Ontario announces strict new emission limits
TORONTO, March 26 - The Ontario government will impose strict
emissions limits on the electricity sector and require the Lakeview Generating
Station in Mississauga to cease burning coal, Environment Minister Elizabeth
Witmer announced today.
"The government is keeping its promise to ensure the environmental
integrity of the future electricity market in Ontario," Witmer said. "Our
review of coal-fired plants is now complete, and while this framework of
actions comes with a price, the benefits will be priceless -- cleaner air and
healthier communities across Ontario."
The proposed caps would drastically reduce current limits on six fossil-
fuel plants currently owned by Ontario Power Generation; the limits on smog-
causing nitrogen oxides would be reduced by 53 per cent, while the cap on acid
rain-causing sulphur dioxide would be cut by 25 per cent. The government also
proposed that the Lakeview Generating Station cease burning coal by April,
2005. These measures would ensure the government keeps its promise to match or
exceed the tough smog requirements of the U.S. Environmental Protection
Agency.
Following a consultation period, through the Environmental Bill of Rights
registry, the government would be in a position to lift the moratorium on the
sale of coal-fired electricity plants imposed in 2000 and begin implementation
of the air quality actions announced today.
"It's important to understand that the electricity sector is just one
piece of our overall air quality strategy," Witmer said. "With these measures
in place, the government will now take aim at other sources of air pollution,
such as further reductions from transportation and other industry sectors.
Ontario is determined to continue setting the pace as a North American leader
in air quality."
"The people of Mississauga are truly grateful that this government has
acted where previous governments dragged their feet," said Margaret Marland,
MPP for Mississauga South. "This announcement is the best news for the entire
GTA airshed and everyone who lives in Ontario."
The government also released a discussion paper on a proposed emission
reduction trading program. Once in place, this innovative system would provide
industry with incentives to reduce emissions above and beyond regulated
requirements.
Details on the proposed initiatives are available on the Environmental
Bill of Rights (EBR) registry for public consultation.
Media Backgrounder
------------------
IMPROVING ONTARIO'S AIR QUALITY
According to Ontario's Air Quality Index, the people of Ontario enjoy
"good" to "very good" air quality more than 90 per cent of the time. Air
pollution, however, continues to be a considerable challenge.
Significant air quality challenges are posed by emissions of nitrogen
oxides (NOx), sulphur dioxide (SO2), carbon dioxide (CO2) and mercury. While
causing smog, acid rain, toxic deposition and contributing to the threat of
climate change, these key pollutants also affect human health. Air pollution
affects Ontario over the short term - during air pollution episodes - and the
long term, when air pollutants fall to the ground and accumulate in our lakes,
soils, plants and wildlife.
Air quality is everybody's business, because we all create air pollution.
Fossil fuels such as oil, coal and natural gas are the very engines that drive
Ontario's economy and way of life. Ontario's transportation sector (on-road:
cars, trucks, buses; off-road: construction equipment), for example, is
responsible for approximately 60 per cent of smog-causing NOx emissions made
in Ontario.
Transboundary and Domestic Air Pollution
Ontario is part of a regional airshed that stretches from the U.S.
midwest into Quebec and the northeastern U.S. Our domestic contributions to
air pollution are far outweighed by pollutants entering the province from U.S.
sources. Prevailing wind patterns make U.S. pollution sources the largest
contributors to air pollution in Ontario. This is especially true for smog --
on average more than 50 per cent of Ontario's smog is due to pollution from
south of the border. The province's successful court interventions supporting
the U.S. Environmental Protection Agency's smog requirement will see
significant benefits for our air quality at home.
To combat air pollution, the government is employing an air quality
strategy that is integrated, comprehensive and balanced. Ontario's strategy
targets a variety of sectors simultaneously - including transportation,
industry, power and residential - while continually growing in scope to ensure
broader contributions across the province. All individuals and sectors must
continue to do their fair share toward eliminating or reducing the emissions
that lead to air pollution.
Environmental protection framework for Ontario's electricity sector
In placing a moratorium on the sale of all coal-fired electricity plants
last May, the government undertook a review to ensure effective environmental
protection measures are in place prior to the start of a competitive
electricity market. The review, now complete, yielded a proposed framework of
air quality actions that will put the government in a position to lift the
moratorium.
Tough emissions limits mean cleaner air
The government is proposing tough new emission limits (caps) on air
pollutants from the electricity sector that cause smog and acid rain. The
proposed caps would be ratcheted down over time and be expanded to cover other
major industrial emitters in the future.
- In January, 2000, the government proposed net limits for 2001 that
would cap net NOx emissions at 36 kilotonnes and net SO2 emissions at
157.5 kilotonnes.
