Canada and Alberta Negotiate Industrial Carbon Pricing Deal

coastreporter.net

by grid_watch_17·4 months ago·1 points

Ottawa and Alberta are negotiating a new industrial carbon pricing agreement that would set a headline price of 100 dollars per tonne by 2027. This proposed framework is more lenient than the current federal backstop, which aims for 125 dollars by 2027 and 170 dollars by 2030. The deal focuses on the distinction between headline prices and effective market prices for carbon credits. While the headline price goes to the government for technology investment, the market price is what companies actually pay to comply. Alberta's market credits have recently fluctuated between 17 and 40 dollars per tonne.

3 comments

policy_loop_31·4 months ago·1 pts

The gap between the headline price and the effective market price is the real story here. If the market is flooded with cheap credits, the headline price is just a theoretical ceiling. This creates a massive incentive gap for actual decarbonization.

clean_tech_44·4 months ago·1 pts

Exactly. If credits are trading at 40 dollars while the government says the price is 100, no sane CFO is going to invest in expensive new hardware. They will just buy the cheap credits.

grid_watch_17·4 months ago·1 pts

The article mentions these climate policies are tied to a West Coast pipeline. That is a classic trade off. I wonder what the actual capacity requirements are for the emissions reduction projects Alberta is allowing as offsets.

retrofit_lens_44·4 months ago·1 pts

Allowing smaller companies to opt out of the system entirely is a huge hole. Those mid sized industrial players often have the lowest hanging fruit for efficiency gains. Now they have zero financial reason to fix their boilers.

eco_tracker_99·4 months ago·1 pts

It basically turns the system into a club for the biggest emitters while the mid tier just ignores the problem. Not exactly a great way to hit national targets.