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SOMBA K'E/YELLOWKNIFE - The territorial government is looking at the possibility of implementing a carbon tax as part of its plan to reduce fossil fuel emissions.

The carbon tax option is highlighted in a brief priority statement included in the government's Energy Priorities Framework, tabled in the legislative assembly by Industry, Tourism and Investment Minister Bob McLeod on Oct. 7.

Bob McLeod: Carbon tax just one of many ideas

It's just one of 23 objectives proposed in the document aimed at reducing energy costs and the territory's reliance on imported fossil fuels.

Nonetheless, just proposing a carbon tax is bound to raise eyebrows considering the poor reception Liberal leader Stephane Dion's "Green Shift" plan received in the recent federal election and the growing anger among some residents in B.C. - one of the first North American jurisdictions to impose a carbon tax other than Quebec - over rising costs at the gas pump and for heating fuel.

Added to that, the territorial government has faced criticism in recent weeks for entertaining a host of possible new taxes and tax hikes in order to cover a two-year budgetary shortfall of $40 million.

David Nightingale, director of energy planning for Industry, Tourism and Investment, said if a carbon tax is introduced in the territory, a "made-in-the-North" solution may be required. He said it's important the government takes a look at a carbon tax option now that it's being entertained by other governments elsewhere as the fear about the impact of carbon emissions on climate change continues.

"We should do some work ahead of time and be prepared for what the national and international response to this issue is," said Nightingale.

"We might need a made-in-the-North solution, one that does not substantially impact the cost of living in the North. What will that made-in-the-North solution look like? That's the process we need to go through."

Mayor Gord Van Tighem, on the other hand, said now is not the time to impose any kind of new tax.

"If you're looking at decreasing the cost of living, the introduction of any additional tax is not a good thought."

Jon Jaque, president of the Yellowknife Chamber of Commerce, echoed that sentiment.

"The bottom line is, from the chamber of commerce perspective, any raised costs, a.k.a taxes, decreases the viability of people living in the North," said Jaque.

"It will cause people to leave and therefore it is not a good idea."

Weledeh MLA Bob Bromley, who was keen to see a carbon tax implemented when he was elected to the legislative assembly last year, said the measure has gotten a bad rap and residents likely won't even notice a cost increase if it were applied because the added cost would be very small.

"The fluctuation in the price of energy is such today that you wouldn't notice a carbon tax," said Bromley.

"I think people are afraid of it because it is new but when you actually talk about these things you find out they're not that big a deal. They can be made revenue-neutral and so on."

B.C. introduced its carbon tax earlier this year. It applies to virtually all fossil fuels, including gasoline, diesel, coal, propane and home heating fuel. Drivers now pay an extra 2.4 cents per litre at the gas pump, which will climb to a maximum of 7.2 cents per litre by 2012.

The B.C. government considers the tax revenue-neutral, meaning that as carbon taxes go up other tax rates go down. The government issued to lower income residents the first of what are to be annual climate action credits of $100 per adult and $30 per child earlier this year.

On Wednesday, the minister of Industry, Tourism and Investment told Yellowknifer that a carbon tax is just one of many ideas the territorial government is looking at to help fight climate change. He acknowledged that it might be hard to convince people to accept it.

"It's hard to sell that kind of plan," said McLeod.

"We're just looking at it. We're not saying we're going to implement it."