Reversing climate change and developing renewable energy sources is about taking care of the things we depend on for survival, including clean air, water and land. Japan and the EU have filed complaints against Canada to the WTO regarding Ontario’s renewable energy and climate change programme (Find out more here). They say Ontario’s efforts to fight climate change and embrace renewable energy technologies run counter to international trade rules. To them, clean air, water and land are not a relevant consideration when it comes to the legality of subsidies under international trade rules.
We think they are wrong. Ontario’s Green Energy Act is an essential piece of legislation for combating climate change and converting our dirty coal energy generation in Ontario to renewables. At its core, it is about spurring the development of clean energy so that dirty energy supplies can be phased out. The Act’s feed-in tariff (FIT) programme provides incentives to renewable energy suppliers by guaranteeing long-term contracts to buy renewable energy at rates that reflect the costs of investing in these technologies. They are high rates and require that the equipment used to generate this power is sourced in the province.
Japan and the EU say the domestic content provision under the FIT programme provides an unfair advantage to Ontario renewable energy equipment providers. We say that climate change and renewable energy policies are exempt from such international trade subsidy rules because they protect human, animal and plant life and health and relate to the conservation of exhaustible natural resources, which should be permissible exceptions. We believe the policy objectives of climate change measures like those in the Green Energy Act should not be considered as a ‘benefit’ providing unfair trade advantages.
With the International Institute for Sustainable Development (IISD), the Canadian Environmental Law Association (CELA) and the Graduate Institute Trade and Investment Law Clinic in Geneva, we have voiced these views in a brief submitted this week to the WTO. A WTO panel started hearing the matter in April and will continue its deliberations next week in Geneva.
We need to ensure that the feed-in tariff and domestic content provision under the Green Energy Act are maintained and not found contrary to WTO subsidy rules. We need to strengthen international trade law to ensure that environmental protection provisions are considered. This matter will impact the manner in which renewable energy policies in jurisdictions across Canada and among WTO member States are drafted. It is a critical case, not just for Canada, but for jurisdictions across the world that want to promote clean energy industries.
Ontario’s actions in fostering the renewable energy sector in the province is important to the health and well-being of Canadians and are fundamental to ensuring that Ontarians have a clean and healthy environment. They must not be jeopardized by international trade rules. We want to live in a world where the sources of energy we use are renewable, energy production does not threaten human lives and health, and energy production does not threaten our climate, biodiversity, ecosystems and lives. We hope to convince the WTO that it should want these things too.
By Hugh Wilkins