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Canada: Alberta facilities to register with CRA regarding fuel charge

Canada: Alberta facilities to register with CRA

Businesses in Alberta need to consider their action steps concerning their fuel charge obligations, now that Alberta’s technology innovation and emissions reduction (TIER) system has been approved.


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Alberta’s TIER regulations meet the federal government’s requirements for carbon pollution pricing, and thus replace the output-based pricing system (OBPS) component of the federal carbon pollution pricing backstop. Finance Canada released draft regulatory proposals under the Greenhouse Gas Pollution Pricing Act to integrate TIER facilities with the federal fuel charge (FFC), effective 1 January 2020.

Facilities that will be regulated under TIER, and have been designated as such by the federal government, will be exempt from the FFC on fuel that is used at a covered facility. To qualify for this exemption, the facility must:

  • Be registered with the Canada Revenue Agency (CRA) as a “registered emitter”
  • Purchase the fuel with an exemption certificate

The FFC will apply on fuel delivered in Alberta starting 1 January 2020 unless a valid exemption certificate is provided to the fuel supplier.

Facilities that are not granted a “registered emitter” status will be subject to FFC for fuel used at their facility (e.g., fuel used in the production process to power equipment or flared fuel). These facilities will not be subject to TIER in respect of their emissions.

KPMG observation

Regulated TIER facilities need to consider acting now to have CRA registrations in place and effective 1 January 2020 so that they can issue valid exemption certificates to their fuel suppliers before their first fuel purchase in 2020.

Read a December 2019 report [PDF 177 KB] prepared by the KPMG member firm in Canada

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