The Province of Québec

Climate policy and GHG emissions reduction targets:

Quebec’s 2012 target was a reduction of GHG emissions by 6% under 1990 levels. In 2012, Quebec’s emissions were reduced by 8% under 1990 levels thus exceeding the target by 2%. (source: Quebec GHG’s 2012 Inventory)

Most innovative climate actions and emissions reduction successes: 

Quebec’s Cap and Trade System and its linking with California

In 2013, Quebec moved forward by setting up a cap-and-trade system for GHG emissions allowances (C&T system), and linked it to California’s on January 1, 2014, at once creating the biggest carbon market in North America. This market is the only one in the world to have been designed and to be operated by sub-national governments in two different countries.

Quebec’s C&T system aims at reducing GHG emissions in most sectors of the economy while offering large emitters a measure of flexibility to enable them to comply with the regulation. Under the system, GHG emissions caps are set for these emitters in such a way as to make a major contribution towards the achievement of Quebec’s 2020 GHG emission reduction target of 20% below 1990 levels. This target is quite ambitious considering that about 99.5% of Quebec’s electricity is already produced from renewable energy (hydro, wind and biomass). The caps decrease over time, guaranteeing that GHG emissions are reduced in absolute terms. At the end of a compliance period, covered entities must remit a number of allowances equal to the real amount of GHG they emitted into the atmosphere. Companies that succeed in lowering their GHG emissions can sell surplus allowances on the carbon market to companies that do not have enough of them to cover their GHG emissions.

In Quebec, the carbon market covers companies in the industrial and electricity-generating sectors, as well as distributors of fossil fuels such as gasoline, diesel oil, propane that are used in transportation and heating and that account for at least 25,000 metric tons of equivalent CO₂ emissions per year. The system currently covers 85% of GHG emissions in Quebec. The government holds GHG emission unit auctions four times a year. Since November 2014, auctions are joint with California.

An efficient instrument to fight climate change and modernize the economy

The Quebec government chose to implement a cap-and-trade system in 2009 because it found it to be an efficient way to put a price on carbon and to reach its GHG emission reduction objectives as decreasing annual caps limit the overall level of GHG emissions of covered sources. A cap-and-trade system also provides the latter with regulatory certainty and stability. It ensures that businesses can reduce their GHG emissions at the lowest possible cost by providing them with flexibility to meet their regulatory obligations and make long-term planning. As a green fiscal instrument, a cap-and-trade system also combines economic and environmental objectives while simultaneously preparing the transition to the low-carbon economy. Thus, it provides incentives for businesses to become more energy efficient, to improve their processes and rely on cleaner sources of energy. As a result, companies are reducing costs and improving their competitiveness on the national and international stage. In addition, a cap-and-trade system stimulates the development, design and marketing of low‑carbon technologies, encourages innovation and leads to the creation of green and sustainable jobs. Today, a cap-and-trade system is recognized as an efficient and promising tool to reduce GHG emissions by the World Bank, the OECD and many other international organizations.

Ties developed with the private sector

The key to the successful implementation of Quebec’s C&T system resides in the dialogue established with the private sector from the very beginning of the development of the C&T system. The government set up sectorial discussion roundtables which gathered representatives from the major GHG emitting industries and supplied detailed information on the scope, potential impacts and benefits of the system as well as the approach used to allocate allowances to trade-exposed industries. The government further welcomed stakeholders’ feedback, listened to their concerns, tried to accommodate them, when possible, and remained available to answer their questions. Several programs were introduced to help businesses (including covered entities) reduce their carbon footprint and make the transition towards more sustainable sources of energy. As a result, the government succeeded in passing the regulation with significant support and a broad understanding that Quebec must do its part to fight climate change.

Linking with California

On January 1, 2014, Quebec linked its cap-and-trade system with California’s. This linking was the culmination of a collaborative process carried out seamlessly by the two partners in an outstanding spirit of cooperation. It was made possible as a result of the harmonization and integration of each partners’ legal and regulatory frameworks. The Quebec/California carbon market is supported by the WCI Inc., a non-for-profit organisation carrying out administrative tasks related to auctions, the tracking of allowances and market supervision.

A number of auctions of emission units have successfully been held so far with California. Results show that the market is well balanced, that businesses are buying the allowances they need and that confidence in the market is solid.

On growing partnerships

The success of the Quebec/California carbon market, also known as the Western Climate Initiative (WCI) carbon market, provides a strong foundation for the development of a wider carbon market in North America. The broader the scope of this market, the more efficient it will be as it generates more opportunities for reducing GHG emissions at the lowest possible cost. Therefore, to increase the environmental and economic performance of their carbon market, Quebec and California are now seeking new partners. Ontario has already announced its intention of joining to implement a cap-and-trade system and to join it with the WCI’s. Both Quebec and California will provide support to Ontario along the way. In addition, Quebec encourages other Canadian provinces or U.S. states to implement a cap-and-trade system and has also pledged to provide support.

