Resilient LLP (formerly DeMarco Allan LLP)
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DT Vollmer

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Canada Publishes Finalized Clean Electricity Regulations

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Canada’s Minister of Environment and Climate Change (the “Minister”) yesterday announced the finalization and publication today of the Clean Electricity Regulations (“CER”) in the Canada Gazette, Part II (see our earlier bulletin on the draft CER here). CER establishes significant annual emission limits (“AEL”) to reduce greenhouse gas (“GHG”) emissions from fossil fuel-generated electricity generation facilities in all provinces and territories across Canada starting in 2035. Requirements to reduce emissions under CER start in 2035 with a pathway to reaching net-zero in 2050. Environment and Climate Change Canada (“ECCC”) estimates that the CER would reduce approximately 181 megatonnes of cumulative GHG emissions between 2024 and 2050. The CER imposes significant registration, record keeping, and reporting obligations on covered electricity generation facilities.   This bulletin briefly summarizes the key provisions of CER and federal financial support to help decarbonize and expand Canada’s electricity system.   Scope. A “unit” is regulated under the CER if it meets all of the following three criteria: It has an electricity generation capacity of 25 megawatts (“MW”) or greater (or is a new unit located at a facility where the sum of all new electricity generation unit capacity is 25 MW or greater); It generates electricity using fossil fuel; and It is connected, directly or indirectly, to an “electricity system” that is subject to North American Electric Reliability Corporation (“NERC”) standards. A unit that has an electricity generation capacity of less than 25 MW is deemed to meet the first criteria if the unit’s commissioning date is on or after January 1, 2025 and the sum of the electricity generation capacity of all units, other than planned units, that are located at the facility where the unit is located and that also have commissioning dates on or after January 1, 2025 is at least 25 MW.   CER does not apply…

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World Bank Group Releases Template Article 6 LOA and Related Guidance

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Resilient LLP is pleased to share that the World Bank Group has today released guidance on Letters of Authorization and Acknowledgement as part of its Article 6 Approach Paper Series. The guidance includes a Letter of Authorization that provides a common template intended to be used for all authorizations to be granted under Articles 6.2 and 6.4 of the Paris Agreement. The Letter of Authorization is intended to be used with schedules that may be specified by each country and includes illustrative terms and conditions that are most likely to maximize investment and value for the country. It also allows each country to actively choose whether a project is intended to be authorized (subject to corresponding adjustments and a Letter of Authorization) or outside the scope of authorization (ideally subject to a Letter of Acknowledgement in order to increase certainty and corresponding investment value). A template Letter of Acknowledgement is also provided. This common template (with schedules) is intended to simplify the process for authorization, reduce transaction costs, and allow flexibility for bilateral arrangements. The guidance also includes a template Letter of Authorization developed by the Multilateral Investment Guarantee Agency (MIGA), which presents illustrative terms that are conducive to facilitating insurance for breach of a Letter of Authorization.   For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@resilientllp.com.

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Ontario Court of Appeal Allows Appeal in Youth Climate Change Case

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The Court of Appeal for Ontario (ONCA) today released its unanimous decision (the Decision) on an appeal of the dismissal of a youth-led constitutional challenge of Ontario’s emissions target (see our earlier bulletin here). The ONCA allowed the appeal, determining that the Ontario Superior Court (ONSC) application judge erred in characterizing the case as a positive rights case and remitted it to the ONSC for reconsideration. The case is the first in Canada to consider whether a government’s approach to climate change can violate the Canadian Charter of Rights and Freedoms (the Charter). This bulletin briefly provides key background details of the case and the main findings of the Decision.   Background. The appellants, seven Ontario youths, some of whom are Indigenous, brought an application for (i) a declaration that Ontario’s 30% reduction of greenhouse gas (GHG) emissions target (the Target) under section 3(1) of the Cap and Trade Cancellation Act, 2018 (the CTCA) – implemented through Ontario’s “A Made-in-Ontario Environmental Plan” (the Plan) – and section 16 of the CTCA, repealing Ontario’s Cap-and-Trade system, were unconstitutional as they violated their rights under sections 7 and 15 of the Charter, and (ii) an order declaring their Charter rights have been violated and requiring Ontario to set a science-based emissions reduction target and to revise the Plan in accordance with international standards. The application judge dismissed the application. While the judge found the issue of the appellants’ sections 7 and 15 Charter rights justiciable, she characterized it as a positive rights claim and concluded that any deprivation of life or security of the person under section 7 was not contrary to fundamental justice, and that section 15 did not impose a positive duty on Ontario to act against climate change.   The Decision. The following is a brief overview of the ONCA’s main findings: The application judge erred in her analysis of the case as…

