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Decarbonization pits groups tightly connected to the fossil fuel industry against those most vulnerable to the impacts of climate change. These policy conflicts are multifaceted and affect industries and firms (capital) as well as affected workers and communities (labour). We analyze how new climate policy reforms channel political conflicts in Canada, a large fossil fuel-producing democracy. The Canadian government recently proposed to cap greenhouse gas emissions (not production) from the oil sector, while also approving a new offshore oil development in Newfoundland. We contend this policy introduces new cleavages because it incentivizes firms to shift extraction to lower carbon-intensity sites, while fossil fuel-producing communities are relatively fixed. We theorize how levels of support for decarbonization and this particular policy vary across communities in different Canadian regions, with particular attention to how internal labour migration interacts with political geography. We field an original survey instrument to study public attitudes. The findings from this project help scholars understand how the politics of decarbonization in different fossil fuel communities.