ve looked at is road fuel … but fuel use on the highways of BC sure hasn’t changed. Well, that’s not exactly true.
Before the tax, per capita road fuel use in BC was dropping faster than almost all the provinces.
…
After the tax, per capita road fuel use in BC is increasing faster than almost all the provinces.
…
So actually, yes, I’d say I was wrong, the tax has had an effect on BC road fuel use … but likely not the one expected by the promoters.
w.
PS—you may recall that up top, the promoters extolled the drop in gasoline used for road fuel in British Columbia … why didn’t I find that result? Why do I show an increase?
Well, it’s because I show all the highway fuel used, not just gasoline. And although there was a small decrease in gasoline use in BC, there was a larger increase in diesel use. And as a result, total BC road fuel use is not 7.3% less than the rest of Canada as they would lead you to believe by omitting the diesel figures—BC road fuel use has increased by 4.2% more than the rest of Canada. Like I say, it pays to be really suspicious with statements from folks like that, single issue fanatics.
PPS—In my previous post on the BC carbon-based energy tax, I said I wanted to discuss the (lack of) benefits, the costs, and the results of the tax. That post showed that the maximum possible benefit of the BC tax is a cooling of three thousandths of a degree (0.003°C) after fifty years. This post is about a curious result of the tax, the fact that BC highway fuel use (gas plus diesel) was dropping before the tax, and has increased since then by much more than the rest of Canada. The next post will discuss the costs of the tax, and why “revenue neutral” isn’t.
NOTE: This is one of a four-part series on the BC carbon-based energy tax. The parts are:
British Columbia, British Utopia
Fuel on the Highway in British Pre-Columbia
Why Revenue Neutral Isn’t, and Other Costs of the BC Tax
Supporters of the British Columbia (Canada) carbon-based energy tax that I discussed in my last post have made claims that the data shows this tax was a success….
The BC socialist supporters of carbon based energy taxes may not have achieved their stated goal of reducing road fuel use…. but they did achieve their unstated goal of increasing tax revenues!
Willis Eschenbach says:
July 12, 2013 at 11:24 am
Dr. Bob says:
July 12, 2013 at 9:16 am
What could be tracked is the change in BC GDP vs Canadian GDP.
W replied: We’re nothing if not a full service website … Statcan has all the data.
Dang! The Yukon Territories look even better!
@Willis 11:34 am
In any case, the tax was implemented in mid-year 2008, so centering anywhere but 2008 is special pleading. We want to compare the “before” and “after” snapshots …
2007 is ‘before’. 2008 is ‘during;’, 2009 is ‘after’.
Making the base year 2008 instead of 2007 raises questions and complications that need not be asked. It is not “special pleading”; just an honest and respectful disagreement about methodlogy.
Does it matter whether the base year is 2008 or 2007? If it does, why? And its it not worth investigation? If it doesn’t, it isn’t special pleading.
Eli Rabett says:
July 12, 2013 at 10:23 am
Well, it certainly hasn’t reduced highway emissions. Those have increased since the tax was passed.
And at present the tax has reached its full amount, about $0.25 per gallon. As a result, as a number of people have stated, they and lots of folks now buy their gas in either Alberta or the US. Not only that, but the people who visit BC are more likely to fill up before crossing the border …
And so the fall in highway gasoline use of 4% since the tax passed is guaranteed to be overstated by at least some amount, and may not be a reduction at all. And that in turn means that instead of highway emissions rising by 5% since the tax while the rest of Canada has seen little change, the rise in highway emissions is likely more like 7% or 8% more than the rest of Canada.
So no, Eli, here in the real world we expect that “workable” policies to reduce emissions actually reduce emissions more than their neighbors … crazy, I know, but that’s how we roll.
In addition, yes, there are “workable” ways to reduce emissions. North Korea, for example, has a very “workable” method, they have little emissions from highway fuel use … so clearly, the fact that a plan is “workable” doesn’t mean that it is desirable.
w.
Stephen Rasey says:
July 12, 2013 at 12:17 pm
The tax was applied in mid-2008, starting at $10 per ton. It has now ratcheted up to $30 per tonne.
If “2007 is ‘before’. 2008 is ‘during;’, 2009 is ‘after’”, then if you wish to compare before with after, you have to base it in 2008. If you center it in 2007 you can’t compare “before” because according to you 2007 is “before”. Similarly, if you center it in 2009 you can’t compare “after”.
So yes, if you wish to compare Pre-Columbian North America with Post-Columbian North America, you have to use 1492 as the base date … and yes, for a comparison of pre-tax and post-tax emission, using anything but the date of the tax is indeed special pleading. That date is mid-2008.
But heck, you’re free to twist the data any way you want, all the rest of the supporters of the tax are doing it, so why not you? Let us know when your brilliant analysis is done, would you?
w.
