Copyright reuters
SummaryCarney has been criticized for backing away from party's focus on environmentBudget promises strengthened industrial carbon pricing to boost investor certaintyBudget extends time frame for carbon capture tax credits OTTAWA, Nov 4 (Reuters) - Canada could scrap a cap on oil and gas emissions in favor of other measures like strengthened industrial carbon pricing and the deployment of carbon capture and storage technology, the government said in a budget plan unveiled on Tuesday. The climate plan, disclosed as part of Prime Minister Mark Carney's first budget, said under those conditions, the cap “would no longer be required as it would have marginal value.” Advertisement · Scroll to continueReport Ad Reuters reported in September that, opens new tab Canada was in talks with energy companies and the oil-producing province of Alberta about eliminating the emissions cap from the country’s oil and gas sector if the industry and province reduce their carbon footprint in other ways. Canada’s emissions cap was not enforced through legislation and not scheduled to take effect until 2030. It has been condemned by Canadian oil and gas companies that say it would result in lower production. Carney, who has been focused on trying to steer Canada's economy through trade wars with the U.S. and China, has been criticized by some members of his own party for backing away from the Liberals' focus on the environment. Advertisement · Scroll to continue The budget also said the government would propose amendments to greenwashing legislation that had created investment uncertainty. Passed during former Prime Minister Justin Trudeau's government last year, the legislation had been criticized by oil companies. "PAN-CANADIAN AGREEMENT" The Carney government said it remains committed to driving down greenhouse gas emissions and will work with provincial governments to strengthen the country's existing industrial carbon pricing system. The budget says a "pan-Canadian agreement" on carbon pricing will help increase investor certainty and the government will apply the federal industrial carbon price to emitters in any province where carbon-pricing efforts do not meet the standards of the federal system. The oil and gas-producing province of Alberta, for example, has frozen its own industrial carbon price while Saskatchewan is currently not applying one at all. Ad Break Coming Up NEXT StayNext OffEnglish 180p288p360p480p540p576p720pHD1080pHDAuto (180p) About ConnatixV2139381526 About ConnatixV2139381526 Continue watchingafter the adVisit Advertiser websiteGO TO PAGE Oil and gas companies worry that a too-stringent industrial carbon price will put Canada at a competitive disadvantage with countries that do not have one, said Mike Holden, chief economist for the Business Council of Alberta, whose members include some of Canada's largest energy firms. But the emissions cap was "universally panned" by industry, he said. "If you're talking about a choice between that or strengthening the industrial carbon price, I think the latter would be the preferred choice," Holden said. Many analysts say large-scale corporate investments in decarbonization — such as a C$16 billion ($11.47 billion) carbon capture and storage project proposed by the Pathways Alliance, a group of Canada's six largest oil sands companies — do not make sense without the financial incentive of a price on emissions. The budget references the Pathways project as being "potentially transformative" for the country, and extends by five years the availability of an existing investment tax credit for carbon capture projects. Reporting by Maria Cheng in Ottawa and Amanda Stephenson in Calgary; Editing by Caroline Stauffer, Deepa Babington and Stephen Coates Purchase Licensing Rights
