Kevin Nicolle spends several hundred dollars a week on fuel to operate his mobile pressure washing and car wash business in Saint John.
He marvels at the ups and downs in gasoline and diesel prices that he has been experiencing several times a week.
Over the weekend, the trend was up.
“It’s terrible,” Nicolle said. “But I mean what can you do? There’s nothing you can really do.”
At the end of last week, trading in the New York gasoline markets was up six cents. In response, New Brunswick, alone among the Maritime provinces, lifted the ceiling on what gasoline retailers can charge consumers on Sunday.
It was the third increase in the province in four days.
On Thursday, prices rose during normal weekly pricing by the New Brunswick Board of Power and Utilities.
On Friday, there was a spike in federally mandated carbon charges that hit New Brunswick but left consumers in Prince Edward Island and Nova Scotia untouched.
Market driven rise
Then the special market-driven surge came on Sunday.
In gasoline, it totaled 19.6 cents in increases in four days, and by Monday morning legal maximum gasoline prices in New Brunswick had risen nearly 14 cents a liter more than in Nova Scotia. Diesel prices were a record 29 cents higher.
Prince Edward Island’s price advantages over New Brunswick are similar.
“I don’t understand that,” said Nicolle, who is puzzled by the differences but has no choice but to pay.
“It’s hard to do these days, but you have to do it… A man has to make a living.”
The drastic price shocks in New Brunswick, up and down, are caused by rigid rules in the operation of its oil price regulation system. They require changes in New York commercial markets of six cents or more to be passed on to consumers in just over a day.
Nova Scotia and Prince Edward Island give regulators in those provinces more discretion to smooth out changes, especially as they move up and down in the following days.
During the last week, not including carbon charges. New Brunswick moved three times its maximum gas price. There was a decrease of 9.2 cents on Wednesday, an increase of 9.8 cents on Thursday, and another increase of 7.2 cents on Sunday.
In Nova Scotia, prices changed only once: a reduction of 5.5 cents on Friday.
Sometimes New Brunswick’s system will produce a sudden discount to the benefit of consumers, such as on March 11, when diesel prices fell 24 cents below those in Nova Scotia. Sometimes it’s the opposite, like on Friday when it shot up 29 cents higher.
But the rising prices in New Brunswick are also structural, mainly due to carbon charges.
On April 1, New Brunswick’s carbon dioxide emission charges under federal requirements increased to $50 per ton. That increased carbon taxes in New Brunswick to 11.05 cents per liter for gasoline and 13.41 cents for diesel.
The same two charges in Nova Scotia are 1.18 cents on gasoline and 1.5 cents on diesel. Those amounts did not change on April 1.
Nova Scotia opted for a complex cap-and-trade system to set the price for carbon in 2019 that has allowed it to escape significant increases in fuel prices.
Criticism of environmentalists
It’s a difference that has drawn sharp criticism from environmentalists like Louise Comeau, director of energy, climate change and energy solutions at the New Brunswick Conservation Council.
Higher carbon costs in New Brunswick are partially reimbursed to consumers through lower income taxes and other measures. But they also generate significant price differences at the pumps with neighboring provinces and, according to Comeau, undermine the idea of a national climate policy.
“We have to move towards a much more consistent and coherent approach,” Comeau said in an interview with CBC News earlier this year.
“It doesn’t do anyone any good to have different regimes and put New Brunswick in a real bind.”
The federal government has pledged to reduce carbon price differences between provinces, but that may not begin to happen in Nova Scotia until 2023.
Meanwhile, Prince Edward Island was supposed to start charging the same carbon prices as New Brunswick last Friday, but failed to pass the legislation in time to meet the deadline.
He is currently charging 4.4 cents a liter for gasoline less than New Brunswick, but he promised changes will come this week.