What are Ontario’s trends on reducing greenhouse gas emissions?

Last week the ECO released Feeling the Heat: 2015 Annual Greenhouse Gas Progress Report. Find out what Acting Commissioner Ellen Schwartzel had to say about it …

Connecting the dots on climate data in Ontario

Ontario’s communities are built based on historic weather patterns. Homes are built in areas that are believed to be safe from flooding and other natural hazards. Roads are built to withstand typical seasonal weather. Farmers plant and harvest crops based on usual growing seasons.

But past assumptions about the weather no longer hold up.

We now live in a changing climate. Climate change doesn’t just mean that temperatures are rising; it also means more unpredictable and extreme weather.

Countless business, personal and government decisions rely on assumptions about what the future climate will be. Many of these decisions are long-term; the roads, buildings, transit, sewers and power grids being built today are meant to last. But now “1-in-100 year” storms, which are often the threshold for resilient design, are happening more frequently than in the past. If major decisions aren’t based on revised climate assumptions, communities will face significant costs in the future. Many communities are already coping with costs of unprecedented storm damage.

Decisions that reflect the past climate are no longer good enough.

Where can decision makers find credible projections of the future climate?  And what are the emerging climate data needs of Ontario decision makers? A Roundtable hosted by the Environmental Commissioner of Ontario in early 2015, focused on these and related questions. Expert presentations and animated discussions among climate data producers, intermediaries and end users illuminated the many facets of this rapidly developing field.

Our Climate Data Roundtable Report summarizes the presentations and discussions from the event, and explores some recommendations that the ECO suggests for moving forward on this issue in Ontario.  We encourage you to download, use and share the video and infographics from the report to help your networks better understand why access to good climate data matters.

Feeling the Heat: 2015 Greenhouse Gas Progress Report

Feeling the Heat: Greenhouse Gas Progress Report 2015

This report was submitted to the Legislative Assembly by Ellen Schwartzel, Acting Environmental Commissioner of Ontario on July 7, 2015.
2015GHG-cover-thumb

 

 

 

July 7th, 2015 – Today we released our 2015 Greenhouse Gas Progress Report.

It looks like Ontario is finally “feeling the heat” on climate change policy. Until recently, the government’s decision to close its coal-fired power plants was Ontario’s main contribution to reducing greenhouse gas (GHG) emissions. Encouragingly, though, the Ontario government is now preparing to take the first of many necessary steps towards meeting its 2050 GHG reduction target (80% below 1990 emissions levels).

As we do every year, our 2015 report reviews the government’s progress throughout the previous year in reducing GHG emissions across its major economic sectors. We use the government’s own GHG reduction targets as a benchmark to track the province’s progress.

The Ontario government appears to have met its 2014 GHG reduction target (6% below 1990 levels) ‒ in large part due to the closure of its coal-fired power plants. However, no other significant GHG reduction policies have since been implemented. The policies in place so far will not reduce emissions enough to ensure Ontario achieves its 2020 GHG reduction target of 15% below 1990 levels.2015GHG Figure 1 GHG emission trends and targets

To make real progress towards the province’s 2020 and 2050 targets, and the government’s recently announced interim 2030 target (37% below 1990 levels), Ontario needs to implement a suite of actions across its economy.

Ontario's greenhouse gas emissions in Ontario by sector

Ontario’s greenhouse gas emissions by sector (click to enlarge)

Ontario continues to struggle to make much progress on reducing emissions from the province’s top three emitting sectors: transportation, buildings and industry (see left). The transportation sector is the largest challenge of the three. There are many potential tools available to reduce emissions in this sector, for example: incentives for lower emissions vehicles (see p.21 of our report); alternative fuels; getting people out of cars altogether and onto bikes and transit; creating a low-carbon fuel standard (p.22); and transit-friendly land use planning (p.20). There is both scope and a need for greater action on each of these measures.

