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Carbon tax could translate into more demand for canola

“Nobody like taxes… but there is also going to be some opportunities,” as a result of Manitoba’s climate and green plan, Manitoba Canola Growers Association (MCGA) president Chuck Fossay told the Keystone Agricultural Producers’ advisory council Nov. 2.

While the plan includes a flat $25-a-tonne carbon tax starting sometime next year, it also says if Manitoba diesel pumps had to include five per cent biodiesel instead of the current two per cent, carbon emissions over the next five years would drop by between 360,000 to 431,000 tonnes.

  • Read more: Mazier defends KAP’s approach on ‘made-in-Manitoba’ carbon tax

That would be the second- largest method of cutting emission behind the carbon tax, which is projected to reduce emissions by 1.07 million tonnes.

While the carbon tax is projected to reduce emissions by 40 per cent, adding more biodiesel would cut emissions up to 16 per cent, according to the plan.

“If we can convince the government that the biodiesel portion should be from canola, for example that’s a 1.9-million-tonne demand (based on five per cent biodiesel across Canada)…” Fossay said. “There’s a good chance we could see our (canola) prices go up.”

Someone suggested a higher biodiesel requirement could result in higher diesel prices, but Fossay noted “marked” farm fuel is exempt from the carbon tax.

In an interview later he said canola-based biofuel is cheaper to make than drilling for, extracting processing petroleum into diesel.

“We think it (canola-based biodiesel) will go a long ways to helping reduce carbon emissions that come from diesel fuel,” he said.

“By going to the B5 level (five per cent biodiesel) the carbon emissions will be reduced I believe by three to four megatonnes a year. So that goes a long ways to achieving the 80-megatonne targets that the (federal) government has… by 2022.”

The MCGA has not taken a position on Manitoba’s plan, but will discuss it at an upcoming board meeting, Fossay said.

The MCGA does favour more biodiesel, he said.

“Certainly any time we can find a new market for canola seed it’s a benefit to producers across Western Canada,” Fossay said.

KAP also supports regulations requiring more biodiesel be used, KAP president Dan Mazier said in an interview after the meeting.

“It will make a huge difference,” he said.

About the author

Reporter

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.

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