On June 25, 2015 the Alberta government announced it would renew
and revise the Specified Gas Emitter Regulation ("SGER").
The announcement increases reductions in greenhouse gases
("GHG") by large emitters of GHG. It also increases the
cost of technology credits used by emitters to achieve compliance.
These changes come as part of a larger "re-thinking" of
Alberta's climate policy currently being undertaken by the new
Currently, SGER requires entities emitting 100,000 tonnes or
more of greenhouse gas per year to reduce their emissions intensity
per unit of production by 12%. Reductions may be achieved in four
Direct improvements to operations;
By earning Emissions Performance credits;
Through purchasing Alberta carbon off-set credits; or
Through payment ($15 per tonne) to the Climate Change Emissions
Management Fund ("CCEMF").
The changes to SGER will increase the reductions required by
large emitters. Larger emitters will need to reduce emissions
intensity by 15% in 2016 and by 20% in 2017.
The cost of achieving these reductions will also increase.
Effective 2016, the price for payments to the CCEMF will increase
from $15 per tonne to $20 per tonne. In 2017 the level will
increase to $30 per tonne.
Government's New Approach
As noted, the changes to SGER are part of a larger re-evaluation
of the approach by the government of Alberta to address climate
change. In addition to the SGER amendments, the government has
announced its intentions to:
Create an advisory panel chaired by Dr. Andrew Leach of the
University of Alberta, to conduct a "comprehensive review of
the current policy" and report to the government by the fall
Create an advisory panel to review oil and gas royalties.
Establish clear climate change policies prior to the UN
Conference Of Parties World Summit to be held in France on December
7 and 8, 2015.
The government's changes to SGER seemingly reflects the
concerns of those emitters who require market access. The
amendments, and the government's position generally, are an
acknowledgement of the relationship between proactively addressing
emissions in Alberta and increasing access to world markets.
Moreover the review to be carried out by Dr. Leach and others
could yet result in further changes to emission regulation in
Alberta. In fact, it seems quite likely that the result of the
advisory panel's review could be a move away from SGER towards
a more comprehensive approach. Such an approach could include more
extensive amendments to the regulatory system such as a cap and
trade regime, a comprehensive carbon tax (as exists in B.C.), or
increased transfer of costs associated with emission reduction
being passed on to consumers.
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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