This consultation was open from:
July 9, 2024
to August 23, 2024
Decision summary
A decision has been made to proceed with the design of a legislative framework for commercial-scale geologic carbon storage in Ontario that would enable the development of technology-ready commercial-scale projects and the continued testing and demonstration of newer carbon storage technologies.
Decision details
The decision to move forward with the design of a legislative framework for commercial-scale geologic carbon storage in Ontario is intended to support emissions management, the production of low-carbon hydrogen, the transition to a low-carbon economy, preserve high-value jobs, attract investment, encourage innovation, and help Ontario businesses take advantage of federal incentives for carbon storage.
Carbon storage is new to Ontario and developing a comprehensive framework to regulate this activity would help ensure that it is done responsibly, with measures in place to safeguard people and the environment. Establishing a clear legislative and regulatory framework for this activity will be key to realizing the potential benefits and managing the potential risks associated with geologic carbon storage, including minimizing the potential for leaks to the surface or drinking water sources, induced seismicity, or interactions with other resource activities.
Ontario has been taking a measured and phased approach to enabling and regulating geologic carbon storage in Ontario.
In the first phase of Ontario’s Roadmap for enabling geologic carbon storage, and following consultation on a discussion paper posted in January 2022, changes were proposed through Bill 46, the Less Red Tape, Stronger Ontario Act, 2023 to remove a prohibition on carbon storage from the Oil, Gas and Salt Resources Act. These changes received Royal Assent on March 22, 2023.
In the second phase, the government made further amendments to the Oil, Gas and Salt Resources Act to provide for ‘special projects’ to test, assess, pilot, or demonstrate new technologies, methods, or activities such as, but not limited to, carbon storage, and to enhance public safety. These changes received Royal Assent on June 8, 2023.
From September to October 2023, the ministry consulted on implementing a regulation to allow proponents to seek approval for special projects, including carbon storage. This regulation took effect on January 1, 2024.
In phase three, the government consulted on the development of a proposed framework for full-scale commercial carbon storage. The feedback obtained in response to this consultation, as well as lessons learned from reviewing Canadian and international jurisdictions with frameworks already in place, will be used to help to inform the design of the ministry’s proposed approach to regulating commercial-scale carbon storage in Ontario.
Ontario’s commercial-scale framework would focus on the regulation of carbon storage within underground geological formations. Carbon storage or sequestration activities that do not involve the use of wells to inject carbon dioxide into geological formations would not be subject to the new framework.
Effects of consultation
Effects of consultation
Comments were received from Indigenous communities, industry, agricultural associations, municipalities, non-government organizations, subject matter experts, farmers and other members of the public.
In consideration of feedback received, the ministry has decided to proceed with the development of a framework for commercial-scale geologic carbon storage, beginning with the development of new legislation, the Geologic Carbon Storage Act, that, if approved, would be followed by supporting regulations before the legislation could be brought into force. The proposed framework would establish a clear approach for providing access to underground storage space, establish a permitting scheme for authorizing research, evaluation, and storage activities, and enable the safe and responsible management of carbon storage activities and sites throughout the project lifecycle and over the long term.
For additional information on the proposed Geologic Carbon Storage Act, please refer to the related notice Enabling the Development of Commercial-Scale Geologic Carbon Storage in Ontario: The Geologic Carbon Storage Act (link provided in Related ERO Notices below).
All comments received were reviewed and considered in the ministry’s decision to proceed with the design of a legislative framework. A summary of the feedback provided is outlined below.
What we heard:
Feedback from commentors on the discussion paper for regulating commercial-scale geologic carbon storage in Ontario was generally mixed. Industry stakeholders were broadly supportive of enabling geologic carbon storage through the design of a regulatory framework as it would provide a potential tool for decarbonization, and lead to other economic benefits for Ontario. Some commentors expressed that more detailed information about the risks and impacts to the environment and public safety associated with geologic carbon storage was necessary to more fully understand and comment on the implications of the discussion paper and framework in development. Other comments related to broader provincial strategies related to carbon capture, transportation, and utilization, which were determined to be out-of-scope for this posting.
Scope of the framework
There was general agreement from industry representatives that initially focusing on enabling commercial-scale projects within saline aquifers and depleted oil and gas reservoirs in southwestern Ontario would meet industry needs. However, not all industry respondents agreed with this form of limitation. In addition, many industry representatives opposed the idea of limiting carbon storage activities to depths of 800 meters or greater and felt that storage activities should be permitted at any depths where a proponent is able to demonstrate that it could be done in a safe and responsible manner.
