Even though they’re currently on pause, the threat of Trump tariffs has sent shockwaves through the Canadian economy. British Columbia’s exports to the United States, in particular natural resource exports, are at risk. 

In this new world of trade uncertainty, there is mounting pressure on the BC government to scrap its climate change commitments and to facilitate the approval of new liquefied natural gas (LNG) facilities to expand exports to Asia and other non-U.S. destinations. Premier David Eby has expressed support for fast tracking gas development, and China’s imposition of tariffs on American LNG in response to Trump would complement such moves.

However, it is important that we don’t lose the big picture. While we must react in the short term to the threat of Trump’s tariffs, building a BC economy that is sustainable and fair cannot be taken off the table.

BC has already been a flashpoint for the development of new infrastructure aimed at reducing the reliance of Canadian energy products on the U.S. market. Front and centre is the controversial and massively over-budget Trans Mountain Pipeline Expansion, which was expressly aimed at providing new capacity to tidewater—and thus the rest of the world—for Alberta’s oil industry.

If greenhouse gas (GHG) emissions causing global climate change were not an issue, the TMX might be viewed as a victory for the federal government, despite cost overruns. The wide range of climate change-induced extreme weather disasters in Canada and around the world, however, point to the need for a very different direction for Canada’s energy sector.

Later this year, LNG Canada will be up and running on BC’s north coast, providing an alternative outlet for BC gas that is currently landlocked and exported to Alberta and the U.S.. Again, a timely development in light of the still-looming threat of Trump tariffs that would add 10 per cent when crossing the border, if enacted.

LNG requires costly processing facilities to cool the gas before loading it onto tankers that can be sent anywhere in the world. A decade ago, new LNG terminals were viewed as a way for BC producers to profit from the arbitrage of selling cheap BC gas in Asian markets where the price was (at the time) much higher.

Since the final investment decision of LNG Canada in 2018, both the BC and federal governments have taken steps to address the GHG emissions from the combustion of fossil fuels. These steps remain incomplete and have largely focused on domestic emission sources while letting fossil fuel exports surge—an uncomfortable contradiction between climate action and fossil fuel development.

BC’s 2023 Energy Action Framework attempts to balance oil and gas development with the urgent need to get the world off fossil fuels. It requires that new LNG facilities clean up their operations by plugging into the BC Hydro electricity grid instead of using gas to power operations. As part of BC’s environmental assessment process, new LNG plants must pass an emissions test and have a credible plan to be net-zero by 2030.

This drive for more LNG production in BC is already stressing BC Hydro’s electricity supplies. Providing clean electricity for both LNG and new mining operations is competing with the need for clean electricity to decarbonize transportation, buildings and other industries.

BC Hydro’s 2024 call for power notably includes First Nations as partners in clean energy development, in a bid towards reconciliation. But producing clean electricity to greenwash LNG projects is a terrible use of limited resources.

Moreover, the marginal cost of this new electricity supply will be high and must be supported by higher rates for households and businesses in BC. Already, the Site C hydroelectric dam, coming online later in 2025, will put upward pressure on rates due to its own massive cost overruns.

In light of these challenges, politicians will be tempted to roll back climate commitments for the development of new LNG exports. A few major proposals (including Cedar LNG and Ksi Lisims LNG, both of which have First Nations participation) are still awaiting final investment decisions. Scrapping emissions requirements would help push them across the finish line.

The newly elected BC government is even considering eliminating BC’s carbon tax for LNG projects altogether. Already, LNG Canada has received special treatment on carbon pricing, capping its tax at 2017 levels. A new BC carbon pricing system was implemented for bigger industrial polluters in 2024, which exempts 65 per cent of oil and gas emissions from carbon pricing, and allows dubious carbon offsets and credits for half of the remaining balance.

Eliminating the carbon tax for LNG operations would be tragic, exempting the very oil and gas industry causing global climate change from efforts to stop it. To make matters worse, the carbon tax only applies to emissions within BC, not the lion’s share of emissions when exported gas is combusted outside BC.

Notably, the LNG Canada facility in Kitimat is well positioned for expansion to a second phase of development. The consortium behind it includes Shell, one of the world’s biggest oil and gas companies, along with the major importing countries in Asia. A second phase of LNG Canada would also be exempted from the Energy Action Framework emissions and net-zero targets.

If we did not care at all about global climate change, it would seem a no-brainer to support new LNG plants, although some energy industry analysts have pointed to a weak outlook for LNG demand. But we have to be realistic about global carbon emissions, and wealthy jurisdictions like BC need to step up if the world is to address this massive collective action problem.

There will be a time when Trump is no longer in office. As climate-change-related crises get worse, the world must not lose the momentum towards clean sources of energy. One bright light in recent years is that renewables have become much more competitive on the margin relative to fossil fuels, and that advantage will only increase over time.

The fight against the Trump tariffs must be balanced with an industrial policy aimed at decarbonization. Digging deeper into fossil fuel expansion and simply seeking alternative markets than the United States is not a long-term win for Canada—or the world.