Businesses Need More Support to Limit Cap and Trade Impact

Ontario Chamber Network calls on Premier Wynne to Prevent Exporting Jobs During the Transition to a Low-Carbon Economy

 Today the Ontario Chamber of Commerce with the support of the Oakville Chamber of Commerce sent an open letter to Premier Kathleen Wynne calling on the government take action through Budget 2017 to contain the costs of the cap and trade system to better support Ontario’s business community.

At a time of low business confidence across the province, and increasing competition from the United States, rising input costs for Ontario business risk negatively impacting jobs and investment in Oakville and across province. In fact, President Donald Trump’s administration is proposing a 30% cut to the Environmental Protection Agency’s budget; eliminating its climate change programs. This means that the cost gap between Canada and the United States will only grow wider, to the competitive detriment of Canadian businesses.

In the letter, the Ontario Chamber warns that the province must measure the impact of cap and trade among other input costs to fully understand the cumulative burden facing Ontario’s business community. Because businesses are directly affected by the costs associated with cap and trade, the Government of Ontario must ensure that the revenue and design of the system is allocated and developed in a way that supports Ontario’s business community.

“On behalf of our members, the Oakville Chamber will continue the dialogue with the provincial government to try to limit the impact on business competiveness.  We also believe that it is important to ensure that our members understand the program and what it means for their bottom-line,” said Caroline Hughes, Chair of the Board, Oakville Chamber of Commerce. “Along with the Ontario Chamber of Commerce, we are calling on the Premier to take action and support our businesses and local economy.”

The Ontario Chamber of Commerce has identified four priority actions that would assist the business community to better navigate the cap and trade system:

  1. Prioritize the allocation of cap and trade revenue for businesses, in addition to other efforts to offset the cost of cap and trade. Making the process to access resources as quickly as possible will be important, especially for smaller businesses who have little time or money to dedicate to program applications.
  2. Prioritize innovation funding. Many Ontario businesses have already taken steps to reduce their carbon footprint. Achieving further reductions could be difficult and will often require the implementation of new technologies.
  3. Create greater post-2020 design certainty. Post-2020 certainty is important for businesses looking to make long-term investments in Ontario.
  4. Monitor and respond to regional impacts. To ensure the strategic allocation of cap and trade revenues, government should conduct a regional analysis of the impacts.

“Increased input costs imposed on the private sector mean that Ontario risks losing out on jobs and investment, and risks an economically and environmentally damaging shift in production to jurisdictions that are not taking action to reduce their greenhouse gas (GHG) emissions,” said Graham Henderson, Chair of the Ontario Chamber of Commerce. “More action must be taken. In all policy decisions, the provincial government must consider how we can prevent exporting jobs while importing pollution.”

The letter is aimed at impacting government policy in Budget 2017, and builds on the Ontario Chamber of Commerce’s meetings with senior government officials. These meetings have emphasized the need to ensure Ontario’s businesses remain competitive and confident in the face of a changing economy.

The Oakville Chamber of Commerce and Ontario’s Chamber Network have engaged in significant advocacy on the cap and trade issue since 2015. This letter builds on the Ontario Chamber’s earlier communications to government calling on the Ontario Energy Board to disclose cap and trade costs to taxpayers as a line-item on natural gas bills.  Last year, the Ontario Chamber Network also called on the government to delay the implementation of the cap and trade system until 2018.

Read the letter.