Preface

On November 27, 2025, Canada and Alberta entered a Memorandum of Understanding (the “MOU”) in recognition of the rapidly changing global context and the necessity of building a stronger, more sustainable, more resilient economy that works for Alberta and Canada.

The objectives and projects identified in the MOU remain critical to the future prosperity and energy security of both Canada and Alberta. Both governments remain committed to the shared priorities of:

• establishing and enabling Canada as a global energy leader;
• unlocking the growth potential of Alberta’s oil, gas and other resources, including an oil pipeline to Canada’s west coast; and
• working toward Canada’s net-zero greenhouse gas emissions objective by 2050.

Canada and Alberta acknowledge their obligations to consult with, and where appropriate accommodate, Indigenous Peoples. Canada and Alberta are committed to respecting Aboriginal and Treaty rights and to engaging in early, consistent, and meaningful consultation with Indigenous Peoples, in a manner that respects the rights and cultures of Indigenous Peoples while advancing economic opportunities through the options for Indigenous ownership and partnerships.

Canada and Alberta also acknowledge the importance of close collaboration with the Government of British Columbia.

Since entering the MOU, Canada and Alberta have worked collaboratively toward its implementation, including through the negotiation of a Co‑operation Agreement on Environmental and Impact Assessment reached on April 1, 2026 as set out in Appendix I and an agreement‑in‑principle on methane equivalency reached on March 25, 2026 as set out in Appendix II.

Both governments reaffirm the commitments made in the MOU and their resolve to work together to implement the MOU and give effect to their shared commitments over time, including completing a trilateral Memorandum of Understanding with the Oil Sands Alliance on the Pathways Project and the oil pipeline to Canada’s west coast to serve Asian markets.

This Implementation Agreement sets out the framework to implement the MOU and translate that shared intent into economic growth and investment, including the execution of priority projects, increasing Alberta’s oil, gas and electricity production to meet domestic and international demand, and tangible progress toward net-zero greenhouse gas emissions by 2050.

Now, therefore, in furtherance of these priorities, Canada and Alberta set out the following additional commitments with respect to:

• carbon markets;
• electricity;
• the Pathways Project;
• an oil pipeline to global markets; and
• continuing cooperation.

1. Carbon Markets

1.1. Canada and Alberta recognize the need for certainty for investment that supports a stronger and more sustainable economy over the longer term.

1.2. Carbon Pricing

1.2.1. Policy Price on Carbon (“Headline Price”)

1.2.1.1. The Headline Price on carbon in Alberta, as set by Alberta through the Technology Innovation and Emissions Reduction Regulation system (“TIER”), per tonne of CO₂ equivalent emissions, will be:

• $95 in 2026;
  $100 in 2027;
  $100 in 2028;
  $100 in 2029;
  $115 in 2030;
  $118 in 2031;
  $121 in 2032;
  $124 in 2033;
  $127 in 2034;
  $130 in 2035; and
  Escalating 1.5% per year inflationary escalator starting in 2036 and ending at $140 in 2040.

1.2.2. Market Price of Carbon Credits (“Effective Price”)

1.2.2.1. Alberta will administer and design TIER such that the Effective Price of credits in the TIER market will adjust over time and will target $130 in 2040.

1.2.3. Minimum Transfer Price for Credits (“Price Floor”)

1.2.3.1 To support market stability and ensure a predictable value for TIER credits over time, Alberta will regulate a minimum transfer price for TIER credits beginning in 2030.

1.2.3.2. The Price Floor will determine the minimum transfer price of any credits obtained and used to satisfy a TIER compliance obligation in a given year.

1.2.3.3. Any traded credit retired for compliance purposes in respect of obligations generated in a given year must have a value of no less than the Price Floor for that year or with the floor price in the year it was obtained.

1.2.3.4. Credits generated prior to the enactment of the Price Floor regulation will be grandfathered and will be eligible for transfer at price below the Price Floor in accordance with their original expiry periods. Alberta intends to enact the Price Floor regulation by December 31, 2026, to enable the price floor to take effect in 2030.

