What is the Federal Carbon Tax?
The carbon tax is applied to your natural gas bill as a tax on the greenhouse gas emissions associated with burning the fuel. The federal carbon tax is applied to provinces that do not already have their own carbon tax system in place, which includes Ontario, New Brunswick, Saskatchewan and Manitoba. Funds collected from the carbon tax will be used to fund energy savings measures in each province that pays the tax.
It is also important to note that electricity generated for the grid that is provided by fossil fuels like coal and natural gas plants may also pay the carbon tax. This could lead to increased electricity prices depending on the efficiency of the fossil-fuel based generation in the province and what percentage of the province’s overall electricity generation is derived from fossil fuels.