As reported in a previous blog post, in late 2018 the Ontario government released the Environment Plan: Preserving and Protecting our Environment for Future Generations. This Plan outlined the government’s intended actions and policies for addressing many environment-related issues in Ontario, including the pollution of air, land, and water, the reduction of litter and waste, and the emission of greenhouse gases (“GHGs”). The government is moving ahead with its Plan and has posted two proposals for a 45-day comment period: (1) a proposal related to emission performance standards; and (2) a proposal to increase the renewable content of gasoline.
The government’s proposal for industrial Emission Performance Standards (EPS) indicates that this program is being developed as an alternative to the federal government’s Output-Based Pricing System (OBPS) (see our earlier blog posts for an overview of the OPBS). The EPS approach would establish industry-specific greenhouse gas emission performance standards that facilities would be required to meet. The provincial program is intended to cover the same industrial sectors as the OBPS (most industrial sectors, essentially) as well as, potentially, large institutions, greenhouse operators, and thermal energy suppliers. As under the OBPS, facilities that use fossil fuels to generate electricity, such as natural gas fired power plants, would be subject to EPS rather than to any fuel levies. The government is seeking input on its EPS proposal, including on the industrial facilities that should be covered by the program, what types of compliance options should be available to meet the EPS, and how fixed process and non-fixed process emissions should be treated. In order to avoid the implementation of the federal OBPS in Ontario, the intent is for the EPS program to come into force in the summer of 2019 and to apply as of January 1, 2019.
The government is also proposing to increase the renewable fuel content of gasoline from 10% to 15% as early as 2025. Ontario’s current regulations require an average of 5% ethanol (renewable fuel) content in gasoline. In 2020, the renewable fuel content would increase to 10% and then to 15% by 2025. The government estimates that increasing the content of renewable fuels in gasoline could result in 1.2 megatonnes of greenhouse gas emission reductions, without increasing the price of gasoline (based on current ethanol prices).
The government is accepting comments on both of these proposals for 45-days, until March 29, 2019. Interested parties, particularly in the sectors that will be impacted by the EPS program, should consider submitting comments.