The federal and Alberta governments have reached an implementation agreement on carbon pricing, electricity development and energy infrastructure aimed at lowering emissions, expanding export access and strengthening the Canadian economy.

The agreement, highly sought-after by the federal government, has widespread commercial real estate implications covering diverse projects, properties and transactions involving the industrial sector and other asset classes in Alberta, B.C., and beyond.

Prime Minister Mark Carney and Alberta Premier Danielle Smith announced the deal as part of a broader effort tied to a memorandum of understanding signed in November 2025 that shifts energy and climate policy concerning the province’s major infrastructure projects toward what both governments described as a more “pragmatic” and co-operative approach.

“Today’s agreement reinforces that Alberta and Canada are lands where the opportunities are plentiful, the rules are clear, and one project means one review. We are building a Canada that works with a more prosperous, sustainable, and resilient economy for all,” Carney said.

Under the agreement, Ottawa and Alberta will establish an effective carbon price of $130 per tonne by 2040, with benchmarks of $115 by 2030 and $130 by 2035. The headline carbon price will rise to $140 per tonne by 2040, while Alberta’s Technology Innovation and Emissions Reduction system will gradually tighten emissions benchmarks over time.

“This agreement sends a clear message to investors and global partners that Canada and Alberta are serious about expanding market access, building major infrastructure, and creating the conditions for long-term investment in our province’s energy sector,” Smith said. “Alberta is ready to build, invest, and partner, but we cannot afford to lose another decade.”

The agreement also includes a minimum floor price for TIER credits beginning in 2030 and the joint issuance of 75 million tonnes of Carbon Contracts for Difference to support emissions-reduction projects, with costs shared equally between Ottawa and Alberta.

The two governments also committed to work toward doubling Alberta’s electricity grid by 2050 through investments in nuclear, wind, solar, geothermal and other lower-carbon power generation while maintaining grid stability. A joint electricity working group will identify projects and technologies needed to achieve net-zero emissions in Alberta by 2050 and support growing demand from AI and data-centre projects.

On energy exports, the province will submit a proposal by July 1, 2026, for a bitumen pipeline capable of shipping one million barrels of low-emission Alberta product per day to the West Coast for transport to Asian markets. The federal government said it would pursue designation of the project as being in the national interest under the Building Canada Act by Oct. 1, 2026, while continuing consultations with Indigenous communities and discussions with British Columbia.

The pipeline proposal is tied to the Pathways Project carbon-capture initiative, which the governments said could reduce emissions by 16 million tonnes annually while generating $16.5 billion in GDP, $12.2 billion in labour income and up to 43,000 jobs each year.

The agreement also builds on earlier deals reached this spring, including a one project-one review framework for major infrastructure and a co-operation agreement on environmental and impact assessments. Ottawa and the province said they are also targeting a methane-equivalency agreement by the end of 2026 that would reduce methane emissions from Alberta’s oil and gas sector by 75% below 2014 levels by 2035.