Ottawa eyes carbon market bargain

POLICY

Ottawa eyes a carbon market bargain with provinces

What happened: Canada could strike a “grand bargain” on climate by abandoning its oil and gas emissions gap - but only if provinces step up their industrial pricing systems.

The details: A report from the Canadian Climate Institute says a stronger carbon pricing regime for heavy emitters would drive more impact than the oil and gas emissions cap. Modelling shows each policy could cut about 25 MT of emissions annually by 2030 - but together, they’d deliver just 32 MT.

The overlapping policies could flood carbon markets with credits from oil and gas, driving prices lower. Other industries covered by the carbon pricing system - like steel or chemicals - could buy cheap credits instead of investing in emissions reduction tech, undercutting demand for industrial decarbonization solutions.

Why it matters: Carbon pricing is a critical demand signal. Stronger, harmonized markets with higher credit prices and tighter rules would unlock broader industrial adoption of clean technologies - from carbon capture to electrification.

Prices have been falling in Alberta’s market for several years, and the province recently froze credit prices due to tariff threats, making it easier to emitters to buy credits than invest in new projects.

A streamlined approach also reduce regulatory uncertainty. Stable, high-integrity markets lower investment risk, expand markets across provinces (vs only trading credits within Alberta, for example) and improve the bankability of projects.

Yes, but: Industrial carbon pricing has historically seen stronger buy-in from the provinces. That consensus isn’t as strong anymore, and provinces like Alberta and Saskatchewan have resisted federal oversight on carbon pricing and allowed credit prices to drop.

Without provinces on board, scrapping the oil and gas emissions would just be a step backwards - removing the stick without fixing the carrot.

The bottom line: CCI’s proposal offers a way forward for the feds and provinces to work together on climate. A well designed system could deliver efficient emissions reductions across industries and make Canada more attractive to investors - but it requires the political will to seriously upgrade carbon pricing.

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CLIMATE CAPITAL

🐟️ Mara Renewables raised $12.5 million investment from S2G Investments for its algae-based omega-3 oils. Mara’s plant-based oils offer an alternative for wild-caught fish, reducing pressure on fish populations. The funding will expand production and drive growth in Asia and the Middle East.

🛰️ EarthDaily closed $60 million in asset-based financing for its satellite observation platform. The funding will enable EarthDaily to deploy its full constellation of satellites for broad-area monitoring.

💰️ DevvStream secured $10 million in convertible debt to build a blockchain-based treasury and launch tokenization for sustainability infrastructure.

🔋 FeX Energy won $1 million as a semi-finalist in the Dept of Defence’s IDEaS NORAD Modernization contest for its zero-carbon, high-density, deployable solution built for remote and Arctic environments.

🧑‍🔬 The Canadian Food Innovation Network announced $1.2 million in funding for 13 foodtech startups, including Lite-1’s sustainable food colourants, Genuine Taste’s cell-based fats, and Food Cycle Science’s food waste solutions.

♻️ Emissions Reduction Alberta will invest $49 million through its Advanced Materials Challenge, including project grants for Carbonova’s carbon nanofibers, Plascred’s plastic recycling, and SeeO2’s carbon-to-fuels tech.

🏭️ Next Generation Manufacturing Canada announced a $37 million investment in 13 sustainable manufacturing projects, including Carbon Upcycling’s low-carbon cement plant with CRH and a joint project between CERT Systems, Pulsenics, and Phycus Biotechnologies to convert CO2 to chemical feedstocks.

🚚 AlumaPower received a $5 million grant to demonstrate its aluminum generator with Purolator through NRCan’s On-Road Transportation Decarbonization program. Elemental Trucks and Inmotive also received funding.

🏘️ Desjardins launched a $50 million fund to build affordable and sustainable housing in Quebec. The fund is backed by several foundations including the Trottier Family Foundation and McConnell Foundation.

