Feds approve Sask. plan to replace federal carbon tax on industrial emitters

All carbon taxes collected from industrial emitters in Saskatchewan will stay in the province starting in the new year.

In a release Tuesday, the Saskatchewan government said the Output-Based Performance Standards (OBPS) program had been approved by the federal government to replace the federally imposed carbon tax on industrial emitters in the province as of Jan. 1.

The government said the program meets the requirements for the 2023-2030 federal carbon pricing standard, and includes the electricity generation and natural gas transmission pipeline sectors.

The provincial government estimates the number of facilities in the OBPS program will double by 2030 now that industrial carbon pricing is under the province’s control.

Under the program, regulated emitters will get credit for every tonne of carbon emissions under their permitted amount, which will create incentives to reduce emissions. The program will also give credit for carbon capture, utilization and storage.

“Regulated emitters will have the option to pay into the Saskatchewan Technology Fund, which will create incentives for industry to develop and implement technologies that contribute to meaningful reductions in greenhouse gas emissions intensity,” the government release said.

According to the province, keeping industrial carbon taxes in the province will save Saskatchewan companies around $3.7 billion between now and 2030 compared to federal carbon pricing.

“Now more than ever, the world needs food and energy security — and that means the world needs Saskatchewan and our clean and sustainable, food, fuel and fertilizer,” Saskatchewan Environment Minister Dana Skoropad said in the release.

“This is not the time for federal climate policies that risk undermining our economic growth and prosperity. Our plan will allow industries to grow and operate sustainably while maintaining our economic competitiveness as a province.”