If it ain’t broke don’t fix it
Ontario’s new provincial government needs to be reminded of this good advice when it comes to finding ways to reduce the province’s emissions of greenhouse gases.
Global warming is inescapable—and Ontario is warming faster than the global average. Climate change has affected almost every aspect of the lives of Ontarians. In just the first five months of this year, extreme weather resulted in more than three-quarters of a billion dollars in damages in the province. The summer brought dangerous heat waves, floods, and blazing forest fires. Scientists are certain that the impacts of the changing climate will become increasingly intense and disruptive.
In 2016, Ontario joined the global movement to put a price on carbon through its Climate Change and Low-Carbon Economy Act, which created a cap and trade program for reducing greenhouse gas emissions. This law set the stage for powering a cleaner Ontario economy, and for continuing to reduce the province’s contribution to the global carbon pollution that drives climate change.
Ontario’s greenhouse gas emissions in 2016 were the lowest since reporting began in 1990. In fact, emissions have been falling for over a decade—down 10.4 % since 1990, and a whopping 21.5 % since 2005.
At the same time, Ontario’s GDP has been growing strongly. The top three performers over the last five years in terms of GDP are Ontario, Quebec and British Columbia. But only Ontario and Quebec—which shared the same cap and trade program—have managed to both significantly reduce emissions and substantially grow their economies at the same time.
In both Ontario and Quebec, revenues from cap and trade have been plowed back into programs to increase energy efficiency, promote electric vehicles, and to unlock the huge potential of renewable energy.
As a result, Ontario’s cleantech sector has been the fastest growing of all the Canadian provinces and territories. It generates $20 billion in annual revenues, supports 5000 companies, and employs 130,000 people. The global market for low-carbon goods and services is already worth US$ 6 trillion and is projected to keep growing—and Ontario is a major player in that market.
Energy efficiency helps customers reduce their power bills, keeps businesses competitive and, most importantly, creates jobs. Lots of them.
One estimate is that strongly promoting energy efficiency measures in Ontario could result in a net increase of almost 53,000 jobs a year and $12.5 billion a year in GDP growth by 2030, even after accounting for some job losses in the fossil fuel sector.
In the US, energy efficiency is the fastest growing part of the energy sector. In 2017, it employed 2.25 million Americans—more than coal, oil, gas, and the electricity production sectors combined. The US energy efficiency sector is projected to grow by more than 9 % in 2018.
In short, Ontario’s cap and trade program has been a huge success—forcing down emissions, raising almost 3 billion dollars in carbon revenues last year, and bringing in millions of dollars more in investments into the province.
Hit the brakes
In June 2018, Ontario’s successful climate progress came to an abrupt halt. Without public consultation, and without giving the notice called for by the cap and trade agreement linking Ontario with Quebec and California, the new provincial government introduced legislation to repeal the 2016 Climate Change and Low Carbon Economy Act, and cancelled contracts and funding commitments for renewable energy and greenhouse gas emission reduction projects across Ontario.
Bill 4, the Cap and Trade Cancellation Act, 2018, has only one objective: to dismantle the previous legal framework. Passing this legislation will leave Ontario with no statutory emission targets, no pathway to achieving targets, weak reporting, no carbon price, and no revenue stream to invest in energy efficiency improvements and hightech clean growth. Many parties who in good faith invested time, money, expertise and credibility in Ontario emission reduction projects have been left with damaged relationships and uncompensated losses. This affects not only Ontario’s economy and its environment, but more importantly : its reputation as a global leader in climate change policy.
The Environmental Commissioner of Ontario (ECO) has issued a strong response to the recklessness of Ontario’s new provincial government. The report, issued on September 25, is called: Climate Action in Ontario: What’s next?. It’s a scathing indictment of the actions taken by the Progressive Conservatives in abruptly shutting down the province’s cap and trade program.
In particular, the report notes that the arbitrary process used to withdraw from program did not comply with the government’s legal obligation under the Environmental Bill of Rights to consult with the public before making that decision.
Three days after the regulatory change that shut down the cap and trade program, the Ministry of Environment, Conservation and Parks stated that no public consultation was held because : “the minister was of the opinion that the recent Ontario election was a process of public participation that was substantially equivalent to the process required under the Environmental Bill of Rights.”
This is an almost contemptuous disregard for the law. There is no conceivable way that voting for a party in a provincial election can be considered to be equivalent to a process of genuine public consultation on a major change in environmental policy.
The ECO report also deplores the abrupt manner in which the new government cancelled contracts and funding commitments for renewable energy and emission reduction projects across the province.
Ontario has gone from being a world class leader in phasing out coal-fired power generation, driving forward energy efficiency, promoting electric vehicles, and forcing down the emission of greenhouse gases–to being an also-ran, a footnote, a sidelined player now just watching the game.
The implications for Canada’s legal obligations under the Paris Agreement are severe. The federal government cannot meet its emission reduction targets without the full and active participation of the province of Ontario—whose emissions of greenhouse gases are more than Quebec’s and British Columbia’s combined. Only Ontario and Quebec have shown that it is possible to both force down emissions of greenhouse gases and substantially grow their provincial economies. Cap and trade was a central pillar of these provincial programs.
In shutting down Ontario’s successful cap and trade program, the new provincial government has damaged not only the reputation of Ontario, but that of Canada itself.
The 2018 report from the Environmental Commissioner of Ontario: Climate Action in Ontario: What’s Next? Is available here.