In 2015, the waste sector in Canada contributed 3.4% of overall GHG emissions in Canada yet in Ontario, the sector accounted for a higher than average 6% of total emissions. The majority (90%) of these emissions come from methane emissions from landfills. Other key sources contributing to waste sector emissions are from Energy from Waste (EfW) facility stack emissions and waste water treatment facilities.

In an effort to strategically reduce emissions, the province of Ontario, as per the ‘Strategy for a Waste-Free Ontario: Building the Circular Economy’[1], has laid out the goals of zero-waste and zero greenhouse gas emissions from the waste sector. These visionary goals will define the actions to be taken by Ontario’s waste sector to achieve resource recovery and the elimination of waste.  Further strengthening Ontario’s action on Climate Change is the province’s Cap and Trade Program Regulation (Regulation 101/16) which took effect from July 1, 2016. The Strategy for a Waste Free Ontario combined with the Cap and Trade Program presents the waste industry in Ontario with the impending regulatory requirements as well as opportunities for cost effective emission reductions.

Carbon offsets for the Waste Sector

A carbon offset is a measure of GHG reduction for an environmental project when it reduces or removes at least one tonne of greenhouse gas emissions from the environment. These carbon offsets have monetary value under cap and trade schemes driven by compliance based market forces. The process to be followed by project developers to generate carbon offset is defined in Offset Protocols[2]. Ontario’s cap and trade program presents numerous opportunities to generate carbon offsets in waste sector as seen under other mature cap and trade schemes like Clean Development Mechanism (CDM) [3] and American Carbon Registry (ACR)[4]. In these schemes, waste sector projects accounted for 11% and 13% of the total projects registered under CDM and ACR respectively.

Under the Ontario cap and trade program, facilities that generate more than 25,000 tCO2 emissions annually are mandatory participants (classified as Regulated Emitters). There are currently very few waste management industry facilities in the province that would be classified as Regulated Emitters. That being said, waste management facilities that are not regulated are still free to play a role as offset project developers to capitalize on the financial benefits of generating carbon offsets.

Ontario is currently developing 13 offset protocols for use in their cap and trade program[5]. A draft Landfill Gas Offset Protocol was posted on the Environmental Registry in May 2017 for stakeholder comments and inputs[6]. The remainder of the protocols are scheduled to be completed by late 2017 or early 2018. The protocols which will be relevant to the waste sector are as follows:

  • Landfill Gas Capture and Destruction: Landfills have historically been considered to be the largest emitter of emissions in the waste industry due to the release of methane emissions generated from the anaerobic decay of the organic components of waste. This protocol is applicable to landfills that capture landfill gas not mandated by law. In Ontario, large landfills (capacities greater than 1.5 million cubic meters of waste) are required by law to implement and operate Landfill Gas (LFG) collection and control systems. Hence, small landfills with capacities less than 1.5 million cubic meters will be eligible to claim carbon offsets if they meet the requirements of this offset protocol.
  • Anaerobic Digestion (Organic Waste and Manure): This protocol is applicable for GHG offset projects that divert and anaerobically treat eligible organic waste and/or wastewater streams that otherwise would have gone to uncontrolled anaerobic storage, treatment and disposal systems, such as solid waste landfills or on-site anaerobic wastewater treatment facilities. Anaerobic digestion of organics can also generate carbon offsets through the electricity production from the combustion of biogas.
  • Organic Waste Management: This protocol is applicable for projects that avoid methane emissions into the atmosphere through the diversion and composting of food waste that would otherwise have been sent to landfill. Organic waste diversion provides an opportunity to reduce the methane generated from landfills through the avoidance of organics to landfill and creates feedstock for alternative organic waste treatment methods i.e. composting and anaerobic digestion.

Other low carbon opportunities

  • Diversion programs: Diversion programs provide another opportunity to reduce emissions by diverting materials from landfills via reuse and recycling programs. This is primarily since emissions from processes that reuse and recycle materials are lower compared to emissions resulting from the processes using virgin materials. The Ontario cap and trade program has not identified recycling as one of the offset protocols at present but it may develop a protocol as the program becomes mature. There are four established recycling related protocols under CDM and ACR, with just three registered projects under these protocols.
  • Renewable natural gas: Anaerobic treatment of organic waste can generate biogas that can be captured as Renewable Natural Gas (RNG) for injection into the natural gas distribution network or to fuel vehicles. Ontario has committed to investing up to $100M in cap and trade proceeds over four years to support the introduction of RNG[7].
  • Reduction of fleet emissions: The waste sector can also reduce GHG emissions by switching the fuel used by its fleet to low carbon fuel or transitioning to electric vehicles. The Ministry of Transportation, Ontario has an Electric Vehicle Incentive Program (EVIP) that supports the adoption of electric vehicles. The EVIP will be financed by proceeds from Ontario’s participation with Quebec and California in the cap-and-trade program.

Given the latest policies in Ontario, the waste industry has a significant opportunity to develop low carbon projects that can be financed through cap-and-trade programs and several green funds like the Ontario Green Investment Fund or Sustainable Development Technology Fund.  Carbon financing provides organizations across the waste sector a cost effective way to measurably reduce CO2 emissions while complying with existing and impending regulations.