From my perspective, as a BC resident, the carbon tax is a total sham. The tax is added to all hydrocarbon based fuels, i.e. gasoline, diesel, propane, natural gas etc. , currently it is frozen at 6.67 cents/liter. That tax is supposed to be revenue neutral with tax credits provided by the government but it is really difficult to see what happens on an individual basis.
The government has also required that publicly funded services such as hospitals, schools etc spend tax payer dollars to reduce their “carbon foot print”. They were required to determine what their impact was according to government guidelines and pay for carbon credits at a private carbon trust. They were not allowed to use the dollars paid to the carbon trust to upgrade facilities.
To reduce the taxpayer dollars spent their they were to upgrade buildings etc to reduce C02 emissions! In the small city I live in, the school board has spent some $800K of capital dollars to replace the heating/A/C system with ground source geothermal system and to reduce the carbon credit dollars paid to the carbon trust. This is insanity, tax payer dollars paid to a private carbon credit trust which grow trees that no one monitors to determine if they are even alive.
This is total insanity to appease the greenie agenda.
I invite you to read the following article from the IEEE Spectrum which further shows the ridiculous lengths that have been taken to reduce CO2 emissions with no consideration for total environmental impact.
http://spectrum.ieee.org/energy/renewables/unclean-at-any-speed/?utm_source=techalert&utm_medium=email&utm_campaign=062713
Willis, it makes little sense to make the “base” year the year of greatest rate of change. Better to make the “base” year the last full year before the decision was made and law passed.
You call that “twisting the data”?
The decline in BC fuel consumption was entirely recession related, and the province was making a strong post-2009 recovery largely as a result of a large rise in exports to Asia, particularly in BC forest products and metallurgical coal. Vancouver has been the site of large, sustained population growth, and sustained very high prices in housing, again largely because of affluent Asian immigration. To pretend that the carbon tax has had any restraining effect on fuel consumption as Rabett suggests is simply delusional given the much larger economic forces at play.
In the case of Saskatchewan, the province has been undergoing a huge economic revival for about the last eight years mostly as a result of the ejection of the NDP from government after about 15 years in power. This has been largely the result of a large surge in business investment across the board in Sask. In 10 years, it has gone from a have-not province to Canada’s second strongest provincial economy. Oil and gas are only a part of the story.
If it was a liberal and it was speaking, there was lying involved.
pwl says:
July 12, 2013 at 5:19 am
Also with gas prices reaching $1.49 per liter yesterday why would they remove such a lucrative and growing source of tax theft revenues?
Yes, you are right, unfortunately I have seldom seen politicians reducing taxation.
Why the tax was introduced is irrelevant. The money is spent on various “absolutely needed projects” – and the result is increasing bureaucracy. A reduction in taxation would only be possible through a reduction in costs, or else it is simply increasing the deficit which is also not the best option.
However reducing costs would mean reducing bureaucracy – which means taking unpopular decision (unpopular with the ones “reduced”), losing their votes.
Once the tax is installed it will stay, unless a very strong majority is against it and the strong message goes through to politics, and the elected ones form a majority and keep their word…
Green tax is just another way to tax the people with the advantage one gets the lunatics to support taxation and can be better “packaged”. What it does in reality is not relevant to politics, but hopefully to enough voters.
I live in a border city in BC, so I always skip across the line to fuel up and buy dairy. The carbon tax was the catalyst that made me a frequent cross-border shopper. The reason why fuel consumption lagged from ’93 to ’98 was political: the previous provincial government from ’91 – ’01 ransacked the economy. Our economic growth was tepid compared to the rest of North America during that time.
Stephen Rasey says:
July 12, 2013 at 11:26 am
When in 2008 was the tax instituted ?
– – –
The tax and subsequent annual increases took effect on Canada day, July 1st. (mid year as Willis has stated).
Just wait till these politicians get the idea for a “Oxygen Tax”
Richard Vada says:
Exactly.
If the tax took effect halfway through 2008, centering on 2008 is inappropriate.You can’t use a period that partially includes the tax to show the change since the tax was implemented.
2007 is your last clean datapoint without the tax, unless you can find seasonally-adjusted monthly data. Looks like centering on 2007 would still show BC doing worse than the rest of the country.
B.C. mulls extra charges for smart meter resisters
http://bc.ctvnews.ca/b-c-mulls-extra-charges-for-smart-meter-resisters-1.1363979
A contact on the inside tells me money is being firehosed at smart meter contractors.
Neo says:
July 12, 2013 at 2:40 pm
Just wait till these politicians get the idea for a “Oxygen Tax”
That’s one thing we are safe from as long as politicians talk.
BC exports twice as much natural gas as is used in the Province. All carbon tax free . The tax
has had no effect in reducing consumption.Natural gas was $10 GJ when the tax was introduced in 2008 .Its now about $4 GJ. so to claim it has had an effect is a lie and the promoters of it know the truth. All the tax does is give the Liberals some greenie wash they can play politics with. The carbon tax is a job killer and is self imposed trade treason by the government of BC.
