Very recently, Minister Murray sent a
letter to interested stakeholders indicating that consultations
will start soon to "inform post-2020 cap and trade program
design." This follows closely on the heels of the unveiling of
the Ontario Government's Climate Change Action Plan (discussed
here) which outlines the measures it will take in the years up
to 2020 to reduce GHG emissions and transition the province to a
The Climate Change Action Plan includes spending of
more than $8 billion to achieve a reduction in GHG emissions of 8.9
million tonnes by 2020. Of course, the GHG reduction commitments
made by the Ontario Government continue beyond that date. Indeed,
the target in future years is even more ambitious (reductions from
1990 emissions levels of 15 per cent in 2020 to 37 per cent in
2030). The expectation is that the cap and trade program will
continue beyond 2020 and will evolve to enable these increasing GHG
reduction goals to be reached.
The Minister's letter about consultations for post-2020 cap
and trade plan design recognizes that sharing information about
future plans will provide policy certainty and reduce business
risk. According to the letter, the Government will engage with
interested stakeholders in the development of a "draft design
document" which will be released for broad public and
stakeholder consultation before the final post-2020 design is
It appears that the timelines for the development of
Ontario's post-2020 cap and trade program design will be short
because the Ontario Government wants to work with its Western
Climate Initiative partners (California and Quebec), and those
jurisdictions are ahead of Ontario on post-2020 plans. On July 12,
2016, the California Air Resources Board released its plan to broaden and continue the state's
cap and trade program past 2020 and link the program with Ontario.
According to a Los Angeles Times article, one reason
for why details are being provided now about the extension of
California's cap and trade plan is to provide greater certainty
for investors. It should be noted, though (as discussed in a
post), that the continuation of California's cap and trade
program is not assured, as it faces legal and political challenges.
How that would impact Ontario's plans is an open question.
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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