Figure 4 GDP and GHG Emissions

Figure 4 – Ontario’s GDP and GHG emissions (click to enlarge)

There is good news. We now know that it is possible for our economy to grow while emissions shrink, as shown in Figure 4 of Ontario’s Climate Change Update 2014. What’s more, we know the costs of not reducing our GHG emissions are significant and growing.

There are some encouraging signs of a renewed provincial commitment to climate change action; Ontario’s recently renamed Ministry of the Environment and Climate Change (emphasis added) just announced that it plans to introduce a cap-and-trade system and release a new climate change strategy later this year. As well, in the coming days, leaders from across the continent will be meeting in Toronto for the Climate Summit of the Americas. This Summit will focus on the potential for major continent-wide climate change action at the sub-national level, including state, provincial and municipal governments. The heat is on for each jurisdiction to deliver on their GHG reduction commitments.  Ontario has set itself strong targets. Now comes the hard part: delivering the results.

A Big Win for the Environmental Bill of Rights

In early April 2015, a cement manufacturing facility north of Picton pled guilty to four charges relating to excessive discharges of dust, particulates and noise. As a result, the company was fined $350,000, plus a victim surcharge of $87,500.  For neighbours of the facility, this marks an important victory in their efforts to see this company held to account for the pollution that has plagued the community for more than a decade.

Since 2003, neighbours of the facility have complained to the Ministry of the Environment and Climate Change about adverse effects related to dust emissions and, more recently, noise. In 2011, some community members decided they had had enough and filed an application for investigation under the Environmental Bill of Rights, 1993 asking the ministry to investigate whether these emissions violated the Environmental Protection Act. Although the Ministry of the Environment and Climate Change undertook an investigation and confirmed that dust emissions from the facility were causing problems, it didn’t lay any charges at that time. The applicants continued to pursue the issue and, almost a full decade after complaints began, the company was charged in 2012.

In a recent news story about this company’s guilty plea and fine, one of the applicants credits the Environmental Commissioner of Ontario (ECO) with helping ensure the ministry finally took their complaints seriously. The story states that it was only after the ECO reported on the issue to the Ontario legislature that the local community saw a real effort by the government to address their complaints; shortly thereafter, a new ministry officer was assigned to the file and charges were ultimately laid. This is a great example of the power of the Environmental Bill of Rights and the importance of the ECO’s public reporting function to ensure accountability in government decision-making, including when enforcing environmental laws.

 

Do you think that someone is breaking an environmental law in your community? Click here to learn more about applications for investigation.

 

Celebrating Soil in 2015

Soil helps to supply our food, clothing, clean water, biodiversity, and it even moderates our climate. We walk on it, dig in it, build on it, and clean it off our clothes.  Mostly, however, we just take it for granted. The United Nations’ Food and Agriculture Organization (FAO) is an advocate for the many benefits that healthy soils provide and it has declared 2015 to be the International Year of Soils.

And today marks the beginning of Compost Week! Every year we gather on the small patch of soil beside our downtown office to add organic matter and new grass seed. We hope this will rehabilitate the soil after years of wear and tear. Stay tuned for updates on that project!

“The multiple roles of soils often go unnoticed. Soils don’t have a voice, and few people speak out for them,” says the FAO. I could not agree more. Over the past few years, I’ve also been calling for more attention to soil, particularly with respect to soil health and to the  potential for mitigating climate change.  My reports have covered topics such as soil erosion, soil carbon and the value of composting in maintaining healthy soils.  I have also blogged frequently on soil issues, particularly on the nature and importance of healthy soils.

In 2012, I hosted a soil-carbon roundtable, where experts and stakeholders discussed soil’s significant potential for sequestering carbon, and how this great opportunity for advancing climate-change mitigation and adaptation could be promoted in Ontario. Regrettably, almost three years later, little has been done in this regard.

Like Dr. Seuss’ Lorax, who spoke for the trees, we need people who will speak for the soil. Over the course of 2015, I intend to support the International Year of Soils by posting a series of blogs, covering topics such as:

  • Healthy soils and agriculture;
  • The role of soils in water management;
  • The living nature of soils and what this means for how we treat them;
  • How soils support and protect the natural environment and biodiversity;
  • Soils and climate.

