October 11, 2018 Dear…

October 11, 2018

Dear Minister Phillips,

The Council of Tay Valley Township, in eastern Ontario, passed the following resolution on October 9, 2018:

“THAT, staff be directed to proceed with a submission to the Environmental Bill of Rights registry regarding:

• the costs to the Province of breaking the cap and trade contracts that were expected to generate $3 Billion in revenue and reduce Greenhouse Gases;
• concern that the Province does not have a proposal to replace the Cap and Trade program; and
• that the Province be encouraged to increase the capacity of the grid in Tay Valley Township to accept more solar generated energy from residents to provide monetary compensation to those residents.”

The Council of Tay Valley Township has strong concerns about the proposed Bill 4 Cap and Trade Cancellation Act, 2018, which, if passed, would repeal the Climate Change Mitigation and Low-carbon Economy Act, 2016 (CCMLEA) and set out the legal framework for the wind-down of the greenhouse gas cap and trade program.

The latest report by the UN Intergovernmental Panel on Climate Change (IPCC) says that urgent and unprecedented changes are needed to achieve the 1.5C target to reduce climate change impacts. Leading climate scientists in fact warned there is only a dozen years for global warming to be reined in, beyond which even half a degree rise will significantly worsen the risks of drought, floods, extreme heat, forest fires, crop failure, and disease.

The Council of Tay Valley Township is concerned with the implications of climate change on its residents. Tay Valley Township, like all municipalities in Ontario, has a responsibility not only to its local residents, but also to contribute its proportional share of climate change actions with respect to Canada’s commitments under the UN Paris Agreement.

Financially, the Township has experienced increases in infrastructure costs due to the need for culvert replacement as a result of increased runoff. It has also experienced increased costs related to winter road maintenance as a result of increased freeze and thaw and ice events. The Township has experienced an increase in tornado warnings and residents witnessed the devastation of the recent tornado in Ottawa.

The Township is also concerned with the implications of climate change impacts on local farmers with the disruption of growing conditions associated with climate change. In addition, the Township is worried about the implications for residents’ food security from fluctuations in supply.

Locations in Tay Valley Township have been identified by the Lanark Leeds Grenville Health Unit as Lyme disease hotspots. The Council is concerned that deer ticks and other disease bearing insects will increasingly affect the health of residents if climate change is not addressed urgently.

Tay Valley residents and Council are disappointed that the support for energy conservation renovations and retro-fits that was funded by the Cap and Trade funds was discontinued.

The Township also urges the Ministry to work with Ontario Hydro to upgrade the capacity of the system to accept energy generated from renewable sources. Many people in Tay Valley have sold their solar energy to the province but many were prevented from doing so because there was not sufficient capacity in the system. This same capacity restriction prevents the municipality and many of its residents from installing a net metering system.

Given the urgency of the need to address climate change, Tay Valley Township Council is extremely concerned that the province intends to cancel the Cap and Trade program without an equivalent or more effective plan to reduce Greenhouse Gas emissions. It is irresponsible for the Province of Ontario to close the existing program without an appropriate replacement.

The IPPC scientists and many Canadian conservative thinkers (including Mark Cameron former policy director in Stephen Harper’s PMO; the Bank of Canada; Alberta’s oil industry, Shell Canada, Canadian Natural Resources, Canadian Association of Petroleum Producers) say that achieving Greenhouse Gas reductions is achievable and financially effective.

Doing nothing has a cost. Timothy Lane, the Deputy Governor of the Bank of Canada stated in 2017 that “while the economic costs of climate change are uncertain they are likely to be significant. In Canada alone, it has been estimated that, in the absence of action to address global warming, we would face annual costs of between $21 billion and $43 billion by the 2050s.”

He went on to state that “In economic terms, climate change is a negative externality. Any individual or company that engages in activities that generate Greenhouse Gases imposes a cost on everyone else by contributing to climate change. Establishing a price for carbon emissions forces polluters to bear those wider societal costs—thus internalizing the externality.

Based on this logic, setting the right price for carbon is at the core of Canada’s strategy to tackle climate change. In a market economy, prices are the mechanism through which decisions of individuals and companies are coordinated. Using that mechanism to address carbon emissions aligns environmentally sustainable goals with the self-interests of individuals and companies. I’ve made the case that carbon pricing is a powerful tool for meeting climate change targets. So is green finance, which facilitates private-sector financial flows into environmentally sustainable investments. Green finance works hand-in-hand with carbon pricing. With the right pricing on carbon, more green investments become profitable.”

Tay Valley Township Council believes in the principle of polluter pay. Tay Valley Township Council would also like to see the dollars captured through polluter pays be used to promote the green economy and be returned to our residents directly. The recent study co-authored by Mark Cameron (former policy director for Prime Minister Stephen Harper) suggests that if Justin Trudeau follows through on his plan to return revenues from a carbon tax to households in the form of carbon dividends, then most people would get more money from the federal government than they would pay out in carbon tax. “To take the case of Ontario: in 2020 an average household would get $517 back but would only pay about $300 in carbon pricing, so they have about $200 more per year.” Mark Cameron has also stated, “I think that the message to Conservatives is charging a straight carbon tax and then refunding the money to citizens, whether it's through direct rebates or through tax cuts, is a smart conservative policy.”

The alternative to carbon pricing is regulation. Mark Cameron stated, “The government could bring in industrial regulation saying that, companies aren't allowed to emit more than a certain amount, putting a cap on the oil sands and things like this, saying people have to drive certain kinds of cars. But regulatory changes like that almost always cost more than using a pricing system.”

In conclusion, the Council of Tay Valley Township urges the Minister to propose an equivalent or more effective plan to significantly reduce Greenhouse Gases before it ends the existing cap and trade program. The issue of climate change and its impacts on Tay Valley residents is of great concern to Council. Tay Valley residents want to contribute to supplying renewable energy to the energy grid, participate in virtual net metering and net metering in a distributed system, and reduce greenhouse gas emissions so their children and grandchildren will have a habitable community in Tay Valley. The predictions are dire but there are economic solutions that will work. The Climate Action in Ontario: What’s Next report provides a number of suggestions in Chapter 3 written by the ECO. Please do not hesitate to contact me for further information on proposals developed by the experts on the Township’s Green Energy and Climate Change Working Group.

The Council requests information about the Ministry’s timeline for developing a comprehensive Greenhouse Gas reduction plan. The Council would also like information on when it can expect the capacity bottleneck to be resolved.

Sincerely,

Keith Kerr
Reeve