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B.C. updates carbon pricing system for large industry to boost clean job creation

B.C.’s updated carbon pricing system for large industry will give companies incentives to lower pollution and create more good, clean jobs for British Columbians.

“Climate change continues to hit British Columbians close to home – and it’s costing families and businesses both money and opportunities. We all need to do our part,” said George Heyman, Minister of Environment and Climate Change Strategy. “Some people want to shut down industry, while others do not want any accountability for big polluters. We think there is a better way to move forward, one that reduces climate pollution by providing both incentives and assistance to industry to reduce emissions. This approach ensures large polluters pay their fair share while people and communities here benefit from good jobs, a cleaner economy and a more secure future.”

Starting April 1, 2024, B.C.’s output-based pricing system will see large industry pay for its emissions above a set target, and ensure companies have flexibility, support and incentives to reduce emissions and transition to a clean-energy future.

“B.C.’s updated industrial carbon pricing system will continue driving down emissions, while ensuring the province’s industries remain competitive in Canada and elsewhere,” said Mark Zacharias, executive director, Clean Energy Canada. “B.C. has what it takes to play a pivotal role in the fast-growing global clean economy and [this] announcement shows that the province understands that B.C.’s industries are a key part of addressing climate change, while helping the provincial economy grow at the same time.”

The pricing system sets a performance standard based on the average intensity for the respective industrial sector. Companies that exceed the standard are rewarded with credits. Companies that do not meet the performance standard will have the flexibility to buy credits or offsets. The standard tightens over time as B.C. transitions toward a cleaner economy and in order to comply with federal requirements.

“Teck appreciates the Province’s focus on taking action on climate change and supporting the continued competitiveness of the mining sector as we work to achieve the shared goal of building B.C. as a responsible, leading critical minerals producer,” said Jonathan Price, president and CEO, Teck.

Industrial operators also have access to the CleanBC Industry Fund, which supports their transition to clean-energy solutions. Since 2019, the fund has invested $215 million back into industry and has reduced nearly nine million tonnes of carbon emissions. The fund will be open for new project applications in spring 2024.

B.C. was the first jurisdiction in Canada to bring in a price on pollution in 2008. The Government of Canada’s changes to national carbon pricing requirements meant B.C.’s system needed updating. The shift to an output-based pricing system was a key request of industry following the introduction of the federal carbon pricing backstop.

“The world is transitioning to a clean economy, and B.C.’s access to clean and affordable energy allows us to be a global leader,” said Katrine Conroy, Minister of Finance. “Our made-in-B.C. approach to reducing emissions will maintain a strong price on carbon, and reward innovation as we work together with industry and First Nations to lead Canada’s economic growth and create more good, sustainable jobs for British Columbians.”

The pricing system will allow eligible companies to buy verified carbon offsets to satisfy some of their emissions obligations. This is a new pathway to reduce and sequester greenhouse gas and carbon emissions to protect the environment and create clean industry jobs in communities across B.C.

The province is committed to working directly with industrial facilities that face unique, insurmountable challenges associated with a rising carbon price. These facilities could be eligible for cost containment measures that provide temporary financial relief in order to protect jobs in B.C.

The output-based pricing system supports the province’s CleanBC goals to lower emissions by 40 per cent by 2030, 60 per cent by 2040, and 80 per cent by 2050.