Scrapping cap-and-trade will end up costing average Ontario households $264
Posted October 16, 2018 10:29 am.
Last Updated October 16, 2018 6:55 pm.
This article is more than 5 years old.
The Ford government’s move to scrap the cap-and-trade program will cost all Ontarians a bundle, according to finding from the Independent Financial Accountability Office (FAO).
The FAO said the average household will be on the hook for an additional $264 in 2019 because under the cancelled cap-and-trade program, approximately one-third of revenue raised by the province was remitted to Ontario households through programs (mainly the Green Ontario Fund and the Electric and Hydrogen Vehicle Incentive Program).
Consequently, the net impact to Ontario households under the cancelled cap-and-trade program would depend on each household’s ability to take advantage of programs funded by cap-and-trade revenue.
The FAO also found the the cancelled program would mean the province’s budget balance will deteriorate by $841 million this year — this also included one-time costs to wind down cap and trade programs. That would add up to a the loss of $3 billion in revenue over the next four fiscal years.
The FAO also says that in the long run, the cap-and-trade system would have cost Ontario families less than the federal carbon tax.
The office estimates that under cap and trade, the typical Ontario household would pay $312 in additional costs by 2022, compared to $648 under the federal system by the same year.
Premier Doug Ford campaigned on a pledge to cancel cap and trade during the spring election and has vowed to challenge the imposition of a federal carbon tax in court.
The cap-and-trade program began in January 2017 under Kathleen Wynne’s Liberals and was designed to reward businesses that reduce their greenhouse gas omissions.
The Ford government ended the program in July.