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Carbon Market

Québec has made the carbon market the key to its strategy for fighting climate change. Putting a price on carbon is a key way to reduce greenhouse gas (GHG) emissions, promote energy efficiency, and spur technological innovation.

Québec’s carbon market was launched in January 2013. Linked to that of California since January 2014, it is the biggest carbon market in North America. It covers the main industrial emitters, power producers and fossil fuel distributors, which represents about 85% of Québec’s GHG emissions.

carbon-market

How does the carbon market work?

The government establishes annual caps on GHG emission units. These caps gradually decrease over the years. Hence

  • Businesses that exceed the limit must buy emission rights for each ton of emissions above this limit
  • Businesses that reduce their GHG emissions below the target levels (for example by developing new technologies or using processes that pollute less) can auction their emission units on the carbon market

Introducing a carbon cost into the Québec economy speeds up the behavioral changes required to shift to a lower-carbon society.

Supporting the efforts of individuals, municipalities, and businesses

All income from the carbon market goes into a Green Fund to finance the measures in the Climate Change Action Plan. Through the plan, more than $3.3 billion will be invested by 2020 to help Québec businesses and municipalities, as well as individual Quebecers, transition to a low-carbon world and adapt to the effects of climate change.

With the income generated by the carbon market, a number of programs have been launched under the Climate Change Action Plan, in addition to many other measures. These actions enable individuals, municipalities, and businesses to

  • Reduce their carbon footprint by increasing their energy efficiency and using renewable energy sources in their buildings, processes, and means of transportation, which, in the case of businesses, makes them more competitive
  • Further promote the development of public transit and active transportation
  • Speed up electrification of transportation and the creation of new businesses
  • Develop new green technologies
  • Take proactive action to adapt to the impacts of climate change

The carbon market is a tool for economic growth that encourages society to reduce its consumption of hydrocarbons, while at the same time spurring technological innovation.

For more information, visit the Carbon Market section on the website of Ministère du Développement durable, de l’Environnement et de la Lutte contre les changements climatiques.

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