Public subsidy of the BC forest industry 2010-2019

THE EVERGREEN ALLIANCE is creating a fulsome account of all the benefits the forest industry receives by not having to pay for something that the general public does pay for, or paying a lower rate. Together, we call these the public subsidy.

(1) The forest management subsidy: The cost of the ministry of forests' operations related to forestry are significantly greater than such revenue as stumpage, the BC Logging Tax, and export fees. The difference must be paid for from the public purse. Our numbers were obtained through FOI requests for the ministry's records of operational costs related to forests, as well as other costs such as benefits obligations and capital expenses. We also FOIed the ministry's record of forest-related income.

(2) The electrical energy subsidy: This subsidy arises because there is a difference between what BC Hydro charges major forest industry customers and what it charges residential customers. Hydro penalizes residential consumers who use more electrical energy, but private forestry companies, who use much more energy, get a much lower rate. Information about the electricity subsidy was obtained through an FOI request of BC Hydro's records related to electrical energy consumption by the BC forest industry.

(3) The carbon emissions subsidy was based on our estimates of carbon prematurely released as a result of logging in BC, and the applicable carbon tax in the year the emissions were created. The general public must pay a tax on the use of hydrocarbon fuels because using it results in carbon dioxide being released to the atmosphere. As a result of forestry activities, far more carbon dioxide is released to the atmosphere but the BC Carbon Tax is not applied. This amounts to a public subsidy of the forest industry. The values for this subsidy were calculated using the ministry of forests harvest billing system and scientific studies.

(4) The loss of carbon sequestration capacity subsidy is based on the annual difference between the provincial estimate of carbon sequestration capacity and the carbon sequestration capacity estimated by the Province during the 1990s. The cost of each year's loss is based on the value of the BC Carbon Tax in the corresponding year.