The Bank of Canadian said on Thursday it may not be able to implement a carbon price as promised by the Trudeau government and that it will continue to rely on carbon markets to help reduce emissions.
In a letter to the finance minister, the Bank of the Canadian noted that the Trudeau Liberals government introduced legislation last year that would have increased the amount of money Canadians are required to contribute to a carbon tax.
The bill would have raised the levy from $50 per tonne of carbon dioxide to $200 per ton.
It would have also made it more difficult for provinces and territories to set their own emissions limits.
The Bank said the new legislation was too complex and would lead to higher costs.
“As a result, the Government has not provided a detailed plan for how it would ensure that Canada’s carbon emissions are met at a lower level than they currently are,” the letter said.
The Bank of Ontario is one of several global banks, including Barclays and Goldman Sachs, that are exploring ways to invest in clean energy technologies.
In May, the Federal government announced a plan that would give Canadian firms an incentive to invest more in carbon capture and storage technology.
That program, which has already seen several big companies invest billions of dollars, was unveiled in May.
In the letter, the bank said it believes that this new program will be effective, but the Trudeau administration has yet to provide a plan.
The Bank said it is also considering its options for the future.
With files from The Canadian Press