Clean Fuel Regulations credit market report, June 2024
The Clean Fuel Regulations (CFR) require producers and importers of gasoline and diesel (i.e. primary suppliers) to reduce the life cycle carbon intensity of gasoline and diesel used in Canada, thereby reducing greenhouse gas emissions. A life cycle approach accounts for emissions across all stages of fuel production and use, from extraction through processing, distribution, and end use. Reduction requirements for primary suppliers took effect as of July 1, 2023. The CFR are an important part of Canada’s climate plan to reduce emissions, accelerate the use of clean technologies and fuels, and support sustainable jobs in a diversified economy.
The Regulations establish a compliance credit market whereby the annual carbon intensity reduction requirements can be met by creating credits through three categories of actions:
- Compliance Category 1 – projects that reduce the life cycle carbon intensity of liquid fossil fuels (e.g. carbon capture and storage, on-site renewable electricity);
- Compliance Category 2 – supply of low-carbon-intensity fuels (e.g. ethanol, biodiesel); and,
- Compliance Category 3 – supply of fuel or energy to advanced vehicle technology (e.g. electricity or hydrogen in vehicles).
This report is the first Annual CFR Credit Market Data Report. It presents data on the compliance credit market, such as credit creation data by category, number of credit transfers, and average price of credit transfers. Credit creation data is presented for credits created for 2022 and 2023 compliance periods (June 21st, 2022 to December 31st, 2023). Credit transfers are presented for transactions completed from June 30th, 2023 to May 31st, 2024. The report first highlights key aspects of the credit market, such as credit prices and number of transfers, and then presents more details on credit creation by compliance category.
Some credit creation is reported annually, corresponding to a calendar year, with the exception of 2022, which spanned June 21st, 2022 to December 31st, 2022. Other credit creation is reported quarterly:
- Q1: January 1 to March 31
- Q2: April 1 to June 30
- Q3: July 1 to September 30
- Q4: October 1 to December 31
The only exception to quarterly reporting is for 2022, which includes one Q3/Q4 combined quarterly report spanning June 21st, 2022 to December 31st, 2022.
Early credit creation, for the time before the reduction requirement came into force on July 1st, 2023, occurred between June 21st, 2022 (where applicable) until June 30, 2023.
Credit market overview
Reduction and volumetric requirements for Canada
The first compliance period during which reductions in carbon intensity for gasoline and diesel were required was July 1st, 2023, to December 31st, 2023. During this period, the minimum volumetric requirements for low-carbon-intensity fuel of 5% for gasoline and 2% for diesel were also required to be met. Data on these requirements for the first compliance period are submitted in two reports: the first on July 31, 2024, in the Compliance Report, followed by a second, for primary suppliers who did not satisfy their reduction requirements fully in the Compliance Report, in the Complementary Compliance report, due by December 15th, 2024 if required.
The data on the annual reduction and volumetric requirements will be included in subsequent publications of the CFR Credit Market Data Report, once available.
Credit Transfers
Table 1 displays credit prices, number of transfers, and number of credits for the CFR for 2022 and 2023 compliance periods.
| CFR Compliance Periods | Number of transfers of Compliance Credits with a price1 | Compliance Credits transferred with a price (t CO2e) |
Average Credit price (CAD$)2 | Minimum Credit price (CAD$) | Maximum Credit price (CAD$) |
|---|---|---|---|---|---|
| 2022 | 77 | 1,222,594 | 141.80 | 9.77 | 300.00 |
| 2023 | 163 | 1,780,206 | 127.30 | 6.75 | 300.00 |
| Total | 240 | 3,002,800 | 133.20 | 6.75 | 300.00 |
1 Canada CFR data from June 30, 2023 until May 31, 2024 for compliance credits created for 2022 and 2023 compliance periods. The number of transfers of compliance credits does not include transfers performed through an agreement to transfer credit upon creation (Section 108) or transfers reported with a zero or near-zero price under Section 106.
