(Bloomberg) -- President Joe Biden’s landmark climate bill has prompted one of Canada’s largest gas-station owners to scrap a planned renewable-diesel plant near Vancouver, illustrating how countries are struggling to counter the US’s green subsidies.

Parkland Corp. cited the US legislation by name in explaining why it’s not proceeding with the low-emissions, 6,500 barrel-a-day facility near its Burnaby refinery.  

“Several factors have impacted the competitiveness of the renewable-diesel complex, including rising project costs, a lack of market certainty around emerging renewable fuels and the US Inflation Reduction Act of 2022, which advantages US producers,” Calgary-based Parkland said in its earnings statement on Thursday. 

The cancellation is a further example of how Biden’s sweeping clean energy and climate incentives are stoking tensions with the country’s allies around the world. Canadian Prime Minister Justin Trudeau faced calls from companies ranging from automobile manufacturers to oil producers to match the subsidies from its largest trading partner, though government officials have acknowledged privately that Canada can’t go dollar-for-dollar with the US.

In one high-profile example, Trudeau has put forward tax incentives for a massive network of carbon capture and storage facilities to reduce emissions from the country’s oil-sands industry, but he still faces a gap in matching the production tax credits contained in the US legislation. 

Parkland said in May that it would invest C$600 million ($441 million) in projects including the standalone renewable-diesel complex and an expansion of its co-processing volumes to about 5,500 barrels a day. 

The initiatives were projected to create 1,000 jobs, and a final investment decision was due this year. The Burnaby plant would have converted organic material into low-carbon fuel that’s chemically identical to diesel produced from crude oil and receives fuel credits in the US as well as additional credits in California and British Columbia. 

--With assistance from Jennifer A. Dlouhy.

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