Without a fully-costed platform or any real discernible plan in place, Doug Ford and the Ontario Progressive Conservatives have won leadership of the most populous province in Canada.
The June 7 election drew out 58.4 per cent of eligible voters. Some 40.5 per cent of those voted for the Progressive Conservatives, while another 33.6 per cent opted for the NDP. The Liberal Party — which had majority ruled the province for 15 years — plummeted at the voting booths, earning just shy of 20 per cent of the vote. Meanwhile, the Green Party drew 4.6 per cent, resulting in the election of the party’s first MPP in Ontario’s history.
As the dust settles, many are now left to wonder what the fewer than one-quarter of eligible voters just signed the province up for. Climate and environment policies are no exception.
“The only thing we really know about a Conservative Ford government is that they’ll be largely unpredictable,” said Sarah Petrevan, senior policy advisor at Clean Energy Canada, in an interview with The Narwhal.
Here’s a look at what we do know about what’s to come.
Cost of ditching cap-and-trade may total billions of dollars, result in lawsuits
A central part of Ford’s campaign was pledging to repeal the province’s cap-and-trade system, which only came into effect at the start of 2017.
Cap-and-trade is a policy alternative to the conventional carbon tax. Rather than the taxing approach, which applies a set price for every tonne of greenhouse gas emitted, the cap-and-trade model establishes a provincial threshold of carbon pollution which decreases every year.
Large emitters are awarded a certain amount of “free” credits, after which they have to buy more for the right to pollute. Conversely, companies that emit below their allowance can sell their credits. Ontario’s cap-and-trade market is linked with Quebec and California. In February, almost half of billion dollars of allowances were auctioned off by the province.
Tim Gray, executive director of Environmental Defence, said in an interview with The Narwhal that it’s unclear how quickly the new provincial government will actually be able to dismantle the framework if it chooses to go ahead with it.
“We’re in a compliance period that goes until 2020 and the costs of getting out of it in terms of returning permits is in the billions, nevermind potential lawsuits from Quebec and California,” he said.
“And it’s legislated, so they at least have to go to the House and get a new law because you can’t redirect any of the money or deal with any of it until the legislative basis of it is changed.”
Over one-third of cleantech companies based in Ontario
So what might actually happen if the government is successful in its pledge?
Most immediately, it could put a sizable dent in Ontario’s clean technology sector, as carbon pricing provided an additional financial incentive to invest.
According to the province’s 2016 climate change strategy, a full 36 per cent of the country’s cleantech companies are based in Ontario. Cleantech includes everything from solar power modules, to energy storage, to using algae to turn carbon dioxide into biofuel. In total, the sector employs 65,000 people in Ontario alone.
Petrevan of Clean Energy Canada said that a vast majority of such companies are export focused, meaning the loss of cap-and-trade may not wreck their business model. After all, if companies are selling their designs to China or Norway, the decision by Ontario to backpedal on climate policy won’t impact them.
That’s compared to companies that are attempting to sell domestically, within Ontario. In that case, a failure to price carbon would result in diminished financial incentive.
But Petrevan said that everything is still very much up in the air at the moment.
“Cleantech is ultimately a business,” she said. “Business is going to go where they can make money. If they can’t make money in Ontario, they’re all going to pack up and move to where they can make money. If we’re not creating the capital and the market opportunity for them here, it opens them up to leaving the jurisdiction and leaving Canada or to getting bought out by larger companies south of the border or internationally.”
Huge political cost to federal carbon price in Ontario: political scientist
The pull-out could also have catastrophic consequences for the future of carbon pricing in the rest of Canada.
To be sure, Ontario won’t be the first province to have a government which fiercely opposes the concept. Saskatchewan and Manitoba have both threatened to sue the federal government over the imposition of a carbon price. Other provinces, like Newfoundland and Labrador, have simply failed to make a move on the policy.
But Russell Williams, associate professor and department head of political science at Memorial University of Newfoundland, told The Narwhal that the jury is still out on whether the federal government will actually step in to mandate a carbon price — which would have to be even higher than the benchmark as Ford also wants to roll back the province’s gas tax.
“That’s a different magnitude of political capital and cost to the federal government than imposing a system on Saskatchewan or one or two other recalcitrant jurisdictions,” he said.
“Ontario is a big province, and it’s a pretty explicit political choice to elect a government that rejects carbon pricing and cuts gas taxes and then have the federal government step in and say ‘we’re going to do it anyway.’ I don’t see a path in the future where that’s going to be an easy decision to make.”
The federal government still hasn’t introduced the legislative backstop to actually enforce carbon pricing in non-compliant provinces and territories. Gray of Environmental Defence said that it’s still in the design phase, with implementation by the start of 2019.
But Williams said he fears that it might almost be too late to matter, especially if Alberta’s United Conservative Party — which has promised to abolish the carbon tax — wins in the upcoming provincial election.
“It leaves me wondering what the national climate change Pan-Canadian Framework will be in the end,” Williams said. “It’s starting to look like it will be B.C.’s carbon tax, Quebec’s cap-and-trade system and some new pipelines. Which is a very strange response to climate change.”
Cutting gas tax would result in loss of $1.2 billion in revenue
But Ontario’s cap-and-trade system isn’t the only thing in Ford’s targets that relate to climate and environmental issues.
As mentioned, Ford has pledged to cut the price of gasoline by a total of 10 cents per litre: some 4.3 cents from eliminating the carbon price, and another 5.7 cents from cutting the existing provincial gas tax. That would result in an annual loss of $1.2 billion to the provincial coffers. Between 2004 and 2017, over $3.7 billion collected via the gas tax was directed to local public transit investments.
The PCs also promised to scrap the Green Energy Act — the controversial legislation introduced in 2009 that established feed-in tariffs for renewable energy generation — and cancel energy contracts that are still in their early stage. With a similar level of ambiguity, the party said it will “develop our natural resources,” “improve enforcement” and “clean up our communities.”
In total, the party pledged $500 million over the course of four years for unspecified environmental projects.
“It’s so vague, it’s really tough for me to say what it reads,” Petrevan said. “They referred to picking up garbage in parks.”
Most of GreenPAC endorsed candidates won in election
Thankfully, there are a few potential positive takeaways.
Gray of Environmental Defence said that Ford’s reversal on the opening up of the Greenbelt to development showed that a combination of public opinion and facts can convince the soon-to-be premier to change course.
There’s also a strong case for positivity being made by GreenPAC, an environmental organization that selected candidates from every party to endorse due to their political sympathies to environmental causes. For this election, GreenPAC backed eight candidates: four Liberal, two NDP, one Green and one PC.
Five of the eight ended up winning.
Sabrina Bowman, executive director of GreenPAC, said her group is extremely pleased as it “guarantees in every party there’s going to be a champion for the environment going forward into Queen’s Park.”
“It’s important to look for opportunities and strange bedfellows to work together,” Bowman told The Narwhal. “And it’s important to not give up hope.”
“I think oftentimes if we can keep an open mind about people who don’t always think exactly like us, we can often be very surprised and delighted by how much they’re willing to push on our issues and find our commonality.”