2 Average credit price weighted by volume of credit per transaction and excluding transfers that were reported without a price or transfers reported with a zero or near-zero price (<$1).
The CFR credit market is in an early phase of development; the credit pricing information reported will not be economically robust until the market matures. As credits transferred under Section 108 (which do not include a credit price) as well as zero and near-zero transfers under Section 106 are excluded, the credit market data reported only represents the credits sold or transferred with a price on the market.
Additionally, the data does not include credits transferred through a Compliance Credit Mechanism or contributions made to a Registered Emission Reduction Funding Program as this information is not yet available.
Credit creation
Overview
Table 2 displays the number of credits created for each compliance category. Contributions to a Registered Emission Reduction Funding Program are not yet available.
| Compliance Period | Compliance Category 1: Undertaking projects that reduce the life cycle carbon intensity of liquid fossil fuels (t CO2e)1 | Compliance Category 2: Supply of low carbon fuels (t CO2e) | Compliance Category 3: Supply of fuel or energy to advanced vehicle technology (t CO2e) | Contributions to a Registered Emission-Reduction Funding Program | Renewable Fuels Regulation (RFR) Rollover (t CO2e) | Total |
|---|---|---|---|---|---|---|
| 2022 creation | - | 1,682,902 | 161,968 | - | 0 | - |
| 2023 creation | - | 5,123,696 | 463,962 | - | 2,774,461 | - |
| Total | 1,116,918 | 6,806,598 | 625,930 | - | 2,774,461 | 11,323,907 |
1 Data aggregated to 2022 and 2023 for confidentiality reasons. More detail may be provided in future reports.
Table 3a and 3b display the number of credits created for each province and compliance category in compliance periods 2022 and 2023.
| Province | Compliance Category 1 | Compliance Category 2 | Compliance Category 3 |
|---|---|---|---|
| British Columbia | - | 82,308 | 47,568 |
| Alberta | - | 139,000 | 2,691 |
| Saskatchewan | - | 216,889 | 288 |
| Manitoba | - | 100,310 | 872 |
| Ontario | - | 870,581 | 52,178 |
| Quebec | - | 263,037 | 54,951 |
| Atlantic Provinces | - | 10,777 | 3,335 |
| Territories | - | 0 | 82 |
| Province | Compliance Category 1 | Compliance Category 2 | Compliance Category 3 |
|---|---|---|---|
| British Columbia | - | 725,855 | 130,131 |
| Alberta | - | 636,752 | 6,766 |
| Saskatchewan | - | 513,823 | 612 |
| Manitoba | - | 207,836 | 2214 |
| Ontario | - | 2,065,316 | 149,201 |
| Quebec | - | 915,712 | 167,779 |
| Atlantic Provinces | - | 58,402 | 6,984 |
| Territories | - | 0 | 278 |
| Total (2022 and 2023) | 1,116,9181 | 6,806,598 | 625,930 |
1 Data aggregated to 2022 and 2023 for confidentiality reasons. More detail may be provided in future reports.
Table 4a and 4b list the number of credits created for compliance category 2 and 3 with default Carbon Intensities and Carbon Intensities calculated using the Fuel LCA Model.
| Carbon Intensity (CI) Used | Compliance Category 2 (t CO2e) | Compliance Category 3 (t CO2e) | Total Credits Created (t CO2e) |
|---|---|---|---|
| Fixed Default CI | 443,246 | 161,553 | 604,799 |
| Calculated Default CI | 149,975 | 415 | 150,390 |
| Fuel LCA Model CI | 1,089,681 | 0 | 1,089,681 |
| Carbon Intensity (CI) Used | Compliance Category 2 (t CO2e) | Compliance Category 3 (t CO2e) | Total Credits Created (t CO2e) |
|---|---|---|---|
| Fixed Default CI | 623,031 | 463,051 | 1,086,082 |
| Calculated Default CI | 816,285 | 911 | 817,196 |
| Fuel LCA Model CI | 3,684,380 | 0 | 3,684,380 |
Compliance category 1 – CO2e Emission reduction projects
Table 5 provides more detail on Compliance Category 1, including the number of projects approved and the Quantification Methods under which credits are created. The Generic Quantification Method may be used for energy efficiency projects, cogeneration projects, methane conservation projects, and any other projects where there is no project type- specific Quantification Method.
