OTTAWA—Ontario’s top court has rebuffed the province’s attempt to quash the law upholding the federal carbon price, ruling that Ottawa has the power to set a minimum standard to reduce greenhouse gas emissions across the country.

In a decision published Friday, four of the five judges on the Ontario Court of Appeal determined the federal Greenhouse Gas Pollution Pricing Act is constitutional. They ruled the law falls within Parliament’s authority to legislate on matters of “national concern” under the Constitution — a decision that mirrors a ruling last month from Saskatchewan’s top court.

Citing documented environmental and economic impacts, Ontario’s top court ruled climate change caused by greenhouse gas emissions is a matter of “acute” concern to Canada. The ruling states the risk of provinces refusing to participate in the fight to slash emissions “permits Canada to adopt minimum national standards to reduce” them.

“The entire country experiences the effects of climate change and every province and territory is affected by the failure of others to reduce their own (greenhouse gas) emissions,” the ruling reads.

“Without a collective national response, all they can do is prepare for the worst.”

The decision marks another blow to the effort of right-leaning premiers to strike down the federal carbon price through the courts, as the federal Conservatives rail against the policy ahead of the national election this fall.

Saskatchewan, which lost its own challenge of the law in May, has already filed a notice of appeal to take the carbon price case to the Supreme Court of Canada.

As expected, Ontario Premier Doug Ford said his government — which set aside $30 million to fight the carbon price — will also appeal the decision to the top court in the country.

“Ontario is disappointed that the court did not accept Ontario’s position that the federal carbon tax is an unconstitutional tax,” the premier said in a statement released by his office Friday afternoon.

“We know, as do the people of this province, that the federal government’s carbon tax is making life more expensive for Ontarians and is putting jobs and businesses at risk. We promised to use every tool at our disposal to challenge the carbon tax and we will continue to fight to keep this promise.”

In her own statement shortly after the decision was published, federal Environment Minister Catherine McKenna welcomed the ruling as “good news” for those who believe climate change is an “urgent threat to Canadians and the world.” She said it is “unfortunate” that provinces like Ontario and Alberta — which launched its own court challenge of the carbon price law this month — are spending taxpayers’ money to confront climate change policies in court.

“Today, the court rejected the Conservatives’ latest attempt to splinter our country and stop the federal government from protecting the environment on behalf of Canadians,” McKenna said.

At Queen’s Park, Liberal MPP Nathalie Des Rosiers said Ontario’s Progressive Conservative government should “take this decision as a signal to change course” on its environmental policies.

“The ruling today confirms that this constitutional challenge was a waste of money,” added Des Rosiers (Ottawa-Vanier), who is her party’s environment critic.

“Since last June, Premier Doug Ford has taken Ontario backwards on climate change, and has wasted Ontarians’ money to fight the federal government on behalf of Andrew Scheer.”

Ford, already slumping in the polls before the departure of his trusted chief of staff in a cronyism scandal, is further weakened by the court decision, said New Democrat MPP Peter Tabuns.

“Doug Ford is wasting piles of Ontario’s money on an expensive court challenge that’s nothing more than a political stunt, and a blowhard talking point,” Tabuns, a former head of Greenpeace, told reporters.

“They are more out on a limb. It’s been shown this case has no merit…it can only hurt them more in the months to come,” added Tabuns (Toronto-Danforth).

“It further undermines the credibility of Ford on this file…if he’d had a victory, then people would say, ‘apparently, he knows what he’s talking about.’ But he didn’t have a victory.”

Ontario Green party Leader Mike Schreiner said he is “relieved” at the court decision.

“The courts confirmed what legal experts have said all along — that the federal government has the constitutional authority to require minimum actions for reducing pollution,” he added in a statement.

“Yet so far the premier had done more to invite climate disaster than he has done to prevent it.”

Friday’s decision marks the second time a top provincial court has ruled on the federal government’s carbon price, a key measure in the federal Liberal government’s plan to fight climate change. On May 3, in a majority 3-2 decision, the Saskatchewan Court of Appeal ruled the federal government can set up a minimum price to deter pollution across the country as a national concern under the Constitution.

