Ontario is following Saskatchewan’s lead in challenging the constitutionality of the federal carbon pricing backstop. At an August 2, 2018 news conference, Minister of Environment, Conservation and Parks Rod Phillips and Attorney General Caroline Mulroney announced that the province has asked its Court of Appeal to rule on the constitutionality of the federal Greenhouse Gas Pollution Pricing Act, the legislation that will impose a carbon backstop on Ontario come January 1, 2019.
The question put to the Ontario court is almost identical to the question put by the Saskatchewan government to its Court of Appeal on April 25, 2018 which Ontario has pledged to join.
The Attorney General said she was confident the cost of the court actions would come in well under the $30 million that the Progressive Conservatives said they would set aside for that purpose during the election campaign.
She also denied that the Ontario action was merely symbolic, given that the question before the Saskatchewan court would seem inevitably bound to find its way to the Supreme Court of Canada.
“It’s not symbolic for the people of Ontario who want us to do everything we can to stop the federal Liberals from imposing this tax on them,” she said.
In addition to filing the court challenge to the federal backstop, Ontario has taken legislative steps to cancel the cap and trade program of the former government. Bill 4, the Cap and Trade Cancellation Act, 2018, was introduced on July 25, 2018 and the Greenhouse Gas Emissions: Quantification, Reporting and Verification Regulation (O. Reg. 390/18) was filed on the same date. Together, they undo the legislative and regulatory framework of cap and trade and require regulated emitters to submit a verified report of their emissions through July 3, 2018.
The government appears intent on allowing mandatory participants in cap and trade to use any accumulated allowances to retire obligations incurred through July 3, 2018. Mandatory participants who have excess allowances may be compensated for them, but non-mandatory participants will not, and Bill 4 explicitly bars lawsuits against the Crown or any Cabinet member resulting from the cancellation of the cap and trade program.