Canada has no single national carbon market. Industrial emissions are priced province by province, under the federal system or a provincial one, while anyone can buy voluntary credits. This guide explains how the systems fit together, what you can buy and the rules on tax and claims. For other countries, see our countries hub.
Canada’s compliance markets
Since 2019, every province and territory has had an industrial carbon pricing system that meets the same minimum national standardsSource 7. Which system applies depends on where a facility is.
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| Where | System |
|---|---|
| Manitoba, Prince Edward Island, Yukon, Nunavut | Federal Output-Based Pricing System (OBPS) |
| Québec | Cap-and-trade, linked with California |
| Alberta | Technology Innovation and Emissions Reduction (TIER) Regulation |
| British Columbia, Ontario, Nova Scotia, New Brunswick, Newfoundland and Labrador | Own output-based pricing systems |
| Saskatchewan | Paused from 1 April 2025 |
| Northwest Territories | Carbon tax for large emitters |
As of Oct 2026
The table follows Environment and Climate Change Canada’s overview of pricing systemsSource 7. In May 2026 the federal government said it is updating the headline price path for all industrial carbon pricing systemsSource 7.
Québec cap-and-trade
Québec’s market is linked with California’s under the Western Climate Initiative, and the link took effect on 1 January 2014Source 8. Covered emitters can use Québec offset credits, which come from voluntary projects in sectors the market doesn’t cover, for up to 8% of their total emissionsSource 4.
Alberta TIER
TIER applies to facilities that emitted 100,000 tonnes or more of CO₂e a year in 2016 or any later yearSource 9. They can comply by cutting emissions on site, submitting emission offset credits or emissions performance credits, or paying into the TIER FundSource 9. Alberta offsets are counted with Alberta-approved protocols and verified by a third partySource 13.
The consumer fuel charge has ended
The federal fuel charge was removed from 1 April 2025 by setting all rates to zeroSource 10. Industrial pricing, described above, continues.
Buying voluntary credits in Canada
Individuals and businesses can buy from online retailers, marketplaces and brokers, which sell credits from projects around the world. Ask which registry holds the credits and check that they are retired in your name; our guide to how to verify carbon credits shows how. Where to buy compares providers side by side.
Canada’s federal offset system
Canada’s Greenhouse Gas Offset Credit System issues credits from domestic projects. Each credit equals one tonne of CO₂ reduced or removed, and the buyers include companies with compliance obligations and voluntary purchasersSource 11. Protocols open for projects include:
- landfill methane
- refrigeration systems
- improved forest management on private land
- enteric methane from beef cattle
- manure methane
The protocol list is from ECCC’s offset system pageSource 11. Registered projects and credits are listed in a public registrySource 12.
Reduce first, then offset
Cut what you can before you buy, then use credits for the emissions that are left. Our guide for individuals shows how to size a purchase.
Claims and tax notes
What you can say about offsets
Amendments to the Competition Act became law on 20 June 2024. Environmental claims about a product must be based on adequate and proper testing, and claims about a business’s environmental benefits on adequate and proper substantiationSource 16. The Competition Bureau issued final guidelines on environmental claims on 5 June 2025Source 16.
In March 2026 Parliament removed the requirement for claims to be backed by an internationally recognised methodology, and the Bureau says it will update its guidanceSource 5. Keep claims factual: say how many tonnes you retired and link to the registry record.
On GST/HST, the CRA says credits and offsets that are validated by a regulator but not issued by one are not emission allowances. The seller collects GST/HST from the buyer as on other taxable suppliesSource 14.
For income tax, section 27.1 of the Income Tax Act values an emissions allowance at the cost the taxpayer paid for it, within rules tied to an emissions obligationSource 15. We found no specific CRA guidance on the income-tax treatment of voluntary offset purchases. Ask an adviser about your own case.
How to check quality before you buy
Each Verra credit represents one tonne of CO₂e reduced or removedSource 1, and registries such as Gold Standard’s track every credit from issuance to retirementSource 2. That makes three checks possible before you pay:
- Is it in a public registry? Ask for the registry and serial numbers, and check the credits are retired in your name.
- Is the method credible? The ICVCM’s Core Carbon Principles set a quality threshold, and credits that meet it can carry the CCP labelSource 3.
- Is the seller clear? A good seller says what you are buying, what it charges and how and in whose name it retires credits.
Our quality section explains each check, and carbon credit scams lists the warning signs.
Article 6 deals
We found no official Canadian bilateral agreement under Article 6 of the Paris Agreement. In September 2026 the federal government said it is exploring a policy framework to enable trading of internationally transferred mitigation outcomesSource 6.
For countries that have signed Article 6 agreements, see Switzerland, Singapore and Japan.
How to buy, step by step
Step 1: Work out what to cover
Estimate your footprint and cut what you can first.
Step 2: Choose a project type
International credits, or Canadian projects under a recognised protocol.
Step 3: Pick a provider
Compare retailers, marketplaces and brokers on registry serials and certificates.
Step 4: Check the registry record
Confirm the credits are retired in your name on the registry.
Not sure how compliance and voluntary markets differ? Read voluntary vs compliance markets.