Alberta Premier Danielle Smith has expressed willingness to make adjustments to Alberta’s industrial carbon pricing system, including the province’s industrial carbon price. Last month, Alberta announced it would keep the industrial carbon price frozen at $95 per tonne until 2026, diverging from the federal government’s planned increase to $110 per tonne next year.
During a press briefing in Ottawa following a meeting with Prime Minister Mark Carney, Smith highlighted that Alberta views its current carbon price as a balanced approach, supporting industry viability while promoting investments in green technology. She mentioned that the $95 per tonne carbon price is subject to discussion as part of ongoing program adjustments.
Federal officials have been evasive about potentially imposing the federal backstop on Alberta if its industrial carbon pricing system fails to meet federal standards. The federal backstop rate is intended for implementation when provinces lag behind, but it remains uncertain if Carney will enforce the higher price, especially given his lack of action against Saskatchewan, which eliminated its industrial carbon price earlier this year.
Carney, who campaigned on strengthening industrial carbon pricing while repealing the consumer carbon price, has not taken action against Alberta’s proposed changes to its industrial carbon pricing program. These changes would offer companies the option to invest in emissions reduction projects to offset provincial fees and allow smaller companies to opt out of the carbon pricing system if they fall below emission thresholds.
Despite being praised by industry stakeholders, critics warn that these changes could deter investments in clean growth. According to the Canadian Climate Institute, the proposed adjustments have created significant uncertainty in Alberta’s cap-and-trade system, potentially leading to decreased market competitiveness and subdued interest in decarbonization investments.
Smith is currently in discussions with Carney to facilitate the construction of a new pipeline from Alberta to the British Columbia coast. She has urged the federal government to lift the tanker ban off the B.C. coast, revoke the electric vehicle sales mandate, remove the oil and gas emissions cap, and eliminate the federal industrial carbon price to enable provincial autonomy in regulation.
While Smith did not disclose specific details of her meeting with Carney, she emphasized the need for policy revisions and repeals in line with environmental goals. Smith also proposed a “grand bargain” that would involve advancing the Pathways Alliance carbon-capture project alongside a potential oil pipeline to the West Coast, with hopes of submitting the project for consideration by Ottawa’s Major Projects Office next spring.
Smith aims to finalize a deal by the time of the Grey Cup on Nov. 16, signaling her commitment to advancing discussions on key environmental and economic initiatives.
