July 2021 – Resilient LLP (formerly DeMarco Allan LLP)

Ontario and BC Amend Regulations to Support Renewable Gas

27 July 2021 No Comments By DT Vollmer

Ontario Ontario has introduced amendments to regulations under the Nutrient Management Act, 2002 that will enable farmers to produce biogas for the renewable natural gas (RNG) market. The regulations were first proposed in January, 2020 by the Ministries of Agriculture, Food and Rural Affairs and Environment, Conservation and Parks to assist farmers in recycling food and organic waste with anerobic digesters. The new regulations will: clarify design and construction requirements to support RNG production while seeking to maintain environmental protections for neighbours and local communities. provide greater flexibility in the amount and type of on- and off-farm anaerobic digestion materials permitted for use in regulated mixed anaerobic digestion facilities to make the generation of RNG more effective, efficient, and economical for farmers. simplify operational requirements regarding the sampling and analysis of received materials to reduce costs and enhance operational flexibility for farmers. The Government of Ontario expects the changes to: increase opportunities for management of food and organic waste in the circular food economy; increase production of RNG in Ontario; and increase economic development opportunities in the agri-food sector. British Columbia The BC Ministry of Energy, Mines and Low Carbon Innovation earlier this month announced amendments to the Greenhouse Gas Reduction Regulation (GGRR) to support the production and use of RNG and green and waste hydrogen. The GGRR allows utilities to make time-limited investments, with volumetric and expenditure caps, to support RNG development and procurement. The amendments will increase the current caps for investments in RNG and expand the scope of the GGRR to include other renewable gases, such as hydrogen. BC estimates that increased use of RNG could reduce GHG emissions by up to 450,000 tonnes per year. The amendments will also increase the amount of RNG, green and waste hydrogen, and other renewable energy that utilities can acquire for customers, supporting provincial commitments for a…

U.S. Democrats Unveil Border Carbon Adjustment Legislation

22 July 2021 No Comments By DT Vollmer

U.S. Senator Chris Coons and House Representative Scott Peters, both Democrats, earlier this week unveiled the “Fair, Affordable, Innovative, and Resilient (FAIR) Transition and Competition Act” (the Act), which, if enacted, would establish a border carbon adjustment (BCA) to be imposed as a fee on imports, starting on January 1, 2024. This follows the recent release of climate and emissions reduction proposals by the European Commission which also include BCAs for imports into the European Union. This bulletin briefly outlines the key provisions of the Act. Sectors. The Act would apply to industrial facilities that produce the following products: Steel; Aluminum; Cement; Iron; and Any product which is composed of over 50 percent of any of the above products. Determination of domestic environmental cost incurred. The Act would empower the Secretary of the Treasury (the Secretary) to annually determine the domestic environmental cost incurred for each sector or the average cost to produce a covered fuel (natural gas, petroleum, and coal), to comply with federal, state, regional, or local law, regulation, policy or program which, inter alia, is designed to limit or reduce greenhouse gas (GHG) emissions, including cap-and-trade systems, carbon taxes, and fees. Border carbon adjustment. The Secretary would administer the BCA through regulation and guidance. The Secretary of State and the United Stated Trade Representative would engage with other countries to reduce global GHG emissions and ensure fairness in the application of the emissions-based tariffs. A fee would be applied to any covered good (either a covered fuel or product produced within a sector) to be determined based on the domestic environmental cost incurred multiplied by the production of GHG emissions of the product or the upstream GHG emissions of the covered fuel. The BCA would not apply to (i) countries on the Least Developed Countries list of the OECD and (ii) countries that…

