Government of Canada: Regulations Amending the Output-Based Pricing System Regulations

On November 22, 2023, the Regulations Amending the Output-Based Pricing System Regulations and the Environmental Violations Administrative Monetary Penalties Regulations (the Amendments) were published in the Canada Gazette, Part II.

To support implementation of the Amendments, the following documents have also been published:

• The new Policy for recognizing additional industrial activities from sectors at significant risk of carbon leakage and competitiveness impacts;
• The updated Policy regarding voluntary participation in the Output-Based Pricing System; and
• The List of Recognized Additional Industrial Activities under the Output-Based Pricing System (the List).

These policies affect both existing covered facilities under the Output-Based Pricing System (OBPS) that are engaged in activities on the List and facilities applying to be covered facilities under the OBPS (i.e. facilities applying to opt-in to the OBPS).

Current OBPS Facilities – Introduction of additional industrial activities

All covered facilities engaged in additional industrial activities must include these activities in the determination of their emissions limit starting with the 2024 compliance period.

Additional industrial activities are identified on the List.

If you are the person responsible for a covered facility under the OBPS, review the List. If your facility is engaged in one or more of these activities, you must submit a Notice of Change to add these activities to your registration information.

Starting in 2024, the List will be updated annually. Newly recognized additional industrial will be published each spring. Persons responsible for covered facilities should review the List annually and submit a Notice of Change if they undertake a newly recognized activity. Additional industrial activities must be taken into account in the calculation of the emissions limit starting in the compliance period that follows the calendar year in which the additional industrial activity is recognized.

Current OBPS Facilities – Recognition of additional industrial activities not currently listed

Facilities that are currently covered facilities under the OBPS that are engaged in activities that are not set out in column 1 of Schedule 1 to the Output-Based Pricing System Regulations (OBPS Regulations) and that are not included on List may request an activity be added to the List.  

• Requests to add an activity to the List must be made on or before February 15^th of each year.
• The Policy for recognizing additional industrial activities from sectors at significant risk of carbon leakage and competitiveness impacts outlines the considerations the Minister will take into account when recognizing additional industrial activities.

Facilities applying to Voluntarily Participate in the OBPS (Opt-in facilities)

Starting January 1, 2024, the voluntary participation process under the OBPS will change. The Policy regarding voluntary participation in the Output-Based Pricing System has been updated. It outlines the considerations the Minister takes into account when evaluating requests for designation as a covered facility.

• Facilities applying to be designated as a covered facility under the OBPS for the 2025 compliance period that do not undertake an activity set out in column 1 of Schedule 1 to the OBPS Regulations or on the List must submit a request for designation under subsection 172(1) of the Greenhouse Gas Pollution Pricing Act (GGPPA) along with a request to add an activity to the List by February 15^th, 2024.
• Facilities applying to be designated as a covered facility under the OBPS for the 2025 compliance period that undertake an activity set out in column 1 of Schedule 1 to the OBPS Regulations or on the List must submit a request for designation under section 172(1) of the GGPPA by July 15^th, 2024.

The first compliance period under the OBPS for facilities designated as a covered facility in 2024 will begin on January 1^st, 2025.

Webinar

Environment and Climate Change Canada will host a webinar on the Amendments and more information on voluntary participation in January 2024.

For more information on the OBPS, please consult the Output-Based Pricing System.

Source: Government of Canada(email)