Environment Committee on March 24th, 2026

[Dale Beugin]

We try to identify top experts in the field. They're usually academics. We also run all of our research through expert panels that are made up of experts from across the country. Again, largely, they are academics. That is our way of ensuring we are providing the best available evidence and research, always grounded in facts and evidence.

[David Bexte, Conservative, Bow River, AB]

I appreciate your view on that.

That's it. I cede the balance of my time.

Thank you.

[The Chair, Liberal, Shannon Miedema]

Thank you, Mr. Bexte. You had only a few seconds.

Mr. St‑Pierre, you have the floor for six minutes.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

Thank you.

I'd like to thank my colleague from Bow River for his professional questions. I'd also like to echo his earlier thanks to the witnesses for spending the time with us and, for some of you, for travelling here today.

Mr. Beugin, you're a very well-known expert on carbon pricing, dating back to the Ecofiscal Commission. I have a lot of respect for the work you've done in the past and also for the work you're doing currently with the Canadian Climate Institute.

Recently, there was an analysis by the Canadian Climate Institute showing that the industrial carbon price on a barrel of oil was about the equivalent of a Timbit. I'm curious to know if you can provide to this committee a copy of that analysis or any related report.

[Dale Beugin]

Yes. We're happy to provide that report. It is drawn from a calculator estimating compliance costs for oil sands firms in particular and shows a range of compliance costs per barrel across those oil sands sectors. Some are generating revenue around $2 per barrel while others are facing costs averaging around nine cents per barrel.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

That's great. The Canadian Climate Institute does some excellent research, and it's peer-reviewed research. It's some of the best in the country.

I'm wondering if you could quickly comment on whether there are other reports from the Canadian Climate Institute on the topic of the industrial carbon price. If you can quickly comment on whether there are reports and, if so, you can kindly provide them to this committee, that would be greatly appreciated.

[Dale Beugin]

There's a range of research we've produced on our website, all publicly available. I'm happy to forward it to the committee for its records.

Maybe I'll also highlight the independent review of industrial carbon-pricing systems that we undertook. We engaged with provinces across the country to assess individual provincial systems, as well as the federal system. We took a look at how they were working and at how they can be improved over time as well. That's also an important publication. I'll add it to our list.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

That's great. I love the analogy with Timbits. I'm a big fan of double doubles. I'm curious. What is the cost of a Timbit? What is the cost of the industrial carbon price on a barrel of oil?

[Dale Beugin]

I think Timbits go for something like 30¢ to 50¢ right now.

To be more precise, our estimate is that current costs in Alberta from the industrial carbon price for the oil sands sector on average are around nine cents per barrel. If the credit price were to increase to $130 per tonne, as is being discussed, then we're talking about a cost per barrel of around 50¢ per barrel, on average.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

Can you comment on that? Does that 50¢ a barrel apply to consumers or does that apply to producers?

[Dale Beugin]

That's going to apply to producers. Producers mostly are not able to pass on their costs to consumers through their supply chains because they are competing in international markets. They're price-takers, not price setters. That cost is nevertheless low for their bottom line—again, by design.

These systems are designed to protect profits and protect the profitability of producers so that they will maintain production but reduce emissions.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

Does that cost of a Timbit per barrel seem significant to you? Is that more marginal?

[Dale Beugin]

I'm just here to put the numbers out there. We have tried to compare it to make it concrete, and whether it's big or small, I'll leave to you.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

Okay.

Can you share why you think Conservatives should get really excited about industrial carbon price? I'm not necessarily hearing that excitement when I'm in the House of Commons.

[Dale Beugin]

Well, I'm not sure I can speak to Conservatives specifically, but in terms of the advantages of industrial carbon pricing in general, I think the case is fairly clear: strong incentives for emissions reductions when it's working; strong protection for competitiveness to make sure we're not offshoring production and driving investment away; and protection for consumers and market forces to minimize the cost of reducing emissions overall. All of that is a pretty strong value proposition for industrial carbon pricing.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

We're often hearing from industry that they want certainty. They want certainty so they're able to move on and they're able to predict what's going to be happening in the future.

Can you speak about industrial carbon pricing, why this is good policy and why this leads to certainty for industry?

[Dale Beugin]

It's not just the price of carbon today that is driving investment, but the expected price of carbon and the value of credits into the future. These are long-lived projects, and as a result, their costs or their revenues are going to extend across the life of the project, pending the existence of carbon pricing, pending the reliability and robustness of these credit markets that it creates. The uncertainty is hugely important for driving that investment and making those projects bankable. It depends on the existence of the policy, as well as the robustness of those credit markets.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

Thanks.

I think I have a minute left, so I'll go to Mr. Rainville.

Clean Prosperity mentioned that in budget 2025 it's right to focus on industrial carbon pricing for low-carbon growth. Clean Prosperity also said that industrial carbon pricing can drive tens of billions of dollars' worth of new investments, creating clean growth and jobs that Canada urgently needs.

Can you explain to us in the next few seconds how billions of dollars' worth of new investments could be created through industrial carbon pricing, and can you give us a couple of specific examples?

[Etienne Rainville]

Yes. The most obvious example that's top of mind is the Pathways project, which I believe has been mentioned a number of times today. That is a project that's made economical in large part because of carbon pricing. It's a project valued in the range of $16 billion to $20-odd billion. There's a number of other projects like that across Canada, and across Alberta in particular, in carbon capture and storage as just a single area where new investment can be driven by industrial carbon pricing.

[The Chair, Liberal, Shannon Miedema]

Thank you very much, Mr. St-Pierre.

Mr. Bonin, you have the floor for six minutes.

[Patrick Bonin, Bloc, Repentigny, QC]

Mr. Séguin, I'd like to hear your thoughts on that.

In your opinion, is it fair to Quebec if Canada enters into an agreement with Alberta to reduce carbon pricing to $130 a tonne?

[Charles Séguin]

It's pretty hard to compare prices across different jurisdictions. In my opinion, that puts Quebec at a disadvantage compared to the other provinces. The greatest inequality for Quebec is that consumer pricing no longer exists in Canada except in Quebec.

[Patrick Bonin, Bloc, Repentigny, QC]

So you're proposing that Canada go back to the former system, which was a form of carbon pricing for transportation and consumers, among other things.

Is that correct?

[Charles Séguin]

Obviously, that would no doubt help Canada meet its greenhouse gas emissions reduction targets and its commitments under the Paris Accord. It looks like it's going to be very difficult for Canada to meet its commitments. Having more instruments and covering a larger portion of emissions in the country would certainly make it easier to achieve those objectives.

If we don't do that, not having a price on large emitters would make it harder for us to meet those targets.

[Patrick Bonin, Bloc, Repentigny, QC]

In your opinion, should oil sands companies make clear commitments to allocate substantial funding to the famous Pathways project for carbon sequestration and capture, and should companies be made to pay rather than use taxpayers' money?