The federal price on carbon came into effect in Nunavut on July 1, 2019 under the federal Greenhouse Gas Pollution Pricing Act (the Act). The federal carbon levy applies in Nunavut at a rate of $20 per tonne of carbon dioxide (CO2) emissions in 2019 and will rise yearly until it reaches $50 per tonne in 2022.
The Act has the following features:
- For larger industrial facilities, an output-based pricing system for emissions-intensive trade-exposed (EITE) industries applies. It covers facilities emitting 50,000 tonnes of CO2 equivalent per year or more.
- Smaller EITE facilities that emit 10,000 tonnes of CO2 emissions per year or more will be able to voluntarily opt into the system over time.
- A charge applied to fossil fuels, generally paid by registered distributors (fuel producers and distributors), as set out in Part 1 of the Act, applies.
Carbon pricing in Nunavut takes into account the territory’s special circumstances, including high costs of living and of energy and challenges with food security. In this regard, the federal government has agreed to:
- Provide relief for fuels used for aviation in the territory. The fuel charge will apply to these fuels at a rate of $0/litre.
- Provide fuel charge relief for diesel-fired electricity generation for remote communities.
Nunavut Carbon Rebate
In May 2019, the territorial government proposed the creation of the Nunavut Carbon Rebate. Through this program, the territorial government will subsidize half of the cost of the federal carbon price for fuel purchased at the pump by residents of Nunavut. This is similar to what is already done through the Nunavut Electrical Subsidy Program, where the Department of Finance works with Qulliq Energy Corporation to subsidize the price of electricity for households and businesses.
In 2023-24, the territorial government will start to phase out the subsidy over a five-year period. As of June 5, 2019, the program has not yet been enacted.
Upagiaqtavut – Setting the Course: Climate Change Impacts and Adaptation in Nunavut
Nunavut has set out its approach to climate change in Upagiaqtavut – Setting the Course: Climate Change Impacts and Adaptation in Nunavut. A central focus of the Upagiaqtavut document is an adaptation initiative strategy, which aims to increase adaptive capacity within Nunavut communities and is tailored around four main components or napuit: (i) partnership building; (ii) research and monitoring; (iii) education and outreach; and (iv) government planning and policy. Specific action items taken to date include the establishment of permafrost monitoring stations throughout the territory and information collection initiatives on local water supplies.