Ottawa gas prices have risen faster than any other major city in the country since March. Photo courtesy of Elron6900.
By Kevin Martine
An analysis of Statistics Canada data shows that Ottawa gasoline prices have risen faster than any other major city in the country since the federal carbon tax was applied in April. The average price of regular unleaded gasoline in Ottawa rose 7¢ per litre to $1.18 between March and August, a 6.2 per cent increase over that time.
In much of the rest of the country where the carbon tax was not applied, prices fell, such as in Montreal, where the price dropped 1.0 per cent.
Prices also rose in other cities in Ontario after the carbon tax was applied, such as Toronto, where prices are up 2.3 per cent. The same is true in New Brunswick, as prices rose 4.7 per cent in Saint John. However, in cities in the western provinces of Saskatchewan and Manitoba where the carbon tax was imposed, prices actually fell slightly. The price in Regina for instance, dropped 2.0 per cent. Western oil prices also fell during that time.
The largest decline in the country was in Calgary, where prices dropped 10.0 per cent.
While some of Ottawa’s 7¢ price increase can be attributed to the federal carbon tax being applied to fuel in April, experts say that only adds about 4¢ per litre.
“There are three components to the price we pay at the pump,” said Jean-Thomas Bernard, a professor of economics at the University of Ottawa. The first Bernard said, is the price of oil, which makes up roughly 65¢, although it varies as the oil price changes. Then there are taxes, including provincial taxes as well as the carbon tax, and costs related to refining and distributing gasoline.
“So the carbon tax,” Bernard said, “is still relatively small compared to the changes in the price of oil.”
Bernard also noted that while gas prices may have risen faster over the past few months, prices in Ottawa are still well below those paid in Vancouver, where the average price was over $1.48, or more than 30¢ higher.
Morgan Gay, NDP candidate for Ottawa-South, said he supports the carbon tax even with the price increases.
“We need to stop looking at fossil fuels as the be all and end all because that’s not the way of the future,” Gay said.
Gay said the NDP plans to set up a government commission to regulate gas prices and help keep prices under control.
Other federal candidates did not respond to requests for comment. However, the Liberal government says the average household in Ontario can expect to receive roughly $300 in tax rebates. An analysis by the Parliamentary Budget Office released in April suggests most Ontarians will receive more back in rebates than they pay in higher gas prices.
The Conservatives have promised to repeal the carbon tax, and the Green Party says it will keep the carbon tax while also eliminating the separate system for industrial emitters.
The carbon tax is set to rise from $20 per tonne currently to $50 per tonne in 2022.