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Climate Change / Renewables
Dec 6, 2018
Ontario Releases Its New Environment Plan
On November 29, 2018, the Ontario government released its promised plan to address climate change, titled Preserving and Protecting our Environment for Future Generations: A Made-in-Ontario Environment Plan (the Environment Plan). The Environment Plan addresses four main topics: protecting air and water; addressing climate change; reducing waste; and conserving greenspace. Interestingly, the document is not titled a “climate change plan,” despite the fact that this is the phrase used in the Cap and Trade Cancellation Act, which directed the preparation of this plan (“The Minister, with the approval of the Lieutenant Governor in Council, shall prepare a climate change plan and may revise the plan from time to time”). Instead, the focus of the document is broader, with one chapter being devoted to meeting the government’s obligation to prepare a “climate change plan.”
In the Overview of the Environment Plan, the government emphasizes that the plan does not include a carbon tax, but it will ensure that Ontario will achieve emissions reductions in line with Canada’s 2030 GHG reduction targets under the Paris Agreement.
Much of the focus of the Climate Change section of the Environment Plan is on the ways that Ontario plans to enable and encourage the private sector to help reduce emissions. The actual GHG reduction target that Ontario set for itself for 2030 appears to be lower than what had been promised by the prior government (the new promise is a reduction in emissions by 30% below 2005 levels by 2030).
The actions identified in the Environment Plan to meet the 2030 target include the following:
- regulation of large emitters (forecast to account for 15% of the required emissions reductions)
- continued adoption of electric vehicles (forecast to account for 16% of the required emissions reductions)
- encouraging clean fuels for transportation and heating (forecast to account for 26% of the required emissions reductions)
- encouraging natural gas conservation (forecast to account for 18% of the required emissions reductions)
- the creation of an emission reduction fund (the Ontario Carbon Trust) (forecast to account for 4% of the required emissions reductions)
Many of these actions are continuations of existing activities, but there are two notable new items:
- Under the heading “making polluters accountable,” Ontario plans to set emissions performance standards for large emitters with the potential for payment or offset credit obligations to be applied to entities that do not meet their industry-specific targets.
- The Ontario Carbon Trust will be used to “activate the private sector” by using public funds to leverage private investment in clean technologies that are commercially viable and will have a widespread presence. According to the Plan, “[t]he Ontario Carbon Trust could consider investing in cost-effective projects from various sectors, such as transportation, industry, residential, business and municipal.” The Ontario Carbon Trust will be funded by government ($400 million over four years) and by proceeds from the emissions performance standards regime.
Presumably, details about how the proposals and initiatives set out in the Environment Plan will be released in the coming months.