Contact: Katie Sullivan, email@example.com
IETA comment on Ontario’s cap-and-trade regulatory proposal
TORONTO, 25 February – Ontario’s government today released its much anticipated regulatory proposal for a cap-and-trade system, expected to launch in January 2017. This comes a day after the Liberal government introduced Bill 172, the Climate Change Mitigation and Low-Carbon Economy Act (2016). This proposed law includes Ontario’s reduction targets, provisions for creating the province’s five-year climate action plan, and details around the management of “regulatory proceeds” from Ontario’s future allowance auctions and the creation of a new Greenhouse Gas Reduction Account.
Commenting on the draft rules, IETA President and CEO Dirk Forrister says:
“The release of detailed design for Ontario’s cap-and-trade program is a significant step forward for North America’s next carbon market. In fact, it is the first major market development since the Paris Agreement was completed in December. It gives Ontario’s businesses the first insights into how this market may take shape. We look forward to continuing our engagement with Ontario officials as they move to finalize the regulation.”
Once in place, Ontario’s program is expected to eventually link to North America’s largest carbon market, comprised of California and Québec’s systems, which recently held their sixth joint allowance auction. In December 2015, the province of Manitoba also announced its intention to move forward with cap and trade, with the intention of linking to this broader regional market.
“The growing provincial leadership is impressive, and the momentum on carbon pricing across Canada is undeniable,” says Katie Sullivan, IETA’s Director of North America. “Linking these markets brings increased flexibility for business so that high environmental achievements are possible while keeping costs in check.”
She adds: “By using cap and trade, governments can also be sure that the environmental goal – emissions reductions – will be met efficiently and at a low cost. This tool allows Canada to remain competitive in a world where many others, from US states to Europe, China and Korea, are controlling greenhouse gases with similar market-based strategies.”