Ban on Thermal Coal Exports

Summary#

This bill would ban exports of thermal coal from Canada, unless the federal government issues a special permit for emergencies. It defines thermal coal, sets out a narrow permit process, requires public reporting of permit decisions, and imposes large fines for violations. The law must take effect within 1 year after Royal Assent, following consultation with affected unions.

• Bans exporting thermal coal, including coal imported into or moving in transit through Canada (Bill s.2, s.3).
• Allows permits only if the export is needed to address an imminent threat to human health, safety, or the environment (Bill s.4(1)).
• Requires public posting of permit decisions and reasons (Bill s.5).
• Sets fines up to CAD $12 million for repeat serious offences (Bill s.6).
• Must come into force within 1 year of Royal Assent, after consultation with likely affected trade unions (Coming into Force).
• Preamble notes 18 million tonnes of thermal coal left Canadian ports in 2022 and that its combustion adds “tens of millions of tonnes” of greenhouse gases (Preamble).

What it means for you#

• Households

  • No direct changes to household energy bills or taxes are mandated by the bill. It targets exports, not domestic electricity prices. Data unavailable on indirect effects.

• Workers

  • Workers in thermal coal mining, rail, port handling, and shipping may see reduced work tied to thermal coal exports once the ban takes effect. The bill does not include job transition funding. Data unavailable (Bill s.3; absence of funding provisions).
  • The government must consult trade unions whose members are likely affected before setting the start date (Coming into Force).

• Businesses

  • Coal producers, exporters, brokers, rail carriers, marine shippers, and port terminals must stop exporting thermal coal unless they have a permit for an imminent threat (Bill s.3, s.4(1)).
  • Metallurgical (steelmaking) coal is not covered; only thermal coal as defined by Harmonized System codes is banned (Bill s.2).
  • Export also covers coal imported into or transiting through Canada, so shipments of foreign thermal coal routed via Canadian ports would be subject to the ban (Bill s.2).
  • Violations can lead to fines up to $6,000,000 for a first indictable offence and up to $12,000,000 for subsequent indictable offences; lower maximums apply on summary conviction ($4,000,000 first, $8,000,000 subsequent) (Bill s.6).
  • Permit applications, conditions, amendments, and revocations will be set out in regulations; details and timelines are not yet defined (Bill s.4, Regulations).

• Local governments and port authorities

  • Terminals and ports handling thermal coal exports would need to cease those shipments unless a permit applies. The bill provides no compensation to ports or municipalities (Bill s.3; absence of appropriations).
  • Permit decisions and reasons will be published, allowing local stakeholders to track any exceptions (Bill s.5).

• Service users and the public

  • The bill creates a public record of permit decisions and any prescribed documents, increasing transparency (Bill s.5).
  • No changes to consumer services are mandated beyond potential indirect economic effects. Data unavailable.

Expenses#

Estimated net cost: Data unavailable.

• No appropriations or new fees are specified in the bill text (Bill text).
• Administrative costs to develop regulations, process permits, and enforce the ban are not estimated. Data unavailable.
• Potential fine revenue from violations cannot be estimated; maximum fines are set at up to $12,000,000 for subsequent indictable offences (Bill s.6).
• No official fiscal note identified. Data unavailable.

Proponents' View#

• Advances Canada’s climate commitments by phasing out exports of a high-emission fuel; the preamble cites 18 million tonnes exported in 2022 and “tens of millions of tonnes” of downstream emissions (Preamble).
• Closes a key gap by covering coal imported into or transiting through Canada, not just coal produced domestically (Bill s.2).
• Uses a narrow, emergency-only permit standard (imminent threats to health, safety, or environment), limiting loopholes that could weaken the ban (Bill s.4(1)).
• Enhances transparency by requiring public posting of permit decisions and reasons (Bill s.5).
• Sets strong penalties to deter non-compliance, up to CAD $12 million for repeat serious offences (Bill s.6).
• Provides a clear implementation deadline (within 1 year of Royal Assent) while requiring consultation with affected unions (Coming into Force).

Opponents' View#

• Economic impacts on workers and communities tied to thermal coal exports are likely, and the bill includes no transition funding or support measures (Bill text; absence of appropriations).
• The permit pathway is limited to emergencies, offering no flexibility for existing commercial contracts or phased wind-downs; this raises contract and planning risks for businesses (Bill s.4(1)).
• Enforcement may be complex and resource-intensive because the definition covers coal moving in transit through Canada; administrative costs are not estimated (Bill s.2; Data unavailable).
• Distinguishing “thermal” from “metallurgical” bituminous coal may create classification disputes and compliance burdens at the border (Bill s.2).
• Global emissions effects are uncertain if buyers source thermal coal through other countries’ ports; this rests on the assumption that demand will be met elsewhere. Data unavailable.