Canada delays development of Clean Fuel Standard regulations

By Erin Voegele | July 25, 2018

The Canadian government has announced plans to delay implementation of its Clean Fuel Standard. Original plans called for development of the program regulations to be complete next year. That work is now expected to take until 2021.

Canada first announced plans to develop the Clean Fuel Standard in November 2016. The program aims to reduce carbon emissions from all fuels by 30 million metric tons in 2030 by setting lifecycle carbon intensity requirements for liquid, gaseous and solid fuels used in transportation, industry and buildings. The standards will be designed to become more stringent over time.

Environment and Climate Change Canada released a preliminary regulatory framework for the Clean Fuel Standard in December 2017. At that time, the government said it planned to publish Part I of the draft regulations in 2018 and Part II in mid-2019.

A notice posted to the government’s webpage in July indicates that implementation timeline will now be delayed. “Since announcing the policy in late 2016, Environment and Climate Change Canada has engaged broadly and listened to stakeholders about the design of the policy,” the government said in the notice. “ECCC recognizes the need for additional time to work with interested parties to conduct robust technical and economic analysis to ensure that the Clean Fuel Standard achieves its goal while maintaining Canadian competitiveness.”

The government now expects to publish proposed regulations for liquid fuels in spring 2019, with those regulations finalized in 2020 and coming into force by 2022. For gaseous and solid fuels, the government expects to publish proposed regulations in fall 2020, with those regulations finalized in 2021 and put into force by 2023.

This fall, the ECCC said it plans to publish two documents to guide further engagement on the design of the standard. The first is a regulatory design paper that will provide more information about the design of the policy, including the proposed allocation of the overall 30-million-metric-ton target among the three fuel streams. The second is a cost-benefit analysis framework outlining the proposed analytical approach, including models, data and key assumptions, for assessing the costs and benefits of implementation of the Clean Fuel Standard for the liquids stream.

Additional information is available on the ECCC website