- When the limit is fully implemented in 2007, net NOx emissions would be
capped at 18 kilotonnes and net SO2 emissions at 131 kilotonnes.
- These proposed caps would reduce current limits on Ontario Power
Generation's six coal and/or oil-fired plants as follows:
- smog-causing NOx by 53 per cent; and
- acid rain-causing SO2 by 25 per cent.
Lakeview Generating Station to cease burning coal
The high demand for electricity in the Greater Toronto Area (GTA) has
meant the Lakeview Generating Station is needed for system reliability and
"peak period" power demand. Active since 1962, Lakeview is the oldest station
in Ontario Power Generation's fossil fleet, with emissions rates for NOx, SO2,
CO2 and mercury above average for coal-fired stations in Ontario.
Located in Mississauga, on the shore of Lake Ontario, the plant's four
smokestacks make it a very visible part of the GTA western waterfront. A
comparison using recent GTA inventories for NOx and SO2 emissions indicates
that Lakeview accounts for 26 per cent of the region's SO2 emissions and 8 per
cent of NOx emissions. As well, the plant is currently the second-largest
mercury emitter in the GTA.
Because of Lakeview's age and unique location in a heavily-populated
urban area, the government is proposing the Lakeview Generating Station cease
burning coal by April 30, 2005. In the interim, the government is also
proposing a strict 3.9-kilotonne NOx cap to help protect the GTA's air
quality. This interim cap is significantly lower than the plant's NOx
emissions in 2000.
Once implemented, this proposed regulation would remove thousands of
tonnes of smog and acid-rain-causing pollutants from our air, while also
drastically reducing emissions of mercury and the greenhouse gas CO2. This
means cleaner air for everyone in Ontario.
Mandatory Monitoring and Reporting
On May 1, 2000, the government implemented a regulation requiring the
electricity sector to monitor and report on 28 criteria air pollutants. More
recently, the ministry announced a proposed expansion to the regulation
requiring other emitters in Ontario to monitor and report on an extended list
of air pollutants including the full suite of greenhouse gases.
Accurate, timely, public reporting of air emissions by all sectors will
be vital to emissions reduction trading. A discussion paper outlining proposed
rules for Ontario's emissions reduction trading program is now also available
for public comment. Once in place, this innovative system would provide
incentives to emitters to reduce their emissions, above and beyond regulated
limits.
Public Comments Welcomed
For detailed information on the proposed air quality actions, including
copies of: A Review of Coal-Fired Electricity Generation In Ontario and
Emissions Reduction Trading Systems for Ontario - A Discussion Paper, please
visit the Ministry of the Environment's website at: www.ene.gov.on.ca.
Comments are welcome via the Environmental Bill of Rights registry.
Contacts:
John Steele Barry Wilson
Communications Branch Minister's Office
(416) 314-6666 (416) 314-6739
Disponible en français
For more information visit www.ene.gov.on.ca
Media Backgrounder
------------------
EMISSIONS REDUCTION TRADING
Making Polluters Pay
As part of its comprehensive strategy to address air quality issues, the
Ontario Government is proposing to introduce emissions reduction trading, an
innovative program that makes polluters pay, while rewarding businesses that
are able to reduce their air emissions. Initially, Ontario's proposed system
of emissions reduction trading would revolve around the fossil fuel power
stations currently owned by Ontario Power Generation, but later be expanded to
include more power stations and more sectors of industry. The proposed system
would include special safeguards to verify and monitor trades in an open,
transparent market.
Emissions Reduction Trading in Ontario - Positioned For Success
Ontario has done the groundwork to make its proposed emissions reduction
trading system a success. We have participated in the Pilot Emissions
Reduction Trading (PERT) program, which has been up and running since 1996.
This pilot has demonstrated that emissions trading can be a cost-effective
approach to achieving emissions reductions, sometimes beyond regulatory
requirements. We have also evaluated the emissions reduction trading
experiences of other jurisdictions. In the U.S., emissions trading is already
a proven concept. The U.S. Environmental Protection Agency's Acid Rain sulphur
dioxide trading program has been in effect since 1995 and has stimulated early
emissions reductions that went far beyond regulatory requirements.
Officially introducing emissions reduction trading will make Ontario one
of North America's leaders in the field of market-based environmental
protection. In the years ahead, Ontario intends to share this expertise with
the world. Clean air should be everybody's business.
Stringent Caps - The Heart of Emissions Reduction Trading
How does emissions reduction trading work? The system is based on new
emissions limits (caps) which force emitters to reduce the air pollution
generated by their operations. As a safeguard, these caps would be set
progressively lower over time, leading to measurable improvements in air
quality.
