Ontario, Quebec and Manitoba Agree to Link Cap & Trade Systems

On December 7, 2015, Ontario, Quebec and Manitoba signed a memorandum of understanding at the Paris climate talks to formalize the intent of all three provinces to link their cap and trade systems. Under the Western Climate Initiative, the three provinces’ cap-and-trade systems would then link to California’s cap and trade program.
Quebec’s cap and trade system has operating since 2013 and is already linked with California’s cap and trade program. Ontario is in the process of finalizing the details of its cap and trade program, which is expected to come online in 2017. When it released province’s new climate change strategy on December 3, 2015 – Climate Change and Green Economy Action Plan – Manitoba confirmed its intent to introduce a cap and trade program for 20 large emitters. Speaking in Paris, Manitoba Premier Greg Selinger said he believes more states and sub-national governments can be convinced to join them in linking cap and trade system, who can learn from each other’s experiences.

 

Ontario Outlines Next Steps Of Climate Change Strategy

On November 24, 2015, the Ontario government released the province’s Climate Change Strategy which sets out the government’s near and long-term vision for a low-carbon future. Although the strategy is short on details, it provides an indication of the government’s priorities on climate change. The Ontario government has said that it will release a detailed five-year action plan in 2016, which will include specific commitments to meet near-term 2020 emissions reduction targets, and establish the framework necessary to meet targets for 2030 and 2050. Ontario has set an interim emissions reduction target of 37% below 1990 levels by 2030 and a long-term target of an 80% reduction in emissions over 1990 levels by 2050.

As articulated in the strategy, by 2050, the Ontario government envisions that its citizens will be using less energy and the energy they do use will be from low-carbon sources. Communities will be climate-resilient, complete and compact. More people will choose electric or other zero-emission vehicles and transit to get swiftly and efficiently where they need to go. Agricultural lands, natural areas and ecosystems will be better protected for the benefit and enjoyment of all. By 2050, the government sees a province that will be employing new ways to reduce waste while ensuring that more of the waste produced is reintroduced to the economy. Industries will be thriving while generating fewer or zero emissions. Finally, businesses and innovators will be creating world-leading clean technologies and products that drive new economic growth, productivity, and job creation.

Under the Climate Change Strategy, the government will:

  • Introduce climate legislation to establish a long-term framework for action and make the cap-and-trade program law in Ontario.
  • Integrate climate change mitigation and adaptation considerations into government decision-making and infrastructure planning.
  • Introduce changes to government operations, procurement, employee training, building retrofits and in other areas to help government move towards carbon neutrality.
  • Develop a coordinated approach to reduce emissions from new and existing buildings.
  • Reduce emissions from transportation by promoting the uptake of zero emission and plug-in hybrid vehicles.
  • Develop data and metrics to measure emission impacts of projects and programs including progress towards emission reduction targets. This will entail the development of tools to assess climate change risk to food production, human health, vital infrastructure, and the economy.

The government will also report on, and renew, its action plan every five years. This strategy is meant to support Ontario’s proposed cap-and-trade program and complements earlier climate initiatives, which include establishing a 2030 mid-term emissions reduction target, ending coal-fired electricity generation, and electrifying and improving Ontario’s commuter rail network.