Canadians see the costs of a changing climate all around them, from stronger storms to wildfires and record-breaking heatwaves. Canada is committed to ambitious climate action while growing the economy. A price on pollution is one of the best tools we have to spur innovation and cut pollution while keeping life affordable for Canadian families.
The Minister of Environment and Climate Change, the Honourable Jonathan Wilkinson, today announced that the Government of New Brunswick’s proposed provincial fuel charge meets federal stringency requirements for the sources that it covers. New Brunswick’s carbon price will go into effect on April 1, 2020-at a rate of $30 per tonne-once the province passes the relevant legislation. The Government of Canada intends to stand down the federal fuel charge on the same date.
As in all other provinces and territories that have adopted their own price on carbon pollution, New Brunswick’s fuel charge will be subject to annual reviews to ensure it remains in compliance with the federal benchmark stringency requirements. The benchmark price rises to $40 per tonne in 2021 and $50 per tonne in 2022.
The federal price on carbon pollution has two components: a fuel charge across the economy and a carbon-pricing system for heavy industrial sectors that face international competition. At present, both parts of the federal system are in effect in New Brunswick.
Today’s announcement relates to New Brunswick’s proposed fuel charge, which would replace the federal fuel charge next year. This is separate from the Government of New Brunswick’s proposed system for large industrial emitters, which is currently being reviewed by the federal government.
Under the federal approach to pricing carbon pollution over the past year, the bulk of the direct proceeds generated in the province by the federal fuel charge went back to individuals and families in New Brunswick as Climate Action Incentive payments. Last year, a family of four in New Brunswick received $256 in Climate Action Incentive payments after they filed their income taxes. New Brunswick’s decision to adopt its own price on carbon pollution means that the province will now determine how to invest revenues raised from the provincial carbon price, and New Brunswickers will not receive federal Climate Action Incentive payments in 2020.
As part of the Pan-Canadian Framework, Canada’s clean-growth and climate plan, governments are committed to reviewing the approach to pricing carbon pollution by early 2022, with an interim review in 2020.
“We’re seeing growing momentum for pricing pollution in Canada because it’s a cost-effective way to cut pollution and deliver clean growth. We congratulate New Brunswick’s government for moving forward with an effective price on the carbon pollution from fuels throughout its economy.”
– The Honourable Jonathan Wilkinson, Minister of Environment and Climate Change
“Today’s announcement is a great example of what can happen when we work together. Canada’s approach is to give provinces the flexibility to design an effective carbon-pricing system that best meets their unique needs while still aligning with the standards of the federal benchmark. We are committed to working closely with the Government of New Brunswick and all provinces and territories as partners in the global fight against climate change.”
– The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Intergovernmental Affairs
“In New Brunswick, and across the country, the impacts of climate change are being felt every day. Putting a price on pollution works: It is the most effective and economically responsible way to address climate change. We welcome New Brunswick’s decision to move forward with their own price on pollution and join us in the fight against climate change.”
– The Honourable Bill Morneau, Minister of Finance
“New Brunswickers sent a clear message that they wanted our two governments to work together on climate action. Pollution knows no borders, and Canadians are seeing the real impacts of climate change every day. Congratulations to the Government of New Brunswick for taking this important step forward and for joining our efforts to tackle climate change across the country.”
– The Honourable Dominic LeBlanc, President of the Queen’s Privy Council for Canada
The Pan-Canadian Approach to Pricing Carbon Pollution gave provinces and territories the flexibility to design a carbon-pricing system that meets their unique needs while ensuring all systems are stringent, fair, and efficient.
Pricing carbon pollution has a proven record across Canada and internationally of reducing the carbon emissions that cause climate change while encouraging innovation and maintaining strong economic growth.
In support of today’s announcement, the Department of Finance Canada intends to release-ahead of April 1, 2020-draft regulations for standing down the fuel charge in New Brunswick.