| Number of projects approved in 2022 and 20231 | 6 |
|---|---|
| Quantification Methods under which credits are created | Co-processing, Enhanced Oil Recovery, Generic Quantification Method |
1 Data aggregated to 2022 and 2023 for confidentiality reasons. More detail may be provided in future reports.
Compliance category 2 – Supply of low-carbon-intensity fuels
Table 6a and 6b provide detail on the volumes of low-carbon-intensity fuels supplied (produced and imported), under Compliance Category 2. They list the volume of different fuels produced and imported, the number of respective credits created, and the weighted average carbon intensity (by low-carbon-intensity fuel volume) of the fuels.
| Fuel Name | Volume of fuel produced (m3) | Number of credits created by produced fuel (t CO2e) | Volume of fuel imported (m3) | Number of credits created by imported fuel (t CO2e) |
Min CI Used (gCO2 e/MJ) | Max CI Used (gCO2 e/MJ) | Weighted Average CI by Volume (gCO2e/MJ) |
|---|---|---|---|---|---|---|---|
| Liquid low-carbon-intensity fuels | |||||||
| Cellulosic Ethanol | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Ethanol | 883,209 | 933,267 | 1,054,663 | 369,317 | 35.0 | 80.0 | 60.5 |
| Hydrogenation-Derived Renewable Diesel | 0 | 0 | 502,095 | 224,621 | 36.0 | 80.0 | 76.4 |
| Low-Carbon-Intensity Fuel that is Suitable for Use in Aviation | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Low-Carbon-Intensity Fuel1 | 4,868 | 6,665 | 298,617 | 149,032 | 11.0 | 80.0 | 74.3 |
| Gaseous low-carbon-intensity fuels | |||||||
| Biogas2 | - | - | - | - | - | - | - |
| Hydrogen | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Renewable Propane | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Renewable Natural Gas2 | - | - | - | - | - | - | - |
1 Includes biodiesel and other self-declared low-carbon-intensity fuels. Data aggregated for confidentiality purposes.
2 Data unable to be shared for confidentiality reasons. More detail may be provided in future reports.
| Fuel Name | Volume of fuel produced (m3) | Number of credits created by produced fuel (t CO2e) | Volume of fuel imported (m3) | Number of credits created by imported fuel (t CO2e) |
Min CI Used (gCO2 e/MJ) | Max CI Used (gCO2 e/MJ) | Weighted Average CI by Volume (gCO2e/MJ) |
|---|---|---|---|---|---|---|---|
| Liquid low-carbon-intensity fuels | |||||||
| Cellulosic Ethanol | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Ethanol | 1,669,176 | 1,779,949 | 2,350,065 | 1,757,721 | 33.0 | 80.0 | 51.6 |
| Hydrogenation-Derived Renewable Diesel | -2 | -2 | 1,244,358 | 1,025,026 | 15.0 | 80.0 | 65.3 |
| Low-Carbon-Intensity fuel that is Suitable for Use in Aviation | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Low-Carbon-Intensity Fuel1 | 13,521 | 19,204 | 517,350 | 496,571 | 11.0 | 80.0 | 61.0 |
| Gaseous low-carbon-intensity fuels | |||||||
| Biogas2 | - | - | - | - | - | - | - |
| Hydrogen | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Renewable Propane | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Renewable Natural Gas | 26,465,453 | 24,540 | -2 | -2 | 18.0 | 80.0 | 70.1 |
1 Includes biodiesel and other self-declared low-carbon-intensity fuels. Data aggregated for confidentiality purposes.
2 Data unable to be shared for confidentiality reasons. More detail may be provided in future reports.
Table 7 lists the approved carbon intensities for various low-carbon-intensity fuels. The number of approved carbon intensities, as well as the standard average/median carbon intensities are shown for each fuel. For context, the baseline carbon intensity to calculate compliance obligations is 95 gCO2e/MJ for gasoline and 93 gCO2e/MJ for diesel.