I will also share useful sources of information on soil, such as the ones below. I hope you will join me in learning more about the importance of soil and in helping to make 2015 the year that soil truly finds its voice in Ontario.

 

Consciously Uncoupling: A Short-Term Solution to a Long-Term Problem

Electricity consumers who save energy should be rewarded with lower utility bills. But collectively we still need to pay enough to maintain our electricity infrastructure to ensure that the power is there when we need it. Ontario, like many other jurisdictions, has seen flat or falling electricity demand in recent years due to conservation, increased customer self-generation, industrial restructuring, and other factors. The problem faced by utilities is that declining electricity sales reduce their revenues that pay for needed infrastructure.

When I released my latest Annual Energy Conservation Progress Report in January, as the province’s environmental watchdog, I warned that I would be watching for signs that the government’s “Conservation First” vision was being realized in Ontario. Taking a look at one of the first major policy decisions to emerge in 2015 – distribution revenue decoupling – I am not so sure we’re living up to the Conservation First promise.

The Ontario Energy Board (OEB) has spent a long time studying how best to “decouple” utility distribution revenues from the amount of electricity sold in Ontario. To address the revenue problem faced by utilities, in April, the Board announced changes to the way residential electricity consumers will pay for the delivery of power to our homes.

what are distribution charges

Beginning in 2016, delivery costs will be recouped through a fixed monthly charge to consumers. The fixed charge will replace the current two-part delivery charge that is part-fixed and part-variable (tied to how much electricity you consume). At first glance, the approach seems attractive; utilities will not collect any net new revenue under the fixed approach. And according to the Board’s analysis, just over half of residential electricity bills will remain unchanged, or will see an increase or decrease of less than $5 per month. But those on either end of the electricity consumption spectrum will see a difference; in short, if you use a lot of electricity, your bill will come down, and if you use less than the average, your bill will go up.

As the Board notes, fixed pricing does have some advantages. In the short-term, a fully fixed charge is probably a more accurate way to recover current operating costs from customers. It will also continue to protect utility revenues and remove any disincentive for utilities to promote conservation to their customers.  What concerns me is the long-term implication of a fixed charge because it means distribution charges will no longer be tied to the amount of electricity we consume. This is despite good evidence that over the long-term higher electricity consumption will lead to more infrastructure being built and thus higher distribution costs. A better option, one of three fixed charge designs that the Board considered and rejected, would be a fixed monthly charge based on a customer’s consumption during peak hours.  Such a “demand charge” recognizes that the distribution system is sized to meet peak demand and discourages consumption during peak periods to avoid the need to build additional distribution infrastructure over the long term.

Why this isn’t Conservation First

A study prepared for the Board found that distribution system peak demand was the most significant predictor of long-term distribution system costs and there is a direct relationship between the two. I have argued for years that price signals should be used to help us avoid these future costs. Yet in its decision the Board implies that conservation cannot impact long-term distribution system costs. Such a position has implications beyond pricing and is inconsistent with “Conservation First” policy.

The new 100 per cent fixed charge also reduces the portion of the residential electricity bill that can be influenced through conservation. How does this impact our incentive to conserve? As a simple example, consider purchasing a new energy-efficient fridge that saves 500 kilowatt-hours of electricity a year. Under the current rules, you would save about $60 each year in lower electricity bills.[i] Under the new rules, a Toronto Hydro customer would see their savings drop to about $52 per year (the impact will vary by utility), or about $100 less over the 12-year life of the average fridge. Not a huge disincentive – but not nothing either.

Unfortunately, the Board’s choice of fixed distribution charge neglects to consider customer electricity consumption (especially peak demand) and will impose the greatest negative impact on residential customers who consume the least electricity. The policy will also weaken the ability of consumers to manage their bills through conservation and lacks long-term vision to mitigate future system costs related to growing peak demand.

