B.C. Output-Based Pricing System Year One Implementation Experience and Recommendations for Improvement

The Business Council of British Columbia is pleased to provide this submission on the second anniversary year, and first retrospective operating reporting year, of the B.C. Output-Based Pricing System (B.C. OBPS). Our membership includes the largest employers in the province across all major sectors of the economy, including many operations that are now regulated under the B.C. OBPS.

The B.C. OBPS came into force on April 1, 2024. The system replaced the CleanBC Industrial Incentive Program (CIIP). Like CIIP, the B.C. OBPS applies to industrial facilities emitting 10,000 tCO₂e or more annually and producing regulated industrial products. The system also follows the federal emissions price path rising to $170 per tonne by 2030.

Under the former CIIP, facilities paid the emissions tax on fuels and could later receive incentive payments that returned part of the tax if their emissions intensity performed well relative to sector benchmarks. The B.C. OBPS uses an output-based emissions pricing system where emission limits are tied to the amount of product a facility produces with the resulting cost of emissions reflecting the facility’s emissions performance relative to that production level. This approach provides a clearer emissions price signal, and it avoids the need for facilities to pay the full cost of emissions up front while awaiting adjudication on whether they might receive rebates.