1.2.3.5. The minimum transfer price for the trade of credits will be:

• $60 in 2030;
  $63 in 2031;
  $67 in 2032;
  $71 in 2033;
  $75 in 2034;
  $80 in 2035;
  $85 in 2036;
  $90 in 2037;
  $95 in 2038;
  $100 in 2039; and
  $110 in 2040.

1.3. Annual Tightening Rate (“Stringency Rates”)

1.3.1. Alberta will administer and design the TIER market such that it functions reliably and provides a predictable basis for decision-making by industry and investors and achieves the agreed effective carbon price in 2040.

1.3.2. The applicable Stringency Rates for the benchmarks under TIER are as follows:

2027-2030:

• 2.0% for firms building and operating the Pathways Project (“Facility-specific benchmark” or “FSB”)
  2.0% for Large Oil Sands (FSB)
  1.5% for Small Oil Sands (FSB)
  1.0% for Electricity (“High-performance benchmark” or “HPB”)
  0.5% for Oil Sands (HPB)
  0.5% for Hydrogen (HPB)
  0.5% for other sectors (HPB)
  1.5% for other sectors (FSB)

2031-2040:

• 2.0% for Large Oil Sands (FSB)
  1.0% for firms building and operating the Pathways Project (FSB)
  1.0% for Small Oil Sands (FSB)
  1.0% for Electricity (HPB)
  0.5% for Oil Sands (HPB)
  0.5% for Hydrogen (HPB)
  0.5% for other sectors (HPB)
  1.0% for other sectors (FSB)

1.4. Direct Investment

1.4.1. Alberta will design and administer the TIER Direct Investment program, including the issuance and use of Investment Credits under the TIER Regulation and any future standard for Direct Investments, in a manner that preserves market function and the Effective Price. This will include:

1.4.1.1. Eligible investment amounts for all projects will be limited to 50% of eligible capital and up to 50% of operating costs directly attributable to the approved project, net of any government grants, TIER Fund support, investment tax credits, or other public financial support. Development studies and related expenses will not be eligible under the program.

1.4.1.2. Consistent with the TIER Regulation, Investment Credits will be limited to use in years in which emitters have compliance obligations prior to their expiry or in substitution for credits used in past three years compliance.

1.5. Financial Mechanism

1.5.1. To support the implementation of the market prices referenced in section 1.2.2, Canada and Alberta will cooperate on the issuance of carbon contracts for difference (“CfDs”) in Alberta as follows:

1.5.1.1. Canada and Alberta will issue CfDs to parties pursuing emissions reductions investments between 2030 and 2040.

1.5.1.2. Canada and Alberta will jointly fund CfDs covering up to 75 million tonnes of emissions reductions, issued on an equal cost-shared basis, up to an agreed upon maximum liability of $600 million per party.

1.5.2. CfDs will be administered in a manner jointly determined by Canada and Alberta such that the effective prices are on track to reach $130 in 2040.

1.5.3. Should the federal carbon pricing backstop system under the Greenhouse Gas Pollution Pricing Act be repealed or should Canada fail to maintain the commitments undertaken in this Part, Canada will assume sole liability for the CfDs.

1.5.4. Should Alberta repeal TIER or fail to maintain the commitments undertaken in this Part, Alberta will assume sole liability for the CfDs.

1.6. Reviews and Implementation Management

1.6.1. Canada will ensure the updated federal carbon pricing benchmark is consistent with this Agreement.

Canada and Alberta will jointly review compliance with this Part on an ongoing basis to monitor progress toward all milestones and commitments, ensure ongoing consistency with the amended federal carbon pricing benchmark, assess global competitiveness, and identify and address any issues that may arise.

1.6.2. Joint reviews and management of any implementation issues are intended solely to address matters of interpretation and implementation, supporting effective administration of this Part and to ensure that TIER continues to be designed, administered and implemented in accordance with these commitments.

