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Federal Carbon Pricing Program for Storage & Transportation Customers

Learn more about the federal carbon charge

Lady reviewing bill on ipad

Learn more about the federal carbon charge

Learn more about the federal carbon charge

Lady reviewing bill on ipad

Learn more about the federal carbon charge

As part of the Government of Canada’s carbon pollution pricing program1, a new federal carbon charge applies to fossil fuel deliveries in Ontario, including natural gas, starting Apr. 1, 2019.

As a valued business partner, the following information is designed to both inform and provide valuable links to the information needed to understand the Federal Carbon Pricing Program (FCPP) related to your business with Enbridge Gas. For a more complete overview of this program, please visit the Government of Canada's Canada Revenue Agency (CRA) website.

What is the Federal Carbon Charge?

As part of the Government of Canada's carbon pollution pricing program, a new federal carbon charge applies to fossil fuel deliveries in Ontario, including natural gas, starting Apr. 1, 2019. The federal carbon charge is expected to increase annually each April. Money collected for the federal carbon charge by Enbridge Gas will go to the Government of Canada.

What does this mean for my business?

The FCPP imposes a federal carbon charge on deliveries of natural gas in Ontario, Manitoba and Saskatchewan (each a "Listed Jurisdiction") as well as certain other jurisdictions. This impacts trading of natural gas in Ontario (including the Dawn Hub), as well as transactions in any other "Listed Jurisdiction".

The FCPP requires that any company that imports, produces or delivers2 natural gas in a "Listed Jurisdiction" to be registered as a "distributor" with the Canada Revenue Agency (CRA). If you deliver or purchase natural gas in Ontario, and register with the CRA, you may be eligible to be exempt from paying the federal carbon charge. We strongly encourage you to register with the CRA as soon as possible. For more information, please visit the Canada Revenue Agency (CRA) website.

Doing business with Enbridge Gas

If you contract for storage and transportation services

Customers who only contract for storage and transportation services (i.e. natural gas is purchased from a counterparty other than Enbridge Gas), do not need to provide an exemption certificate to Enbridge Gas. For these customers, the customer related carbon charge will not be invoiced by Enbridge Gas.

Enbridge Gas has received Ontario Energy Board (OEB) approval to add a "facility related" carbon charge effective Aug. 1, 2019. The facility related carbon charge is applicable to Enbridge Gas' own operation of its distribution and transportation system. All customers that use Enbridge Gas transportation and/or distribution services will be charged a facility-related carbon charge.

The following rate zones are subject to a facility-related carbon charge effective Aug. 1, 2019, as summarized in Table 1:

Table provides the rate zones that will be eligible to receive a facility-related carbon charge (once approved by the OEB)
Union Gas Rate Zones Facility-related carbon charge
M12 $0.002/GJ
M12X $0.002/GJ
C1 $0.002/GJ
M13 $0.002/GJ
M16 $0.002/GJ
Enbridge Gas Distribution Rate Zones Facility-related carbon charge
332 $0.001/GJ
325 $0.001/GJ

If you supply gas to Enbridge Gas

Enbridge Gas has registered with the CRA, and its Exemption Certificate is available to all contracting parties so that sales to Enbridge Gas will be exempt from the federal carbon charge. This applies to deliveries to both "Enbridge Gas Operating as Union Gas" and "Enbridge Gas Operating as Enbridge Gas Distribution".

Enbridge Gas' Exemption Certificate can be found by clicking on the following link:

Enbridge Gas Exemption Certificate

If you receive delivery of natural gas and are invoiced for consumption by Enbridge Gas

Generally, if Enbridge Gas is delivering natural gas to a counterparty at a delivery point in a "Listed Jurisdiction", Enbridge Gas is required to collect the amount of federal carbon charge.

If you receive delivery of natural gas and are invoiced for consumption by Enbridge Gas, your Exemption Certificate is required in order to be exempt from the customer related carbon charge.

Once you have completed the CRA registration process, please forward the CRA-issued registration confirmation letter and CRA-issued Exemption Certificate touglcontractingteam@uniongas.com.

If you export natural gas outside of Canada or outside of a "Listed Jurisdiction"

For exporters of natural gas outside of Canada or outside of a "Listed Jurisdiction", the Government of Canada is working to clarify registration requirements. This is applicable if your business in Ontario is exclusively for the purpose of exporting natural gas outside of Ontario to an unlisted jurisdiction or outside of Canada. It is anticipated that exporters of natural gas outside of Canada will not be required to register with the CRA.

To register with the Canada Revenue Agency as a "distributor"

To register as a distributor, the Canada Revenue Agency has issued the following steps:

  1. Review Fuel Charge Notice FCN2 – information on registration, filing and reporting requirements
    • Producers, distributors or wholesalers that are required or permitted to register as distributors should carefully review the information contained in this notice since a clear understanding of the legislative provisions is key to remaining compliant with the Greenhouse Gas Pollution Pricing Act.
  2. Complete both Form L400, Fuel Charge Registration and Form L400-1, Fuel Charge Registration Schedule
  3. Registration forms can be submitted electronically using the CRA "Submit documents" function in the CRA My Business Account. If the person submits a registration application electronically, that person will be provided with a confirmation number. This confirmation number should be retained for follow-up on the status of the application.

The person can also send the completed registration forms by mail to the following address:

Sudbury Tax Centre
Fuel Charge Program
Post Office Box 20000, Station A
Sudbury ON, P3A 5C1

If the application for registration is approved, the CRA will inform the person in writing of its registration number and the effective date of registration.

The following resources can assist in determining registration requirements.

Filing and Reporting

The reporting period of a registered distributor is a calendar month (see Section 68 of the Greenhouse Gas Pollution Pricing Act). A registered distributor must file a return monthly with the CRA, even if there is no amount owing. The return must be filed by the end of the month following the reporting period.

A registered distributor will be required to submit the following forms monthly to CRA (note that these forms have not yet been made available by CRA):

A registered distributor must determine the net charge (see the "Calculating the net charge" section of the link) for each listed province for the reporting period for which the return and accompanying return schedule(s) must be filed.

FCPP-related charges on Storage and Transportation Customer Invoices

The federal carbon charge went into effect in Ontario on April 1, 2019 and Enbridge Gas has been incurring these costs on customers' behalf since that time. On July 4, 2019 we received approval from the OEB to include the federal carbon charge on customer invoices effective Aug. 1, 2019. We have tracked these incurred costs related to the federal carbon charge between April 1, 2019 and Aug. 1, 2019 in approved deferral and variance accounts and will seek to recover them from customers at a later date, subject to OEB approval.

If you have questions regarding the FCPP or how it impacts your business with Enbridge Gas, please contact your account representative.


1 Pursuant to the Greenhouse Gas Pollution Pricing Act, S.C. 2018, c. 12, s. 186

2 The GGPPA defines "delivery" of natural gas to include making the natural gas available.