Federal Government Proposes New CFS Regulations, Launches SMR Action Plan

Clean Fuel Regulations. The federal government today released proposed Clean Fuel Regulations (the Regulations) under the Canadian Environmental Protection Act, 1999. This bulletin briefly summarizes the Regulations.

The Regulations, which were published in Canada Gazette, Part I earlier today, seek to lower greenhouse gas (GHG) emissions by reducing the carbon intensity (CI) of liquid fossil fuels produced in and imported into Canada.

The proposed Regulations would reduce the CI of liquid fossil fuels from 2016 CI levels by 2.4 gCO2e/MJ in 2022 increasing to 12 gCO2e/MJ in 2030 and establish a credit market to facilitate annual CI reductions through the following three categories of credit-creating actions:

  1. Reduce. Actions that reduce the CI of the fossil fuel throughout its lifecycle.

  2. Supply. Supplying low-carbon fuels.

  3. Switch. Specified end-use fuel switching in transportation.

The proposed Regulations will replace the Renewable Fuels Regulations, but maintain the minimum volumetric requirements of at least 5% low CI fuel content in gasoline and 2% low CI in diesel and light fuel oil.

The Regulations will not apply to gaseous or solid fuels, as previously announced in the federal government’s new Climate Change Plan (see our earlier bulletin).

SMR Action Plan. Minister of Natural Resources Seamus O’Regan today announced Canada’s Small Modular Reactor Action Plan (the Plan). The Plan provides details for the development, demonstrations, and deployment of small modular reactors (SMRs) in Canada and abroad. The Plan builds on the 2018 SMR Roadmap and brings together inputs and actions from all levels of government, industry, innovators, research institutions, power utilities, and Indigenous communities for an emerging global market estimated to be valued at $150-300 billion by 2040.

The Plan provides concrete actions for key enablers under the following four pillars:

  1. Demonstration and deployment, including risk sharing;

  2. Policy, legislation, and regulation, including nuclear liability, security and waste management;

  3. Capacity, engagement, and public confidence, with an emphasis on Indigenous engagement; and

  4. International partnerships and markets, including international enabling frameworks.

The Plan supports and forms part of the federal government’s plan to reach net-zero emissions by 2050.

For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@demarcoallan.com.

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