“It boggles my mind why there’s no action to resolve this.”
–Kiel Giddens
It was all smiles when Premier David Eby joined executives from Tidewater Renewables in Prince George last year to help mark the grand opening of Canada’s renewable diesel refinery.
“A low-carbon future means high-quality jobs and clean industry for British Columbians, as this investment by Tidewater in clean diesel refining shows,” Eby said, standing outside the $380 million refinery.
“By prioritizing reducing carbon pollution, we’re opening B.C. for business and investment, and building healthier communities, while fighting climate change.”
Just 18 months later, and Tidewater stands on the brink of collapse, a victim of a loophole in the provincial low-carbon fuel credits program that was supposed to ensure its success.
“By prioritizing reducing carbon pollution, we’re opening B.C. for business and investment…””
David Eby
“As early as March they could be at insolvency because of what’s going on in this unfair trade market,” said BC Conservative MLA Kiel Giddens, whose Prince George-Mackenzie riding encompasses the plant.
“They’ve been pounding their head on the door of the province, and a little bit in Ottawa, and haven’t gotten anywhere.”
Giddens has crafted a private members’ bill to close the credit loophole, which is being exploited by American renewal diesel manufacturers who are shipping their product into British Columbia. But he’s unable to table the bill because the NDP called off a fall sitting of the legislature.
“The premier was up here touting this, so that’s why it boggles my mind why there’s no action to resolve this,” Giddens said in an interview.
‘This company may not survive’
Tidewater uses canola oil, tallow, used cooking oil and other oils to produce the renewable diesel, which is considered identical to regular diesel and can be used in existing engines. It produces an average of 65 per cent fewer emissions than petroleum diesel.
At issue is B.C.’s low carbon fuel standard credit market. It’s the only one in Canada, and B.C. set it up to help encourage companies like Tidewater to open facilities. The system awards credits to low-emission suppliers, who can then sell them to facilities with higher emissions to help bring their emissions down.
But Giddens says the system has been exploited by American renewable diesel producers, who get subsidies from that country’s Inflation Reduction Act, and then “double dip” by accessing B.C.’s subsidies as well — letting them flood the province with cheaper product and devaluing the credits companies like Tidewater need to survive.
“It’s wrong,” said BC Conservative leader John Rustad. “We have a piece of legislation to simply change that, and that’s something I’m sure the Green Party would be very interested in, in terms of supporting this type of a product that’s produced in B.C.”
“I worry this company may not survive,” added Rustad.
Province blames US subsidies, not BC-only fuel credits
Reuters reported in October that American producers shipped more than 530 million litres of renewable diesel to Canada in the first half of 2024, compared to 151 million litres in the previous year. As a result, B.C.’s low carbon fuel credits fell from above $400 to a low of $207 in July, Reuters reported.
When Reuters highlighted the issue in October, the B.C. government said it wasn’t currently considering changing the credit system because fluctuations in demand are normal.
The Ministry of Energy and Climate Solutions changed its tune this week, saying in a statement that “we have heard from industry stakeholders, including Tidewater Renewables, that subsidies in the U.S. are impacting suppliers across Canada.
“It’s clear we need a national approach to support production in Canada.”
BC Ministry of Energy and Climate Solutions
“As biofuel production increases so has the number of international trade disputes, and it’s clear we need a national approach to support production in Canada,” the ministry stated.
“We’ve been working with Natural Resources Canada to ensure a fair deal for B.C. biofuel producers, And Premier Eby has advocated for increased support to the biofuels sector directly to the Prime Minister.”
A squandered ‘achievement’
Tidewater, meanwhile, is haemorrhaging money, according to its latest quarterly financial report.
Its CEO told the Prince George Citizen this week that without a solution, it will likely have to shutter operations at the end of March. That would also derail a potential sustainable aviation fuel refinery and push B.C. off its CleanBC pollution reduction targets.
The plant’s closure would be in stark contrast to what then energy minister Josie Osborne called “an incredible achievement” in 2023.
“It’s an exciting time, but we have to be ready to take it,” Eby said at the opening, citing the Canadian-first facility.
Fewer than two years later, though, the province appears to be squandering the opportunity.