Ontario's New Energy Plan - Confronting Climate Change


Ontario’s New Energy Plan - Confronting Climate Change

By Emma Bailey


For too long, action against climate change has taken the form of vague promises and elusive legislation. However, with the recent passing of Ontario’s Climate Change Mitigation and Low Carbon Economy Act and the establishment of a broader 5-year “Climate Change Action Plan”, quantitative measures and tangible progress towards emissions reduction are now in place in the province of Ontario, Canada. With the Climate Change Action Plan (CCAP) our neighbors to the north aim to drastically reduce greenhouse gas pollution (GHG), create jobs and shift all families and businesses towards a low-carbon economy.


By the year 2050 if all goes according to the “plan”, carbon emissions in the province will be 80 percent lower than they were in 1990 – an ambitious target which will require a dramatic restructuring of all infrastructure supporting Ontario’s current society.


The Climate Change Mitigation and Low-Carbon Economy Act arrived as an outcome of the global climate agreement signed in Paris this past December. Afterwards the United States, Canada and Mexico entered into a regional partnership (“The Three Amigos”), agreeing to cut carbon emissions by creating a wider North American carbon market. Unlike prior arrangements, this agreement extends to Mexico, thereby expanding its potential impact.


By establishing a cap-and-trade carbon exchange, Ontario created a revenue-providing market aligning with the regional agreement. When industries with high-volumes of carbon emissions reach their cap, they can trade for more allowances. The collected revenue will be managed by a new Green Bank which will support programs phasing out fossil fuels among other “green” changeovers.


The Course of Action


Unlike British Columbia, Ontario aims to make a profit off of the carbon exchange using a cap-and-trade model. In British Columbia, a revenue neutral plan is put into effect. In this type of situation, the government knows how much revenue it will receive annually, in the form of taxes, from high carbon producers. Ontario legislators are aware that cap-and-trade revenue can decrease over time, which is why the CAPP pushes monetary investment up-front so that low-carbon emissions becomes a sustainable practice over time.


Implementing the full plan has been put at an estimated cost of $7 billion. The CAPP breaks up the billions by allotting $3.8 billion to subsidies for switching to geothermal energy and solar panels, while $285 million will be spent on rebates and subsidies for electric vehicles and charging stations, with other funds slotted for education and job-training in green industries and other projects.




Prior to its official release, portions of the CAPP were leaked to the media – leading to public uproar over certain sections outlining the reduction of natural gas use. Complete documentation later clarified that natural gas is still an important part of energy consumption in Ontario, but progress within the plan will mean less gas from fracking and more “renewable” natural gas biofuel drawn from sources of methane such as livestock manure, food and beverage manufacturing waste and sewage treatment plants.


Though this might sound an alarm to those who are all too aware of the carbon dioxide emissions and other eco-disasters long associated with natural gas use, “renewable” natural gas is derived from organic matter available on a renewable basis. This includes waste from harvesting or processing agricultural products, waste from food, landfill gas, sewage, and other products made from organic plant and animal matter. Additionally, renewable natural gas is interchangeable with current non-renewable sources and can be produced, cleaned and injected into the current natural gas distribution system. The CAPP plan calls for a $30 million Natural Gas Economic Development Grant to help communities make the transition from a hybrid natural gas to fully renewable natural gas resources.


Controversies and Concerns


Approximately 76 percent of Ontario households currently heat their homes using natural gas resources. Switching to geothermal and electric heating will increase residential heating costs – Ontario’s Liberal Premier Kathleen Wynne and her administration estimate the average cost of the CAPP will be $13 per person. Progressive Conservatives however claim the costs will be much higher, at $3,000 per year and could potentially cause the loss of manufacturing jobs.


What these high rates do not take into account are subsidies, rebates and a changing market. For instance:


  • Older, retrofitted homes that undergo an energy audit will improve their value upon resale.
  • Electric vehicle consumers will see subsidies ranging from $3,00 to $14,000 depending on vehicle make and model. They will avoid gasoline price increases, while lower-income individuals can charge their cars overnight at free charging stations.
  • As for the claims that manufacturing jobs will be lost, an upsurge in new, green-based occupations is evident. Ontario’s environmental and clean technology industries currently employ 65,000 people and are worth $8 billion in annual revenue.


Beyond the Environment


The process of establishing the CAPP required Ontarians from a diverse range of communities to come together and forge new paths of communication. From indigenous communities, low-income residents, high-powered energy companies and concerned businesses alike came ideas that will impact the CAPP’s implementation. Rarely are the voices of such disparate groups considered altogether when creating climate action laws. 


Internationally, the plan sets the stage for solidifying scientific developments in clean energy technology and exploring other forms of alternative, carbon-free energy (such as wave power!) with European and other international bodies. The CAPP places Ontario at the forefront of regions in North America attacking climate change head-on. But of course, new policies are only as good as their application. With the backing of cap-and-trade funding, Ontario’s climate change “action plan” may be as viable and sustainable as its proponents hope.