Rights to pore space
Most industry representatives support the vesting of pore space in the Crown on the basis that it would affirm pore space as a public good and provide industry with the certainty they require to make investments in commercial-scale operations.
Other commentors generally oppose Ontario vesting pore space under private land in the Crown on the basis that it would be a removal of existing landowner rights and could negatively impact the rights and interests of Indigenous communities. However, some commentors noted that landowner control of pore space has led to legal disputes and challenges in other jurisdictions where this approach has been adopted.
Use of Crown land
There was general agreement from industry submissions that a competitive process is appropriate for allocating storage space on Crown land, as it would help to optimize a limited resource, and facilitate evaluation of project applications in a transparent and systematic manner. Some commentors proposed that owners of existing subsurface rights for petroleum and natural gas development, where they overlap with potential geologic carbon storage areas on Crown land, should be given priority in a competitive process to reduce risk associated with migration of injected CO2 into leased reserves.
Engagement and potential impacts
Many commentors submitted that more context and supporting information regarding the impacts of carbon dioxide storage facilities is required, including a description of risks associated with induced seismicity and improperly decommissioned wells within a project area.
Indigenous communities are seeking meaningful engagement and consultation throughout the development of the framework and individual projects. Concerns were raised about the adequacy of consultation processes generally. For individual projects potentially impacting Indigenous communities, one community expressed that detailed information should be provided for all aspects of the project including project plans, risk assessments, monitoring plans, and closure plans, and that information provided to communities should be easy to understand and that proponents should provide adequate time and capacity funding for review. One commentor suggested that guidance material be developed for engagement with Indigenous communities with rights and interests that correspond with potential geologic storage areas in southwestern Ontario.
Landowners and the agricultural community generally agreed that the framework must establish clear requirements with respect to how impacts to agricultural productivity, soil, and water quality would be assessed and mitigated and that assessments should be supported by additional information about the benefits, risks, and safety of geologic carbon storage.
One commentor highlighted the importance of engagement and risk mitigation with nuclear power plant operators if a geologic carbon storage project is proposed in the vicinity of nuclear power generation activities.
Authorizations, operational controls, and framework delivery
Overall, commentors outlined that operational controls must be sufficient to address risks to the environment, drinking water and public safety. Commentors supported the design of rigorous operational controls for all stages of project implementation, including the adoption of industry standards (e.g., Canadian Standards Association Z741 Geological storage of carbon dioxide). A staged approach to authorizations is generally supported by industry provided the stages are clearly articulated. Commentors also submitted that the process to obtain required permits should not be seen as piecemeal and uncoordinated to ensure that local stakeholders have a good understanding of the permits being applied for and the proposed project scale.
Industry submissions generally recognized that a role may exist for third parties in certain aspects of framework delivery, in appropriate circumstances and with conditions, including adequate oversight and authority over third parties. One commentor expressed opposition to any elements of the framework being delivered by a third party, as the risks associated with geologic carbon storage could outlast a third-party organization.
It was also submitted that, whether administered by a third party or by the province, there should be appropriate resources and capacity (in number of staff, their technical knowledge, and practical experience) in place for implementation.
Financial assurance and long-term liability
Commentors agreed that proponents must carry financial assurance for liabilities associated with the operation of their projects, as well as costs for decommissioning and remediation to prevent sites from becoming orphaned.
Overall, commentors agreed that the timeframes associated with long-term carbon storage and the ongoing monitoring and maintenance of storage sites may outlast any individual proponent, and the province is likely the only entity that could reasonably take on the long-term monitoring and stewardship responsibilities for geologic carbon storage projects. Commentors were supportive of preventing this long-term liability from becoming a burden to taxpayers and landowners.
Supporting materials
View materials in person
Some supporting materials may not be available online. If this is the case, you can request to view the materials in person.
Get in touch with the office listed below to find out if materials are available.
300 Water Street
Peterborough,
ON
K9J 8M5
Canada
Connect with us
Contact
Public Input Coordinator
300 Water Street
Peterborough,
ON
K9J 8M5
Canada
Original proposal
Proposal details
Capturing carbon dioxide (“CO2” or “carbon”) and permanently storing it in deep geological formations could provide industries in Ontario with a critical tool for managing their emissions and contributing to the achievement of Ontario’s emissions reduction targets. Geologic carbon storage (further referred to as carbon storage) involves injecting captured CO2 into deep geological formations for permanent storage.
