On February 12, 2015, the Ministry of the Environment and
Climate Change released Ontario's Climate Change Discussion Paper
(the Paper), which identifies the risks and challenges associated
with climate change and the threat it poses to Ontario. The Paper
also outlines Ontario's long-term visions for reducing
greenhouse gas emissions, most notably by establishing a carbon
pricing policy in Ontario. "A well-designed carbon pricing
system is the most cost-effective approach to reducing greenhouse
gas emissions," the Paper states. "Carbon pricing reduces
greenhouse gas emissions as businesses and households incorporate
the cost of emitting carbon into their decisions, encouraging
companies and consumers to move away from fossil fuels and towards
cleaner and more efficient ways of going about their
business." The Paper outlines four approaches to carbon
A Cap-and-Trade System, which places a cap,
divided into permits, on the amount of greenhouse gases that can be
emitted in a given period. Emitters must acquire enough permits to
match their emissions, and those that have reduced emissions can
sell extra permits to those that require more. The auctioning and
trading of permits establishes a carbon price, which fluctuates
A Baseline and Credit System,where a baseline
intensity is determined for each emitter, which is then required to
improve its efficiency by a set amount (i.e. reducing greenhouse
gas emissions by 10% per barrel of oil produced). Emitters that
overachieve can obtain credits that can be sold to other businesses
that exceed their limits.
A Carbon Tax, where a charge is applied to
each unit of greenhouse gas emitted.
Regulations and Performance Standards,
requiring businesses to meet standards or targets or to use
specific technologies to reduce greenhouse gas emissions.
Currently, Quebec utilizes a cap-and-trade system while British
Columbia has a carbon tax.
In addition to emphasizing the importance of placing a price on
carbon, the Paper also outlines three other critical policy areas
that are essential to achieving Ontario's greenhouse gas
Take action in key sectors – reducing
greenhouse gas emissions in major polluting sectors, including
transportation, buildings, electricity, industry, agriculture and
Support science, research and technology
– investing in science and technology to improve efficiency
and help spur the uptake of carbon-reducing technologies.
Promote climate resilience and risk management
– integrating climate change considerations in key
infrastructure and asset planning decisions.
The Paper invites citizens, businesses and communities to engage
in a discussion on climate change, reducing greenhouse gas
emissions and maintaining strong economic growth. The Paper has
been posted for a 45-day public review and comment period, with
town hall meetings to be held across the province.
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.
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Ontario's Ministry of the Environment and Climate Change continues to roll out its Climate Change Action Plan with its proposed GHG guide for projects that are subject to the province's Environmental Assessment Act.
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