| Fuel Type | Number of Approved Carbon Intensities | Median Approved Carbon Intensity (gCO2e/MJ) |
Average Approved Carbon Intensity (gCO2e/MJ) |
|---|---|---|---|
| Liquid low-carbon-intensity fuels | |||
| Biodiesel | 22 | 21.0 | 28.9 |
| Cellulosic Ethanol | 0 | 0 | 0 |
| Ethanol | 62 | 42.0 | 55.2 |
| Hydrogenation-Derived Renewable Diesel | 48 | 36.0 | 37.3 |
| Other Low-Carbon-Intensity Fuel 1 | 21 | 56.0 | 49.4 |
| Gaseous low-carbon-intensity fuels | |||
| Biogas | 0 | 0 | 0 |
| Hydrogen | 0 | 0 | 0 |
| Renewable Propane | 0 | 0 | 0 |
| Renewable Natural Gas | 17 | 31.0 | 29.7 |
| Total | 170 | - | - |
1 Includes low-carbon-intensity fuel that is suitable for use in aviation and other declared low-carbon-intensity fuels. Data aggregated for confidentiality purposes.
Baseline carbon intensity for gasoline (to calculate compliance obligations) is 95 gCO2e/MJ
Baseline carbon intensity for diesel (to calculate compliance obligations) is 93 gCO2e/MJ
Table 8 lists the credits created by the RFR rollover, classified by credit group. Credits were divided into gasoline and diesel credit groups. The credit type was assigned a carbon intensity based on the fuel that was used to calculate the corresponding volume of low-carbon-intensity fuel.
| Credit Group | Number of Credits created (t CO2e) | Corresponding volume of low-CI fuel (m3) | CI assigned (gCO2e/MJ) |
|---|---|---|---|
| Gasoline Replacement | 1,316,007 | 1,860,727 | 59 |
| Diesel Replacement | 1,458,454 | 767,555 | 35 |
| Total | 2,774,461 | 2,628,282 | -- |
Compliance category 3 – Supply of fuel or energy to advanced vehicle technology
Table 9a and 9b list the number of fuelling stations, volume, number of credits, and average weighted carbon intensity by volume for fuel/energy supplied to fuelling stations.
| Type of fuel/energy source | Number of fuelling stations | Volume (m3 or kg) | Number of Credits (t CO2e) |
Min CI Used (gCO2 e/MJ) | Max CI Used (gCO2 e/MJ) | Weighted Average CI by Volume (gCO2 e/MJ) |
