Enhanced Carbon Pricing in Canada 2024 & Post-Removal Impacts

Data as of April 1, 2024 | Post-Removal Impacts Effective April 1, 2025

Federal Alberta British Columbia Manitoba New Brunswick Newfoundland & Labrador Northwest Territories Nova Scotia Nunavut Ontario Prince Edward Island Quebec Saskatchewan Yukon Territory

Carbon Pricing Mechanisms Across Canada (2024)

Province/Territory Pricing Mechanism Price (per tonne CO2e)
Alberta (AB) Federal Carbon Tax $80
British Columbia (BC) Provincial Carbon Tax $60
Manitoba (MB) Federal Carbon Tax $80
New Brunswick (NB) Federal Carbon Tax $80
Newfoundland & Labrador (NL) Federal Carbon Tax $80
Northwest Territories (NT) Provincial Carbon Tax $80
Nova Scotia (NS) Federal Carbon Tax $80
Nunavut (NU) Federal Carbon Tax $80
Ontario (ON) Federal Carbon Tax $80
Prince Edward Island (PE) Federal Carbon Tax $80
Quebec (QC) Cap and Trade $53.16
Saskatchewan (SK) Federal Carbon Tax $80
Yukon Territory (YT) Federal Carbon Tax $80

Note: As of April 1, 2025, the consumer carbon tax (Federal and Provincial) is removed, leaving only industrial pricing mechanisms like OBPS and Cap and Trade.

Federal Carbon Pricing System

The federal government has developed two carbon pricing mechanisms – the federal fuel charge (often called the ‘pollution price’ or ‘carbon tax’) and the federal baseline and credit system for industrial facilities. These programs are referred to as the ‘federal backstop,’ applying in provinces and territories without their own carbon pricing programs.

Federal Fuel Charge (Carbon Tax)

As of April 1, 2024, the federal carbon tax is $80 per tonne of CO2e, applied to fossil fuels based on carbon content. It was set to increase by $15 annually to $170 per tonne by 2030. The tax applies in Alberta, Manitoba, Newfoundland and Labrador, New Brunswick, Nova Scotia, Ontario, Prince Edward Island, Saskatchewan, and partially in Nunavut and Yukon.

Fuel Charge Rates (2024)

Fuel Rate
Butane $0.1424 per litre
Diesel $0.2139 per litre
Gasoline $0.1761 per litre
Kerosene $0.2065 per litre
Natural Gas $0.2035 per cubic metre
Propane $0.1238 per litre

Full list of fuel tax rates

Canada Carbon Rebate (2024)

Approximately 90% of funds collected are distributed back to residents. Average individual: $516.92/year | Average family of 4: $1,219/year.

Federal rebate schedule

Federal Baseline and Credit System (OBPS)

The Federal Output-Based Pricing System (OBPS) applies to industrial facilities emitting over 50,000 tonnes of CO2e per year. Facilities are given a baseline emission limit per unit of product. Examples:

  • 650 tonnes CO2e/GWh (electricity from solid fuels)
  • 0.216 tonnes CO2e/vehicle produced
  • 0.0728 tonnes CO2e/tonne of potatoes processed

Facilities beating the standard earn credits; those exceeding it must buy credits. OBPS applies in Manitoba, Nunavut, Prince Edward Island, and Yukon. Full OBPS standards

OBPS Regulations Overview

The OBPS Regulations (SOR/2019-266) define a facility as a site or sites where specified industrial activities are carried out, including oil and gas production, mineral processing, and electricity generation. Key emission types quantified include stationary fuel combustion, industrial process emissions, and flaring emissions. The regulations set output-based standards (e.g., 0.0159 CO2e tonnes/barrel for light crude oil production). Facilities must submit annual reports detailing GHG emissions and production, verified by an accredited body.

Post-Removal (April 1, 2025)

The federal consumer carbon tax is removed, ending rebates. OBPS continues for industrial facilities, focusing on emissions over 50,000 tonnes CO2e/year.

Alberta

Carbon Tax: Federal rate of $80/tonne. Rebate: $900/individual, $1,800/family of 4.

