The Technology Innovation and Emissions Reduction (TIER) system replaces the Carbon Competitiveness Incentive Regulation (CCIR) on Jan. 1, 2020. The province estimates that TIER will achieve similar emission reductions as the CCIR, but will save Alberta’s job creators about $330 million in 2020.

TIER is an updated approach to reducing emissions from large industries, which account for more than half of Alberta’s emissions. The system will help facilities find innovative ways to reduce emissions and invest in clean technology to stay competitive and save money.

While TIER protects large industrial emitters and opted-in facilities like small oil and gas operators from the federal carbon price in 2020, Albertans will be subject to the federal government’s punitive carbon tax on gasoline, natural gas and propane starting Jan. 1, 2020.

Alberta challenged the federal carbon tax in court in mid-December, arguing that it is an unconstitutional intrusion of federal jurisdiction into provincial jurisdiction. The five-judge Alberta Court of Appeal panel is expected to deliver its decision on the challenge in the coming months.

“Our government supports emissions-management and climate-resilience approaches, including the industrial carbon pricing and emissions trading systems that have made our province a leader since 2007 and continue to achieve significant emission reductions in Alberta. The federal government’s carbon tax, which punishes people for driving to work and heating their homes, is not the best policy for Alberta.”

Jason Nixon, Minister of Environment and Parks

The governments of Saskatchewan, Ontario and New Brunswick intervened in the Alberta reference case to support Alberta’s position. Additional interveners supporting Alberta included the Canadian Taxpayers Federation and the Saskatchewan Power Corporation.

“The federal carbon tax strips provinces of constitutional power over their own economies, natural resources, industries and the day-to-day activities of their residents. The federal government will say their benchmark only sets a minimum standard, but once they are given the power to set standards in areas of provincial jurisdiction, those standards could continue to change without warning. By defending Albertans in court, we are fulfilling our commitment to create jobs and economic opportunity.”

Doug Schweitzer, Minister of Justice and Solicitor General

Until a court decision is reached saying otherwise, the federal government will impose a price of $20 per tonne of carbon dioxide emissions on transportation and heating fuels in Alberta on Jan. 1, 2020. The rate will increase by $10 per tonne on April 1 each year until the carbon price reaches $50 per tonne on April 1, 2022. For more information, visit the Department of Finance Canada’s website or contact the Canada Revenue Agency.

Quick facts

  • On May 30, 2019, Alberta’s Carbon Tax Repeal Act came into effect, ending Alberta’s provincial carbon tax.
  • An Economic Impact Assessment of Climate Policy in Alberta shows that the former provincial carbon tax would have reduced annual employment by between 4,000 and 8,200 jobs.
  • The TIER regulation applies to facilities that emit 100,000 tonnes or more of greenhouse gas emissions per year starting in 2016, or a subsequent year.
  • Smaller facilities that meet the criteria in the regulation can opt in or be designated as aggregate oil and gas facilities under TIER to avoid the federal carbon tax. For more information, see the Federal Fuel Charge Exemption Application Fact Sheet.
  • On Dec. 6, 2019, the federal government accepted the TIER regulation as meeting federal stringency standards under the federal government’s Greenhouse Gas Pollution Pricing Act. This approval ensures that the federal carbon pricing system does not apply to Alberta’s facilities that are subject to TIER in 2020.
  • Alberta, Saskatchewan and Ontario contend that the federal carbon price represents an unconstitutional intrusion into provincial jurisdiction.
  • The Supreme Court of Canada will hear the appeals of the Saskatchewan and Ontario federal carbon tax references in March 2020. Alberta is intervening in both appeals.
  • Some consumers may be exempt from paying the federal carbon tax. For more information, visit the Canada Revenue Agency website or call 1-800-959-8281.

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