The first year of Ontario’s carbon cap and trade program was successful, says a report from Dianne Saxe, Environmental Commissioner of Ontario, issued in late January. The cap and trade system establishes a carbon price framework and enables decreasing caps on allowable levels of carbon pollution that are expected to help achieve Ontario’s climate targets.
“A price on carbon pollution is a crucial tool we need to slow climate change,” said Commissioner Saxe.
Carbon levies raised $1.9 billion of funds in 2017 that are expected to support reductions of greenhouse gas emissions. The report, Ontario’s Climate Act: From Plan to Progress, notes that of the $1.37 billion in projects funded as of November 2017, almost all meet the requirements of the Climate Change Mitigation and Low-carbon Economy Act.
As well, Ontario’s carbon market has been linked with the carbon markets of Quebec and California, creating a combined market of 61 million people. “This should keep costs down for Ontario families, and provide more flexibility and opportunities for business,” said the Commissioner.
Given the system’s progress, there is still room to improve, the report says. It notes that the government needs a better plan for spending cap and trade funds and a number of proposed policies may not lower emissions. Some government ministries will need to take climate change more seriously by considering it in their decision making, spending and regulations.
Saxe is also concerned about the government’s long-term plans for reducing emissions. While Ontario’s emissions are at their lowest levels since 1990, when reporting began, there will be challenges in meeting future targets. Much of the past improvement relates to the phase-out of coal fired power generation in the province. “There are no more silver bullets,” said Saxe.
Transportation represents a third of Ontario emissions. Specifically, greenhouse gas emissions from freight transport have more than doubled since 1990. Without urgent action, fossil fuel emissions from trucking alone will make it impossible to meet the province’s climate targets.
“Reducing greenhouse gas emissions and putting a price on carbon pollution are a good start,” said Saxe. “But this is a complicated process; there is a lot more to do.”