Quebec’s work at the international level

Quebec is very active around the world in promoting the importance of putting a price on carbon, particularly through its solution of choice, a cap-and-trade system. As co-chair of the States and Regions Alliance of the Climate Group, it promotes the latter as well as the role and actions of subnational governments in tackling climate change on international tribunes such as the ones that are being held during the Conference of the Parties of the United Nations Framework Convention on Climate Change. Quebec is also encouraging other subnational governments in Canada and abroad to adopt ambitious targets and actions and to report them in the Compact of States and Regions. On that note, Quebec is fostering a dialogue on climate issues in Canadian intergovernmental forums and mobilizing the Canadian provinces and territories to strengthen Canada’s contribution in the global fight against climate change. For instance, on April 14, 2015, Quebec Premier, Philippe Couillard convened his provincial and territorial counterparts in Canada to a summit on climate change where the heads of governments committed to strengthening pan-Canadian climate change cooperation, and making a transition to a lower-carbon economy through appropriate initiatives, including carbon pricing.

In 2014, Quebec joined 1,000 businesses, 74 countries and 25 sub-national governments in publicly signalling its support for the World Bank Declaration entitled “Putting a price on Carbon” which was presented at the United Nations Summit on Climate Change in September. It later became a member of the Carbon Pricing Leadership Coalition that is following up on that declaration.

Also in 2014, Quebec became co-chair of the International Carbon Action Partnership, an international forum that is facilitating cooperation among countries, sub-national governments and supranational institutions that have implemented or are planning to implement carbon markets. It also became a Technical Partner of the World Bank’s Partnership for Market Readiness, which helps developing and economically-emerging countries implement carbon pricing mechanisms.

Renewable Energy and smart grids:

99.5 % of Quebec’s electricity production comes from hydro power, wind energy and residual biomass. Electricity is produced at a competitive price and is widely used to heat buildings and in industrial process which contributes to reducing Quebec’s carbon footprint. Part of Quebec’s electricity is exported to neighbouring states (New-England States, Canadian provinces). These exports generate substantial income for the government while contributing to reduce these states’ carbon footprint.                                                                                       

The development of renewable energy is considered a tool for economic development in Quebec. For example, Quebec’s public utility, Hydro-Quebec, has invested in 2014 over CAN$3.3 billion dollars in procurement of goods and services, of which 94% (3.1 billons dollars) were purchased in Quebec businesses.  The number of jobs supported by these investments were estimated at 17 700 among which 12 300 were directs jobs, often located in northern regions.

Social acceptability of renewable energy projects is also a great concern in Quebec and a number of agreements have been concluded with local and native communities to contribute to their community development. Moreover, a call for 450 MW of renewable energy projects was also only open to local and native communities.

The development of wind energy has been on the rise in the last decade in Quebec. In 2017, wind energy farms will produce up to 4000 MW which will represent 10% of Quebec’s installed capacity. It is interesting to note that a recent call for tender for 450 MW of wind energy established the marginal cost of this form of energy at CAN$0.063/kWh (2014 dollars) which is well below many thermal electricity projects or even hydropower projects.

The use of geothermal, solar and biomass energy in buildings and industry are also increasing in Quebec. Two government programs help businesses and citizen interested in acquiring such systems to reduce their return on investment period when they invest in these technologies.

Finally Hydro-Quebec has a research center (Institut de recherche en énergie du Quebec) which develops new technologies related notably to renewable energy, smart grids, energy efficiency and efficient batteries for EVs.

Energy efficiency:

Considerable effort has been devoted over the years to energy efficiency and innovation in Quebec. Between 2008 and 2014 alone, energy distributors and the Quebec government invested just over CAN$1.4 billion in programs covering all areas of activity and engendered recurring energy savings equivalent to more than 41.7 million gigajoules (GJ).

Since 2008, investments of over CAN$280 million aimed to reduce energy consumption in industry permitted recurring energy savings equivalent to 36.3 petajoules (PJ) and GHG emission reduction of 763 kt CO₂ eq.  In the new 2013-2020 Climate Change Action Plan, the government established programs that will result in additional GHG reduction reductions by 2020.

