Ottawa Approves Alberta TIER Tax on Industrial Emitters

The federal government has approved Alberta’s new C$30 per tonne tax on industrial carbon emitters, a move that “avoids escalating a fight between Ottawa and the Prairie province but does nothing to end the battle over the consumer-based carbon tax, which the federal Liberals say will still come into effect in Alberta on January 1,” the Globe and Mail reports.

The new Technology Innovation and Emissions Reduction System, introduced by Premier Jason Kenney in October, is a “step forward in terms of ensuring that provinces across this country are taking action on climate change,” said federal Environment Minister Jonathan Wilkinson. He added that the provincial program will have to increase by $10 per tonne through 2020 to remain in sync with the federal floor price on carbon.

On Friday, Kenney responded that he didn’t want the duly-elected national government “big-footing into Alberta, and enforcing their own separate regulatory regime,” although “I won’t close the door to go into $40 [per tonne] if we have no choice except the imposition of a federal regulatory regime in Alberta.”

The Pembina Institute, which previously called the new provincial system a “step backwards”, welcomed last week’s announcement.

“We were pleased to see that the federal acceptance of Alberta’s Technology, Innovation and Emissions Reduction (TIER) comes with the critical caveat of an annual review,” said Federal Policy Director Isabelle Turcotte. “The TIER system is a step backwards for the province, and is weak in encouraging companies to reduce GHG emissions and promoting the necessary investments in innovation and technology for industry to stay competitive in the 21st century economy.”

After six months of climate policy rollbacks in Alberta, Turcotte urged Ottawa to use the annual review “to ensure that in 2021, Alberta’s system is strengthened so [its] weaknesses are addressed.”