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What is the Government of Canada Federal Carbon Tax?
The Federal Carbon Tax is part of the federal government's carbon pollution pricing system. It applies to fuels that emit greenhouse gases when combusted, including natural gas. It took effect in Alberta on January 1, 2020 and was designed to increase every April 1 thereafter until 2030.
Frequently Asked Questions
What is the Federal Carbon Tax?
The Federal Carbon Tax is not a tax set by Direct Energy. As part of the Government of Canada's goal to reduce greenhouse gas emissions, a tax was introduced on the price of all fuels that emit greenhouse gases including natural gas. To learn more, visit
Who does the tax apply to?
The Federal Carbon Tax applies to all customers that consume natural gas. This means, regardless of your energy provider, the tax will be included on your natural gas bill. We have a separate line on our bills to show you exactly how much money the federal government collects based on how much natural gas you've used. You will continue to see this charge in the Distributor and Government Charges section on your natural gas bill as "Federal Carbon Tax".
How much will I be charged on my monthly bill?
On April 1, 2023, the Federal Carbon Tax rate will increase from $2.629 to $3.327/GJ. How much you pay is determined by how much natural gas you use. In Alberta, the average household consumes about 120 GJs per year. That estimate shows that the annual cost of the carbon tax on natural gas bills will increase by about $84. Remember that your monthly natural gas consumption changes depending on the season, with the highest consumption falling in the cold winter months.
| Dates | $/Carbon tonne | Rate ($/GJ) |
|---|---|---|
| April 1, 2021 - March 31, 2022 | $40 | $2.103 |
| April 1, 2022 - March 31, 2023 | $50 | $2.629 |
| April 1, 2023 - March 31, 2024 | $65 | $3.327 |
Is this a Direct Energy Tax?
This is not a Direct Energy Tax. All Albertans will pay the tax no matter who their provider is. However, Albertans will be eligible for a Federal Carbon Tax Rebate administered through the income tax system as a Climate Action Incentive payment.
Where will I see the charge on my bill?
You will continue to see this charge in the Distributor and Government Charges section on your natural gas bill as "Federal Carbon Tax".
Where does the money that I am paying for the Carbon Tax go? Does Direct Energy keep it?
All funds collected through the Federal Carbon Tax are submitted to the Government of Canada, which will return all direct proceeds through direct payments to families and direct investments to reduce emissions.
Do I have to pay the Federal Carbon Tax?
All Albertans will pay the Federal Carbon Tax, however many Albertans will be eligible for Climate Action Incentive Payments from the federal government through their personal income tax returns.
Who do I talk to if I have specific questions about the Federal Carbon Tax?
Please contact the regional Prairies Office at 1-866-439-4202.
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