The Alberta Government introduced Bill 20, the Climate
Leadership Implementation Act, on May 24, 2016. The
Bill proposes a carbon levy on fuel consumption and marks the
Government's first step towards executing Alberta's Climate
Leadership Plan. Additional legislation aimed at eliminating
emissions from coal-fired electricity generation, capping oil sands
emissions and reducing methane emissions is still pending.
Currently, the Specified Gas Emitters Regulation remains
in full force and effect.
Bill 20 proposes two new statutes, the Climate Leadership
Act and the Energy Efficiency Alberta Act, while also
making minor, corollary amendments to three existing pieces of
provincial legislation. The proposed legislation passed its first
reading in Parliament and will become law upon receiving Royal
Under the Climate Leadership Act, all fuel
consumption—including gasoline and natural gas
consumption—will be subject to a carbon levy to be effected
through a series of payment and remittance obligations throughout
the fuel supply chain. Commencing on January 1, 2017, consumers of
fuel will pay levies at rates based on CA$20 per ton of carbon
(e.g. 4.49 cents/litre for gasoline), with the carbon price
increasing to CA$30 per ton on January 1, 2018 (6.73 cents/litre).
There are certain exemptions from the carbon levy, including fuel
used in the operation of a specified gas emitter and fuel used in
farming operations. The Climate Leadership Act creates
mechanisms for the assessment of the levy and the enforcement of
payment, while providing that directors can be held jointly or
severally liable for payment if their corporation fails to remit
the required carbon levy.
The revenue generated from the carbon levy will be applied to
provincial climate change initiatives, while also producing rebates
for qualified individuals and businesses. Initial estimates state
that more than 60 percent of Albertans will be eligible for full or
The Energy Efficiency Alberta Act establishes a new
Crown corporation, Energy Efficiency Alberta. The provincial agency
will have a mandate to raise awareness among energy consumers,
design and deliver programs related to energy conservation and
small scale renewable energy systems, and to promote the
development of an energy efficiency services industry. Energy
Efficiency Alberta will consult with stakeholders and citizens to
encourage a reduction in energy use and to raise awareness of
consequences of energy consumption.
Amendments to the Corporate Tax Act will reduce the
small business tax rate from three to two percent in order to allow
businesses to adapt to the carbon levy, while amendments to the
Alberta Personal Income Tax Act will provide for the
eligibility and calculation methods pertaining to the Alberta
Climate Leadership Adjustment Rebate. Finally, amendments to the
Climate Change and Emissions Management Act broaden the
accepted use and purpose of the Climate Change and Emissions
Management Fund to encompass education initiatives and outreach
The Dentons Climate Change group will continue to track and
report on further legislation, including the pending regulations
referred to above. If you wish to receive our Climate Change
Newsletter please contact us.
This article was co-authored by Kim Martyn, an Articling
Student in Dentons' Calgary office.
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