Ontario is taking a measured and phased approach to enabling and regulating geologic carbon storage in Ontario.
In the first phase of Ontario’s Roadmap for enabling geologic carbon storage, and following consultation on a discussion paper posted in January 2022, changes were proposed through Bill 46, Less Red Tape, Stronger Ontario Act, 2023 to remove a prohibition on certain carbon storage activities from the Oil, Gas and Salt Resources Act. These changes received Royal Assent (approval) on March 22, 2023.
In the second phase, further amendments were made to the Oil, Gas and Salt Resources Act to enable ‘special projects’ to test, assess, pilot or demonstrate new technologies, methods or activities such as carbon storage and to enhance public safety. These changes received Royal Assent (approval) on June 8, 2023.
From September to October 2023, we consulted on implementing a regulation to allow proponents to seek approval for special projects, including carbon storage. Ontario Regulation 425/23 – Special Projects made under the Oil, Gas and Salt Resources Act took effect on January 1, 2024. While the framework for special projects applies equally to both public (Crown) and private lands, further legislative changes would be required before public land could be used for carbon storage projects.
In Phase 3, we are now working on the development of a proposed framework for full-scale commercial carbon storage projects.
Development of commercial-scale carbon storage projects in Ontario could help:
- Support emissions reduction and the production of low-carbon hydrogen.
- Support the transition to a low-carbon economy.
- Preserve high-value jobs, attract investment, and encourage innovation.
- Ontario businesses take advantage of federal incentives for carbon storage.
Different jurisdictions have taken different approaches in developing regulatory frameworks for commercial-scale carbon storage projects. Some jurisdictions, like Alberta and British Columbia incorporated requirements governing carbon storage activities into existing legislative frameworks. The province of Manitoba has recently introduced a new stand-alone bill that if proclaimed into force, would govern the storage of carbon dioxide in geological formations in that province. Regardless of the approach taken in Ontario, the development of a commercial-scale framework would most likely require amendments to number of existing statutes and regulations and the development of broad regulation-making authority sufficient to allow the province to add to and refine Ontario’s framework in the future.
We are seeking feedback on the design of a commercial-scale regulatory framework in Ontario. The discussion paper outlines various elements commonly addressed in the regulatory frameworks for carbon storage in other jurisdictions that we are considering in the design of Ontario’s proposed framework. At the end of the discussion paper, we have also included questions seeking feedback on how these components could be incorporated into the design of a commercial-scale carbon storage framework in Ontario.
Regulatory impact analysis
The environmental, social and economic consequences of this proposal are expected to be neutral to positive.
Carbon storage is new to Ontario and developing a comprehensive framework to regulate this activity would help ensure that it is done responsibly, with measures in place to safeguard people and the environment. Establishing a clear legislative and regulatory framework for these projects would be key to managing the risks associated with geologic carbon storage, including minimizing the potential for leaks to the surface or drinking water sources, induced seismicity (seismic events from human activity), or interactions with other resource activities.
The development of commercial-scale carbon storage projects in Ontario has the potential to preserve or create job opportunities, particularly in the construction, operation, and maintenance of facilities and related infrastructure.
If approved, proponents seeking approval to develop commercial-scale carbon storage activities would be required to provide financial assurance and pay fees and other charges established to cover costs associated with the framework’s delivery such as annual fees and fees for applications. Where projects would be using public land/resources in connection with carbon storage projects, they could also be subject to charges such as lease and/or rental payments. The framework could seek to adopt industry standards to eliminate redundant reporting requirements and facilitate harmonization of activities with other jurisdictions.
Administrative costs associated with a commercial-scale regulatory framework would depend on the framework’s final design and would be assessed during the framework’s development. We welcome feedback on the potential administrative costs associated with any of the concepts or framework components addressed within this discussion paper.
Supporting materials
View materials in person
Some supporting materials may not be available online. If this is the case, you can request to view the materials in person.
Get in touch with the office listed below to find out if materials are available.
300 Water Street
Peterborough,
ON
K9J 8M5
Canada
Comment
Commenting is now closed.
This consultation was open from July 9, 2024
to August 23, 2024
Connect with us
Contact
Public Input Coordinator
300 Water Street
Peterborough,
ON
K9J 8M5
Canada
Comments received
Through the registry
23By email
13By mail
0