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Canada Output-Based Pricing System Regulations (OBPS Regulations, SOR/2019-266)

Canada Output-Based Pricing System Regulations (OBPS Regulations, SOR/2019-266): Canada’s OBPS Regulations implement output-based industrial carbon pricing, requiring annual emissions reporting

Maílis Carrilho
Written by Maílis Carrilho
Updated on December 15th, 2025

Summary

The Output-Based Pricing System (OBPS) Regulations are Canada’s federal industrial carbon pricing regulations under the Greenhouse Gas Pollution Pricing Act. They require large industrial facilities to measure, report, and verify greenhouse gas emissions and production data annually, using prescribed methodologies and independent verification. Facilities designated under the OBPS must compare verified emissions against emissions limits and remit compliance units for any excess emissions. The OBPS operates as the industrial carbon pricing component of the federal backstop carbon pricing framework, continuing in force even after the federal consumer fuel charge rate was set to zero in April 2025. Applicability depends on designation status and thresholds. Non-compliance can lead to enforcement actions, including penalties under CEPA and related federal enforcement tools.

Details

Jurisdictions
  • Canada
Exemptions

This law has a mandatory nature.

Criteria:

Covered facilities must follow the OBPS reporting, quantification, verification, recordkeeping, and compliance/remittance requirements defined in the Regulations and schedules.

The federal government states the OBPS remains in effect, including after the fuel charge was set to $0 starting April 1, 2025.

Exceptions:

Applicability depends on designation and thresholds by industrial activity and jurisdictional coverage within the federal backstop architecture.

Certain facilities can be excluded or cease to be designated under rules in the Regulations (for example, changes in designation status).

Deep dive

2 min read
Published Dec 15, 2025

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What’s Required

For covered facilities and responsible persons, the OBPS Regulations require:

  • Determination of whether a facility is a covered facility and identification of the person responsible.

  • Preparation and submission of an annual report on emissions and production, in the required form and content.

  • Quantification of GHG emissions and production according to prescribed methods, including any approved alternative methods (where permitted).

  • Independent verification of the annual report by an authorised verification body meeting specified accreditation requirements.

  • If emissions exceed the facility’s limit, remittance of compliance units (or other compliance instruments recognised under the system) is required within the required timelines.

  • Certain facilities can be excluded or cease to be designated under rules in the Regulations (for example, changes in designation status).

Important Deadlines

  • Annual Reporting Deadline: Covered facilities must file verified emissions/production reports each year by the prescribed reporting date (specific date set in the regulatory instruments).

  • Compliance Unit Retirement Date: Emissions compliance units must be remitted by the regulatory compliance deadline for the applicable reporting year (typically tied to the annual reporting cycle).

Current Status

  • Regulations are current and have been amended (consolidated text current to late 2025 per the Justice Laws site), indicating active maintenance of the framework.

  • The federal program page confirms the continued operation of OBPS while the fuel charge is $0.

Penalties for Non-Compliance

Non-compliance can trigger:

  • Administrative monetary penalties under the federal environmental AMP framework (where designated).

  • Offences and punishments under the GGPPA enforcement architecture depend on the nature of the violation.

Examples of Known Violations

  • A covered cement plant must quantify annual emissions and production, submit a compliant annual report, and have it verified by a properly accredited third party under the verification provisions.

  • A facility whose verified emissions exceed its OBPS emissions limit must provide the required compliance units by the compliance deadline for the period.

Resources


Maílis Carrilho
Added by:
Maílis Carrilho
Sustainability Research Analyst
Maílis Carrilho is a Sustainability Research Analyst (Intern) at Net Zero Compare, contributing research and analysis on climate tech, carbon policies, and sustainable solutions. She supports the team in developing fact-based content and insights to help companies and readers navigate the evolving sustainability landscape.
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Added on Dec 15, 2025 by Maílis Carrilho ·