Canada: Greenhouse Gas Emissions Reduction In Ontario: A Discussion Paper From The Provincial Government

Last Updated: February 28 2013
Article by Julie Bedford and John Goetz

On January 21, 2013, the Ontario Ministry of the Environment posted a discussion paper regarding greenhouse gas (GHG) emissions reduction in Ontario, eliciting public input in the development of the Ministry's GHG reduction program. The stated objective of the emergent program is to "reduce greenhouse gas emissions while supporting the province's economic goals".


The discussion paper notes that the regulatory environment surrounding GHG emission reduction has evolved as of late, an observation that is highlighted by the fact that the province of Quebec began the initial phase of its cap and trade system in January, 2013 and the federal government recently finalized an emission reduction regulation for coal‐fired electricity generation. Although the federal coal regulation does not affect Ontario (as coal‐fired electricity is currently being phased out of Ontario and will be eliminated by the end of 2014) additional federal regulation is underway that may impact Ontario sectors. The Canadian government is currently in consultations with other large industrial emitters, with further draft federal regulations expected later this year.

The provincial government has revived this conversation more than three years after Bill 185, the Environmental Protection Amendment Act (Greenhouse Gas Emissions Trading) was passed by the Ontario legislature. In early 2010, it appeared Ontario was prepared to implement a GHG cap‐and‐trade system, but across both theprovince and the country, momentum stagnated and the relevant sections of the Environmental Protection Amendment Act were not proclaimed into force. Given the changing landscape and the tone of the discussion paper, it looks as though the Ontario government is prepared to revisit cap‐and‐trade as well as other emissions reduction solutions.

Purpose and Timing of the Program

Similar to the approach taken by other Canadian provinces, Ontario has indicated its interest in an equivalency agreement with the federal government, under which federal regulations would not apply where Ontario regulations achieve the same or better environmental outcomes. The Ministry proposes that Ontario's GHG program would be in place by 2015, approximately one year prior to the anticipated federal regulation of GHG's, expected to begin in 2016.

As noted in the discussion paper, the Ontario Climate Change Action Plan (2007) includes GHG emissions reduction targets (6% below 1990 levels by 2014, 15% below by 2020 and 80% below by 2050), and current initiatives are estimated to be able to provide approximately 60% of the reduction required to meet the 2020 target. The "made‐in‐Ontario" emission reduction program currently underway will attempt to begin to close this gap.

The paper provides a set of key principles that have acted to frame the program elements presented for discussion. Among other things, these principles include: achieving absolute reductions in a cost effective way, considering competitiveness and supporting equivalency with the federal government; simplicity, consistency, transparency and administrative efficacy; and using accurate and verified emissions data to support policy development. Providing emitters with incentives to invest in green technologies is also stated as a key target objective of the upcoming program.

Program Scope

The paper discusses the possibilities for the scope of the program, including which gases and industries may be covered and the level at which emissions targets would be set. Emitters covered by the program would be responsible for emission reduction of those GHGs that are consistent with the gases covered under the Kyoto Protocol and the reporting requirements under Ontario's current Greenhouse Gas Emissions Reporting Regulation, namely, carbon dioxide, methane, nitrous oxide, sulphur hexafluoride, hydrofluourocarbons and perfluorocarbons from covered sources.

The Ministry states that it is considering applying the program, at a minimum, to the same industrial sectors to be regulated by the federal government. Currently, this would include fossil fuel‐fired electricity, large emitters from petroleum refining, chemicals, steel, cement and pulp and paper. The Ministry is also considering covering the broader scope of large emitters that are currently subject to the Greenhouse Gas Emissions Reporting Regulation. Emissions associated with transportation and residential heating are not presently being considered for regulation.

Emission Reduction Targets

The discussion paper notes that the program will likely apply a mix of approaches for motivating the regulated emissions reductions across sectors, including production‐based benchmarks, energy benchmarks and reductions from an historical baseline.

Noting that initiatives such as the phase‐out of coal‐fired electricity and the Feed‐in‐Tariff program have already begun to significantly reduce GHG emissions from the electricity sector, the Ministry is also considering including regulation of the emissions from the electricity sector in the program. The target for the electricity sector, however, would be aimed at stabilizing, rather than reducing, emissions that would otherwise be expected to rise duringupcoming nuclear refurbishment and economic growth.

The proposed industrial sector targets would be set at the forecast of total emissions expected at the start of the program, thereafter declining by 5% over the next five years. Emissions data is currently available for many facets of the industrial sector dating back to 2010. The expected emissions levels at the start of the program are likely to be based on ongoing emissions forecasting being carried out by the Ministry, with input from the Ministries of Finance and Economic Development and Innovation.

Program and Compliance Options

The Ministry indicates that through prior discussions with stakeholders, it has determined that the province needs flexible compliance options and clear signals to allow industries to plan investments. The discussion paper puts forth compliance options that the Ministry is considering implementing in order to meet these objectives.

Investment in Cleantech

The Ministry lists a number of technologies and industries for which it expects investment opportunities to reduce GHG emissions while simultaneously maximizing competitiveness and productivity, and retaining and creating employment. These include: energy efficiency technologies, renewable energy, industrial cogeneration, district heating, oxygen‐enhanced combustion, fuel switching, biofuels and carbon capture and storage. The Ministry acknowledges that complementary policies are required to foster the implementation of such technologies.

Market-based Trading

The possibility of integrating a market‐based trading approach to GHG emissions reduction, such as is already established in Alberta and, more recently, Quebec, is presented. Under a flexible trading mechanism (commonly known as a "cap‐and‐trade" system), regulated industry members may choose how to comply with an emissions reduction target, and trading of emissions credits generated within the system establishes a carbon price, which in turn drives investment decisions. Without explicitly stating that Ontario will develop a cap‐and‐trade system, the Ministry speaks favourably of the efficacy of such market based mechanisms, citing a number of recent reports by international and domestic think tanks.

Offset Protocols

The Ministry proposes that protocols for offsets to be used in the Ontario GHG emission reduction program would be developed in coordination with the federal government and other jurisdictions, including the Western Climate Initiative (WCI) and North America 2050. Whether an Ontario capand‐ trade regime would officially link with the WCI market, the Regional Greenhouse Gas Initiative, the province of Alberta or another exchange or system is not addressed, although Ontario has been a partner in the WCI since 2008.

Public Review

The discussion paper concludes by requesting public input and listing a number of questions awaiting industry and stakeholder response, including: What sectors should be covered by the program? What should the emissions threshold be? What are the barriers to achieving significant reductions? And how should the program be designed? The discussion paper is currently open for a 90 day public review, expiring on April 21, 2013. Comments can be submitted through the Environmental Registry.

Since the Ministry posted the paper, further developments have transpired that may serve to create an environment that encourages ambitious emissions reduction legislation. In his state of the union address on February 12, 2013 President Obama called for a "bipartisan, market‐based solution to climate change," noting that if such a solution does not emerge from Congress,executive action will be taken in lieu of Congressional action. If the Obama administration adopts more aggressive climate policy, Canada will likely follow suit, both federally and provincially. Past bills and the most recently proposed bill to tax carbon emissions from Senators Sanders and Boxer, indicate that fuel imported from Canada will be subject to the same standards of carbon regulation or tax that domestic energy is subject to. Now is a great time for interested Ontario parties to have their voices heard and to contribute to the evolution of emissions regulation.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.