While you were busy firing up the grill on Saturday, new clean fuel rules quietly came into effect.
Driving the news: Canada’s new Clean Fuel Regulations will require refiners and importers of gas and diesel to reduce emissions across all stages of fuel production and consumption, working towards reducing fuel emissions by 15% between 2016 and 2030.
- Efforts will be measured through carbon credits: Refiners and importers can directly cut their emissions to produce their own credits or buy them from other companies.
Why it matters: Higher supplier costs are almost always passed down to consumers, and that will mean more expensive gas... eventually. The requirements for refiners and importers are starting out pretty light and will slowly ratchet up as 2030 approaches.
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Ultimately, Environment and Climate Change Canada estimates that the new regulations could add as much as 13 cents to the price of a litre of gasoline.
Zoom out: The transport sector is Canada’s second-largest emitter, accounting for 22% of total emissions in 2021. Recent estimates show the rules will cut emissions by 18 million tonnes by 2030, about 5-6% of what’s needed to meet that year’s reduction target.—QH