Carbon Spotlight: Demystifying Canadian Levies, Markets and Beyond

ARC ENERGY IDEAS

This week our podcast guest is Rachel Walsh, Environmental Commodities Strategist at BMO Capital Markets.

Here are some of the questions Peter and Jackie asked Rachel: Is the hefty Canadian emitter carbon tax starting to impact competitiveness? Is the carbon levy causing industrial emitters to invest in reducing their emissions? Canada and Alberta have introduced incentives to reduce the capital cost of carbon capture and storage (CCS) projects. Are these incentives enough to kick-start the industry? Are the contracts-for-difference that guarantee a carbon price for industrial emitters over a decade or more required for investment in large decarbonization projects? The Canada Growth Fund has set aside about $7 billion for contracts-for-difference; how much carbon do you think that will mitigate? The voluntary markets have struggled with credibility issues; do you expect this will improve and prices will increase? Could strong voluntary markets reduce the risk of investing in Canadian compliance markets since they offer an alternative way to monetize the carbon credits?

Content referenced on this podcast:

• Clean Prosperity Canada
• ICE has introduced two futures markets for Alberta Carbon Credits: Alberta Emission Offset and Alberta Emission Performance Credits

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