A provincial plan has been approved to replace the federally imposed carbon tax on industrial emitters in Saskatchewan, effective January 1st. The federal government approved the plan called the Saskatchewan Output-Based Performance Standards Program.

A news release from the province says it meets the requirements for the 2023-2030 federal carbon pricing benchmark, including the addition of the electricity generation and natural gas transmission pipeline sectors. It means all industrial carbon taxes now stay in Saskatchewan which the province estimates will save Saskatchewan industry $3.7-billion during that time period, compared to federal carbon pricing.

The number of facilities in the OBPS Program is expected to double by 2030. Regulated emitters will receive credit for every tonne of carbon emissions under the permitted amount, creating incentives to reduce emissions. The program will also include credit for carbon capture, utilization and storage (CCUS).

Regulated emitters will have the option to pay into the Saskatchewan Technology Fund, which will create incentives for industry to develop and implement technologies that contribute to reductions in greenhouse gas emissions.