Carbon Pricing in Canada
Carbon pricing plans impose a cost on the combustion of fossil fuels by industries and consumers — either directly through a tax, or indirectly through a cap-and-trade system. In a market economy like Canada’s, prices help regulate the supply and demand of goods and services. By influencing the price of a commodity like gasoline, through carbon pricing, governments aim to discourage its use and thereby reduce the greenhouse gas emissions that result from its consumption.
In 2016, Prime Minister Justin Trudeau announced a national climate-change policy that included a system of carbon pricing across Canada. As of 2020, nine provinces and territories have carbon pricing plans that meet the requirements of the national policy. In the remaining provinces — Alberta, Alberta, Saskatchewan, Manitoba and Ontario — Ottawa has imposed its own carbon tax. The tax has vocal opponents on the political right, including some premiers and party leaders.