Ministers McKenna and Morneau outline next steps in pricing carbon pollution
Climate change and extreme weather affects all Canadians, and we all need to be part of the solution. A price on pollution is one of the most efficient tools available to drive clean innovation while curbing greenhouse gas emissions. That’s why pricing carbon pollution is a central part of Canada’s plan for clean growth and climate action, and why the federal government is working with provinces and territories to put a price on carbon across the country.
Today, Environment and Climate Change Minister Catherine McKenna and Finance Minister Bill Morneau delivered letters to provincial and territorial governments setting a deadline of September 1, 2018 for each jurisdiction to outline how they are implementing carbon pricing systems that meet the federal standard.
The federal government will then determine whether the planned systems are on track to meet the standard, or whether the federal approach should be applied in that jurisdiction.
The letter also invites any jurisdictions wishing to adopt the federal approach to confirm that decision by March 30, 2018. This would allow us to implement the federal approach in those jurisdictions in Fall 2018 with the federal standard price of $10 per tonne.
Pricing carbon pollution is one of the four pillars of Canada’s climate and clean growth plan. The pan-Canadian approach to carbon pricing, announced in October 2016, gives provinces and territories flexibility to choose which type of system to implement:
- a direct pricing system, such as a carbon tax, like British Columbia has, or a carbon levy combined with a performance-based emissions system, as in Alberta, or
- a cap-and-trade system, as in Ontario and Quebec.
The combination of existing carbon provincial pricing systems, new carbon pricing systems, and the federal approach will ensure a price on carbon across Canada. In direct pricing systems, that price will rise to $20 per tonne on January 1, 2019.
Global momentum is driving a move towards cleaner economic growth. Canadian businesses are already taking advantage of this global opportunity. In addition to pricing carbon, the federal government is making other investments to enable Canadian businesses and workers to participate in the trillion-dollar opportunities offered by the transition to a clean-growth economy.
“Putting a price on pollution works. It stimulates innovation, it encourages businesses to clean up their operations, and it’s one of the best tools we have to tackle climate change. Canadians understand that a clean environment and a strong economy go hand-in-hand, and a price on pollution helps drive the clean growth Canadians want to see.”
– Catherine McKenna, Minister of Environment and Climate Change
“We are working to ensure Canadians can succeed in the economy of the future by investing in growth that benefits the middle class and our environment, and is sustainable over the long term. Protecting our air, water and quality of life is essential to making sure we are able to hand down our prosperity to our kids and grandkids.”
– Bill Morneau, Minister of Finance
- Every province has committed to adopting some form of carbon pricing.
- More than 80 percent of Canadians already live in a jurisdiction that puts a price on carbon pollution.
- The federal government has the legal authority to implement a carbon price in provinces and territories.
- In explicit price-based systems, the federal benchmark sets a carbon price of $10 in 2018. That price will increase to $20 on January 1, 2019, and by $10 a year thereafter to $50 a tonne in 2022.
- The federal approach will be able to be applied in whole or in part in a jurisdiction. Once the federal option goes into effect, it will remain in effect until at least 2022.
Marie-Pascale Des Rosiers
Office of the Minister of Environment and Climate Change
Environment and Climate Change Canada
819-938-3338 or 1-844-836-7799 (toll free)