|
Sweeping climate change plan from Ontario Goal to cut GHG emissions 15% from 1990 levels by 2020, 80% by 2050; electricity, geothermal, to replace natural gas for heating GARY PARK For Petroleum News
Energy, auto and airline industries are stunned by the Ontario government’s plan to slash greenhouse gas emissions at a cost of C$7 billion by 2021.
With 13.8 million residents, Ontario accounts for more than one-third of Canada’s population, meaning that whatever reforms it implements will have a sweeping impact on those sectors and their ability to meet the targets.
A confidential blueprint, obtained by the Globe and Mail prior to a scheduled release in June, includes an exhaustive list that Premier Kathleen Wynne said will put her province on “the cusp of a once-in-a-lifetime transformation ... of how we look at our planet and the impact we have on it. It will forever change how we live, work, play and move.”
Goal is 15% cut If Ontario goes ahead with the full strategy, aimed cutting greenhouse gas emissions to 15 percent below 1990 levels by 2020, 37 percent by 2030 and 80 percent by 2050 - it will also deliver a body blow to fossil-fuel industries.
Among the objectives is a phase out of natural gas - once touted as the cleanest energy source - for heating by requiring all new homes to be heated with electricity or geothermal power by 2030 and all buildings by 2050, while setting a target for 12 percent of all new vehicle sales, or about 86,000 vehicles, to be electric by 2025.
More than half of the C$7 billion involves grants, rebates and other subsidies to retrofit new buildings.
The largest emissions cuts are projected to achieve the following annual reductions: 3 million metric tons for buildings disconnected from natural gas; 2.5 million metric tons for making industry more energy efficient; 2 million metric tons for a low-carbon fuel standard; 1 million metric tons for a renewable energy content in natural gas; and 400,000 metric tons for switching trucks and buses to LNG and electricity.
Currently natural gas provides 76 percent of the heating source for all of Ontario.
But experts note that an earlier version of the new action plan camouflaged its costs in electricity surcharges which were expected to see Ontarians pay an extra C$170 billion between 2006 and 2032. They are still trying to calculate the hidden costs of the latest initiative.
Reports of sharp disagreement Although there have been reports of sharp disagreement within the Ontario cabinet over the proposals, Energy Minister Bob Chiarelli said the “debate” within government has ended with “100 percent consensus” on the strategy.
John Yakabuski, energy spokesman for the opposition Progressive Conservative Party, said there is “no possible way you can embark on this plan to basically eliminate all fossil fuel heating” in a province that already has the highest electricity prices in North America.
Andrea Stass, a spokeswoman for Union Gas, one of Ontario’s largest utility companies, said the plan is “prescriptive ... it removes the choice of consumers to be able to determine which heat source they are going to use.”
Malini Giridhar, vice president of business development at pipeline and utility company Enbridge, said the goal of electrifying building heat would “require a lot of generation, transmission and distribution just to handle what natural gas provides very affordably today.”
Vehicle objectives called impossible Automotive industry executives and analysts issued a flat warning that meeting electric vehicle objectives would be impossible.
One analyst, Dennis DesRosiers, said proposed electric vehicle incentives, including C$14,000 in rebates per vehicle, while eliminating the provincial sales tax on vehicle sales, would not solve the greatest challenge facing electric vehicles.
He said they are unable to travel far enough on a single charge to out-distance vehicles using fossil fuels.
The Canadian airline industry has already started raising objections to the Alberta government’s decision to adopt a carbon tax of C$30 per metric ton, arguing that will only add to a growing burden of fees and taxes paid by air carriers and passengers.
Marc-Andre O’Rourke, executive director of the National Airlines Council of Canada, said the patchwork of carbon tax schemes that vary from province to province is not the most effective way to tackle climate change and greenhouse gas reductions.
He said Canada already has one of the highest rates of third-party taxes and fees at a time when airlines are operating on razor-thin profit margins.
Gregg Saretsky, chief executive officer of WestJet, Canada’s second largest airline, warned that if other provinces follow Alberta’s new carbon tax the cost for passengers would be “potentially big.”
| 