Carbon Pricing

Written by Curtis Andre

Written by Curtis Andre

In a couple of weeks, the federal carbon pollution pricing system will apply in Ontario. We had some questions as you may have and we found some answers and solutions that we’d like to share with you.

From the Ministry of the Environment and Climate Change (excerpts):

“Protecting the environment and growing the economy go together. In 2016, the federal government worked with provinces, territories, and with input from Indigenous Peoples on Canada’s first comprehensive climate action plan, which includes a stringent, fair, and efficient price on carbon pollution.

As part of Canada’s plan, provinces and territories had the flexibility to maintain or develop a carbon pollution pricing system that works for their circumstances, provided it meets the federal standard. The Government of Canada worked with provinces and territories on this for over two years.

On July 3, 2018, the Government of Ontario ended its climate plan, including its cap-and-trade pollution pricing system. This has resulted in a projected annual increase of emissions of approximately 48 million tonnes of carbon pollution in 2030, equivalent to the emissions from about 30 coal-fired electricity units. The province has also cancelled their investments in energy efficiency and low-carbon projects that help schools, businesses, and hospitals reduce emissions and reduce costs, therefore costing Ontarians money and good jobs.”

“...under the federal Greenhouse Gas Pollution Pricing Act larger industrial facilities, an output-based pricing system for emissions-intensive trade-exposed (EITE) industries will start applying in January 2019. This will cover facilities emitting 50,000 tonnes of carbon dioxide equivalent (CO2e) per year or more, with the ability for smaller EITE facilities that emit 10,000 tonnes of CO2e per year or more to voluntarily opt-in to the system over time. A charge applied to fossil fuels, generally paid by registered distributors (fuel producers and distributors), as set out in the Greenhouse Gas Pollution Pricing Act, Part 1, will start applying in April 2019.”

“The Government of Canada has committed to return all direct proceeds collected in Ontario, under the federal carbon pollution pricing backstop system through direct payments to families and investments to reduce emissions, save money, and create jobs. In Ontario, we will return the direct proceeds as follows:

  • Climate Action Incentive payments: Under the proposed approach, most of the proceeds the federal government collects from Ontario through the fuel charge will be returned directly to Ontario’s individuals and families through Climate Action Incentive Payments.

  • Support for particularly affected sectors: The remainder of fuel charge proceeds will be used to provide support to the province’s schools, hospitals, small and medium-sized businesses, colleges and universities, municipalities, not-for-profit organizations and Indigenous communities, which will help save money and create good jobs. In Ontario, this amount is estimated at $1.45 billion over the next five fiscal years.

  • Direct proceeds from industrial facilities under the federal output-based pricing system will be directed to supporting reductions in greenhouse gas emissions in Ontario.”

From recent media:

  • Carbon pricing will make a significant contribution towards meeting Canada’s greenhouse gas reduction target. A price on carbon could cut carbon pollution across Canada by 80 to 90 million tonnes in 2022, once all provinces and territories have systems that meet the federal standard. This is equivalent to taking 23-26 million cars off the road for a yea or shutting down 20-23 coal-fired power plants for a year. Without this contribution, more costly regulatory interventions would be needed to meet our target.

  • GDP growth would remain strong with pan-Canadian carbon pricing. Applying the federal carbon pricing system to the nine provinces and territories that are not pricing carbon pollution today would not be expected to have any significant impact on national economic growth rates in the context of a more than $2 trillion economy. It is also likely to stimulate innovation, investments in clean technology and benefit long-term growth opportunities, although these benefits are not included in the modelling analysis.

  • The numbers to date agree. British Columbia saw net emissions fall by 4.7 per cent over eight years after putting in a carbon tax, and for an example outside of Canada, Sweden has seen emissions fall by 26 per cent since implementing a carbon tax in 1991 alongside an existing energy tax. By comparison, Saskatchewan — which does not have a carbon tax — saw heavy increases in greenhouse gas emissions from 1990-2015.

At Sustainable Kingston we support the transition to a low-carbon economy, and have been helping our business members cut carbon emissions and reduce environmental impacts for the last 3 years.

The transition is happening and businesses are responding; businesses who know that change means opportunity. In this case, we know that businesses who embrace the low-carbon economy, will not only gain credibility with consumers but will also see an economic advantage in the immediate term.

We know from working on the ground with businesses owners (especially SME’s) that these are busy people with often limited time and resources.  It can be tough to know where to start. But when given the opportunity to take action, many of our business members have seen amazing short and long term benefits that save money for their organization and minimize impact to our environment.

The sooner that local businesses can reduce their carbon emissions, the stronger and more competitive they will become.  We’ve seen this through our network of members at Sustainable Kingston and we welcome local business owners to contact us and let us help you make that transition. The low carbon economy is simply a better way to do business. is about connecting people who care to businesses that are making a measurable difference in sustainability. The .eco domain signifies a trusted and global branding for businesses/groups that are committed to the sustainable future of the planet. By obtaining this domain, has joined a community that is taking action and making real positive change.

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