Early days in assessing cancelled cap and trade

​By Drew Spoelstra, Executive Member, Ontario Federation of Agriculture
Weather, climate and trade are all hot topics in Ontario right now. The recent elimination of Ontario’s cap and trade program is leading the news in the province and leaving Ontario farmers with questions.
 
Fulfilling an election promise, Premier Ford has formally scrapped the cap and trade program that was designed to reduce greenhouse gas emissions. The Ontario Federation of Agriculture (OFA) has supported the concept of a system that would allow farmers to sell offset credits for the greenhouse gas reduction that often occurs when implementing beneficial management practices. Farmers have always prioritized the health of their soils and overall environment, and it was an appealing option to be recognized for these actions by offset payments from other industries and companies emitting greenhouse gases. The end of the cap and trade program in Ontario won’t stop farmers from continually improving their environmental footprint but the incentives and recognition to further drive performance could be lost.
 
OFA is waiting for the full details of Premier Ford’s announcement that deals with the funding available from cap and trade revenues. We are hopeful that funding promised to the agricultural sector through the Climate Change Action Plan will survive. This funding flowing from the Greenhouse Gas Reduction Account was intended to support soil health initiatives for farmers. Healthy soil is vital to production today and tomorrow, and farmers are working diligently on projects to control phosphorus and improve carbon sequestration by developing new tillage and soil improvement practices. Funding from the Greenhouse Gas Account could have also helped farm businesses retrofit their barns and buildings to conserve energy. Farmers have always been eager adopters of energy conservation initiatives because energy in all its forms is one of the largest input costs in a farm business. We’re hopeful that funding for these types of programs will continue.
 
OFA will also be closely watching the upcoming carbon tax debate to be had with the federal government. Farmers are large consumers of fuel to run machinery and to heat barns and greenhouses. For a farmer to produce a crop and raise livestock, few economical alternatives currently exist to replace fossil fuel energy meaning a tax on carbon is an ineffective deterrent to consumption and only serves to take money out of margins and threaten our food security. If the federal carbon tax is imposed in Ontario because of the demise of the cap and trade system, OFA will seek a complete exemption on all farm fuels from the federal tax. We’ll be watching as Premier Ford challenges the federal government on their proposed carbon tax.
 
These are early days for this issue and many details remain unclear. But OFA has been taking stock of all policies and regulations impacting Ontario farm businesses and we’re ready to get to work with Premier Ford and his government to ensure Ontario’s agriculture and food sector is positively accounted for in any changes to existing programs, including cap and trade.
 
 
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For more information, contact:

Drew Spoelstra
Executive Member
Ontario Federation of Agriculture
905-379-5751

Neil Currie
General Manager
Ontario Federation of Agriculture
519-821-8883