Resilient LLP (formerly DeMarco Allan LLP)
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DT Vollmer

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Canada and Alberta Reach Agreement-in-Principle on Methane Equivalency

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The Government of Canada and the Government of Alberta have announced an Agreement-in-Principle to lower methane emissions in the oil and gas sector by 75% below 2014 levels by 2035 in Alberta. The Agreement-in-Principle builds on the Canada-Alberta Memorandum of Understanding (see our earlier bulletin here) and follows the recently published draft Co-operation Agreement between Alberta and Canada on Environmental and Impact Assessment. Under the proposed framework, Alberta would implement a performance-based approach to reduce methane emissions that combines regulations, offset credits, and targeted investments. This bulletin briefly summarizes the key commitments set out in the Agreement-in-Principle. Commitments. Alberta and Canada commit to: develop an outcome-based equivalency agreement (the Agreement) under the Canadian Environmental Protection Act, 1999 (CEPA), whereby Canada’s Enhanced Methane Regulations would be stood down in Alberta, in recognition of final provincial regulations and a provincial approach that delivers, over the term of the Agreement, 75% methane emissions reductions by 2035; act reasonably in adjusting the Agreement, if required, in the face of a force majeure event; jointly select and rely on an independent third party, contracted on an equal cost-shared basis, to conduct methane modelling, analysis of emissions reductions, and to assess methane reduction results; and agree that Alberta will publish information explaining the covered sources of methane and the province’s approach to meet its emissions reduction targets. Next Steps. Once Alberta and Canada agree on the terms of the Agreement, it will undergo a 60-day consultation period, with the goal of finalizing it by the end of the year and implementing it no later than January 1, 2027, for a 10-year period, subject to the amendments to CEPA contained in the federal Budget 2025 Implementation Act. Alberta’s existing equivalency agreement will remain in place until the Agreement is finalized.   For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@resilientllp.com.

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EPA to Rescind 2009 GHG Endangerment Finding

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The U.S. Environmental Protection Agency (EPA) yesterday announced its intent to rescind the 2009 Endangerment and Cause or Contribute Finding for Greenhouse Gases (the Finding) later this week. The Finding, issued under the Clean Air Act (the Act) and preceded by confirmation of the EPA’s regulatory authority by the U.S. Supreme Court in a landmark 2007 decision, has served as the legal foundation for almost all climate regulations under the Act, including auto standards. Once rescinded, the EPA is expected to repeal all GHG emission standards for light-, medium-, and heavy-duty vehicles and engines. The EPA previously indicated that engine and vehicle manufacturers would no longer have any future obligations for the measurement, control, and reporting of GHG emissions for any highway engine and vehicle. The EPA has stated, however, that it would maintain regulations necessary for criteria pollutant and air toxic measurement and standards, Corporate Average Fuel Economy testing, and associated fuel economy labeling requirements. Background. On December 7, 2009, the Obama Administration signed two distinct findings regarding GHGs under section 202(a) of the Act: Endangerment Finding. Current and projected concentrations of the six key well-mixed greenhouse gases – carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6) – in the atmosphere threaten the public health and welfare of current and future generations. Cause or Contribute Finding. The combined emissions of the well-mixed GHGs from new motor vehicles and new motor vehicle engines contribute to the GHG pollution that threatens public health and welfare. On January 20, 2025, President Trump signed an Executive Order directing the EPA to submit recommendations regarding the legality and continuing applicability of the Finding. Following that directive, the EPA announced last summer that it was reconsidering the Finding, culminating in this week’s anticipated formal rescinding of the Finding.   For further information or to discuss the contents…

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President Trump Directs U.S. Withdrawal From 66 International Organizations, Conventions, and Treaties

