This Act amends the Petroleum Products Pricing Act and its regulation to eliminate the statutory concept and regulatory mechanism called the “cost of carbon adjustor.” The bill deletes the definition, removes references to the adjustor throughout the Act (including several subsections and a regulation provision), repeals subsection 14(2.1), and changes the heading for adjustors to “Market adjustor.”
Why it matters: by stripping the legal basis for a discrete carbon-cost adjustor, the law changes how carbon-related costs can be reflected in regulated petroleum prices. That raises immediate compliance and pricing questions for fuel wholesalers, retail dealers, and the provincial pricing authority, and it creates a gap the regulator will need to fill through updated pricing formulas or guidance.
At a Glance
What It Does
The Act removes the statutory definition of “cost of carbon adjustor,” excises textual references to that adjustor in multiple provisions (including section 13.2 and subsection 14(2.1)), and repeals the corresponding regulatory section (section 13.2 of NB Reg 2006-41). It also renames the heading formerly labelled “Adjustors” to “Market adjustor.”
Who It Affects
Fuel wholesalers, retail gasoline stations, and provincial pricing officials are directly affected because the change alters the statutory components available when the Director or regulator calculates regulated petroleum prices. Lawyers and compliance officers for fuel distributors will need to reassess pricing practices and invoicing.
Why It Matters
The change removes an explicit statutory channel for passing carbon costs through to regulated pump prices. That shifts the administrative burden to the regulator and industry to determine how (or whether) carbon costs will be recovered under existing pricing formulas, with consequences for price transparency and cost recovery.
More articles like this one.
A weekly email with all the latest developments on this topic.
What This Bill Actually Does
The bill performs a surgical repeal of the statutory and regulatory language that created a separate “cost of carbon adjustor” inside New Brunswick’s petroleum pricing framework. It starts by striking the definition from the Act so that the phrase no longer legally exists, then removes every statutory cross-reference that had relied on that concept.
Parallel edits to the province’s regulation complete the removal: the regulation’s section that implemented the cost-of-carbon adjustor is repealed and its heading removed.
Operationally, that means the written formula and the enumerated adjustors the regulator previously referenced will no longer include a named carbon adjustor. The Act does not substitute a new mechanism or supply alternative wording to capture carbon costs; it simply deletes the statutory tool.
Because the legislation also renames the general heading to “Market adjustor,” the remaining price adjustments will read through a market-focused lens rather than a discrete carbon-cost line item.For regulators and regulated entities the immediate task is interpretive and practical. The Director responsible for setting or approving regulated prices must revise pricing schedules, calculation spreadsheets, and public forms to remove the defunct line item and to explain how carbon-related costs—if recoverable—will be treated under the continuing price-setting rules.
Fuel suppliers and retailers must decide whether to absorb carbon costs, reallocate them within base prices, or seek an alternative approval route under existing statutes.The statute’s repeal creates ambiguity about historic and future cost recovery. The law makes no transitional or compensatory provision, so affected parties will need administrative guidance or updated regulations to avoid disputes.
Expect briefings from the regulator and likely operational changes at wholesale and retail accounting levels as participants adjust to the absence of an explicit statutory carbon adjustor.
The Five Things You Need to Know
The Act repeals the statutory definition of “cost of carbon adjustor” from the Petroleum Products Pricing Act (amendment to section 1).
Multiple cross-references are removed: the bill deletes the phrase “the cost of carbon adjustor and” from section 13.2, paragraph 33(c.1), and related subsections in section 4.
The Act repeals subsection 14(2.1), removing whatever specific statutory authority or detail that subsection previously supplied (the text deletes that provision rather than replacing it).
New Brunswick Regulation 2006-41 is amended: the regulatory heading for the cost-of-carbon adjustor is removed and section 13.2 of the regulation is repealed in full.
The bill does not create a replacement mechanism—no alternative statutory adjustor or specific recovery path for carbon costs is added; the change is a deletion, not a substitution.
Section-by-Section Breakdown
Every bill we cover gets an analysis of its key sections.
Repeal of the 'cost of carbon adjustor' definition
The Act removes the definition of “cost of carbon adjustor” from the Act’s definitions. Practically, this eliminates the canonical reference point for any downstream provisions that needed that defined term. Once a statutory definition disappears, any price calculations or regulatory language that previously relied on that exact term will need to be reworked to avoid drafting dead references.