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Supervisory Body Reaches Agreement on Mandatory Environmental and Human Rights Safeguards for Article 6.4 Mechanism

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The Article 6.4 Supervisory Body (the SB) this week agreed on mandatory environmental and human rights safeguards for the Article 6.4 carbon crediting mechanism (A6.4 Mechanism) established under the Paris Agreement. The SB is tasked with developing and supervising the requirements and processes needed to operationalize the A6.4 Mechanism. The safeguards will be implemented through the mandatory Sustainable Development Tool (SDT) that assesses and monitors project impacts throughout their lifespan (SDT text available here).    This bulletin briefly summarizes the SDT criteria for the environmental and social safeguards.   Environmental. The SDT will require those participating in the A6.4 Mechanism to identify, evaluate, avoid, minimize and mitigate the following environmental safeguards associated with projects: Energy. The A 6.4 activity ensures sustainable use of energy. Air, land and water. The A6.4 activity avoids releasing pollutants into the air, land, or water, including hazardous and/or non-hazardous pollutants in solid, liquid, or gaseous phases. Ecology and natural resources. The A6.4 activity avoids adverse direct, indirect and cumulative impacts on habitats and the biodiversity they support. Social. The SDT will require those participating in the A6.4 Mechanism to identify, evaluate, avoid, minimize and mitigate the following social safeguards associated with projects: Human rights. Project activities must be compliant with human rights obligations. Labour. The A6.4 activity supports employment creation and income generation in the pursuit of poverty reduction and inclusive economic growth, while activity participants of the A6.4 activity are to ensure safe and healthy working conditions. Health and safety. The A6.4 activity avoids adverse impacts on the health and safety of the community during its implementation, including those who, because of their circumstances, may be vulnerable. Gender equality. The A6.4 activity avoids potential gender-based risks and impacts by implementing effective measures to prevent, eliminate or mitigate such risks and impacts, thereby eliminating the possibility of reinforcing pre-existing inequalities…

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Government of Canada Commits to Purchase Carbon Dioxide Removal Services

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Anita Anand, President of the Treasury Board and Minister of Transport (the Minister), yesterday announced the federal government’s commitment to purchase carbon dioxide removal (CDR) services as part of the Greening Government Strategy (the Strategy). The Minister indicated that the federal government will purchase at least $10M in CDR services by 2030 to help reach the Strategy’s goal of net-zero emissions in government operations by 2050. The CDR services will be purchased through the Low-Carbon Fuel Procurement Program (LCFPP), an eight-year, $134.9M initiative to reduce emissions from federal air and marine operations. This investment follows the Budget 2024 decision to expand the LCFPP to include the procurement of CDR services in addition to low-carbon intensity fuels. The Minister also announced the federal government’s intention to work with public and private leaders to advance the development and responsible deployment of CDR solutions in Canada.   The Minister made the announcements at Carbon Removal Canada’s “Procuring with Purpose: Canada’s Opportunity to Shape the Carbon Removal Market” report launch event. The report seeks to recommend design elements to help maximize the positive impact of CDRs in Canada. For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@resilientllp.com.

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