In its own court challenge, lawyers from Ontario’s justice ministry argued Ottawa doesn’t have the power to dictate how provinces fight climate change. They said the pollution pricing act is a “massive expansion” of federal authority that would disrupt the balance of powers in the Constitution and open the door to invasive regulations from Ottawa over virtually “all human activities.”

The majority on the court rejected those arguments in their decision Friday, ruling that the pricing law leaves “ample scope” for provinces to pass their own laws on the environment, climate change, and measures to reduce emissions — so long as they meet a federal minimum standard that Ottawa is allowed to impose.

“Federal jurisdiction in this field is narrowly constrained to address the risk of provincial inaction regarding a problem that requires co-operative action,” the ruling states.

Like in Saskatchewan, Ontario’s top court also found that charges imposed under the federal carbon price law are “not taxes.” The judges determined instead that the price includes “regulatory charges” on emissions, with revenues returned to households and businesses that pay them.

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Stewart Elgie, a professor of law and economics at the University of Ottawa who works with the pro-carbon price Ecofiscal Commission, said it is routine for courts to give split decisions in constitutional cases like this.

He also noted that even the dissenting judges in the Saskatchewan and Ontario cases agreed Canada could impose a carbon price — it’s just that they said it would need to be defined as a tax enacted by Parliament rather than a regulatory charge.

“The decision is a legal nail in the coffin for provincial premiers fighting carbon pricing. Two provincial appeal courts have now upheld the federal law, and it’s very likely the Supreme Court will do the same,” Elgie said.

Enacted last year, the federal pollution pricing act says all provinces and territories need their own carbon price — either an emissions tax or cap-and-trade system — that meets a minimum standard set by Ottawa. That standard kicked in this year at $20 per tonne of emissions and is scheduled to go up each year until it hits $50 per tonne in 2022.

Provinces that refused to develop their own pricing schemes to meet this threshold have had the federal “backstop” system imposed in their jurisdictions. So far, this includes Ontario, Saskatchewan, New Brunswick and Manitoba — though Alberta is set to join them in January, after Premier Jason Kenney scraped the province’s carbon tax when he took power earlier this year.

The backstop system includes a levy on fuel and a separate system for heavy industrial emitters that sets a price based on the average emissions intensity of production in various sectors. Ninety per cent of the revenues from the fuel levy are funnelled back to individuals and household via tax rebates — a household of four in Ontario gets $307 this year — while the remaining 10 per cent will be returned to businesses, schools, municipalities and other groups.

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The federal plan has sparked intense political opposition as well as legal challenges from provinces where the backstop was imposed. Federal Conservatives and their provincial allies have railed against the plan, arguing it will only increase the cost of gasoline and consumer goods while failing to place Canada on track to meet its emissions reduction commitment under the international Paris Agreement to fight climate change.

The latest projections from Environment Canada, published last December, predict current policies aren’t enough to meet Canada’s target to slash emissions to 30 per cent below 2005 levels by 2030.

Last week, in a final of five pre-election policy speeches, the federal Conservative party released their own plan to fight climate change that doesn’t include a levy on fuel.

Instead, the party proposes new regulations to force companies to fund clean technology research if they emit more than a set cap. It would also spend $900 million over two years on tax incentives for home retrofits.

The plan does not specify how much these companies would have to pay, does not spell out expected emissions reductions, and does not commit to meeting Canada’s Paris target in 2030.

Other federal parties have said they would keep the national carbon price. The New Democrats would change the rebates so that wealthy people don’t receive them, and also change the pricing system for heavy emitters so that they pay more. The Green party has said they would continue to hike the carbon price beyond $50 per tonne in 2022 — something the Liberal government ruled out this month.

According to the World Bank, 44 “national jurisdictions” have implemented a form of carbon pricing, representing the source countries of 14 per cent of global emissions. This includes the entire European Union, South Korea and Japan.

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