Conservative Leader Pierre Poilievre plans to challenge the federal government over what he calls the "carbon tax 2.0" when Parliament reconvenes. This term refers to clean fuel regulations that have already increased gas prices across Canada.

During a visit to Prince Edward Island on Wednesday, Poilievre claimed he successfully urged the federal Liberals to eliminate the consumer carbon tax. He now aims to focus on clean fuel regulations when Parliament returns in September.

"We are making it a priority to boost take-home pay and reverse the Liberal cost of living crisis by opposing Mark Carney’s carbon tax 2.0," Poilievre stated. He emphasized the need to eliminate all carbon taxes permanently, saying, "We want to increase your purchasing power because we know it’s not just gas and diesel; everything that comes in a truck will be more expensive when you tax fuel."

The clean fuel regulations, which took effect in July 2023, require gasoline suppliers to gradually reduce the carbon intensity of the fuels they produce. These regulations impose stricter annual reduction targets, compelling refiners to either lower carbon intensity, supply more renewable fuels, or purchase credits if they fail to meet the goals. Poilievre argues that these costs will ultimately be passed on to consumers.

Speaking to reporters outside a gas station in Charlottetown, Poilievre referenced a report from the Parliamentary Budget Officer (PBO). The report indicated that Canada’s Clean Fuel Regulations could raise gasoline prices by as much as 17 cents per liter by 2030. This finding was based on data from Environment and Climate Change Canada.

The PBO's analysis also noted that the regulations disproportionately affect lower-income households and could lead to a decrease in real GDP by up to 0.3 percent by 2030, equating to a loss of $9 billion. The report estimated that the financial burden would range from 0.62 percent of disposable income, or $231, for lower-income households, to 0.35 percent, or $1,008, for higher-income households.

Other political parties have criticized the PBO’s report for not considering the costs of inaction on climate change. By 2030, the carbon intensity of fuels must be reduced to 15 percent below 2016 levels, a target expected to result in a reduction of 26 million tonnes of greenhouse gas emissions, according to Environment and Climate Change Canada.

The impact of these regulations is particularly noticeable in Atlantic Canada, where gasoline prices are regulated. To protect smaller fuel retailers from potential margin squeezes, the four Atlantic provinces incorporated a charge for the federal clean fuel standard into the cost of gas. In New Brunswick, legislation was passed to allow this cost to be transferred to consumers, modifying the price-setting formula to include a "cost of carbon adjustor." This adjustment has recently added an extra 8.77 cents per liter to the price of regular unleaded gas in the province.

Poilievre warned that gas prices will continue to rise as long as the fuel standard is in effect. "They pass it all on," he said of refiners. "Bottom line is that the big companies don’t really care all that much because they know the consumer will end up paying the price. It’s always the case."

On Wednesday, Poilievre also reflected on his previous success in persuading Carney to abandon the Trudeau government’s carbon pricing ahead of the federal election earlier this year. "I did take some satisfaction in winning the debate on the carbon tax," he said. "I led the great Conservative team in an ‘axe the tax’ campaign that everyone dismissed and then had to reverse themselves."

Looking ahead, Poilievre stated, "This fall, our priorities are very clear," emphasizing a focus on increasing Canadians' take-home pay, reducing crime, limiting immigration, and fostering a self-reliant Canada through energy development. The House of Commons is scheduled to reconvene on September 15.

Poilievre's trip to the east coast included stops in Nova Scotia and attendance at the funeral of former federal minister and Conservative MP Gail Shea in Prince Edward Island. He expressed his admiration for Shea, saying, "I have not met a single person that didn’t love Gail Shea. She had a big, beautiful heart, and, you know, when I was going through hard times in life, I would often call her and she would fill me with encouragement and mentorship." He concluded, "She will be remembered as a great Islander and a great Canadian."