Submission: Clean Electricity Regulations Canadian Gazette, Part 1

The Canadian Climate Institute and Clean Energy Canada propose adjustments to the Clean Electricity Regulations (CER) to ensure they are achievable and cost-effective. Key recommendations include raising the performance standard to 60 tonnes of CO2 per GWh, increasing the capacity factor for peaker plants to 15%, and introducing interim standards for facilities commissioned after 2025. To complement the CER, the authors argue for reforming the Output-based Pricing System (OBPS) to apply full carbon pricing to the electricity sector, federally procuring negative emissions via DAC-CCS and BECCS to offset residual emissions, and increasing support for demand-side management and distributed energy resources.

• The proposed performance standard of 30 tonnes of CO2 per GWh is likely too stringent for many fossil gas generators to achieve, as it would require a carbon capture rate of approximately 95%. The authors recommend increasing this standard to no more than 60 tonnes of CO2 per GWh, which corresponds to a 90% capture rate for an average high-efficiency combined cycle unit.
• To prevent the risk of operators forgoing carbon capture investments due to the binary nature of the CER, a 'soft-landing' compliance flexibility mechanism should be established. This would allow units within a specified margin of the performance standard to use verified negative emissions offsets to achieve remaining reductions.
• The current 5% capacity factor for peaker plants may be too restrictive and uneconomic for operators in deregulated markets like Alberta. The authors recommend increasing this limit to a capacity factor of no more than 15%, citing data from the U.S. and California.
• To avoid the 'lock-in' of new unabated fossil gas capacity that is only 'net-zero ready', the government should apply an interim performance standard to any facility commissioned after 2025. This standard would gradually tighten until the full performance standard takes effect in 2035.
• The current Output-based Pricing System (OBPS) shields the electricity sector from the full carbon price, which weakens the incentive to reduce emissions. The authors recommend removing the sector from the OBPS or reforming benchmarks to apply the full carbon price by 2030, with revenues returned to in-province ratepayers.
• Because some residual emissions will likely remain after 2035, the federal government should procure negative emissions through engineered processes—specifically direct air capture with carbon capture and storage (DAC-CCS) and bioenergy with carbon capture and storage (BECCS)—to ensure permanence.
• Federal investment tax credits (ITCs) currently favor supply-side measures, creating a distortion that neglects cost-effective demand-side interventions. The government should target more support toward distributed energy resources (DERs), demand-side management (DSM), and energy efficiency to improve grid flexibility and household affordability.

APA

Pivnick, E., & Dion, J. (2023). Submission: Clean Electricity Regulations Canadian Gazette, Part 1. Canadian Climate Institute. https://climateinstitute.ca/wp-content/uploads/2023/11/Submission-Clean-Electricity-Regulations-Canadian-Gazette.pdf

Chicago

Pivnick, Evan, and Jason Dion. Submission: Clean Electricity Regulations Canadian Gazette, Part 1. Canadian Climate Institute, 2023. https://climateinstitute.ca/wp-content/uploads/2023/11/Submission-Clean-Electricity-Regulations-Canadian-Gazette.pdf.

Wikipedia

{{cite press release |last1=Pivnick |first1=Evan |last2=Dion |first2=Jason |title=Submission: Clean Electricity Regulations Canadian Gazette, Part 1 |publisher=Canadian Climate Institute |date=31 October 2023 |url=https://climateinstitute.ca/wp-content/uploads/2023/11/Submission-Clean-Electricity-Regulations-Canadian-Gazette.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{pivnick2023submission, author = {Pivnick, Evan and Dion, Jason}, title = {{Submission: Clean Electricity Regulations Canadian Gazette, Part 1}}, publisher = {Canadian Climate Institute}, year = {2023}, month = oct, url = {https://climateinstitute.ca/wp-content/uploads/2023/11/Submission-Clean-Electricity-Regulations-Canadian-Gazette.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }