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Canada Ontario climate plan to offer subsidies for energy retrofits, electric cars

Cars drive in traffic on the Gardiner Expressway in Toronto, June 29, 2015.

MARK BLINCH/REUTERS

Environment Minister Glen Murray is pledging to give every building in Ontario an energy retrofit and offer more subsidies for electric cars as the province ramps up its battle against climate change.

In a wide-ranging speech to business leaders at the Empire Club in Toronto on Thursday, Mr. Murray offered a preview of the Climate Change Action Plan, which he will unveil later this spring. He said the plan will contain new programs to help homeowners and landlords do retrofits, switch buildings from natural gas to geothermal heat, make it easier to install solar panels, and provide incentives for drivers to buy electric vehicles. The programs will be financed with the estimated $2-billion the province's upcoming cap-and-trade system on carbon emissions is expected to raise every year.

The speech came a day after The Globe and Mail obtained a draft of the plan, which set out aggressive targets, including getting 1.7 million electric and hybrid cars on the road by 2024 and reducing emissions to zero for most of the province's buildings by 2050. The draft also revealed the government is considering creating an "ultra-low-carbon utility" to oversee these programs.

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The Minister on Thursday also warned the titans of industry gathered in the room their companies must become 10 times more efficient in the use of carbon in order for the province to meet its targets.

"What are you going to do differently tomorrow? Because each of you have to do something different. That's the only way this works. If you keep doing what you did yesterday and the day before, it isn't enough," he said. "The assignment for all of us is improve our carbon productivity by tenfold … if we all do that, we're going to survive and we'll be okay. If we don't do that, we're screwed."

Mr. Murray took particular aim at the province's auto industry, which he said is "missing courageous leadership" to build more electric vehicles. If these companies do not shape up, he said, Tesla and BMW "are going to start eating [their] lunch."

"I still have auto executives here who come into my office and say, 'You know, it's not going to work,'" he said. "But they don't actually have an alternative."

Auto makers have urged provincial governments not to mandate that a certain number of electric vehicles must be sold by a certain year.

Flavio Volpe, president of the Automotive Parts Manufacturers Association of Canada, points out that the action plan is coming at a time when the province is trying to win new investment from some auto makers whose assembly plants in Ontario are under threat of closing.

"Strangely misguided commentary by the Environment Minister is not going to undo the balanced partnership between the auto sector and this government," Mr. Volpe said. "We have publicly supported Ontario's climate change initiatives from their inception, and still enjoy a solid working relationship with the Premier and the Minister of Economic Development."

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Mr. Murray did, however, offer some relief to the auto sector by ruling out a zero-emissions vehicle (ZEV) mandate – a policy in which the government would force auto makers to sell a certain percentage of electric cars and hybrids.

"We're not looking, because of the nature of our economy, for the kind of ZEV mandate that you would see in California and Quebec. That's not on the table," he said.

Instead, Mr. Murray suggested the province can better meet its targets using subsidies. He said he would soon announce programs to "help finance both your new net-zero car and your new zero heating and cooling home.

"It will be one of the biggest economic boons in Ontario, North American history, because we have to retrofit every building we ever built," he said.

He confirmed the government is considering a new "ultra-low-carbon utility" to oversee these programs, but said he is mulling four or five possible models and does not know exactly what it will look like.

Mr. Murray also surprised the room when he said he believed the province would eventually move away from nuclear power, its primary source of electricity. Over time, he said, he believes the grid will become more diffuse, with many buildings and homes generating their own power, such as with solar panels.

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Progressive Conservative environment critic Lisa Thompson said the subsidies for energy retrofits and electric cars constitute "picking winners and losers," and the Liberals' cap-and-trade system will make life more expensive.

"At the end of the day, there's one pocket, and it's called your pocket and it's my pocket," she said. "This cap-and-trade scheme is nothing more than an initiative to drive up their coffers so they have a slush fund to continue picking winners and losers."

NDP environment critic Peter Tabuns, by contrast, said he was encouraged the Liberals appear to be taking climate change seriously. But he cautioned that Mr. Murray has not released enough specifics on how the province will actually achieve its goals. Mr. Tabuns said he fears the province will not meet its target of cutting greenhouse gas emissions 15 per cent below 1990 levels by 2020 and must step up its game. He suggested doing energy retrofits of all government buildings as one place to start.

"I'm pleased that the government is being ambitious, but there are a lot of concrete numbers we have to see so we can tell if this is going to translate into action," he said.

Mr. Murray insisted all of his plans are doable and that, compared with other crises in human history, this one should not be as difficult to overcome.

"It's not hard now. Our grandparents had to send their kids off to die in Dieppe and the beaches of Normandy to save a generation. To save our planet, we're being asked to ride our bicycles, to drive an electric vehicle, to accept money from government to help transform the energy systems in our business and our homes," he said. "So let's have some courage. Let's get up tomorrow and realize that we're living in a different world."

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