The Ontario Ministry of the Environment, Conservation and Parks (the Ministry) has posted a bulletin (the Bulletin) providing principles to guide policy development and future consultations for Ontario’s Emissions Performance Standards (EPS) program to meet the updated federal benchmark for 2023-2030 (read our earlier bulletins on the EPS here and here). The Ministry also released new modelling demonstrating how Ontario is forecasted to meet its GHG emission reduction target of 30% below 2005 levels. This bulletin briefly summarizes key information in the Bulletin and the emissions scenario modelling.
Proposed Principles. The Bulletin notes that the federal government, in its Update to the Pan-Canadian Approach to Carbon Pollution Pricing 2023-2030, set out new and more stringent benchmark requirements ($65/tCO2e in 2023, rising $15/year to $170 in 2030) that all carbon pricing systems, including the EPS program, must meet under the Greenhouse Gas Pollution Pricing Act. To meet the more stringent benchmark, the Ministry is proposing to design the next phase of the EPS program using the following guiding principles:
- provide continuity and predictability for Ontario businesses;
- incent GHG emissions reductions, which will help Ontario to meet its target to reduce GHG emissions by 30% below 2005 levels by 2030;
- minimize the risk for carbon leakage (the risk of production leaving the province for other jurisdictions with less stringent climate policies), taking into account competitiveness impacts to Ontario industry;
- ensure the program continues to be fair, cost-effective, and flexible to the needs and circumstances of Ontario; and
- minimize regulatory burden.
Emissions Reduction Modelling. New modelling released as part of the Bulletin provides updated forecasting of provincial emissions out to 2030. The modelling shows that Ontario’s emissions are forecasted to be 143.7 MT CO2e in 2030, slightly lower than Ontario’s 144 MT target for 2030. The Ministry notes, and as shown in the graph below, that Ontario is reducing its emissions through the following:
- increasing the renewable content in gasoline, with 11% renewable content by 2025, 13% in 2028, and 15% by 2030;
- increasing the GHG performance requirement for fuel from 45% to 50% in 2030;
- supporting the phase out of industrial use of coal through actions supporting low-emission electric arc furnaces for steel production;
- simplifying the approvals process for energy-intensive facilities, such as cement manufacturers, to substitute the use of coal and petroleum coke with fuels derived from materials diverted from landfills;
- investments in public transportation;
- supporting natural gas conservation through demand side management programming;
- continuing the EPS program until 2030; and
- engaging with stakeholders to improve collection of methane from landfills and diverting more food and organic waste.
Source: Ministry of Environment, Conservation and Parks
Public Consultations. The Bulletin notes that the Ministry will begin collecting data to support the development of the potentially new performance standards and intends to consult with stakeholders this summer on the proposal for the EPS program for the 2023-2030 period.
For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@resilientllp.com.
