Uncertainty of federal Clean Fuel Standard problematic for industry

As part of Alberta Chemistry Day, the Chemistry Industry Association of Canada (CIAC) hosted a panel on how the proposed federal Clean Fuel Standard (CFS) for industry could work within Alberta’s Climate Leadership Plan.  Dave Sawyer of EnviroEconomics and Bob Savage, Assistant Deputy Minister for Alberta Environment and Parks, shared concerns about the uncertainty for industry of the policy interactions of a federal CFS with provincial climate change programs.

The proposed CFS would be a first-of-its-kind globally as it would include fuels used in industry, buildings, and homes along with those used in transportation. Panelists commented that implementation will be complicated given the multiple layers of provincial and federal regulation already in place, and could lead to duplication of incentives and/or penalties for industry. 

One of the panelists suggested that consideration should be given to a phased-in approach to CFS for each sector starting initially with transportation. This would allow provincial-level regulatory frameworks to be established and to better understand their impact on greenhouse gas (GHG) reductions.  Going forward, greater transparency on the CFS development would also be important. 

CIAC member-companies expressed concerns that reducing the carbon intensity of feedstocks and some combustion fuels may be complex and may result in costly, if not prohibitive, modifications that might not lead to the most cost-effective carbon reductions. If not handled thoughtfully and transparently, a poorly designed CFS could affect profits, operations, and opportunities to invest and to modernize within Canada.

The chemistry industry is supportive of carbon pricing and remains committed to working with governments to develop effective long-term regulatory policies that successfully achieves GHG emissions reductions without impeding innovation, investments, jobs, and economic growth.