Postscript – Reset of Time-of-Use rates

As I was about to post this blog, the OEB announced a second policy change linked to “Conservation First” principles. In late April, the Board set new time-of-use (TOU) prices that take effect May 1st. These rates affect the electricity charge on your bill and are reviewed every six months.  I have long argued that the Board needs to increase the differential between on-peak and off-peak electricity prices to reduce peak demand and lessen the need for new infrastructure over the long term.

The Board slightly increased this difference; the spread between the two was widened from a ratio of 1.8:1 to 2:1.  Hardly jaw dropping, and unfortunately continues to raise the off-peak price contrary to what I have previously advocated, but at least moving in the right direction compared to the past several years when the Board has narrowed the differential. Since the OEB has forfeited conservation savings derived from the delivery charge, it needs to double down on conservation obtained through the electricity charge.

As the year progresses, I will continue to keep a watchful eye on whether Ontario is truly favouring conservation as its first choice.

[i] calculations based on average 9 c/kWh RPP supply cost, 1.5 c/kWh distribution (Toronto Hydro), 1.4 c/kWh transmission

Environmental Rights – In Your Hands

Looking back at my time as Commissioner – 15 years! – a very strong theme has been the passionate engagement of so many Ontarians in environmental protection. The Environmental Bill of Rights (EBR) has had many success stories over the years, and some of the best have involved pro-active nudges by the public to strengthen law or policy.  The public has delivered these nudges thanks to the EBR’s applications process.

The fall of Hamilton's SWARU Incinerator

The fall of Hamilton’s SWARU Incinerator

As my term as Environmental Commissioner winds down, let me express my warm personal thanks to everyone who has ever submitted an application using the EBR; there are well over 1,500 of you.  Whether you applied the EBR many years ago to help shut down a polluting garbage incinerator in Hamilton, or whether you recommended just last year that Toronto should get a sewage bypass alert program – or indeed whether you drafted any of the hundreds of other thoughtful submissions on so many topics that have passed through my office, you can be proud of being part of the larger EBR success story.  Your example shows that democracy is not a spectator sport.

And for those of you who have long grumbled into your beer about environmental concerns – I may have grumbled with you! – but have held back from submitting an EBR application, allow me to offer some parting advice.  Applications are:

easy to write.  The application forms are on our website.  You should make the clearest argument you can, but you don’t need to be a lawyer or hire a lawyer. You should provide the best evidence you have, but you don’t need to submit lab test data. We offer a guidebook to walk you through the steps of completing an EBR application.

open to anyone.  People from all walks of life have submitted EBR applications, ranging from rural property owners, university students and retirees to First Nations groups, municipal councillors, environmental groups and even Members of Provincial Parliament.  Two people need to sign. As long as you are both residents of Ontario, you can submit an EBR application.  It’s that simple.

confidential. If you submit an EBR application, your name or other personal information will not be disclosed by either the ministries or by our office.  Of course, you are free to go public if you like.

a way to draw attention to your issue.  Many people have made their EBR application the subject of a news release, or have featured their submission on their website as a way of shedding light on the topic. For example, the Canadian Environmental Law Association has taken this approach.

The ECO’s website can help you get started, and explain your other rights under the EBR.  For groups of about 30 or more, you could also request a speaker from my office to give an overview talk about your toolkit of rights under the EBR.  Contact commissioner@eco.on.ca. We will try to accommodate you.

The Environmental Bill of Rights offers Ontarians a potent set of tools, but they depend on you to be used.  Best of luck!

Ontario finally moves on carbon pricing

The long wait is over; today Ontario finally announced that it will implement a carbon price (a cap-and-trade system), and I am very pleased with this development.

Ontario first joined the Western Climate Initiative in 2008 and a team of dedicated staff has been contemplating a cap-and-trade system ever since. The MOE (as the MOECC was then known) posted a carbon pricing discussion paper to the Environmental Registry in January 2009 (Environmental Registry # 010-5484) and a second follow-up proposal in May 2009 (Environmental Registry # 010-6740), but a final decision was never posted by the ministry.