Baseline System: Alberta TIER (100,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

The federal carbon tax ends, eliminating $900/individual and $1,800/family rebates. Fuel costs drop (e.g., 17.6¢/litre for gasoline). No direct provincial revenue loss as funds were federal. TIER remains for industrial emissions.

British Columbia

Carbon Tax: Provincial rate of $60/tonne. Rebate: $504/individual, $1,008/family of 4 (income-adjusted).

Post-Removal (April 1, 2025)

B.C. eliminates its consumer carbon tax, losing $2.8 billion in revenue ($1 billion returned as credits). Fuel costs decrease (e.g., 14.3¢/litre for gasoline). Rebates end, creating a $1.8 billion budget shortfall unless offset by other taxes.

Manitoba

Carbon Tax: Federal rate of $80/tonne. Rebate: $600/individual, $1,200/family of 4.

Baseline System: Federal OBPS (50,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Federal tax removal ends rebates. Fuel costs drop (e.g., 17.6¢/litre for gasoline). No direct provincial revenue impact; federal OBPS continues for industry.

New Brunswick

Carbon Tax: Federal rate of $80/tonne. Rebate: $380/individual, $760/family of 4.

Baseline System: NB OBPS (50,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Rebates cease with federal tax removal. Fuel costs decrease. No provincial revenue loss; OBPS persists for industry.

Newfoundland & Labrador

Carbon Tax: Federal rate of $80/tonne. Rebate: $596/individual, $1,192/family of 4.

Baseline System: NL EPS (25,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Federal tax ends, stopping rebates. Fuel costs drop. No direct revenue loss; EPS continues for industry.

Northwest Territories

Carbon Tax: Territorial rate of $80/tonne. Rebate: $441/individual, $1,868/family of 4 (community-based).

Post-Removal (April 1, 2025)

NWT ends its consumer tax, losing a small revenue stream. Rebates stop; fuel costs decrease (e.g., 17.6¢/litre for gasoline). Budget adjustments may be needed.

Nova Scotia

Carbon Tax: Federal rate of $80/tonne. Rebate: $412/individual, $824/family of 4.

Baseline System: NS OBPS (50,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Federal tax removal ends rebates. Fuel costs drop. No provincial revenue impact; OBPS remains.

Nunavut

Carbon Tax: Federal rate of $80/tonne (aviation exempt). Rebate: $308/individual, $1,232/family of 4.

Baseline System: Federal OBPS (50,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Federal tax ends, stopping Nunavut Carbon Credit. Fuel costs decrease. No territorial revenue loss; federal OBPS continues.

Ontario

Carbon Tax: Federal rate of $80/tonne. Rebate: $560/individual, $1,120/family of 4.

Baseline System: ON EPS (50,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Rebates end with federal tax removal. Fuel costs drop (e.g., 17.6¢/litre for gasoline). No direct revenue loss; EPS persists.

Prince Edward Island

Carbon Tax: Federal rate of $80/tonne. Rebate: $440/individual, $880/family of 4.

Baseline System: Federal OBPS (50,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Federal tax ends, stopping rebates. Fuel costs decrease. No provincial revenue impact; federal OBPS continues.

Quebec

Cap and Trade: $53.16/tonne (Nov 2023). No consumer carbon tax or rebates.

Post-Removal (April 1, 2025)

No change; Quebec’s cap-and-trade system remains, generating ~$200 million annually for climate initiatives.

Saskatchewan

Carbon Tax: Federal rate of $80/tonne. Rebate: $752/individual, $1,504/family of 4.

Baseline System: SK OBPS (25,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Federal tax removal ends rebates. Fuel costs drop. No provincial revenue loss; OBPS persists.

Yukon Territory

Carbon Tax: Federal rate of $80/tonne (aviation exempt). Rebate: $310/individual, $1,240/family of 4.

Baseline System: Federal OBPS (50,000+ tonnes CO2e/year).

Post-Removal (April 1, 2025)

Federal tax ends, stopping Yukon rebates. Fuel costs decrease. No territorial revenue impact; federal OBPS continues.

Created by Asiri | April 2, 2025