In the residential sector, investments totalling CAN$545 million have generated total energy savings of 10.1 PJ since 2008. Energy efficiency initiatives take the form of financial assistance programs, awareness-raising initiatives, training, and regulations.  For example, the revision, in 2012, of the construction requirements for new homes permitted to improve energy efficiency by 25%. Moreover, under the 2013-2020 Climate Change Action Plan, the “Chauffez vert” program will contribute to reduce consumption of fossil fuel products and reducing GHG emissions in homes by financing the conversion of oil-fired heating systems to systems that rely on renewable energy.

Finally, in the commercial and institutional sectors, CAN$545 million in investments have generated total energy savings of 9.5 PJ since 2008. The new EcoPerformance incentive program encourages owners and managers to invest in energy efficiency measures as well as in renewable energy technologies to heat the buildings.  Regulations governing the energy efficiency of new commercial and institutional buildings are presently being revised. What is more, new government buildings are requested to opt for renewable energy heating system and existing buildings are expected to reduce GHG emission by 15% by 2020 over 2010 levels.

Clean transportation:

Transportation is the main cause of GHG emissions in Quebec, contributing 44.7 % of the province’s absolute GHG output (2012). In order to improve this sector’s carbon footprint the government has initiated a number of measures that reflect the avoid-shift-improve approach.

Avoid

Through the revision of the legislation respecting land-use planning and development, the government will define new policy direction in order to reduce the number of motorized trips and favor other means of transportation than automobiles. Moreover, the government is planning to support municipalities that wish to invest in sustainable mobility. Accordingly, municipalities may benefit from financial support to elaborate land-use planning projects such as eco-neighbourhoods and Transit oriented Development neighbourhoods (TOD). 

Innovation with respect to logistics processes seems also to be a promising means to reduce emissions from freight transportation. However, the generally small size of trucking firms—84% have fewer than 10 employees—limits the capacity of some firms to develop sustainable solutions to optimize freight logistics and handling. In order to reduce the carbon footprint of this sector, the CCAP supports projects that enhance the logistics of road haulage firms for CAN$5 million.

Shift

In order to help Quebecers switch to cleaner means of transportation, the government has invested over the last decade almost CAN$900 million to improve mass transit services and the development of alternative transport (car-pooling, car sharing services, walking and cycling infrastructures). As a result, urban mass transit service offers jumped by 24.5% during this period while ridership increased by 11.5%. Ridership is continuing to grow at a rate of roughly 2% per year while the number of trips recorded has risen even faster (7% in 2013).  In the next decade, over CAN$8 billion will be invested further to increase and improve mass transit services in Quebec.

The government is also strongly encouraging alternative modes of transport to the car such as cycling and walking. Already 1.3 million cyclists rely on a bicycle for utilitarian travel. Launched in the fall of 2013, the Véloce program (CAN$43 million investment up to 2020) seeks to intensify the establishment of transportation infrastructure (pedestrian and bicycle networks) that promotes active travel in urban environments.

Reliance on railroads and navigable waterways where available in Quebec makes it possible to use less energy to transport freight compared to road transport. Under the 2013-2020 Climate Change Action Plan, the Ministère des Transports du Québec is implementing the Programme visant la réduction ou l’évitement des émissions de GES par le développement du transport intermodal (PREGTI). The program has a CAN$41 million budget and is supporting the establishment of intermodal projects and the promotion of maritime and rail services.

Improve

In the last few years, the electrification of transportation has become a government priority in Quebec. As of January 2012, the Roulez electrique program gives rebates of up to CAN$8.000 for the purchase or the leasing of a plug-in hybrid or electric vehicle (EV). Subsidies are also available for the purchase and installation of charging stations at home and in the workplace. These policies has led Quebec to be the number one EV market in Canada representing close to 50% of the Canadian EV fleet and sales. Just between 2014 and 2015, EV have increased by 150% in Quebec. In October 2015, the government released a new Action Plan on the Electrification of transportation which notably targets 100 000 EVs on the road by 2020. 

In view of the government’s objective to promote a broader recourse to rail and maritime transport, it is important to focus on the efficiency of these modes of transportation and implement initiatives aimed at reducing their GHG emissions.  The Écocamionnage program promotes the use of equipment aimed at enhancing energy efficiency or alternative fuels to reduce GHG emissions. The main technologies eligible are anti-idling systems, alternative power systems, on-board computers, and devices that improve the vehicle’s aerodynamic shape. Furthermore, some training centres already offer in-house training by means, in particular, of a driving simulator. This approach can be applied on a broader scale and directly affects fuel consumption. Finally, Heavy motor vehicle inspection and maintenance program makes provision for measures to reduce regulated gas emissions produced by such vehicles, e.g. particles, volatile organic compounds (VOCs) and carbon monoxide (CO). It thus seeks to enhance air quality and promote proper vehicle maintenance, which can also reduce fuel consumption and GHG emissions.

