Canada’s carbon tax increase schedule no longer follows the $15-per-tonne annual climb toward $170 by 2030. The federal consumer fuel charge was set to zero on April 1, 2025, and the industrial carbon price is frozen at $95 per tonne through 2026. A revised trajectory for large emitters rises slowly from there, reaching $115 per tonne in 2030 rather than the $170 originally planned.
What Replaced the Old $15-Per-Year Climb
Under the Greenhouse Gas Pollution Pricing Act, the price was supposed to rise $15 per tonne every April 1, hitting $95 in 2025, $110 in 2026, and $170 by 2030. That schedule held through April 1, 2024, when the price reached $80. The $95 rate technically took effect on April 1, 2025, but only for a few days before the consumer charge was zeroed out.
On March 15, 2025, the federal government published regulations (SOR/2025-107) amending Schedule 2 of the Act to set every federal fuel charge rate to zero effective April 1, 2025.1Government of Canada. Schedule 2 to the Greenhouse Gas Pollution Pricing Act Gasoline, diesel, natural gas, and every other fuel listed in the Act stopped carrying a federal carbon surcharge. The Act itself was not repealed; the pricing mechanism was removed by regulation.2Government of Canada. The Federal Carbon Pollution Pricing Benchmark
Industrial carbon pricing under the federal Output-Based Pricing System kept going, but on a slower path than the original one.
The Current Industrial Carbon Price Schedule
For facilities covered by the federal OBPS or an equivalent provincial industrial system, the revised trajectory looks like this:
- 2025: $95 per tonne
- 2026: $95 per tonne (frozen)
- 2027: $100 per tonne
- 2030: $115 per tonne
- 2035: $130 per tonne (rising by $3 per year after 2030)
- 2036 onward: indexed to inflation with a 1.5% annual escalator
The 2026 price of $110 per tonne under the old schedule did not take effect. By 2030, the industrial price lands at $115 rather than $170, roughly two-thirds of what was planned. The slower pace reflects concern about competitiveness for trade-exposed sectors competing against firms in countries without carbon pricing.
Why the Frozen Price Still Costs More Each Year
The OBPS doesn’t charge a flat tax on every unit of fuel a facility burns. It measures emissions intensity, meaning pollution per unit of output. Each covered facility gets a performance standard based on the national production-weighted average for its industry. Emissions below that standard are free. Only emissions above the limit are charged at the prevailing carbon price, which is $95 per tonne in 2026.
The performance standards themselves tighten at 2% per year for most industries, and 1% per year for sectors deemed highly trade-exposed.3Environment and Climate Change Canada. Review of the Federal Output-Based Pricing System Regulations So even with the headline price frozen, the effective cost of industrial emissions rises as the benchmark ratchets tighter. A frozen price paired with a tightening benchmark is less generous than it looks.
The federal OBPS applies to facilities emitting 50,000 tonnes or more of carbon dioxide equivalent per year.
The Consumer Charge and the Rebate Are Gone
If you are looking for the schedule that used to add cents-per-litre to gasoline and per-cubic-metre charges to natural gas bills, there isn’t one anymore. All federal fuel charge rates are zero, and there is no scheduled increase. A future government could restore the charge by regulation without passing new legislation, but as of 2026 no consumer fuel charge applies in any province or territory.
The Canada Carbon Rebate ended with the fuel charge. Residents of Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, and Saskatchewan had received quarterly payments while the charge was in effect.4Government of Canada. Who Was Eligible – Canada Carbon Rebate (CCR) for Individuals The CRA has confirmed there will be no further payments to individuals.5Government of Canada. Closed – Canada Carbon Rebate (CCR) for Individuals Retroactive rebate payments for small businesses covering fuel charge years from 2019–2020 through 2024–2025 are still being processed for eligible Canadian-controlled private corporations. Those payments are non-taxable, and the CRA expects most to be issued by fall 2026.6Government of Canada. Non-Taxability of the Canada Carbon Rebate for Small Businesses
Which Schedule Applies Where You Live
The Greenhouse Gas Pollution Pricing Act was designed as a backstop. Provinces and territories can run their own carbon pricing systems, whether a carbon tax, a cap-and-trade market, or an industrial output-based system, as long as they meet federal minimum stringency standards.7Government of Canada. Carbon Pricing Systems Across Canada With the consumer charge gone, the backstop question is now entirely about industrial pricing.
British Columbia, Alberta, Saskatchewan, Ontario, Quebec, New Brunswick, Nova Scotia, Newfoundland and Labrador, and Northwest Territories operate their own industrial carbon pricing programs. Quebec runs a cap-and-trade system where companies buy and sell emission allowances rather than paying a fixed per-tonne price. Alberta’s TIER program is frozen at $95 per tonne for 2026, matching the federal trajectory.
The federal OBPS applies directly in Prince Edward Island, Manitoba, Yukon, and Nunavut. If a provincial system falls behind the federal benchmark on stringency, federal regulators can impose the OBPS to close the gap.
Whether the Schedule Could Change Again
Because the consumer fuel charge was removed by regulation rather than repeal, a future government could restore it without passing legislation. The Act remains on the books, and the government has indicated it will consider broader amendments going forward.2Government of Canada. The Federal Carbon Pollution Pricing Benchmark
For industry, the open question is whether the revised path to $115 in 2030 will hold. Businesses planning capital investments tied to carbon costs should watch federal benchmark reviews, since the tightening OBPS performance standards mean the real cost of emitting keeps rising even when the price per tonne does not.