Recommendations to strengthen Canada’s forthcoming Clean Fuel Regulation Purpose Background

• Pembina commissioned Navius Research in 2021 to quantify the GHG emission and economic impacts of the draft CFR, as represented in the Dec. [...] These nascent commitments, together with planned or proposed increases in the stringency of provincial transportation policies, will increase the risk of policy overlap and diminish the effectiveness of the CFR. [...] The composition of the credit market between different compliance categories should not strongly deviate from each category’s share of the life cycle emissions 3 The Net-Zero Advisory Body’s Submission to the Government of Canada’s 2030 Emissions Reduction Plan (Net-zero Advisory Body, 2022), 18. [...] While the Quantitative Methodologies will be the primary means of achieving a balanced credit profile, the intent of a balanced market should be signaled in the final regulations (via s. [...] The introduction of new zero- emission sales mandates on light- and heavy-duty vehicles is expected to decrease the incremental effectiveness of the CFR as it relates to GHG emission reductions, if the policy design is not adapted accordingly.