Beyond obvious affordability concerns, forecasts of dramatically-increasing energy costs this winter threaten Canadian real estate owners and buyers on another level. Since these pronouncements appear to herald a short-term crisis, real estate buying, development and selling decisions may not take the long-term impact of rising energy costs into full account.

Yes, this will be a tough winter, but even if crude oil prices dip at some point, the crisis will not be over. Energy cost can no longer be considered an incidental expense to buyers or an optional design consideration in development.

Managing real estate investments by responding to daily fluctuations in gas pump prices may short change you. Long-term strategies are essential to building property value and protecting it against economic fluctuations, including energy cost increases.

The re-calibration has begun. Gas prices that were unthinkable a few years ago are now acceptable. Pump prices went up to C$1.40 a litre (that's about C$5.30 a US gallon) and caused panic. Now, that gas prices have slipped under a loonie a litre (a previously unimaginable price), there's widespread relief, but the problem has not gone away.

"Approximately one third of the price of a litre of fuel in Canada is taxes," said John Williamson, Federal Director of the Canadian Taxpayers Federation (CTF), an advocacy organization that works to lower taxes, eliminate government waste and hold politicians accountable to taxpayers. "Taxpayers want action in the form of lower taxes on fuel, not more excuses from the government why gas taxes cannot be reduced.

"It is time Ottawa ended its gas gouging. This can be accomplished with three easy steps. Ottawa should end its GST tax-on-tax bite. This will lower the price, on average, by 1.5 cents a litre. It should scrap the 'deficit elimination' tax, which will save another penny and a half. Lastly, reduce the federal levy by 2 cents, bringing the total saving to motorists to 5 cents a litre. Theses modest measures will return $2-billion to taxpayers each year."

CTF sets the cost paid by Canadian motorists through "the GST tax-on-tax bite (since 1991) and the 'deficit elimination' tax (since 1998)" at $9.5-billion. According to CTF, less than 5 per cent of the C$6-billion collected by the federal government each year in gasoline taxes is put back into our roadways.

One indicator of future rising energy costs is the government's revenue-protecting response to outcry over its gains on gas and energy taxes in this most recent crisis. The federal government does not give up its income -- your taxes -- without a fight. Remember the infamous 'tax bracket creep' caused when the income tax system was "de-indexed?" CFT reports that federal and provincial government coffers bulged with an additional C$90 billion before public pressure put an end to that revenue source 14 years later.

While purporting to protect Canadian investments and lifestyles against rising crude prices without cutting taxes, the Government of Canada is:

• Prepared to strengthen the Competition Act and the Competition Bureau by increasing criminal fines for conspiracy from C$10 million to C$25 million. This is considered sufficient deterrent to "unlawful cartel behaviour."

• Providing consumer information on crude oil, gasoline and furnace oil prices through the Office of Petroleum Price Information , funded at C$15 million for the next 5 years.

• Offering a package of short-term and longer-term measures to help Canadians deal with high energy costs. It is "providing timely and direct financial assistance to low-income seniors and low-income families with children" by authorizing about 3.1 million payments totaling C$565 million under the proposed Energy Cost Benefit legislation

• Creating "a number of measures to provide greater protection against future price volatility and achieve lasting environmental benefits by making homes and other buildings more energy-efficient" including

  • C$500 million to provide direct financial assistance of between $3,500 and $5,000 to approximately 750,000 low-income households by 2010 that should defray the cost of items such as draft-proofing, heating system upgrades and window replacement under the new EnerGuide for Low-Income Households (EGLIH) program. For multiple-unit buildings and rooming houses, financial assistance will range between $1,000 and $1,500 per unit. Reportedly, cost savings will average about 30 per cent per household.

• Freeing up C$400 million in previously allocated funds to allow municipalities to boost investments in urban transit over the next two years.

But don't spend the extra money yet. Payments under the proposed Energy Cost Benefit and EGLIH program can be issued only after the legislation has received Royal Assent.