The good old days are coming to an end for carbon in Ontario, and a new age of decarbonization dawns in 2017.
A provincial cap and trade system looms, and businesses are wondering what it means to them. EarthCare Sudbury held a panel to address questions and concerns in April. The main message: it’s going to impact everyone. Get ready.
“I hope some of the small businesses walk away with the knowledge that there are going to be changes in pricing coming; there is a huge movement coming down the pipes,” said Jennifer Babin-Fenske, coordinator of EarthCare.
While the proposed policy would only directly impact businesses emitting over 25,000 tonnes of greenhouse gasses (GHG) each year, it has ramifications beyond that. The costs will be passed along, and things like gas prices are anticipated to go up 4.3 cents per litre by 2017 in Ontario due to the policy.
Panelist Sean Capstick, principal at Golder Associates, explained that in a cap and trade system, there is a cap on how much GHG a company can emit, measured in “units,” and any units above that must be purchased at a premium. The cap is lowered over the years, which in theory will encourage people to reduce GHG emissions over time.
Panelist Livio Nichilo — CEO of InternatEnergy Solutions Canada — said the policy is anticipated to be more effective than a carbon tax.
“Tax doesn’t make change occur. This almost forces the change to occur,” said Nichilo.
Nichilo acknowledged that big industry will be hit hard, especially the transportation- and fuel-heavy mining industry in the North, but he said that there will be ways to mitigate some of the change.
The cap and trade system generates revenue from the sale of units. This revenue will be reinvested in initiatives that reduce the risk and impact of the policy by providing alternatives and assistance.
The cap and trade policy is also just one piece of a bigger picture.
“The cap and trade program will not operate alone to reduce GHG emissions,” Nichilo. “There are also low carbon transportation policies, renewable energy policies, energy efficiency programs, changing building standards.”
Industry makes up only 30 per cent of emissions, with people, buildings and transportation making up most of the rest. Some other policies will impact smaller businesses those other sectors more directly.
Ed Cocchiarella, principal at IDEAL EHS Systems, attended the panel to prepare himself and his clients for the change. The environment, health and safety consultant expects some of his clients are going to start looking into how to adapt their facilities to minimize the impacts of cap and trade, as well as the other policies.
“You better start to understand them to get in the game. If you don’t, the costs will get out of control,” said Cocchiarella.
