Ontario enters cap-and-trade era with first auction raising $471-million
The Ontario government declared its first foray into international carbon markets to be a success on Wednesday after an auction of allowances raised $471-million that will be funnelled into programs aimed at reducing greenhouse gas emissions in the province.
Ontario's inaugural joint auction of greenhouse gas allowances with Quebec and California took place on Feb. 21 as part of the province's cap-and-trade programs. The auction comes just months before a provincial election, with the Progressive Conservative Party vowing to kill the Liberal's carbon-pricing plan.
Under that plan, major industrial emitters, gasoline markets and distributors of natural gas face a limit on the amount of carbon dioxide they or their products can emit, but companies having trouble meeting the cap can buy allowances while those who can reduce emissions below their regulatory obligations can sell.
In the auction from governments, more than 98 million current-vintage allowances were sold at a price of $18.44 a tonne, while 8.6 million allowances with a 2021 date were sold at $18.34. Ontario accounted for roughly a quarter of the allowances sold, while Quebec sold a total of 11 million allowances.
The two provinces opted for the cap-and-trade plan rather than the straight carbon tax that B.C. and Alberta have adopted. Cap-and-trade sends money out of the province but lowers the cost of compliance because emitters in those provinces can purchase allowances from other companies – including those in California – who can reduce their emissions more cheaply.
"That's good news for businesses and consumers," Ontario Environment Minister Chris Ballard said in a release. "In a linked market, companies have more choice and lower cost options for reducing their greenhouse gas pollution, and that means lower costs for consumers."
https://www.theglobeandmail.com/rep...-auction-raising-471-million/article38159162/
The Ontario government declared its first foray into international carbon markets to be a success on Wednesday after an auction of allowances raised $471-million that will be funnelled into programs aimed at reducing greenhouse gas emissions in the province.
Ontario's inaugural joint auction of greenhouse gas allowances with Quebec and California took place on Feb. 21 as part of the province's cap-and-trade programs. The auction comes just months before a provincial election, with the Progressive Conservative Party vowing to kill the Liberal's carbon-pricing plan.
Under that plan, major industrial emitters, gasoline markets and distributors of natural gas face a limit on the amount of carbon dioxide they or their products can emit, but companies having trouble meeting the cap can buy allowances while those who can reduce emissions below their regulatory obligations can sell.
In the auction from governments, more than 98 million current-vintage allowances were sold at a price of $18.44 a tonne, while 8.6 million allowances with a 2021 date were sold at $18.34. Ontario accounted for roughly a quarter of the allowances sold, while Quebec sold a total of 11 million allowances.
The two provinces opted for the cap-and-trade plan rather than the straight carbon tax that B.C. and Alberta have adopted. Cap-and-trade sends money out of the province but lowers the cost of compliance because emitters in those provinces can purchase allowances from other companies – including those in California – who can reduce their emissions more cheaply.
"That's good news for businesses and consumers," Ontario Environment Minister Chris Ballard said in a release. "In a linked market, companies have more choice and lower cost options for reducing their greenhouse gas pollution, and that means lower costs for consumers."
https://www.theglobeandmail.com/rep...-auction-raising-471-million/article38159162/