Following closely on the heels of Québec's recent proposal for a provincial greenhouse gas ("GHG") cap-and-trade system, the Ontario government introduced enabling legislation on May 28, 2009 to allow for the implementation of a GHG cap-and-trade system in Ontario by 2012. The details of Ontario's cap-and-trade system will be set out in regulations and Ontario is currently consulting stakeholders regarding issues such as cap setting and allocation, a 25,000 tonne emission threshold for regulated sectors, offset creation in the agriculture, forestry and waste management sectors, early action incentives and measures to address carbon leakage. Comments on Ontario's cap-and-trade discussion paper are due by July 26, 2009.
To maximize trading opportunities and to avoid duplicate federal and provincial regulation, Ontario will aim to harmonize its cap-and-trade system with the Canadian federal and U.S. carbon regimes. The Canadian federal government announced this week that its GHG cap-and-trade system will not take effect by 2010 as had been planned. The federal government stated that it will need to ensure that the application dates for Canada's carbon regime are harmonized with the U.S. carbon regime (which could establish a national program in the U.S. as early as 2012). However, given recent threats in the U.S. to impose 'border carbon adjustments' on imports from countries without commensurate carbon regimes, there is a growing consensus among Canadian business leaders on the urgent need for a clear and cohesive national carbon policy in Canada that would be compatible with the proposed U.S. carbon regime.
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Davies Ward Phillips & Vineberg LLP, with over 250 lawyers, practises nationally and internationally from offices in Toronto, Montréal, New York and an affiliate in Paris and is consistently at the heart of the largest and most complex commercial and financial matters on behalf of its North American and overseas clients.
The information and comments herein are for the general information of the reader and are not intended as advice or opinions to be relied upon in relation to any particular circumstance. For particular applications of the law to specific situations, the reader should seek professional advice.
