Canada and Alberta Agree on Oil Sands Deal Removing Emissions Cap

Prime Minister Mark Carney reached an agreement with Alberta to remove a proposed hard cap on carbon emissions from the oil sector. The deal also includes plans to expand the power grid using natural gas and expedite permitting for a new Pacific Coast pipeline.

U.S. trade policies and to keep Alberta within Canada. Alberta agreed to support a long-term increase in carbon prices in exchange for the removal of the emissions cap.

Carney has already ended the federal electric vehicle mandate and removed the consumer carbon tax. The industrial carbon price that applies to large emitters remains in place. The oil sector accounts for about 30 percent of Canada’s emissions. Oil makes up more than 15 percent of the country’s export volume.

The chief executive of Cenovus said the country should not have a carbon price at all. Climate advocates said the deal lowers the industrial carbon tax price and slows the rate of future increases. Julia Levin of Environmental Defence said companies will not have to take additional action for 15 years under the new terms.

Richard Masson, a former oil sands executive, said the carbon tax should be viewed as the cost of operating in Canada. A new pipeline to the Pacific Coast still requires a private company to build it. No company has come forward yet.