A hard copy submission was…

A hard copy submission was also made on March 10, 2017 directed to the attention of Rebecca Tan.

March 12, 2017

Rebecca Tan
Policy Advisor
Ministry of the Environment and Climate Change
Climate Change and Environmental Policy Division
Air Policy Instruments and Programs Design Branch
77 Wellesley Street West
Floor 10
Toronto, ON
M7A 2T5

RE: EBR Registry number 012-7923 – Discussion Paper: Developing a Modern Renewable Fuel Standard For Gasoline in Ontario

Dear Ms. Tan;

On behalf of P38 Inc., I wish to submit this letter and the attached comments in response to the EBR posting 012-7923: Developing a Modern Renewable Fuel Standard For Gasoline in Ontario.

P38 Inc. was created in 2008 by several leaders of the Canadian propane industry. It is led by EDPRO of London, Ontario and Budget Propane of Valleyfield, Quebec representing 300 employees in Ontario and 120 employees in Québec.

Access to clean, reliable, and affordable energy is critical to the success and sustainability of Ontario’s economy. While a Renewable Fuel Standard (RFS) may achieve the goal of reducing GHG emissions from gasoline by 5% by 2020, other measures in the transportation sector will be required to achieve the provincial greenhouse gas emissions target by 2020. Low carbon fuels such as propane and natural gas are mentioned in the CCAP, however no specific initiatives in this area have been developed nor announced to date.

With abundant domestic supply and infrastructure that has already been established, low carbon fuels such as propane can assist in our transition to a lighter-carbon economy and should therefore have a stronger consideration in the near-term.

As technologies evolve, the relative advantages between various energy sources will change. Guided by astute government policies, the market will naturally evolve to achieve the outcomes delineated and shaped by government policy.

The comments that have been included with this submission suggest how propane, as a low carbon fleet transportation fuel, can assist the Ontario Government in achieving its CCAP goals in a cost-effective, timely, and responsible manner. Propane as a transitional strategy in the transportation sector will allow time for newer, even lower carbon technologies to become practical and implementable on a larger scale.

Sincerely,

Andy Bite

EBR Registry number 012-7923 – Discussion Paper: Developing a Modern Renewable Fuel Standard For Gasoline in Ontario

General Comments:

Access to clean, reliable, and affordable energy is critical to the success of Ontario’s economy as it relates not only to the transportation of the public, but also to the transportation of our goods and services. Ontario’s Climate Change Action Plan (CCAP) sets an aggressive goal of reducing greenhouse gas emissions from gasoline by 5% by 2020 with the development of a modern Renewable Fuel Standard (RFS). The CCAP also sets out specific commitments to meet Ontario’s target of 15% overall greenhouse gas emissions target by 2020.

While a RFS may achieve the goal of reducing GHG emissions from gasoline by 5% by 2020, other measures in the transportation sector will be required to achieve the greenhouse gas emissions target by 2020. While low carbon fuels such as propane and natural gas are mentioned in the CCAP, no specific initiatives in this area have been developed nor announced to date. Passenger vehicle GHG’s have increased a limited amount since 1990, however freight GHG’s have increased substantially since 1990. While electric vehicles are increasingly available to the passenger vehicle segment, it will be a number of years until electric or other zero-emission vehicles are commercially available to the fleet sector. Propane vehicles are readily available in the light- and medium-duty fleet and school bus segment. A number of professional fleets such as UPS and Canpar have adopted propane engine technology in substantial numbers within their own fleet. Natural gas vehicles (both LNG and CNG) are also commercially available and viable now particularly in the heavy-duty Class 7 and 8 segments. Both fuels can reduce GHG emissions by 20 to 25 percent and contribute considerably to the reduction of other harmful emissions, such as particulates. Both fuels offer operational and maintenance savings to the fleet operator once the capital cost of the engine or engine conversion has been recovered.

