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Ontario Energy Association: Ontario’s Path to Achieving Net-Zero Emissions by 2050

Fasken
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Automotive Bulletin

On November 19, 2020, the Government of Canada introduced the Canadian Net-Zero Emissions Accountability Act. The proposed bill would legislate targets to achieve net-zero greenhouse gas emissions by 2050. In its "Net Zero 2050" report released on June 9, 2021, the Ontario Energy Association (OEA), an advocacy group representing Ontario's energy leaders, provides an overview of Ontario's energy landscape and recommends several measures to achieve net-zero emissions in Ontario by 2050.

The report highlights that the target to achieve net-zero emissions by 2050 presents an enormous challenge but also an excellent opportunity to create a sustainable future. The OEA stresses that a successful strategy will require coordination between all levels of government, industry stakeholders, and Ontarians. In particular, the report urges increased government coordination. For example, the Ministry of Energy, Northern Development & Mines sets policy for fuels, the Ontario Energy Board handles the natural gas system, the provincial government manages the electricity system, and the Ontario Energy Board oversees utilities and rate-regulated assets. Future efforts must be coordinated under a broader energy framework.

Additionally, the report highlights the three main pillars of Ontario's energy system: affordability, reliability, and sustainability. The OEA emphasizes that Ontarians have a strong desire for energy affordability. In 2016, electricity rates were the number one issue for Ontario voters and they remained a key issue in the 2018 election. A strategy that recognizes the importance of these three factors will increase public support for the transition to a net-zero future.

Transportation currently represents the largest source of greenhouse gas (GHG) emissions in Ontario. Refined petroleum products for the transportation sector account for 35.6% of overall emissions. Each year, the transportation sector consumes 1000 petajoules of refined petroleum product and emits 58 metric tons of carbon dioxide equivalent. The International Energy Agency found that Canadian vehicles generate the highest emissions per kilometer worldwide. This is due in large part to markedly increased consumer adoption of heavier and larger vehicles in Canada. In Ontario, the market share of light trucks has increased from 54% to 79% of total vehicles since 2010. Any successful GHG reduction strategy must therefore focus on the transportation sector.

The report states that technologies needed to reduce GHG emissions in the transportation sector are currently available, scalable, and affordable. For example, lighter passenger vehicles and vans in Ontario are ideally suited to transition to electric power. Ontarians can take advantage of lower cost electricity for charging during off-peak hours. “Managed charging" for EVs can substantially reduce transportation costs for Ontarians. While Ontario's electricity grid can currently handle a large volume of EV charging at night without any significant grid infrastructure upgrade requirements, such upgrades will be required to increase grid capacity to handle charging at other times.

The report notes that hydrogen fuel cell electric vehicles may provide another option to transition to a net-zero transportation sector. In December 2020, the Canadian government released its Hydrogen Strategy for Canada report, underscoring its hope that hydrogen play a major role in a net-zero 2050 strategy. Hydrogen has been recognized by the US, EU, and Asia as an essential element to achieving decarbonization. Hydrogen will be helpful in decarbonizing segments of the transportation sector that may not be suited for battery use. This includes high mileage and heavy-duty transportation such as mass transit, trains, shipping, trucking, and aviation.

The OEA report calls attention to the need for a comprehensive energy strategy to allow Ontario to reach net-zero by 2050. It reinforces that there exists both a challenge and an opportunity for government and industry stakeholders in the transportation sector to work together to achieve this goal.

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