1.6.3. Alberta will continue to operate carbon markets in Alberta and ensure the operating function of TIER overall.

2. Electricity

2.1. Clean Electricity Regulations

2.1.1. Subject to ongoing application of the provisions of Part I (Carbon Markets) and factoring all other measures to the satisfaction of both parties, Canada will maintain the Clean Electricity Regulations (“CER”) in abeyance while the CER Reference is before the Alberta Court of Appeal and any subsequent appeal to the Supreme Court of Canada (“SCC”) proceeds.

2.1.2. Should the CER be upheld and found to be constitutional once all avenues for appeal have been exhausted (if pursued), Canada and Alberta will enter into negotiations towards an equivalency agreement on the CER under the Canadian Environmental Protection Act, 1999 to stand down the regulations in Alberta, based on the terms and activities (i.e. the Electricity Working Group) outlined in this agreement.

2.1.3. Should the CER be found unconstitutional once all avenues for appeal have been exhausted (if pursued), Canada agrees to repeal the CER and Alberta agrees to maintain the carbon pricing framework defined in this agreement.

2.2. Electricity Grid Growth and Stability

2.2.1. Canada and Alberta will work collaboratively to expand economic opportunities related to the electricity sector, including by facilitating a doubling of the grid by 2050 and an expansion of natural gas generation and lower-carbon forms of energy development (e.g., nuclear, wind, solar, geothermal, and abated natural gas), in a manner consistent with the overall stability of Alberta’s electricity system.

2.2.2. Canada intends to extend the Clean Electricity Investment Tax Credit to support major high-voltage intra-provincial transmissions projects, on a national basis, complementing existing support for inter-provincial interties.

2.2.3. Consistent with Alberta’s constitutional jurisdiction over the development and management of sites and facilities in the province for the generation and production of electrical energy Alberta will implement changes as warranted to the Restructured Energy Market to ensure the stability of its electricity system while continuing to enable natural gas generation and investment in renewables and other forms of generation on an ongoing basis.

3. The Pathways Project and the Trilateral Memorandum of Understanding with the Oil Sands Alliance

3.1. Canada and Alberta reaffirm their commitment to expeditiously reach agreement on a trilateral memorandum of understanding (the “trilateral MOU”) with the companies jointly advancing the large-scale carbon capture, storage, and emissions reduction initiative located in northeastern Alberta, known as the Pathways Project.

3.2. These companies are Canadian Natural Resources Limited, Cenovus, ConocoPhillips Canada, Imperial Oil Limited, and Suncor Energy, collectively referred to as the Oil Sands Alliance. The trilateral MOU will be concluded with the Oil Sands Alliance following the signature of this Agreement and, once finalized, will form an integral part of this Agreement and be incorporated as Appendix III.

3.3. Canada and Alberta reaffirm that construction of the Pathways Project and the construction of the oil pipeline project as set out in the MOU and Part IV of this Agreement (Oil Pipeline to Asian Markets) are mutually dependent.

3.4. Canada and Alberta reaffirm their commitment to respecting Aboriginal and Treaty rights. The trilateral MOU will commit to working cooperatively with Indigenous parties in Alberta to consult and accommodate on the carbon pipeline, capture, and storage facilities related to the Pathways Project.

3.5. Canada and Alberta reaffirm their shared objective of achieving 16 million tonnes per annum (Mtpa) of emissions reductions from Pathways projects, including 6 Mtpa minimum as CCUS in-service by 2035 and an additional 5 Mtpa of reductions via a range of technologies by 2040 and a further 5 Mtpa by 2045.

3.6. Canada confirms that current credit rates under the Carbon Capture, Utilization, and Storage Investment Tax Credit have been extended to 2035 and reaffirms its commitment to extend federal Investment Tax Credits to support enhanced oil recovery as announced in the 2026 Spring Economic Update.

