Alberta and the Canadian federal government have agreed to a new framework to raise the effective carbon price for industrial emitters to 130 dollars per tonne by 2040. The plan addresses a surplus of cheap credits that previously allowed companies to avoid real emissions reductions by using a combination of higher headline prices and a rising price floor for credits. A key part of the deal includes carbon contracts for difference. These contracts provide a financial guarantee to companies investing in green projects between 2030 and 2040, ensuring that the government covers the price gap if the carbon market is repealed or fails to meet expected levels.
