Ottawa and Alberta Agree on Industrial Carbon Price Rising to $130 per Tonne by 2040

The federal government and the Alberta government have agreed on changes to industrial carbon pricing in the province. CBC News reported that both governments have settled on raising Alberta's effective carbon price to $130 per tonne by 2040. The Calgary Herald previously reported the same timeline.

Sources said an announcement is expected before the end of this week. The sources spoke on condition of anonymity because they were not authorized to discuss the talks publicly. Canada maintains a national carbon price intended to apply across all provinces and territories.

The headline national price had been scheduled to increase to $170 per tonne by 2030.

Alberta operates its own system for heavy emitters known as the Technology Innovation and Emissions Reduction Regulation, or TIER. A November energy accord signed by both governments stated that the carbon price would ramp up to a minimum effective credit price of $130 per tonne but did not specify a target year for reaching that level.

The current agreement fills in that timeline. Industrial carbon pricing is applied to large emitters in sectors such as oil and gas, manufacturing and electricity generation. The federal government requires provinces to maintain carbon pricing systems that meet national standards or face a federal backstop price.