In 2016 the government of Ontario passed the Climate Change Mitigation and Low-carbon Economy Act, 2016. The act outlines the framework for the province’s, cap-and-trade program with the aim of establishing an effective market mechanism to curb greenhouse gas emission levels and transition the province to a low-carbon economy.
Ontario’s cap-and-trade program came into full effect in 2017. The program covers all facilities emitting over 25,000 tonnes of greenhouse emissions per year, electricity importers and fuel suppliers that sell more than 200 litres of fuel per year. In partnership with the Western Climate Initiative, Ontario’s Ministry of the Environment and Climate Change intends to link the province’s cap-and-trade program with California and Quebec, expanding North America’s largest carbon market.
This page provides all the relevant documentation and information needed for compliance entities and market participants operating within Ontario’s carbon market.
An allowance is a tradable permit that allows the emissions of one metric ton of Carbon Dioxide (MTCO2e).
Ontario has set an initial cap of 143,332,000 tonnes of GHG emissions for 2017. This cap is set on the best estimates of emissions and declines annually to support the province’s GHG emission targets of 15% below 1990 levels by 2020, 37% below 1990 by 2030 and 80% below 1990 by 2050.
|Distribution of Allowances:||
In order to ease the transition towards a low carbon economy and minimize the risk of leakages, large emitters will be given set quotas of allowances free of charge. During the program’s first compliance period (2017-2020) most large polluting emitters will be given free allowances covering the majority of their emissions with allocations declining each year.
For more information on the methodology for distributing free allowances and to apply for free allowances in 2018, please see: