Putting a Price on Carbon? Ontario’s New Cap-and-Trade System
Last week on April 13th, 2015, Ontario announced plans to introduce a cap-and-trade system to put a limit on greenhouse gas emissions. Climate change has been devastating our world – shifting long-term weather patterns causing droughts and floods, and negatively affecting our agriculture and food supply. As a result of the harmful effects of climate change, Ontario is working on a system to protect our air and water supply, agriculture and food security, nature and wildlife.
Ontario will work with communities and consult with industry over the next six months to ensure the system works best for our province. Our province will join Quebec and California jurisdictions, meaning that Ontario companies can trade with, or buy/sell permits to/from companies in Quebec and California.
In short, ‘the “cap” sets a maximum limit on the amount of greenhouse gas pollution industry can produce. Over time, the cap is lowered, reducing greenhouse gas pollution.
The “trade” creates a market for pollution credits where industries that do not use all their credits can sell or trade with those that are over.’
This system will reward industries that innovate, so the less a company pollutes, the less they pay.
Industries that are opposed to this new system argue that it is simply a carbon tax, and will lead to consumers paying more for goods and services because it will increase the cost to businesses. What do you think? Share your comments below!
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