Ontario makes headway in cap-and-trade system

Thursday, September 24, 2015

As the Ontario Ministry of Environment and Climate Change (MOECC) moves forward with its commitment to a cap-and-trade system to reduce greenhouse gas emissions (GHG) across the province, it has released potential changes expected to help ease the Western Climate Initiative (WCI), which will sync Ontario with the systems currently executed in Quebec and California.

Such changes will be evident in the Greenhouse Gas Emissions Reporting Regulation (Ontario Reg. 452/09, GHG Reporting Regulation), along with a Draft Proposed Guideline for Greenhouse Gas Emissions Reporting (Draft Proposed Guideline).

According to law firm Bordner Ladner and Gervais, particular emissions sources will require third party verification while others will not be subject to the requirement. Meanwhile, as of 2016, petroleum product suppliers and natural gas distributors will be subject to the reporting regulation.

Other potential sources of emissions will be added to the reporting regulation: equipment used for natural gas transmission, distribution and storage; electricity imports; electricity transmission; and distribution; magnesium production, and mobile equipment at facilities.

Currently, the GHG Reporting Regulation requires facilities operating in Ontario with annual emissions equal to or greater than 25,000 tonnes of carbon dioxide equivalent (CO2e) to record, verify and report their GHG data. The proposed changes would lower the reporting threshold to 10,000 tonnes CO2e per year.

Other technical amendments will inform the discussion about system design. MOECC’s draft regulatory proposal should be released before the end of 2015.

Links to the proposed GHG Reporting Regulation and Draft Proposed Guideline can be found here.

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