Fourteen of Canada’s biggest oil and gas executives, backed by Conservative leader Pierre Poilievre, are turning up the heat on the federal government’s carbon pricing system. They've made it clear: they want the policy scrapped. Their argument? The current system is making it harder for Canada’s energy sector to stay competitive.
This coordinated move comes as Canada faces new global pressures. With U.S. tariff threats looming, Canadian energy leaders are calling for a shift in priorities—from climate targets to economic stability.
At the center of the debate is the Pathways Alliance, a group representing the country’s top oil sands producers. Their massive carbon capture project was shaped around the existing pricing policy. But now, even they are questioning whether the current approach works.
The federal carbon pricing system, introduced in 2019, was supposed to curb pollution. It charges companies when their emissions go over a set limit. Over time, that was meant to push them toward cleaner operations.
But this week, things escalated. The 14 oil and gas CEOs signed an open letter demanding the repeal of the policy. They argue that letting provinces design their own carbon strategies would make more sense.
“This is about recognizing the unique needs of each province and industry,” one executive stated. They believe Ottawa’s one-size-fits-all approach is doing more harm than good.
Pathways Alliance didn’t hold back either. In a public statement, the group labeled the carbon pricing system as “uncompetitive”. According to them, it’s slowing down growth in Canada’s vital oil sands sector.
The push to end carbon pricing isn't just coming from business leaders. Pierre Poilievre, leader of the Conservative Party, has made it a top campaign issue.
He’s promised to scrap the system if he wins the April 28 election. Instead, Poilievre plans to roll out federal tax incentives to motivate emissions cuts. Under his plan, provinces would get the final say on whether and how to price carbon.
It’s a sharp contrast to the current model. And it’s clearly gaining traction among energy executives who say they’re tired of federal red tape.
This policy shift could throw a wrench into Pathways Alliance’s plans. Their proposed multi-billion-dollar carbon capture and storage (CCS) project was designed around the federal carbon pricing model. Without it, the entire structure of their investment might need to change.
Still, Pathways isn't sitting on its hands. The group has been in ongoing discussions with the federal government, exploring a potential backup plan if the pricing system disappears. But so far, no deal has been made.
And that uncertainty is starting to weigh on investor confidence.
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One thing energy leaders seem to agree on: they need predictability. Constant changes in federal policy make it harder to plan long-term projects, especially ones involving massive capital and tech investment.
“Companies can adapt, but they need a clear runway,” said one executive. “It’s the stop-and-start nature of federal policy that’s hurting us.”
The CEOs behind the open letter aren’t denying climate change. They say they’re still committed to cutting emissions. But they believe economic growth doesn’t have to take a backseat to environmental goals.
This pushback reveals a deeper divide in Canada’s climate conversation. How do you balance environmental responsibility with economic reality?
Critics of the current carbon pricing model say it’s tilted too far toward idealism. Supporters argue it’s one of the few tools Canada has to hit its climate targets.
Meanwhile, the rest of the world is watching. Countries like the U.S. are using tax credits and market incentives to drive clean innovation. That’s the approach Poilievre and the oil CEOs say they prefer.
With an election just weeks away, the future of Canada’s climate policy could hinge on who wins.
If Poilievre takes office, expect a swift move away from carbon pricing toward tax-based incentives. If the current government holds on, the carbon system will likely stay—though maybe with some tweaks to address competitiveness concerns.
One thing’s for sure: this isn’t just a political fight—it’s a business one too. And the outcome will shape Canada’s energy landscape for years to come.
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