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Ontario Should Commit to Spending Cap and Trade Revenue on Low-income Ontarians

CELA challenges Ontario to follow California's example and legislate that 35% of cap and trade revenue be invested in low-income and vulnerable communities.

Climate change is an environmental justice issue. The burdens of climate change are fundamentally unjust: vulnerable communities responsible for the least carbon emissions are burdened with the most severe effects of climate change. Carbon pricing initiatives are also regressive. They are an absolutely essential component of the fight against climate change, but they have a disproportionate impact on low-income and vulnerable communities.

To correct that injustice, CELA has advocated for a legislative requirement in Ontario's cap and trade legislation which would set aside at least 25% of the revenue raised by the cap and trade program to assist low-income and vulnerable communities.

California's cap and trade legislation currently does just that. 25% of cap and trade revenue must be spent on projects that would benefit disadvantaged communities, 10% of which has to be spent within those communities.

In a welcome amendment to California's legislation, AB 1550 increases that amount.

Once AB 1550 becomes law, California's commitment will be to spend 25% of cap and trade revenue within identified disadvantaged communities, an additional 5% in low-income households or low-income communities elsewhere in the state, and further additional 5% in low-income households or communities within 1/2 mile of identified disadvantaged communities.

California's approach appropriately recognizes the disproportionate burden of climate change, and carbon pricing, on low-income and vulnerable communities. Although Ontario has committed to ensuring its Climate Change Action Plan includes measures to assist low-income households, it does not set aside any specific amount of the revenue for those communities.

California has set a strong example. As Ontario looks to link with California and Quebec's cap and trade market in 2018, it should also step up and match California's commitment to assist low-income and vulnerable communities.