P38 Inc. suggests the following actions related to the development of Ontario’s RFS:

• As is the case in other jurisdictions, make the Renewable Fuel Standard (RFS) a Low Carbon Fuel Standard (LCFS) and include propane, renewable propane, DME, and natural gas as low carbon fuels • In order to achieve a reduction of 5% GHG emissions from gasoline, Ontario will need to expand the scope to include the use of low carbon fuels such as propane, particularly in the fleet sector • Propane vehicles in the fleet sector would displace gasoline and diesel vehicles thereby reducing GHG emissions; this displacement should be recognized as a GHG abatement

• Fleet operators need to be encouraged to switch fuels and government support in the form of incentives, rebates, tax concessions, and other methods are necessary; similar to the electric vehicle incentive programs for consumers

• Regulatory barriers that impede the development of low carbon fuels need to be removed • Baseline data and modelling is required in order to establish sound policy

Response to Key Design Questions:

1. Targets and blending requirements:

a. Ontario has existing content requirements for ethanol in gasoline. What minimum level of ethanol blending and GHG performance would help support the objectives of the RFS?

i. When setting the minimum level of ethanol blending in gasoline for Ontario the program should take into account the source of the ethanol, its GHG emission lifecycle profile, and the correspondence availability and accessibility in Ontario. Also the compatibility of the blend to the vehicle engine technology must be considered. Consumers and fleet operators are keeping vehicles longer (typical vehicle lifecycle of 10 to 15 years) with the problem being that engine technologies in these older vehicles are not compatible with higher ethanol blends.

b. Given Ontario’s GHG reduction targets for 2030 and 2050, what factors should be considered in setting RFS targets?

i. When setting the targets for 2030 and 2050, significant modelling will be required to determine potential GHG lifecycle emissions reductions and vehicle technology assumptions will have to be made that include consumption, fuel compatibility, and impact of autonomous technology. In addition considerations for such issue as fugitive emissions needs to be considered in lifecycle modeling.

2. Flexibility Mechanisms:

a. Should activities to lower the carbon intensity of other conventional transportation fuels be eligible for compliance purposes?

i. Yes, as well as activities associated with the use of low carbon fuels and not just blended gasoline or diesel.

b. Should investments in low-carbon transportation projects also be eligible for compliance purposes? If yes, what type of projects?

i. Yes, low-carbon transportation projects that reduce GHG emissions on a lifecycle basis should be eligible and encouraged for compliance purposes. For instance, London Police have converted all of their patrol cars to propane resulting in between 20 to 25% GHG reductions from gasoline.

3. Assessing lifecycle emissions

a. Should an RFS consider impacts from indirect land-use changes (ILUC), even though science in this area continues to evolve? If so, how?

i. As the science in this area evolves and the land use changes become quantifiable the impacts should be considered in setting policy as it relates to biofuels and other renewal sources. The unintended consequences will become apparent in time and the models will need to be revised to account for these effects.

4. Transparency:

a. What measures can be taken to increase transparency and support business decision making under an RFS (e.g. an information registry, bulletins, guidance material)?

i. While measures such as an information registry, bulletins, and guidance materials would be helpful, other measures such as the development of an annual report to track the performance of various initiatives under the Climate Change Action Plan would measure the effectiveness of the various policies and programs. For instance the Green Commercial Vehicle Program has been in place for close to ten years and anecdotal evidence suggests that there has been minimal engagement by fleets which would suggest that the program and its implementation require changes to increase its effectiveness.

5. Others:

a. What other considerations should be included in the discussion?

i. Revise the Renewable Fuel Standard (RFS) to a Low Carbon Fuel Standard (LCFS) to encourage the use of low carbon fuels including propane and natural gas. While the RFS reduces passenger vehicle GHG’s, specific programs targeted at reducing fleet GHG’s should be implemented. Have programs in place that recognize propane and natural gas substitution in fleets as GHG abatement to meet the Climate Change Action Plan targets in the short term.

ii. Level the playing field – Ontario should not pick a particular fuel source as a winner, rather establish a regulatory framework to encourage the transportation sector to reduce its carbon footprint while at the same time ensuring that it can preserve the goal of supporting our economy.

[Original Comment ID: 208687]