Ontario ministers to debate climate change strategy as tensions simmer

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Premier Kathleen Wynne's cabinet is set to thrash out the Ontario government's sweeping Climate Change Action Plan amid tensions between several ministers over how far the plan should go.

Sources with knowledge of the plan say it is scheduled to be debated at Wednesday's cabinet meeting. Environment Minister Glen Murray and Energy Minister Bob Chiarelli have been at loggerheads behind the scenes over the possible effect on electricity prices, the sources said, setting the stage for a possible confrontation. And Economic Development Minister Brad Duguid is said to be worried about how the plan will affect manufacturing firms, particularly the province's auto sector.

The document is hefty, containing roughly 80 individual actions that cabinet must approve, insiders told The Globe and Mail. They include:

• A new government agency, modelled on New York State’s Green Bank, to oversee programs to get more renewable energy in the province – including helping home and business owners install solar panels and geothermal heating systems – as well as provide financing for green technology companies and research. Cabinet will be asked to approve startup funding in the hundreds of millions of dollars.
• $200-million over four years for new cycling infrastructure, such as bike lanes and paths.
• Up to $200-million to help transport trucks switch to cleaner-burning liquefied natural gas.
• Programs to help with energy retrofits of buildings, targeted in particular at large apartment blocks and office towers.
• A major expansion of electric vehicle-charging infrastructure and some incentives for vehicle owners.

These measures will be paid for from the proceeds of the provincial government's upcoming cap-and-trade system, which is expected to take in about $2-billion annually.

The Globe last month obtained a draft summary of the action plan, which laid out a series of big-picture targets, including getting every multivehicle household in the province to buy an electric or hybrid vehicle by 2024, and cutting the proportion of trips taken by car to just 20 per cent by 2050. The full plan going to cabinet is significantly more detailed.

Mr. Murray is said to have caused consternation among some colleagues with what they see as an overly aggressive stance on some climate actions. In March, he told the Economic Club that the auto industry isn't pulling its weight in the battle against climate change, that the province must move away from using natural gas for home heating and that nuclear power plants will one day be "stranded assets."

The Premier's office read him the riot act after that speech, sources said, obliging him to issue an apology of sorts to the auto industry. But concerns linger both inside and outside government.

Mr. Chiarelli, sources said, is worried about climate action driving up already-high electricity prices. Some insiders said there are plans to address these concerns by offsetting the added cost of electricity for consumers. How this will work – whether by a rebate or other means – is unclear.

Mr. Duguid, meanwhile, wants to ensure that the government does nothing to hurt the auto sector. Multiple industry sources say privately that the goal of having an electric or hybrid vehicle in every multivehicle driveway in the province by 2024 is impossible to reach. Publicly, they are cautious about criticizing the plan until they have seen the details.

"If it's hybrids and electrics, what does infrastructure look like? What do incentives look like? What does the marketing look like?" Stephen Carlisle, president of General Motors of Canada Ltd., said in an interview. "Is there an integrated map that gets us to that goal line? We haven't seen that. I have not seen all the detail."

David Adams, who heads the Global Automakers of Canada, which represents Asia- and Europe-based automakers that sell vehicles in Canada, said he doesn't see how the province can reach that goal, which would amount to 1.7 million electric or hybrid vehicles in the province in eight years.

U.S. industry analysts who forecast vehicle production say that number represents close to 100 per cent of the battery-powered and hybrid vehicles that will be made in North America by the middle of the next decade. Auto makers will not allocate all such vehicles to Ontario when they need to meet more stringent mandates established by California and other states in the U.S.

How to resolve this problem is unclear, but some sources said a consultation process that involves government, the auto industry and academic experts to figure out how to cut emissions without hurting the sector would be necessary.

Mr. Duguid, who is off work recuperating from a heart operation, is not expected to attend the cabinet meeting. But sources said other ministers share his concerns.