Trudeau Government Introduces Outline For Cap And Trade System
As Reuters reported, on December 7 Canadian government officials unveiled a plan to limit emissions from the oil and gas industry using a cap and trade system. The system, if finalized by regulators, is expected to go into effect in 2026.
Starting that year, the proposal would limit oil and gas sector emissions at 35 percent to 38 percent below 2019 levels while providing compliance flexibilities to emit up to a level that is about 20 to 23 percent below 2019 levels. According to the government’s press release, facilities will be able to buy a limited amount of carbon offset credits or contribute to a decarbonization fund, which would hold them accountable for a limited volume of emissions above the greenhouse gas pollution cap.
The government pledged to continue engaging with industry, Indigenous groups, provinces, territories, and all other stakeholders “to get this system right.” To that end, written comments can be submitted to the government by stakeholders until February 5, 2024.
As Reuters noted, Prime Minister Justin Trudeau first proposed a cap on oil and gas emissions during his 2021 election campaign.