To view a graph of emissions reduction trading, visit:
files.newswire.ca
Under emissions reduction trading, this ever-tightening sector cap would
be divided up among participating power plants, with each company receiving a
so-called emissions allowance either annually or for a defined period. In
order to keep emissions within their allowances, generating stations might
choose to install pollution control equipment, switch to cleaner fuels, or
improve their energy efficiency.
What would happen, however, if a factory or power plant was unable to
make do with its allowance? This is where emissions reduction trading has an
ingenious answer: These companies would have to pay other businesses for
making the emissions reductions they themselves were unable to achieve. For a
simplified look at how emissions trading would work, see the chart above.
Does this system let polluters off the hook? Not at all, because having
to pay others for emissions reductions adds to the cost of doing business and
makes polluting industries less competitive.
Does this work for the environment? Yes, because air movements spread
pollution over large areas, which makes it ineffective to focus on the
emissions produced by a single emitter. As emissions limits are progressively
strengthened, total air emissions are reduced and Ontario's air quality
improves. At the end of the day, emissions reduction trading is an effective
system of incentives geared toward achieving improvements in air quality. In
the future, the same regime could be expanded beyond electricity generation
and apply to emitters in other sectors.
Emissions Reduction Credits - Air Quality Becomes Everybody's Business
Ontario's proposed emissions reduction trading, however, ventures beyond
the simple cap-and-trade system illustrated in above chart. It would involve
emitters subject to a cap, but also be open to every industry, every business
and every institution whose emissions affect Ontario's air quality. Any such
emitter able to reduce its emissions would be allowed to sell emissions
reduction credits to capped emitters unable to meet the emissions reduction
obligations under their allowance.
In the early phases of the program, the fossil fuel power plants
currently owned by Ontario Power Generation would be the only buyers of
Emissions Reduction Credits, since they would be the only plants regulated by
an emissions cap. Everyone else, however, would be permitted to offer credits
for sale. A private-sector market for reduction credits would bring together
buyers and sellers. Over time, buying and selling emissions reduction credits
would become a natural and effective approach to pollution reduction, driven
by ever more stringent emissions caps extended to an ever-larger number of
emitters.
Under the proposed system, polluting would cost hard-earned cash, while
investing in clean air technology would carry a built-in financial reward. And
this reward would not go to waste: allowing companies to bank their Emissions
Reduction Credits or sell portions of their allowances will encourage
emissions reductions again and again, and earlier than might otherwise be
expected.
There are other unique benefits to Ontario's proposed system: Ontario
businesses would be allowed to use Emissions Reduction Credits created by U.S.
emitters whose air pollution affects Ontario's air quality. This would give
Ontario the unique opportunity to encourage emissions reductions from sources
that do not fall under provincial jurisdiction. Since more than 50 per cent of
Ontario's air pollution is blown in by prevailing wind patterns from the
United States, this feature of the proposed emissions reduction trading system
has the potential to significantly improve Ontario's air quality.
Making Sure The System Works - Special Safeguards
To ensure that the proposed system of emissions reduction trading is
successful, the Ministry of the Environment would closely monitor the actions
of all participants. The system would rest firmly on three pillars put in
place by the Ontario Government:
- Tough emissions caps, which are the environmental heart of the system;
- A system for verifying the emissions reductions of uncapped industries;
- An open and transparent marketplace for trading Emissions Reduction
Credits.
The Ontario Government would further ensure the environmental integrity
of the proposed market system by:
- Setting and continuously lowering effective emissions caps year over
year;
- Expanding caps to cover more and more of Ontario's industries;
- Ensuring that all emissions reduction credits are real, quantifiable
and verifiable. Companies that cut down on business, outsource
operations, or sell individual plants, for example, will not
be allowed to register and sell the resulting emissions reductions;
- Ensuring that only companies whose emissions reductions directly affect
Ontario's air are allowed to participate in emissions reduction
trading;
- Ensuring a transparent and accountable system by keeping close watch
over the credit market and making all transactions under the proposed
system available for public scrutiny.
Expanding Emissions Reduction Trading - Clean air is the limit
Since stringent emissions caps are the environmental heart of emissions
reduction trading, Ontario intends to expand these to other industry sectors
and reduce caps even further. Currently, Ontario's proposed emissions
reduction trading system only covers the pollutants nitrogen oxides and
sulphur dioxide. In the future, greenhouse gases like carbon dioxide could be
added to this list to help meet national and international environmental
targets.
By asserting environmental leadership and putting the foundations for a
market-based pollution reduction system in place, Ontario is preparing for the
future: In the 21st century, emissions reduction trading is expected to be a
cornerstone of environmental policy in North America and around the world.
Contacts:
John Steele Barry Wilson
Communications Branch Minister's Office
(416) 314-6666 (416) 314-6739
Disponible en français
For more information visit www.ene.gov.on.ca |
