Want to keep up with climate news, law, and policy? Sign up for the Green Economy Law Monthly Newsletter here.

Last month, Ontario’s Ministry of the Environment, Conservation and Parks proposed amendments to the Emissions Performance Standards (EPS) program that regulates industrial greenhouse gas (GHG) emissions in the province. The program generally applies to industrial facilities polluting over 50,000 tonnes of GHG per year.

The program functions by allowing covered facilities to emit a capped annual amount. Above-the-cap emissions must be set off by the purchase of (a) performance units garnered by other covered parties who have kept their emissions below their applicable cap; or (b) excess emissions units (EEUs) purchased from the government.

The proposed program amendments aim to ensure it remains in compliance with the federal government’s carbon pricing benchmark standards for 2023-2030. Substantial program changes include the following:

• Carbon Price: Ontario will raise the price of EEUs from $65 per tonne of carbon for the 2023 period, to $170 per tonne for the 2030 period, in line with the federal government’s planned carbon rate hike.  

• Program Scope: Ontario proposes adding several new economic sectors to the list of industrial activities covered by the EPS, including:

  • Converted paper product manufacturing;

  • Plastic product manufacturing;

  • Rubber product manufacturing; 

  • Forging and stamping;

  • Spring and wire product manufacturing;

  • Office furniture (including fixtures) manufacturing;

  • Machine shops, turned product, and screw, nut, and bolt manufacturing;

  • Engine, turbine and power transmission equipment manufacturing, motor vehicle parts manufacturing, aerospace product and parts manufacturing, and other general-purpose machinery manufacturing;

  • Fruit and vegetable preserving, dairy product manufacturing, meat product manufacturing, beverage manufacturing, and specialty food manufacturing; and

  • Other miscellaneous manufacturing.

• Compliance: In cases where a new site is added to an already-covered facility, the new site may be exempted from EPS requirements for three (3) years. This is in line with the program’s general three (3) year exemption for new facilities.

• Captured CO2: Ontario proposes recognizing CO2 captured at a covered facility and stored permanently in a storage project as GHG emissions reductions at the facility.

Among other proposes changes, Ontario will seek to publish more regular and transparent information on the key features, outcomes, and impacts of the EPS program.

Ontario’s Ministry of the Environment, Conservation and Parks is accepting public comments on the proposed changes until October 10th, 2022.

Looking for help understanding how proposed regulatory amendments to the EPS program might affect your business, or other legal assistance with carbon pricing matters? Contact us at 647-724-4308 or info@greeneconomylaw.com.