Question Period Note: Carbon Pollution Pricing

The Government has eliminated the federal fuel charge and announced that it will refocus its approach to carbon pricing on industrial emissions.

• Meaningfully addressing Canada’s carbon emission requires action by large emitters. The Government of Canada is committed to making sure our industrial pricing system drives emissions reductions and investment and allows our companies to remain competitive in the global marketplace.
• Providing long-term certainty and predictability of our system is crucial to maintaining investor confidence in decarbonization projects.
• As Canada looks to expand its trading relationships around the world, including with Europe and the UK, it is more important than ever to maintain strong carbon markets as those partners move forward with their own carbon border measures.

In March 2025, the government announced it was refocusing carbon pricing on a broad range of greenhouse gas emissions from industry and removed the federal fuel charge as of April 1, 2025 (i.e., federal fuel charge rates were set to zero). It committed to engage provinces, territories, Indigenous Peoples and stakeholders on changes to the minimum national stringency standards for carbon pollution pricing, known as the federal ‘benchmark’ criteria. It indicated that changes would focus the benchmark on ensuring industrial pricing systems continue to maximize emissions reductions and encourage the transition to low carbon technologies, while protecting industry against competitiveness and carbon leakage impacts. The Liberal campaign platform also committed to strengthening carbon pricing systems in Canada. In the interim, several provinces have taken action to undermine their carbon pricing systems.

Non-applicable