SaskPower Customers Will See no Change to Federal Carbon Tax on Power Bills in 2022

December 15, 2021

Effective January 1, 2022, the Federal Carbon Tax that is applied to SaskPower’s carbon emissions will increase from $40 to $50 per tonne. However, SaskPower customers will pay the same Federal Carbon Tax rate as they did in 2021.

“SaskPower is working hard to reduce its carbon emissions while keeping rates as low as possible,” said Don Morgan, Minister Responsible for SaskPower. “Because of reduced emissions from coal generation, the addition of more than 400 megawatts of wind, solar, and biomass, as well as an improved outlook on hydro generation, SaskPower is able to avoid passing Federal Carbon Tax rate increases on to customers in 2022.”

SaskPower has committed to reducing its CO2 emissions by at least 50 per cent from 2005 levels before 2030, and reaching net-zero emissions by 2050. In order to achieve this target, SaskPower intends to continue adding renewable power generation capacity in the coming years. This commitment by SaskPower will help reduce the financial impact of the Federal Carbon Tax on Saskatchewan customers.

The Federal Carbon Tax was set at $20/tonne of CO2 effective January 1, 2019 for emissions above established thresholds. It increased to $30/tonne effective January 1, 2020, then to $40/tonne on January 1, 2021, and will rise to $50/tonne on January 1, 2022. It will increase $15/tonne per year starting in 2023 until it reaches $170/tonne in 2030. 

SaskPower applies a rate rider that is revised January 1 of every year to collect an estimate of the federal carbon tax for the upcoming calendar year. At the end of the year SaskPower calculates the actual carbon tax payment that we are required to remit to the federal government. Any difference between the amount collected and the payment due to the federal government is factored into the following year’s rate rider. 

At a glance...

  • Federal carbon tax on SaskPower greenhouse gas emissions will increase from $40 to $50/tonne in 2022
  • SaskPower customers will pay the same rate of Federal Carbon Tax as they did in 2021, due to anticipated decreased emissions
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