Due to the ECO’s role in reporting on the province’s progress in reducing its greenhouse gas (GHG) emissions (see my annual GHG progress reports), the ECO has accumulated years of commentary on the subject of carbon pricing. Here’s a brief history of our efforts and suggestions.

The ECO’s 2010 GHG progress report explained that the ECO “supports government efforts to put a price on carbon emissions, but remains agnostic” on the mechanism. The 2010 report provides an overview of both pricing instruments (carbon tax or cap-and-trade) from the standpoints of: 1) emissions reduction certainty and price certainty; 2) administrative oversight; 3) transparency; and 4) implications for the transition to a low-carbon economy. The 2010 report also outlines the Western Climate Initiative and B.C.’s experience with a carbon tax. The report concluded by recommending one important condition for whichever carbon pricing policy instrument that Ontario chooses: that it be based on a full public review to compare emissions trading and a carbon tax in terms of their efficacy in providing a transparent price signal to the economy.

The following year, my 2011 GHG Progress report urged the provincial government to stop delaying and implement a carbon pricing mechanism sooner rather than later. This report also addressed two important concerns that had been raised about any potential carbon pricing mechanism: carbon leakage and so-called “trade-exposed industries.” Subsequently, I blogged about why a carbon price is actually good for Ontario industry.

More recently, in November of last year, I wrote a blog making a case for the potential of a carbon tax to effectively reduce GHG emissions in Ontario.

Although carbon pricing has been a slow train coming, based on the government’s renewed commitment to climate change (see The Road to Paris is paved with subnational intentions), I’m optimistic that Ontarians will finally see this policy implemented.

The road to Paris is paved with subnational intentions

Yesterday Monday was an important milestone on the road to the next United Nations (UN) climate change conference in Paris this December ‒ March 31st was the deadline for countries to submit their “intended nationally determined contributions” (INDC) for this next round of UN negotiations. The INDC is each country’s updated greenhouse gas (GHG) reduction target, which is meant to build on countries’ previously established targets. Many believe a binding international climate change agreement may finally be reached in Paris.1 In the Canadian context, it appears subnational governments are playing an important role in making this happen.

Canada’s GHG reduction target remained the same as it was in 2009 (17% below 2005 levels by 2020);2 a target which Canada will not be able to meet, according to Environment Canada’s 2014 Emissions Trends report. However, some provinces, such as Ontario, have not only stepped up to achieve emission reductions for Canada, but are beginning to play a larger role internationally, which I wrote about after attending the last UN conference in Lima in December 2014.

The province’s most recent report on its progress on reducing its GHG emissions shows that Ontario is set to meet its 2014 target (6% below 1990 levels). The Ontario government has recently demonstrated a renewed commitment to meet its targets for 2020 and beyond (15% below 1990 levels by 2020, and 80% below 1990 levels by 2050). For example, the province recently released a Climate Change Discussion Paper, which establishes its commitment to produce a new climate change strategy later this year that will include, among other measures, a carbon pricing mechanism.

I remain hopeful for the possibility of a binding international agreement in Paris, because, as the IPCC reported, to avert the risks associated with major climate change, mitigation actions will need to be taken at all levels of government. I am also increasingly optimistic about the potential for collaboration among subnational governments to make significant progress as well. With this in mind, I eagerly anticipate the meeting of Canadian Premiers in Quebec City on April 14 to discuss a national energy and climate strategy, and the Climate Summit of the Americas on July 7-9 in Toronto, where the Ontario government aims to develop and deliver a common statement on commitments by subnational governments to reduce GHG emissions.
It appears that the road to Paris may just be paved with subnational intentions.

1. See for example: Neil Bathiya, U.S. News & World Report, “This Time Is Different, Why optimism about a 2015 climate change agreement is growing” Feb.18, 2015. http://www.usnews.com/opinion/economic-intelligence/2015/02/18/paris-2015-climate-change-agreement-optimism-is-growing.

2. Compare against EU’s target of 40% below 1990 levels by 2030, Switzerland’s target of 50% below 1990 level by 2030, or the US target to cut emissions by 26-28% from 2005 levels by 2025.