Ontario is backing away from plans to establish the most aggressive ethanol mandate in the country, a surprising move that has stirred up the province’s farm groups.
Premier Dalton McGuinty recently said he was rethinking the plan to move to a 10 percent ethanol mandate by 2010, up from the five percent mandate implemented in 2007.
“The issue for us is whether it would be in the public’s interest to stretch it to 10 percent,” he said, according to media reports in Ontario newspapers.
“I think we’ve got to pay attention to some of the other developments, including food costs.”
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Those comments didn’t sit well with the province’s farm groups.
“It’s disconcerting that the premier’s office is buckling under media pressure, suggesting Ontario’s small ethanol industry is the factor responsible for rising food costs,” said Dale Mountjoy, president of the Ontario Corn Producers’ Association.
“In reality, rising food costs are associated with increased costs everyone is facing, namely the price of petroleum-based fuels, which reinforces the need for a vibrant renewable fuels industry in Ontario.”
The Ontario Federation of Agriculture called on McGuinty to reaffirm his commitment to a biofuel industry in the province, where three new ethanol projects are under development at a cost of about $500 million.
“Affirmation of the premier’s continued support of biofuels and the ethanol mandate is necessary to reassure farmers and biofuel investors in Ontario,” said OFA president Geri Kamenz.
Officials with the Ontario Soybean Growers reminded the premier that six weeks ago he gave the province’s farm leaders a verbal assurance that Ontario was on track for a 10 percent mandate by 2010.
“We are seeking clarification from the premier that he remains committed to the Ontario biofuels strategy,” said association chair Leo Guilbeault.
Gordon Quaiattini, president of the Canadian Renewable Fuels Association, downplayed the controversy. He spoke to the premier’s office and was assured that regardless of whether the government goes ahead with the 10 percent mandate, it is still firmly behind the biofuel sector.
Quaiattini was told that the premier made the comments in light of recent federal and provincial policy developments.
On June 26, the federal renewable fuel bill received royal assent, paving the way for the establishment of a five percent national mandate for ethanol by 2010.
The five percent is a national average, but there is likely to be overcompliance in Ontario, which is the largest user of transportation fuels in Canada.
On May 30, McGuinty signed a memorandum of understanding with California governor Arnold Schwarzenegger calling for a 10 percent reduction in carbon emissions from Ontario’s transportation fuels by 2020.
“The vast majority of that reduction is going to come from the further blending of biofuels,” said Quaiattini.
The combination of Ontario’s existing five percent mandate, its leading role in meeting the federal mandate and the move to a low carbon fuel standard should combine to make the province a leading blender of biofuel even without a new binding mandate.
“We feel pretty confident that we’re going to get to that 10 percent and possibly beyond that 10 percent,” said Quaiattini.
But the Ontario Corn Producers’ Association would be more comfortable if there was legislation in place to that effect.
“We are pleased to hear prime minister (Stephen) Harper is standing by the federal government’s commitment to mandate a five percent ethanol blend in gasoline sold in Canada and we are confident that once the premier’s office has had the opportunity to review the issue more closely it, too, will stand by its previous commitments,” said Mountjoy.
