TIER Regulation & Administrative Penalty amendments effective January 1, 2023

Envirosoft - January 11, 2023

As of December 14, 2022, the Government of Alberta has made amendments to the TIER Regulation and the Administrative Penalty Regulation.

An overview of the regulatory changes effective January 1, 2023 are outlined below. 

  • Emission Scope: Flaring emissions are included in regulated emissions for aggregate oil and gas facilities
  • Opt-In Threshold: Opt-in threshold for emissions-intensive and trade-exposed industry is 2,000 tonnes CO2e/year
  • Benchmark Tightening: A 2% annual tightening rate will apply to facility-specific benchmarks and high performance benchmarks. For oil sands mining, in situ and upgrading, the annual tightening rate is 4% in 2029 and 2030
  • Credit Use Limit: The credit usage limit is 60% in 2023, 70% in 2024, 80% in 2025, and 90% in 2026 forward
  • Credit Expiry: Emission performance credit and emission offset credit expiry is 5 years
  • CCUS Credits: Sequestration credits and capture recognition tonnes are established as new instruments.  Sequestration credits enable recognition under the Clean Fuel Regulations. Capture recognition tonnes also enable large emitters and opt-in facilities to reduce sequestered emissions from total regulated emissions at carbon capture sites
  • Biomass: The biomass emissions definition is changed, and excluded biomass emissions from the calculation of exported CO2
  • Cost Containment Program: The program remains, and changes include setting a supplemental benchmark on entry to the program and enabling sites in the program to earn emission performance credits
  • Expiry and Review: The TIER Regulation is in effect through 2030, and includes a commitment to review it by the end of 2026

Please note: The Ministerial Order establishing the TIER fund price for 2023 through 2030 increasing from $65 to $170 in $15 annual increments will be released shortly. Also, in early 2023, Environment and Protected Areas will be releasing updates to TIER standards and Ministerial Orders to establish additional high performance benchmarks. In January, the department will hosting an information session in Calgary (aiming to enable virtual participation) for regulated facilities and carbon offset project developers on the changes detailed in the TIER Amendment Regulation and standards. Registration details for the session will be emailed by the government of Alberta in early January. Sign up for their mailing list here. 

This post will be updated once more information becomes available. 

If you have any questions, please reach out to us at support@envirosoft.com and our team would be happy to assist you. 

Related: TIER Conventional Oil and Gas Fall 2022 Webinar | Key highlights