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ARTICLE · 06 AUGUST 2019

New Details Released Regarding Federal Pollution Pricing Regime

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Under the current regime, compensation can be paid at the Fuel Charge rate or through the remittance of surplus credits.

CanadaEnvironment
Rangi Jeerakathil
Rangi Jeerakathil
Jessica Buhler
Jessica Buhler
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On June 28, 2019, Environment and Climate Change Canada released the Output-Based Pricing System Regulations – a key piece of the federal government's pollution pricing regime.

The Output-Based Pricing System Regulations regulate industrial greenhouse gas emissions and give effect to Part 2 of the Greenhouse Gas Pollution Pricing Act. The regulations are yet to be published in the Canada Gazette, but are expected to be shortly.

Federal Pollution Pricing Regime

The Greenhouse Gas Pollution Pricing Act sets out the legal framework for the federal carbon pollution pricing backstop system. It has two parts:

  1. various charges on specified fuels ("Fuel Charge"); and
  2. an output-based pricing system for industrial facilities ("OBPS"). Facilities subject to the OBPS can obtain a certificate exempting them from the Fuel Charge.

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