Québec's Minister of Sustainable Development,
Environment and the Fight Against Climate Change and Alberta's
Minister of Environment and Parks have both recently announced
amendments to provincial regulations on greenhouse gas
Changes to the Québec regulation the Cap-and-Trade
System for Greenhouse Gas Emissions Allowances are intended to
streamline and strengthen its carbon market and further align it
with California's market. Regulated emitters were expanded to
include all companies distributing fuel of 200 litres or more
annually, preventing avoidance of the current 25,000–metric
tonne emission threshold. In addition, the proposed amendments will
expand the number of offset opportunities and permit recognized
financial intermediaries to transact within Québec's
On June 25, 2015, changes were made to Alberta's
Specified Gas Emitters Regulation. The most stringent
emission-reduction requirement was 12% of a facility's net
emissions intensity, and this is being increased to 15% as of
January 1, 2016, and 20% as of January 1, 2017. Regulated emitters
may still comply with reduction requirements by contributing to the
Climate Change and Emissions Management Fund, but the price of any
contribution is increasing from $15 per tonne to $20 per tonne in
2016 and $30 per tonne in 2017. It is noteworthy that the new
requirements will continue to apply only to entities with greater
than 100,000 tonnes of greenhouse gas emissions per year.
More significant changes may be forthcoming because Alberta also
announced the appointment of an advisory panel to study further
carbon strategies. The panel is to report this fall and has been
instructed to explore several economic models, including a carbon
tax and a carbon market.
The proposed amendments to Québec's regulation
demonstrate a maturing carbon market with clear intention to expand
the linkages with California's carbon market. Ontario's
recently announced intention to launch a carbon market linked with
those of Québec and California means that the prospect of a
viable market in North America may be realized. A regulated and
reliable trading system would encourage emissions reductions and
provide cost-effective alternatives for compliance by regulated
emitters. As Alberta considers its options for further
emission-reduction measures, it remains to be seen whether a
harmonized cap-and-trade system is feasible in Canada.
Notwithstanding such initiatives by the provinces, current
action will leave Canada falling short of the recently announced
federal target of 30% below 2005 levels by 2030.
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