IN THE FIELD

🧱 Carbon Upcycling Technologies broke ground on its carbon capture and utilization project at Ash Grove’s cement plant in Mississauga, ON. The system will displace 30,000 tonnes of CO2 annually.

🥛 Opalia landed the world’s first commercial supply agreement for cell-based dairy from Dutch dairy giant (and Opalia investor) Hoogwegt.

💨 Deep Sky sold 3,000 tons of carbon removal credits to commodity traders McGill St Laurent Climate Solutions, with delivery in 2027.

💧 Next Hydrogen launched its onsite hydrogen generation and fuelling station in Ontario, designed to produce 650 kg of hydrogen per day for fuel cell forklifts.

🔌 United Chargers launched its Grizzl-E Club charger-as-a-service, offering free home EV chargers funded by carbon credit generation.

🏭️ Algoma Steel produced the first green steel from its electric arc furnace in Ontario, with a 70% lower carbon footprint than traditional steel.

🏛️ Canada’s EV charging operators launched the Canadian Charging Infrastructure Council industry group, including FLO, ChargePoint and SWTCH, to help policymakers build the economic and regulatory pathways to accelerate charging investments.

☀️ Enbridge will build a 600 MW solar project in Texas to power Meta Platforms’ data centres, while Loblaws installed Canada’s largest rooftop solar array at its Ontario distribution centre, spanning more than 40,000 sq meters with 7.5 MW capacity.

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NEWS

📡 Signals & Currents

🍔 Beyond rebrands to tap into consumer trends - Beyond Meat will rebrand to become just “Beyond” as the company focuses on whole plants and growing demand for protein. Sales dropped 9% in Q1, and the company’s market value is down 95% since it’s IPO.

🔍️ Quebec probes EV subsidies - The province’s AG is investigating more than $410M in subsidies for Northvolt and Lion Electric, both of which filed for bankruptcy. [Financial Post]

🌊 NS moves forward with wind energy plans - Nova Scotia finalized four areas for offshore wind development. The provinces plans to attract 5 GW of wind energy by 2030. [CBC]

🌩️ Boards on the hook for nature risk - Company directors could face lawsuits or penalties if they ignore nature risks like biodiversity loss or extreme weather. [CCLI]

⛔️ Oil companies walk away from emissions standards - Enbridge, Shell and others quit SBTi’s advisory group for global oil and gas emissions standards. The corporate-driven program is now on pause. [Reuters]

🧑‍⚖️ The right to a healthy environment - Canada released its implementation framework for the Right to a Healthy Environment, focused on protecting the environment and people impacted by exposure to pollution. [Canada]

🇺🇳 ICJ rules on climate accountability - Nations can be legally held accountable for greenhouse gas emissions according to the International Court of Justice, opening the door for legal action from those harmed by climate change. [Carbon Brief]

⚛️ China spins up fusion platform - China National Nuclear Corporation launched a fusion subsidiary, backed by $2.1B in funding, to build R&D and capital platforms for fusion companies. [Xinhua]

🇺🇸 The high cost of clean energy cuts - The U.S. lost 16,500 jobs in the first half of 2025 from cancelled clean energy projects due to policy uncertainty and funding changes. [E2]

🧑‍⚖️ U.S. targets clean air regs - The U.S. EPA plans to eliminate the “endangerment finding”, a key ruling that allows the agency to regulate CO2 and other pollution. [NPR]

COMMUNITY

🚀 Critical Minerals Innovation Fund: Funding projects that strengthen Ontario’s critical minerals sector. Apply by October 1st.

➡️ Discover more funding opportunities.

🗓️ Toronto Climate Week: A festival-meets-forum experience that brings together communities, ideas, decision-makers and climate solutions. Toronto, October 1-3rd.

➡️ Discover more climate events.

🧑🏻‍💻 CarbonRun is hiring a Senior Director of Science and Operations to lead the scientific and operations aspects of novel CDR projects.

➡️ Find more open roles.