Text edits to section 4 — removing references
Amendments to section 4 delete specific paragraphs that referenced the cost-of-carbon adjustor (including paragraph (e) in two places). These are targeted excisions: the Act preserves the structure of section 4 while removing the clauses that invoked the carbon adjustor. The effect is to stop the statute from authorizing adjustments tied to a named carbon-cost line in those subsections.
Heading change to 'Market adjustor' and strike from section 13.2
The bill replaces the heading formerly labeled “Adjustors” with “Market adjustor,” signalling an editorial refocus of allowable adjustments. It also removes the phrase “the cost of carbon adjustor and” from section 13.2, narrowing the statutory text that governs what adjustors may be applied. That change tightens the statutory language to focus on market-based adjustments rather than a separate carbon-cost item.
Repeal of subsection 14(2.1) and removal in paragraph 33(c.1)
Subsection 14(2.1) is repealed outright and paragraph 33(c.1) is edited to strike the cost-of-carbon wording. Those deletions remove any standalone legal authority that had been tucked into subsection 14(2.1), and they clean up references elsewhere to avoid orphaned language. The practical implication is that any operational detail previously placed in that subsection will no longer have force.
Repeal of regulatory section implementing the adjustor (NB Reg 2006-41 s.13.2)
The regulation change deletes the heading for the cost-of-carbon adjustor and repeals section 13.2 of Regulation 2006-41. Since the regulatory provision likely contained the mechanics for calculating and applying the adjustor, its repeal removes the implementing rules as well as the statutory references. Without a replacement regulation, administrators lack a regulatory formula or method tied explicitly to a carbon adjustor.
This bill is one of many.
Codify tracks hundreds of bills on this topic across all five countries.
Explore this topic in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Consumers of gasoline and diesel — removing a visible, line-item carbon adjustor could lower the specific surcharge shown on price breakdowns, and may lead to more stable apparent pump prices if the adjustor had been a volatile add-on.
- Provincial pricing administrators — the consolidation to a “Market adjustor” heading simplifies the menu of named adjustors the regulator must manage, reducing one statutory category to track and eliminating the need to administer a discrete carbon-cost calculation.
- Large integrated fuel suppliers — firms with scale and diversified margins can more easily reallocate carbon costs across product lines or absorb short-term costs, giving them greater flexibility compared with small independents when an explicit passthrough mechanism disappears.
Who Bears the Cost
- Independent fuel retailers and small wholesalers — these operators are more exposed if they previously relied on an explicit mechanism to recover carbon costs; they may face margin compression or cash-flow pressure while pricing mechanisms are reworked.
- Regulatory and legal teams for suppliers — removing the statutory adjustor creates an implementation and interpretive workload: updating contracts, invoices, pricing schedules, and regulatory filings will consume time and resources.
- Provincial government — the government or regulator may incur administrative costs to issue guidance, rewrite the pricing framework, and handle dispute resolution or appeals arising from the change in legal authority.
Key Issues
The Core Tension
The core tension is between transparent cost pass-through and a streamlined, market-focused pricing framework: removing the explicit carbon adjustor simplifies the statute and reduces one administrative line item, but it undermines a clear, auditable mechanism for recovering carbon costs—forcing a choice between preserving cost-recovery clarity for industry and consumers, or simplifying the regulatory code at the expense of transparency and predictable recovery.
The statute is a deletion without a legislative substitute; that design choice creates immediate interpretive and administrative gaps. The law eliminates a named adjustment mechanism but does not state how carbon-related costs should be recovered going forward, leaving it to the regulator or market participants to fill the vacuum.
That raises questions about transitional treatment (are past approvals or adjustments affected?), invoice and contract language, and whether costs must be rolled into base prices or absorbed by sellers. Absent regulatory follow-up, disputes over permitted recoveries or retrospective claims are a realistic risk.
There is also a transparency trade-off. A discrete carbon adjustor provides an auditable, visible line item tying consumer charges to environmental policy costs; deleting it improves simplicity but reduces line-item transparency.
Finally, the change may interact awkwardly with external carbon-pricing frameworks: the statutory removal does not alter federal or interjurisdictional carbon obligations, so compliance teams must reconcile how those external costs are reflected in provincial pricing under an altered legislative framework.
There's more to this law than the bill.
Codify Laws traces every connection across the legislative lifecycle.