The Liberal government’s cap-and-trade bill has been set free from a Tory filibuster and given a new, NDP-inspired focus on how the carbon-pricing system may affect “low-income” families.

Environment and Climate Change Minister Glen Murray said the new “lens” will require the government to consider households of more modest means in its greenhouse gas emissions reduction efforts. That now also involves channelling some of the nearly $2 billion in revenue expected to be raised by the cap-and-trade system towards programs that support lower-income families affected by the fight against climate change.

“Are we getting enough money to people who are living in supportive housing? Are we helping them reduce their costs and their emissions, and what’s the implication for them?” Murray said to QP Briefing Monday. “But you also need investments in public transit. So you see the kinds of things like electrification of public transit for people who can’t afford to own a car. Are there resources going into those fields?”

Bill 172, the government’s greenhouse gas legislation, had been mired in a Progressive Conservative-led filibuster until April 21, when the Liberals time-allocated debate on the act (the Tories accused the government of being the source of delay, citing the Liberals' own amendments to the bill). The motion required the legislation to be reported to the House by Monday for third reading. It will be debated this week.

But, during the committee work on the bill, the Liberal government made numerous tweaks — and even accepted a few suggestions from the New Democrats.

Murray said he has been speaking with NDP environment and energy critic Peter Tabuns for a long time about how to tackle the problem of lower-income families facing the added costs of cap-and-trade. As one possible solution, Murray brought up the fact that California earmarks a quarter of its cap-and-trade revenues to GHG-reducing projects in low-income neighbourhoods. Tabuns told QP Briefing that size of allotment makes sense for Ontario as well.

Bill 172 contains the framework for the cap-and-trade program that is slated to start next year. The system will require large emitters to purchase nearly $2 billion in emission allowances annually, while the government reduces the number and increases the price of those carbon credits as time goes on (the "cap" in cap-and-trade will start at 142 megatonnes of GHGs the first year, and fall to 125 megatonnes annually by 2020). The businesses buying those allowances would pass the cost on to their customers, with the expectation that it would nudge Ontarians towards, for example, buying an electric car or furnace.

One addition to Bill 172 that was inspired by the NDP was that the government’s yet-to-be released climate change action plan “must consider the impact of the regulatory scheme on low-income households and must include actions to assist those households with Ontario’s transition to a low-carbon economy.”

Another amendment concerned the Greenhouse Gas Reduction Account — which records the money raised from selling credits to emitters and can have GHG-reducing programs charged to it. Bill 172 requires any initiative funded this way to be reviewed by the environment minister, and for that evaluation to be handed over to the Treasury Board.

A new section to the bill requires that any initiative being funded must be judged to see if it will “assist low-income households and vulnerable communities with their transition to a low-carbon economy.”

The “vulnerable communities” could refer to northern parts of the province, where a colder climate forces homes to burn more natural gas for warmth. With no transition period for fossil fuels under Ontario’s cap-and-trade system, those northern households are likely facing heftier heating bills. Tabuns has pushed for measures such as accelerated home energy retrofits for those areas.

The Liberal government has said it will keep northern and rural Ontario in mind when it unveils its climate change action plan. Murray is expecting the plan to be rolled out in a few weeks, hopefully before the legislature rises for the summer.

Murray also said these sorts of low-income-aimed programs would involve retrofitting homes to cut their heating costs and fossil fuel use, by assisting them in buying better insulation and reducing their reliance on natural gas. Many lower-income people, Murray said, also live in public housing, and their needs must be addressed.

“So a lot of these programs have to go in there in a way that we’re putting in enough money in that people’s rents don’t go up,” he explained. “As a matter of fact, if we do this properly, we think heating and cooling costs can come down in apartments.”

While he praised the NDP for their helpfulness, Murray blasted the Tories for their “absolute stonewalling” the bill’s progress.

To contact the reporter on this story:
gzochodne@qpbriefing.com
416-212-5913
Twitter: @geoffzochodne

Cap-and-trade bill now includes ‘low-income’ lens for carbon-pricing cash

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