Ontario mulls wider voluntary participation in ETS programme

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Ontario is looking at facilitating more voluntary participation in both its cap-and-trade scheme and offsetting programme, according to an official with the Canadian province’s environment ministry.

The provincial emissions trading scheme, which launches in Jan. 2017, will regulate companies that emit at least 25,000 tonne of CO2e on a mandatory basis, and those with emissions above 10,000 tonnes on a voluntary basis.

But the government will next year begin to consider lowering the threshold for voluntary participation in the scheme post-2020, said Craig Golding, cap-and-trade manager at the Ontario Ministry of the Environment and Climate Change (MOECC).

Speaking to Carbon Pulse on Monday on the sidelines of the EUCI Canada’s Carbon Market Future conference in Toronto, Golding said this was mostly as a result of smaller emitters requesting changes that would allow them to participate.

Under current rules, emitters that fall below 10,000 tonnes for three years in a row will also be removed from the market.

Ontario is also looking at developing voluntary standards for offset projects that don’t qualify to generate compliance-grade credits, Golding said.

“The bar for compliance-grade offsets is generally high, but other projects are verifiable and robust, and to acknowledge that they exist we are developing standards for voluntary reduction instruments,” he said, adding that the work was in its early stages.

Ontario is due to link its ETS to those in Quebec and California under the WCI programme in H1-2018, and will adopt similar rules to allow its emitters to use compliance-grade offsets to cover 8% of their annual emissions.

But the government also wants to introduce a separate, branded type of made-in-Ontario credits to help its operations become carbon neutral by 2018, as well as to provide a tool to the private sector to offset its carbon footprint.

Golding said that unlike the suite of 13 compliance-level offset protocols, on which the province is working with Quebec to design, Ontario is working independently on the voluntary standards initiative.

“We’re not currently working with Quebec, but we wouldn’t preclude it,” he added.

The voluntary measures form part of proposed changes to the province’s offset rules, which are in the midst of a 45-day public consultation.

Golding added that the province will also next year kick off a study analysing the risks of carbon leakage within Ontario’s major emitting sectors.

He also reiterated that Ontario will in January announce a 60-day notice period for the province’s first allowance auction, with the date tentatively set for March.

By Mike Szabo – mike@carbon-pulse.com

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