LASER TALK: The Effect of Pricing Carbon on Farmers

Canada, Agriculture, and Climate Change

Farmers and governments are at the beginning of a multi-decade undertaking during which pressure for ever-larger greenhouse gas emissions cuts will intensify, with each round of reductions more challenging than the one before. This feat needs to be achieved on top of a farm crisis in Canada [1].  Both the climate and the farm crises have the same causes and largely the same solutions: reduce dependence on high-emission petro-industrial farm inputs and rely more on ecological cycles, energy from the sun, and the knowledge and wisdom of farm families. 

The federal carbon price already features an exemption for gasoline and light fuel oil costs used in tractors and trailers. [2] As well, the federal government is spending $37.1 million on 99 grain drying projects as part of its $495.7 million Agricultural Clean Technology program. [3]

In March 2021, the Minister of Agriculture and Agri-Food announced an investment of $185 million over the next 10 years for the new Agricultural Climate Solutions (ACS) program. [4]  In August 2021, the Minister also announced the On-Farm Climate Action Fund, a new fund under Agricultural Climate Solutions. From 2021 to 2024, a $200-million Fund is providing direct support to farmers to adopt beneficial management practices that store carbon and reduce greenhouse gas (GHG) emissions in three target areas: cover cropping, nitrogen management, and rotational grazing practices. [5]

In June 2022, Canada launched a Greenhouse Gas Credit Program, in which farmers can participate [6]. As demand for clean energy rises with the price of greenhouse gas pollution, there will be an economic opportunity for many farmers and ranchers. Farmers could lease land for wind and solar projects.[6]

It should be noted in a report by the Pacific Institute for Climate Solutions that British Columbia’s carbon tax did not appear to have had a measurable impact on international agricultural trade[7]. Currently, what is unclear to us at Citizens’ Climate Lobby Canada is how exactly carbon rebating works for farmers. It is logical to assume rebates to farmers should buffer consumers. We need the data. 

We need to listen closely to farmers. They have the knowledge for building climate resilience. During COVID farmers For Climate Solutions put forth recommendations on how to help farmers during COVID with a three “E” focus of economics, equity, and emissions in mind [8]. The Canadian government has created a Sustainable Agriculture Strategy [8] and farmers are part of the advisory committee [10]. 


[1] Tackling the Farm Crisis and the Climate Crisis: A Transformative Strategy for Canadian Farms and Food Systems – The National Farmers Union (2019) Accessed 26 May. 2023.

[2] Greenhouse Gas Pollution Pricing Act –” Accessed 26 May 2023.

[3]”Agricultural Clean Technology Program – Adoption Stream: Step 1. What this program offers” Accessed 26 May. 2023.

[4] “Accelerating the adoption of climate-smart best practices in agriculture” March 2021   Accessed 26 May. 2023.

[5] “Helping farmers to reduce GHGs and improve resiliency to climate change”   Accessed 26 May. 2023 

[6] Canada’s Greenhouse Gas Offset Credit System Accessed 26 May. 2023.
[7] The Effect of British Columbia’s Carbon Tax on Agricultural Trade.” Accessed 26 May. 2023.

[8] “A better future starts on the farm: Recommendations for recovery from COVID-19 in Canadian agriculture” Farmers For Climate Solutions. Accessed 26 May. 2023.
[9] Sustainable Agriculture Strategy Accessed 26 May. 2023.

[10] NFU’s Darrin Qualman named to Sustainable Agriculture Strategy Advisory Committee Accessed 26 May. 2023.


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