3.7. Alberta reaffirms its commitment to extend the Alberta Carbon Capture Incentive Program to support the Pathways Project.

3.8. Canada commits to maintain a minimum credit creation rate of at least 20% in all circumstances for upstream carbon capture, utilisation, and storage projects under the Clean Fuel Regulations.

4. Oil Pipeline to Asian Markets

4.1. Canada and Alberta reaffirm their commitment to the oil pipeline project as set out in the MOU, as follows:

4.1.1. Alberta will submit its pipeline application to the Major Projects Office on or before July 1, 2026;

4.1.2. Canada will, subject to the conditions set out in the MOU, refer the project to the Major Projects Office for consideration of designation under the Building Canada Act;

4.1.3. While fully respecting Canada’s duty to consult obligations with Indigenous Peoples as required by section 35 of the Constitution Act, 1982 and by subsection 5(7) of the Building Canada Act, Canada will pursue the designation of the oil pipeline as a project of national interest for approval under the Building Canada Act by October 1, 2026; and

4.1.4. If designated, Canada will assess the project under the Building Canada Act to determine the conditions required for construction and development of the pipeline and, provided that duty to consult obligations with Indigenous Peoples have been met, Canada intends to make best efforts to provide the conditions document by September 1, 2027 to enable commencement of construction of the pipeline.

4.2. Canada and Alberta reaffirm that construction of the oil pipeline project and construction of the Pathways Project are mutually dependent.

4.3. Canada and Alberta agree to continue to engage with British Columbia immediately in a trilateral discussion on the pipeline application, and during the potential development and construction of the oil pipeline referred to in this Agreement, and to further the economic interests of British Columbia related to their own projects of interest that involve the Province of Alberta, including interties. In addition, Canada will continue working with British Columbia on other projects of national interest in their jurisdiction.

5. Continuing Collaboration

5.1. Electricity Working Group

5.1.1. Canada and Alberta will launch a joint Electricity Working Group (the “Working Group”) with a mandate to advance the joint commitment to work toward net-zero greenhouse gas emissions from the electricity sector by 2050.

5.1.2. The mandate of the Working Group will include:

5.1.2.1. Collaborative work to identify projects, technologies, and investments that are economic and competitive;

5.1.2.2. The work will include the identification of projects, and measures to support grid stability, modernization, and services for baseload and intermittent power sources under the Alberta Restructured Energy Market, including renewables, storage, interties, intra-provincial transmission, nuclear and geothermal; and

5.1.2.3. Administration and governance of the Working Group will be by mutual agreement of Canada and Alberta as represented by the MOU Implementation Committee.

5.2. Other Commitments

5.2.1. Canada and Alberta confirm that Canada has fulfilled other commitments in the MOU, including by announcing the extension of federal Investment Tax Credits to support enhanced oil recovery; extending current credit rates under the Carbon Capture, Utilization, and Storage Investment Tax Credit to 2035; removing certain “greenwashing” provisions from the Competition Act; and honoring its commitment not to introduce the Oil and Gas Emissions Cap.

5.2.2. Canada and Alberta reaffirm their commitment to collaborate to finalize Alberta’s policy framework for artificial intelligence data centres by July 1, 2026.

5.2.3. Canada and Alberta reaffirm their commitment to collaborate to finalize Alberta’s nuclear power generation strategy by January 1, 2027.

5.3. Implementation Management

5.3.1. Canada and Alberta will make best efforts to agree on the interpretation and implementation of this Agreement and will work with each other to resolve issues related to the implementation of this Agreement through co-operation and consultation. This includes a commitment to provide reasonable advance notice to one another of decisions and communications related to the implementation of this Agreement and an opportunity to provide comments.
 

• Appendix I: Co-operation Agreement on Environmental and Impact Assessment
• Appendix II: Agreement in principle – Canada-Alberta methane equivalency agreement

*For Alberta, the English version of this agreement is authoritative.

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