Duncan MacKenzie says:
July 12, 2013 at 3:28 pm
Fine. When you and Stephen Rasey collaborate on your blog post, you can center it on 2007. Your desires are immaterial to me. I’ve made my decision. You don’t like it? Go do your own.
w.
Jean Parisot says:
July 12, 2013 at 10:21 am
I suspect if you looked at year to year sales results at US gas stations in relative proximity to the border you might also be able to find a measurable effect of tax.
This is exactly right – the city of Bellingham Washington would not survive without the massive number of Canadians who Regularly cross-border shop for gas, clothes, and groceries.
Gasbuddy has Regular Gas at around $1.00 a liter in Bellingham. I will be going down in the next few days for a tankful of gas that will cost just under $30 CDN LESS in Bellingham; I will also buy some books and groceries – these are also cheaper to massively cheaper in Bellingham, compared to Metro Vancouver.
The carbon tax has spawned a growth in fuel tanks for pick up trucks. It seems every second truck has a tank in the back. Fill it in Alberta or Washington and your good for a month or two. The tax has done nothing but raise the cost of food and transportation.
The following link is an RTF file containing 4 Excel Chart Pictures:
Gross Gasoline
Net Gasoline + Net Diesel
Gross Gasoline + Net Diesel
Net Diesel
All are from 2002 to 2011, with 2007 = 1.0
Series by Canadian Province
http://www.wikiupload.com/I88VAYSUWUIJ0NW
(You’ll have to trust me that it is a safe RTF).
Data source:
http://www5.statcan.gc.ca/access_acces/alternative_alternatif.action?l=eng&keng=7.5&kfra=7.5&teng=Download%20file%20from%20CANSIM&tfra=Fichier%20extrait%20de%20CANSIM&loc=http://www20.statcan.gc.ca/tables-tableaux/cansim/csv/04050002-eng.zip&dispext=CSV
Original data from 1992 to 2011, Edited down to 2002 to 2011.
BC, ALB, SAS Emphasized with square markers.
Maritime in dotted lines.
NW Territories and Nunawat series combined. There was some suspected data in these series, but clearly 2007 was a high point for some reason.
Not really. The liberals ( leftists, progressives, socialists, neocommunists … ) like cancer have metastasized to all parts of the planetary body now. Wherever these cells spread they drag along their dogma of worshiping a powerful central government that is empowered to regulate every facet of our lives. God is not dead, government is God.
We all have to face the fact that they are everywhere now and must be dealt with. They have always counted on our boundless good will and ability to stay quiet, ignore them or even vacate to escape their craziness. This was fine when it was just a few big cities but they have trickled down to all points, every state, local and rural government included.
The first step is recognizing and identifying the enemy. They don’t always have convenient (D) and (R) or other obvious nametags. But their common characteristic is that they are natural born slaves, and tireless evangelists for a kind of neo-feudalism. When you see those that fight to the death over concepts of freedom, private property, independence, decentralization and privacy then you have found the enemy within.
They are the ones that never met a tax they wouldn’t accept and never seen a government rule or regulation they wouldn’t bend over for. They are hiding in plain sight asking you to vote for them to save the children and even if you don’t, they will find a way to steal the votes on election day. Amazingly, their only real strategy is to demonize their opponents using strawman arguments like: “What’s the alternative to patronizing government, anarchy?” or in the case of the mad AGW cult: “Vote for us to fix the weather and stop hurricanes and sea level rise”. Simply put, all we really have to do is ridicule and shun them and most important of all, send them packing. We do have that power. No, there is nowhere left to run, we will have to get our hands dirty now.
Just another take from a yank in Bellingham.
I never buy gas in BC and make sure I have enough before I cross the line. Never realized they had the carbon tax but that certainly explains the large increase in gas sales to our Northern Brothers flooding the various gas stations like Costco & Fred Meyers from here to Burlington (25 miles South). These things go in waves and just as suddenly the Canadians stop coming down. Even though it seems like a lot of people coming down, there may not be much of an impact, but I think it would be worth looking at gas station data of towns within 50 miles of the border in Washington, Idaho and Montana.
Funny thing, I was just up to Richmond for Dim Sum and Granville Island and the gas prices were all 145.1 no matter if it was Petro Canada, Esso, Shell, Chevron, Husky, etc. Is there some sort of price control there now?
Something got fouled up with the Vivian Krause link I left at July 12, 2013 at 10:47 am.
So go to the channel here
http://www.youtube.com/user/DavidBernerTV?feature=watch
and choose Episode 88: Vivian Krause
Anthony picked up her article here:
Rockefellers behind ‘scruffy little outfit’
Anti-Keystone protests get millions in funding
By Vivian Krause, Financial Post, Feb 14, 2013
http://opinion.financialpost.com/2013/02/14/rockefellers-behind-scruffy-little-outfit/