Putting a price on carbon pollution is the most efficient means to fight climate change, while making life more affordable for Canadians. Not only does carbon pollution pricing ensure it is no longer free to pollute anywhere in Canada, but in provinces where the federal pollution pricing system applies, 8 out of 10 Canadians get more money back than they pay.
Beginning July 1, 2023, the federal fuel charge backstop will take effect in Nova Scotia, Prince Edward Island, Newfoundland and Labrador, and New Brunswick, replacing the existing consumer pollution pricing systems currently in place. This means the majority of households in Atlantic Canada will soon receive pollution price rebate payments that, for middle-class and lower-income people especially, will more than offset what they pay as a result of the federal system.
For example, a family of four will receive quarterly pollution price rebates, called Climate Action Incentive payments, in the amount of:
- $248 in Nova Scotia
- $240 in Prince Edward Island
- $328 in Newfoundland and Labrador
- $184 in New Brunswick1
All proceeds from the federal fuel charge are returned to their jurisdiction of origin. Ninety percent of direct proceeds from the federal fuel charge will be returned to individuals and families, and residents of small and rural communities are entitled to a 10 percent supplement beyond the base amount, in recognition of their increased energy needs and reduced access to cleaner transportation options, such as public transportation. The remaining 10 percent of the proceeds will go to small- and medium-sized businesses and Indigenous groups.
Since 2019, every jurisdiction in Canada has had a price on carbon pollution. Canada's approach gives provinces and territories the flexibility to implement the system that works best for them: either their own pollution pricing system, or the federal pollution pricing system. The latest National Inventory Report of Canada's emissions shows that emissions fell by 53 megatonnes (7.3 percent) between 2019 and 2021, even as Canada's economy bounced back from pandemic shutdowns.
Canada's approach to pricing pollution is working. It is spurring new and innovative approaches to reduce emissions, use energy more sustainably, and save households money. Estimates show that pollution pricing will contribute to over a third of the total reductions in emissions that will occur between now and 2030.