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Yesterday, President Trump issued a memorandum on “Withdrawing the United States from International Organizations, Conventions, and Treaties that Are Contrary to the Interests of the United States” (the Memorandum). The Memorandum directs all executive departments and agencies to take immediate steps to effectuate the withdrawal of the United States and cease participating in and funding of 35 non-United Nations (UN) organizations and 31 UN entities that “operate contrary to U.S. national interests, security, economic prosperity, or sovereignty.” Most notably, the Memorandum directs the withdrawal of the U.S. from the Intergovernmental Panel on Climate Change (IPCC) and the United Nations Framework Convention on Climate Change (UNFCCC), a move with potentially far-reaching implications for global climate action, climate multilateralism, and international climate science coordination and reporting. This bulletin identifies the key climate, environment, and energy-related organizations listed in the Memorandum and provides an overview of the differing processes and implications of withdrawing the U.S. from the UNFCCC and the soon to be effected withdrawal from the Paris Agreement. Non-UN Organizations. The U.S. will withdraw from the IPCC and, among others, the following climate, environment, and energy-related non-UN organizations: 24/7 Carbon-Free Energy Compact; Commission for Environmental Cooperation; Inter-American Institute for Global Change Research; Intergovernmental Forum on Mining, Minerals, Metals, and Sustainable Development; Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services; International Energy Forum; International Renewable Energy Agency; International Solar Alliance; International Tropical Timber Organization; International Union for Conservation of Nature; Renewable Energy Policy Network for the 21st Century; and Secretariat of the Pacific Regional Environment Programme. UN Organizations. The U.S. will effectively withdraw from the UNFCCC and, among others, the following climate, environment, and energy-related UN organizations by “ceasing participation in or funding to those entities to the extent permitted by law”: Department of Economic and Social Affairs; International Law Commission; International Trade Centre;…

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ECCC Publishes Discussion Paper and Launches Consultation on Effective Carbon Markets

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Environment and Climate Change Canada (ECCC) recently published a discussion paper on “Driving effective carbon markets in Canada” (the Discussion Paper). The Discussion Paper sets out proposed changes to the federal benchmark criteria ahead of the federal government’s review next year. ECCC also launched consultations on the Discussion Paper, seeking comments and responses to questions included in the Discussion Paper from stakeholders.  This bulletin briefly summarizes the key topic areas, current requirements, the federal government’s proposal and considerations, and next steps set out in the Discussion Paper. Common scope of coverage Current requirement. The current benchmark requires that carbon pricing systems maintain a common scope, covering, at a minimum, an equivalent percent of combustion emissions as the federal backstop. It also requires market-based systems to cover industrial process emissions, and to limit eligibility for OBPSs, performance rebates, or the free allocation of allowances to sectors that are at risk of carbon leakage and competitiveness impacts of carbon pricing. Proposals and considerations. ECCC notes that the removal of the fuel charge (see our earlier bulletin here) requires rethinking how scope of coverage should work. The federal government is considering the following three options to modify the benchmark to specify the common scope criteria explicitly to ensure consistent minimum coverage across systems: Option 1: A threshold-based approach that would cover all facilities in specific sectors emitting above a certain level annually. Thresholds under consideration are 10kt per year (Option 1A) and 25kt per year (Option 1B). Option 1A would cover a large number of facilities and industrial activities, which would support market function and liquidity, but could create intra-sectoral competitiveness risks in some sectors. Option 1B would reduce these risks by covering fewer industrial activities where there is a significant split between emissions above and below the threshold, but may negatively impact market function…

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Canada Announces Proposed CFR Amendments

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Environment and Climate Change Canada (ECCC) published a discussion paper to invite views and information related to targeted amendments to the Clean Fuel Regulations (CFR) on December 3, 2025. The proposed amendments are largely intended to complement Canada’s Biofuels Production Incentive (announced in September), which is expected to provide more than $372 million over two years to support the stability and resiliency of domestic producers of biodiesel and renewable diesel. This bulletin provides a brief summary of the discussion paper.  Background. The CFR require producers and importers of gasoline and diesel (i.e., primary suppliers) to reduce the life cycle carbon intensity of gasoline and diesel produced and imported for use in Canada, with the intent of reducing GHG emissions. A life cycle approach considers the GHG emissions involved in multiple stages of the fuel’s production process, from feedstock extraction or cultivation to fuel combustion. CFR credits can be created by:  compliance category 1 – undertaking projects that reduce the life cycle carbon intensity of liquid fossil fuels (e.g., carbon capture and storage, renewable electricity, co-processing) compliance category 2 – supplying low-carbon intensity fuels (e.g., ethanol, biodiesel) compliance category 3 – supplying fuel or energy to advanced vehicle technology (e.g., electricity or hydrogen in vehicles) The discussion paper notes that the majority of credits created to-date under the CFR come from the supply of low-carbon intensity fuels. While an important share of these credits comes from fuel produced in Canada, Canada does not currently produce enough low-carbon intensity fuels to meet the total domestic demand. As such, a large share of CFR credits for low-carbon intensity fuel supply reportedly come from imports, mostly from the United States (see Annex 1). Policy goal. The stated goal of the CFR amendments is to strengthen the resiliency and support the development of Canada’s low-carbon fuel sector, while maintaining the Regulations’ primary focus on…

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