IESO Releases 2021 Annual Acquisition Report

21 July 2021 No Comments By DT Vollmer

Ontario’s Independent Electricity System Operator (IESO) earlier this week released its 2021 Annual Acquisition Report (the Report) providing details on the province’s future reliability needs and how to address them. The Report sets out an approach to address these needs over three planning horizons: operations planning, near-term planning, and long-term planning. The Report is anticipated to lead to demand reductions and increased procurement of lower-carbon power. This bulletin outlines key highlights of the Report: Understanding Ontario’s Reliability Needs Demand side uncertainties. Energy consumption is predicted to increase 1 percent each year until 2040. This prediction may be affected by the pace of economic recovery from the COVID-19 pandemic, demographic changes, changes in government policy, future energy management initiatives, and increasing electrification. Energy management. The Report indicates that the Industrial Conservation Initiative program is forecasted to reduce demand by 1300 MW with an additional 2.8 TWh and 450 MW of energy and demand savings from the 2021-2024 Conservation and Demand Management (CDM) Framework. Planned Actions to Ensure Resource Adequacy Flow East Towards Toronto (FETT). With the upcoming planned nuclear retirements and recommissioning, the supply capacity east of the FETT is expected to decline considerably and additional supply will be required as early as 2023. As a result, IESO is recommending upgrading the transmission line between North Oakville and Pearson Airport by 2026, reducing capacity needs by 2000 MW. To meet the increased demand, IESO is negotiating a transitional contract for the Lennox Generating Station which ends in April 2029. The Lennox Generating Station provides large-scale and flexible supply from a dual gas and oil generation facility. West of London. Electricity demand in Windsor-Essex and Chatham-Kent is expected to grow from 500 to 2300 MW by 2035. As a result, IESO is recommending development of new transmission infrastructure from Lambton to Chatham and Chatham to Lakeshore, which will require addressing…

Canada’s UNDRIP Law Receives Royal Assent

15 July 2021 No Comments By DT Vollmer

Bill C-15, the United Nations Declaration on the Rights of Indigenous Peoples Act (the Act), received Royal Assent on June 21, 2021. The Act affirms the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) as a universal international human rights instrument applicable in Canadian law and seeks to provide a framework for its implementation in Canada. This bulletin provides an overview of the implications and key aspects of the Act. Implications of the Act. The Act is widely seen as the first step in the domestic implementation of UNDRIP in Canada and follows similar legislation adopted by British Columbia in 2019. The Act does not itself implement UNDRIP into Canadian law but provides a pathway for its adoption and application, commensurate with Canadian law and the framework for recognizing the rights of Indigenous peoples provided under Canada’s Constitution. It is not yet clear to what extent Canadian law will be made consistent with certain provisions of UNDRIP, specifically the right of Indigenous peoples to free, prior, and informed consent (FPIC) for actions that may affect their rights, resources, and traditional territories. It is, however, probable that the use of UNDRIP as a tool for the interpretation of rights and statutes is likely to increase, in light of the Act, as laws are amended and adopted, in order to ensure or improve consistency with UNDRIP. Rights of Indigenous peoples. Section 2(2) provides that the Act upholds, and does not abrogate or derogate from, the rights of Indigenous peoples recognized and affirmed by section 35 of the Constitution Act, 1982. Consistency with UNDRIP. Section 5 provides that the Government of Canada must take all measures to ensure that the laws of Canada are consistent with UNDRIP. Action Plan. Section 6 provides that the Minister designated by the Governor in Council pursuant to section 3 (the Minister), must prepare…

Canada Submits NDC to UNFCCC, Formally Commits to Reduce Emissions by 40-45% by 2030

12 July 2021 No Comments By DT Vollmer

Canada yesterday filed its update to its nationally determined contribution (NDC) under the Paris Agreement with the United Nations Framework Convention on Climate Change (UNFCCC) secretariat. The updated NDC commits Canada to reduce GHG emissions by its previously announced target of 40-45% below 2005 levels by 2030, reaching net-zero emissions by 2050. Canada’s emissions reduction ambitions under the NDC are supported by the Pan-Canadian Framework on Clean Growth and Climate Change and Canada’s strengthened climate plan: A Healthy Environment and a Healthy Economy (read our earlier bulletin on the plan here) as well as the various climate plans of provincial and territorial governments and the climate leadership, priorities, and goals of the Indigenous peoples of Canada. Modelling for the NDC indicates that GHG emissions are anticipated to decline to 401 to 438 Mt CO2e by 2030. Further reductions are to be achieved with the adoption of innovative technologies such as zero-emission vehicles (ZEVs), industrial electrification, carbon capture, utilization and storage (CCUS), and hydrogen. The NDC makes clear that Canada is committed to a just transition to a net-zero economy (read our earlier bulletin on the Net-Zero Emissions Accountability Act here) through economic diversification and support for workers with skills training, education, accreditation, and ensuring equitable access to opportunities for underrepresented individuals and groups. For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@resilientllp.com.