Low Carbon Transportation Fuels in Ontario: Amendments to Ethanol in Gasoline (O. Reg. 535/05) and Greener Diesel - Renewable Fuel Content Requirements for Petroleum Diesel Fuel (O. Reg. 97/14) Regulations
Regulation - LGIC
Bill or Act:
Environmental Protection Act, R.S.O. 1990, c.E.19
Summary of Decision:
We have amended the renewable fuel regulations to increase blending requirements, improve the environmental performance of fuels, and recognize emerging low carbon fuel technologies. This includes changes to:
1. O. Reg. 535/05 (Ethanol in Gasoline)
2. O. Reg. 97/14 (Greener Diesel - Renewable Fuel Content Requirements for Petroleum Diesel Fuel)
These changes are tied with a commitment outlined in Ontario's Climate Change Action Plan to provide funding to fuel distributors for high-blend sustainable biofuels and infrastructure upgrades to increase the availability and use of lower-carbon fuels.
Analysis of Regulatory Impact:
There are substantial benefits to the amendments. It is estimated that Ontario's fossil fuel suppliers may incur some administrative costs to comply with the amended gasoline regulation starting in 2020. It is anticipated that recognizing more fuel technologies (e.g. renewable gasoline, biocrude) will provide fuel suppliers with greater flexibility to choose the most economical compliance pathway.
The Ministry estimates that the additional annual administrative costs to all fossil fuel suppliers combined, will be $1,600 beginning in 2020 as a result of the amendments. Changes to gasoline retail prices are expected to be minimal, generally imperceptible to fuel users relative to other day-to-day market fluctuations. Experience in Ontario and other provinces (British Columbia, Alberta, Saskatchewan, and Manitoba) indicate no observable price impact from the implementation of similar transportation fuel policies, based on a comparison of retail pricing before and after implementing renewable fuel policies.
No increase to the price of diesel fuel is anticipated as a result of the amended diesel regulation. It is anticipated that recognizing biocrude as a compliance option will provide fuel suppliers with greater flexibility to choose the most economical compliance pathway.
November 29, 2017
Summary of Proposal:
The Ministry is proposing to make the following amendments to the Ethanol in Gasoline regulation (O. Reg. 535/05) under the Environmental Protection Act, R.S.O. 1990, c.E.19:
1.Require gasoline suppliers to maintain an average of at least 10% ethanol in regular grade gasoline (88 octane or less), by volume per calendar year starting in 2020.
2.Require ethanol used for compliance to emit significantly fewer (e.g. 35%) greenhouse gas (GHG) emissions on a lifecycle basis than petroleum gasoline starting in 2020.
3.Expand the existing incentive/multiplier for advanced renewable fuel technology to emerging technologies, including renewable gasoline and biocrude and include a compliance value for renewable gasoline and biocrude, to be informed by consultations.
4.Calculate the lifecycle GHG performance of a fuel in carbon intensity (CI) using GHGenius version 4.03a, or a subsequent model adopted by the Director.
5.Require that a professional engineer certify that primary data used in the carbon intensity calculations are reasonable and the calculations are correct.
The Ministry is proposing to make the following amendments to Greener Diesel - Renewable Fuel Content Requirements for Petroleum Diesel Fuel (O. Reg. 97/14) under the Environmental Protection Act, R.S.O. 1990, c.E.19:
1.Amend the regulation to create an incentive for emerging renewable fuel technologies, such as biocrude, by allowing it as a compliance option and assigning a compliance value, to be informed by stakeholder consultation.
For both regulations, make any other housekeeping updates to clarify existing regulatory requirements (e.g. updating references to revised fuel standards, updating reporting requirements such as removing requirements for reporting summer volumes).
Ministry of the Environment
Climate Change Directorate
Climate Change Programs Branch
77 Wellesley Street West
Phone: (416) 325-5102
January 1, 2020