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The Alberta Court of Appeal has concluded the federal government’s carbon tax is an unconstitutional intrusion into provincial powers, handing Alberta a key victory in its battle with Ottawa over climate-change policies.

In a 4-1 decision, the court rejected the federal Liberal government’s claim that the carbon tax falls within its powers to address matters of national concern under the “peace, order and good government” clause of the Constitution. The highest courts of Ontario and Saskatchewan sided with Ottawa last year in similar cases in those provinces, setting up a hearing next month where the Supreme Court of Canada will decide on the future of the federal carbon tax.

None of the rulings so far, including Alberta’s, are binding.

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Writing for the majority, Alberta Chief Justice Catherine Fraser warned that the law creating the federal tax is a “constitutional Trojan horse” that would grant Ottawa wide powers to intervene in provincial affairs. “Buried within it are wide-ranging discretionary powers the federal government has reserved unto itself. Their final shape, substance and outer limits have not yet been revealed,” she wrote.

Justice Thomas Wakeling, in a separate opinion that sided with the majority, wrote that no valid emergency exists to give the federal government such sweeping powers to impose a carbon tax.

“The Greenhouse Gas Pollution Pricing Act is a massive and unprecedented peacetime non-emergency invasion of Alberta’s and other provinces’ jurisdiction,” he wrote.

Ottawa imposed a consumer carbon tax on Alberta on Jan. 1, after Premier Jason Kenney’s United Conservative Party government scrapped a tax created by his NDP predecessor and launched a court challenge of the federal law. The UCP government retained a carbon tax on the province’s largest industrial emitters.

Speaking with reporters after the decision was released, Mr. Kenney said his government remains firmly opposed to the carbon tax. Like other conservative leaders, he said he believes the tax punishes families for driving automobiles and heating their homes. The Premier said carbon taxes on industry, as well as stricter government regulation on pollution, would be a cheaper way to combat climate change.

“We expect the government of Canada to comply with the order from the court today and remove the federal carbon tax on Albertans. Because really folks, that tax is not about the environment,” Mr. Kenney said in Edmonton.

The Premier said he expects the Alberta court’s decision will be part of the Supreme Court’s hearing on the federal law. “This government, together with our allies across the country, will continue to defend the Constitution of Canada,” Mr. Kenney added.

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Federal Environment Minister Jonathan Wilkinson said Ottawa will await the Supreme Court’s decision later this year before reacting to the Alberta court.

“The Ontario and Saskatchewan Courts of Appeal have both determined the federal plan to put a price on pollution is constitutional. Our government will look to the Supreme Court of Canada’s decision and we are confident that the price on pollution is within federal jurisdiction,” he said.

According to the federal government, most Alberta families will receive more in income-tax rebates than they can expect to pay in carbon taxes. The government expects the average family of four will receive $888 this year.

The court found that the power to regulate non-renewable natural resources rests with provincial governments under the Constitution and the federal carbon tax upsets the balance between Ottawa and the provinces.

Justice Wakeling wrote that the law would end federalism in Canada. He added that the law could allow Ottawa, without consulting the provinces, to regulate the temperature of thermostats in homes, as well as ban gasoline-powered cars and the raising of cattle.

“This assault on provincial jurisdiction could only be justified if Parliament validly claimed an environmental emergency that threatened life as we know it on planet earth and required an immediate and comprehensive response to dangerously high levels of greenhouse gas emissions,” Justice Wakeling wrote.

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The court noted that the federal carbon tax law doesn’t declare a state of emergency due to climate change. “In the absence of a valid environmental emergency, the federal and provincial governments must work together,” Justice Wakeling added.

Amir Attaran, who represented the Athabasca Chipewyan First Nation in the case, said he doesn’t expect the decision’s findings and tone will be well received by the Supreme Court.

“In law school you’re taught to avoid slippery slope arguments and this is the paradigm of a slippery slope agreement: If the law is upheld the climate police from Ottawa will be making arrests around every home’s thermostats. It’s unserious and that will be to Alberta’s detriment at the Supreme Court,” said Dr. Attaran, who is a law professor at the University of Ottawa.

The majority wrote that they were not considering the science behind climate change or Canada’s commitments under the 2015 United Nations Paris Agreement on Climate Change, but instead were focused only on the constitutionality of the law. Ottawa has used the law to impose carbon taxes on Ontario, New Brunswick, Saskatchewan and Manitoba.

Justice Kevin Feehan was the lone dissenter. He sided with the earlier decisions of the courts in Saskatchewan and Ontario and found that the federal law was constitutional.

We have a weekly Western Canada newsletter written by our B.C. and Alberta bureau chiefs, providing a comprehensive package of the news you need to know about the region and its place in the issues facing Canada. Sign up today.

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In 2018, the federal government announced that all provinces would need to implement a carbon-pricing system by April 1, 2019 and those that didn't would fall under a federal carbon tax. But what is carbon pricing anyway?

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