If re-elected, British Columbia premier will impose coal tax

Tue May 2, 2017 3:29pm EDT
 
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By Nicole Mordant

VANCOUVER (Reuters) - British Columbia Premier Christy Clark, campaigning one week before an election, said on Tuesday her ruling Liberal party will apply a levy on thermal coal exports from the Canadian province if it is re-elected and the federal government does not ban exports.

Clark, whose Liberal party is neck-and-neck with the opposition New Democratic Party in polls ahead of a May 9 election, last week called on Canadian Prime Minister Justin Trudeau to ban thermal coal exports through British Columbia.

The move is in retaliation against the United States for slapping duties on Canadian softwood lumber. A handful of U.S. miners ship coal through B.C. ports. Meanwhile, British Columbia is Canada's largest producer of softwood lumber, and last year exported C$4.6 billion ($3.35 billion) worth to the United States.

If the Canadian government does not ban exports, a re-elected B.C. Liberal government would develop regulations to levy a carbon price on all thermal coal shipped through B.C. ports, Clark said in a statement.

The levy will reflect the greenhouse gas emissions caused by the coal's extraction, processing, transportation and combustion, she said in a statement.

A coal levy, which would be the world's first greenhouse gas benchmark for thermal coal according to the Liberals, would make it uncompetitive to ship thermal coal through B.C. ports, Clark said.

Between 70-90 percent of coal produced in B.C. is metallurgical, or steel-making coal, not thermal coal, which is burned for heat to produce electricity.

U.S.-based Cloud Peak Energy would be the biggest U.S. coal producer affected by a B.C. export ban or levy, Jefferies analyst Christopher LaFemina said in an April 28 note to clients.   Continued...

 
FILE PHOTO: British Columbia Premier Christy Clark takes part in a news conference during the First Ministers’ meeting in Ottawa, Ontario, Canada, December 9, 2016. REUTERS/Chris Wattie