Hoo boy. Last year, we reported that per capita gasoline consumption in British Columbia spiked unexpectedly in 2009, notching a 9 percent per capita gain. The numbers struck us as odd, but not inconceivable—especially given the steep drop in fuel prices in 2009, coupled with the fact that the province was gearing up for the 2010 winter Olympics. So we checked with the provincial agency that gave us the numbers; and when they assured us that they were confident in the figures they gave us, we went with them.
But now, the official numbers from StatCan, Canada’s main statistical agency, tell a very different story. Per person consumption didn’t spike after all, according to StatCan. Instead, it basically held steady. And the provincial agency that gave us the original numbers has confirmed that the numbers they gave us last year were wrong; they double counted some fuel sales. Drat.
So now that we know that the numbers we reported were wrong, we wanted to say: we’re sorry. We do our level best to catch errors, but this one sneaked through. Unfortunately, our report caused a bit of a hubbub in BC, especially among a few folks who were trying to claim that the provincial carbon tax wasn’t working—which meant that we inadvertently muddied the debate over what we believe to be the planet’s most effective and well-structured carbon tax shift.
But there’s yet another wrinkle in the story.
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Just last week, StatCan released the new official numbers for 2010. They show a significant uptick in gas consumption from 2009 to 2010, almost like a miniaturized echo of the same trend we thought we’d spotted a year earlier.
Given our experience with the 2009 data, we’re hesitant to say—yet—that the 2010 uptick is real. It’s certainly possible. Yet it’s also clearly out of step with the trends in the Northwest states, where gas consumption has remained roughly flat.
So for the moment, we’re suspending our judgment about the fuel consumption trends that are being reported by StatCan. We’re also working on the 2011 version of our annual report on gasoline use trends in the Northwest, which will focus on Oregon and Washington. Stay tuned.
The 2010 BC gasoline rise reported by statCan does seem a bit high and out of step with other indicators and trends.
The BC GDP did rise about 4% which is similar to the gasoline rise. But gas prices also rose about 10% and long term trends have been downward on per-cap gas use. The Olympics were credited with a big decline in traffic in the lower mainland where most people live and drive. It will be interesting to see what the final numbers are.
Regardless of final numbers, the role of the carbon tax is pretty basic economics. By raising the price of gas it will discourage some use. The question is whether the carbon tax is high enough to get gas use to fall enough to meet legally mandated GHG levels in BC. I think everyone agrees it is not high enough yet. But that isn’t the full measure of it. It was never intended to be so large in the third year to force big changes. It was designed to come in slowly to affect long term purchasing decisions by big fossil fuel consumers, like companies, at the start. Those decisions have a longer timeframe to play out in lower gas consumption.
A quick decline in gas consumption would come from a carbon price so high it discouraged significant driving via existing vehicles. That probably wouldn’t be accepted at this point by voters.
So, until other jurisdictions jump in with serious carbon pricing it seems unlikely the BC carbon tax will rise so high that it does more than encourage efficiency in fleet turnover.
Good points, Barry.