|---|---|---|---|---|---|---|
| Hydrogen -Compressed | 4 | 15,022 | 285 | 80.0 | 80.0 | 80.0 |
| Natural Gas - Compressed | 59 | 24,580,736 | 16,147 | 69.0 | 72.0 | 71.9 |
| Natural Gas - Liquefied1 | - | - | - | - | - | - |
| Propane - Compressed | 141 | 33,444 | 11,166 | 76.0 | 76.0 | 76.0 |
| Propane - Co-Processed Low-CI | 0 | 0 | 0 | 0 | 0 | 0 |
| Propane - Renewable | 0 | 0 | 0 | 0 | 0 | 0 |
| Renewable Natural Gas -Compressed | 0 | 0 | 0 | 0 | 0 | 0 |
| Renewable Natural Gas -Liquefied | 0 | 0 | 0 | 0 | 0 | 0 |
1 Data unable to be shared for confidentiality reasons. More detail may be provided in future reports.
| Type of fuel/energy source | Number of fuelling stations | Volume (m3 or kg) | Number of Credits (t CO2e) |
Min CI Used (gCO2 e/MJ) | Max CI Used (gCO2 e/MJ) | Weighted Average CI by Volume (gCO2 e/MJ) |
|---|---|---|---|---|---|---|
| Hydrogen -Compressed | 5 | 26,038 | 495 | 80.0 | 80.0 | 80.0 |
| Natural Gas - Compressed | 85 | 78,661,507 | 51,666 | 69.0 | 72.0 | 72.0 |
| Natural Gas - Liquefied | 11 | 43,265,974 | 0 | 113.0 | 113.0 | 113.0 |
| Propane - Compressed | 133 | 62,684 | 20,938 | 76.0 | 76.0 | 76.0 |
| Propane - Co-Processed Low-CI | 0 | 0 | 0 | 0 | 0 | 0 |
| Propane - Renewable | 0 | 0 | 0 | 0 | 0 | 0 |
| Renewable Natural Gas -Compressed | - | - | - | - | - | - |
| Renewable Natural Gas -Liquefied | 0 | 0 | 0 | 0 | 0 | 0 |
Table 10 lists the type of charging stations, energy supplied to electric vehicles, number of credits, and weighted carbon intensity by energy for public/residential charging stations and charging site hosts.
| Type of charging station | Number of Registered Organizations1 | Energy (kWh) | Number of Credits (t CO2e)2 |
|---|---|---|---|
| Charging Site Host | 5 | 148,709 | 193 |
| General Public Charging | 10 | 89,777,528 | 111,548 |
| Residential Charging | 2 | 18,330,385 | 22,629 |
1 This represents the total number of registered organizations that have created credits during the specified year (i.e. a registered organization that did not create credits in a particular year would not be counted in the number for that year).
2 In 2022/2023 all compliance credits for electricity supplied to electric vehicles were created using the provincial grid carbon intensities.
| Type of charging station | Number of Registered Organizations1 | Energy (kWh) | Number of Credits (t CO2e)2 |
|---|---|---|---|
| Charging Site Host | 10 | 3,814,006 | 4,437 |
| General Public Charging | 11 | 250,335,841 | 314,052 |
| Residential Charging | 4 | 58,364,106 | 72,367 |
1 This represents the total number of registered organizations that have created credits during the specified year (i.e. a registered organization that did not create credits in a particular year would not be counted in the number for that year).
2 In 2022/2023 all compliance credits for electricity supplied to electric vehicles were created using the provincial grid carbon intensities.
Organization roles
Table 11 provides the number of organizations registered per quarterly compliance period for each organization type. An organization that has multiple roles will be displayed in each of their individual roles.
| Type of Entity | 2022 | 2023 | 2024 | Total |
|---|---|---|---|---|
| Primary Supplier | 5 | 2 | 1 | 8 |
| Registered Creator | 64 | 31 | 2 | 97 |
| Foreign Supplier | 37 | 16 | 1 | 54 |
| Primary Supplier/Registered Creator | 23 | 3 | 0 | 26 |
| Registered Creator/Foreign Supplier | 6 | 1 | 0 | 7 |
| Foreign Supplier/Carbon-Intensity Contributor | 0 | 1 | 0 | 1 |
| Verification Body | 0 | 5 | 4 | 9 |
| Total | 135 | 59 | 8 | 202 |
Total number of parties with an annual reduction requirement consists of Primary Suppliers plus Primary Suppliers/Registered Creators (34)
Table 12 provides a break down of the different types of organizations transferring credits.
| Type of Entity | Transferors | Transferees |
|---|---|---|
| Registered Creator | 18 | 6 |
| Primary Supplier/Registered Creator | 30 | 21 |
| Primary Supplier | 0 | 5 |
| Primary Supplier/Registered Creator/Foreign Supplier | 0 | 0 |
| Registered Creator/Foreign Supplier | 1 | 1 |
| Total Number of Organizations Participating in Credit Transfers | 49 | 33 |
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