Urban environment/smart cities:

The Climat Municipalité program launched in 2008 supported some 250 municipal organizations to undertake an inventory of their communities’ GHG emissions and to develop an action plan to reduce their carbon footprint. Five of these organizations have also developed a climate change adaptation plan.

The program was available to municipalities of all sizes. The participating municipal agencies accounted for about 78% of Quebec’s population.  The implementation of concrete climate change measures is one of the priorities of the CCAP to enable Quebec municipalities to contribute actively to Quebec’s climate change objectives and also benefit from the numerous attendant advantages.

Waste management:

Since 2006, a regulation has been in place to control biogas emissions at large landfill sites (50,000 tons annually and more), and it is estimated to have prevented more than 500Kt carbon emissions annually up to now.

The targets for 2015 are that 70% of the paper, glass, metal and plastic, 60% of the organic waste, 80% of the cement, bricks and asphalt and 70% of construction waste be recycled. The province has targeted the banishment of the elimination of organic matter by 2020. In order to achieve this objective, the government has launched a program to help local authorities to install biomethane and composting equipment which will help divert organic waste from land-fill site and contribute to producing renewable energy with biomethane and biogas.

Sustainable land use:

At the Copenhagen Climate Conference, in 2009, Quebec committed to plant 100 million trees by 2015, as part of the 1 billion Tree Initiative. In 2014, Quebec had exceeded its objective and had planted 140 million trees.

Adaptation:

Located in the northern hemisphere, Quebec has already seen the effects of global warming on its territory. Melting permafrost, coastal erosion and extreme weather events have been observed across the province in the last decade. Climate change is expected to bring more hot days that threaten our health, more extreme rainfall events that damage public infrastructure and damage homes and larger and more frequent storms that disrupt society. We can also expect more coastal erosion and permafrost thaw in vulnerable regions. In addition, climate change will have impacts on water resources and the natural environment that affect the related socioeconomic activities.

Since the early 2000s, Quebec has been engaged in a proactive process to improve our understanding of climate change impacts and develop adaptation measures to reduce our vulnerabilities and the potential risks.

In 2001, the Government of Quebec created with other partners (universities and federal government) the Ouranos Consortium on Regional Climatology and Adaptation to Climate Change. Since then, the Consortium has developed advanced expertise in the study and modelling of regional climate, which it has brought to bear in exploring the biophysical and socioeconomic impacts that climate change could have on the most vulnerable sectors of Quebec society, and in analysing different adaptation solutions.

At the same time, thanks to the 2006-2012 Climate Change Action Plan, multiple departments have been working on laying the groundwork for future governmental action. With a budget of almost CAN$100 million, foundational actions have been taken toward climate change adaptation.

Armed with the experience gained over recent years the Quebec Government adopted in 2012 a government strategy for climate change adaptation. This strategy is implemented by the CCAP and an amount of more than CAN$200 million is been used to implement actions aimed at adapting Quebec society to the impacts of climate change. These actions focus mainly on four fundamental issues:

• The well-being of the population and communities
• The continuity of economic activities
• The safety and durability of buildings and infrastructures
• The maintenance of essential ecological services

Devolved powers and competencies relevant to climate and energy:

According to the Canadian constitution, provinces have the sole responsibility over natural resources and have exclusive jurisdiction over their management, development and conservation. The same is true regarding all sources of energy derived from those resources, their production and development. In fact, provinces are responsible for all the climate actions derived from energy and natural resources.

The Canadian constitution is silent with respect to the environment, so jurisdiction in that field follows the respective separation of powers between the two levels of government. The provinces thus play a key role with respect to the environment.

The federal government can enact laws on environmental issues that cross provincial and territorial boundaries or are extra territorial in nature. This means that the federal government could enact a Canadian cap and trade system for GHG emissions if it wished to do so. Provinces are responsible for implementing international agreements in areas where the constitution has granted them  jurisdiction.

Last, provinces have the constitutional authority to adopt higher environmental standards than the federal government if they wish to do so. The cap and trade system adopted by the government of Quebec is a case in point.

Most important economic sectors:

Finance, insurance, real estate, business management and manufacturing are the major economic sectors in Quebec. Health, the public sector, retail and construction also play significant roles.

Source: Institut de la statistique du Québec, Le Québec chiffres en main, 2012 edition.

GHG breakdown by sector (%)

Year: 2012

Source: MDDELCC, Inventaire québécois des émissions de gaz à effet de serre en 2012 et leur évolution depuis 1990.

Current electricity generation mix (%)

Year: 2013

Links

• Quebec Green Power
• Quebec government portal on climate change