The stodgy image once associated with the P&C industry can be cast aside with the launch of the Green Energy Act.
Bill 150, tabled in the provincial legislature at the end of February, offers key policy initiatives for renewable energy production and use in Ontario.
“We’re now at the point where there is going to be a change,” in how business is conducted, explained Richard Corley, partner at Blakes, Cassels and Graydon LLP and and clean-tech expert. “The Green Energy Act is part of this change.”
Corley was among five legal experts participating in a forum on the impact of climate change on Tuesday April 14, 2009 in Toronto, ON.
“The insurance industry has a very different view of green energy,” said Corley, who recently attended the California CleanTech conference, where the Ontario Minister of Environment was showcasing Canadian initiatives in this area.
“The insurance industry has a more aggregated view of climate change. They witness the hundreds of billions of dollars that are spent on the impact of climate change every year.”
With the new provincial bill, renewable energy projects would get priority in terms of funding, initiatives and infrastructure.
As such, the key policy initiatives of Bill 150 include:
- Enhanced policy commitment to conservation, smart grid and renewables.
- Enabling feed-in tariffs to procure renewables.
- Guaranteeing and prioritizing connection of renewables.
- Streamlining approvals while protecting neighbouring uses.
With this bill, Corley believes Ontario is positioning itself as a leading jurisdiction of renewable and green energy initiatives. This will be important in the short-term as more and more governmental jurisdictions follow through with promises, like Barak Obama’s election promises, or succumb to public pressure, such as the Canadian federal government.
Direct impact on the insurance industry will be felt in a variety of ways including:
- Building code amendments (which will be reviewed within the next six months and then every five years thereafter);
- Potential mandatory home energy audit, which would be required before a homeowner was to sell their home;
- Public sector entities will have to produce and follow energy conservation plans;
- Increase of smart grids and complementary initiatives (such as electric cars);
- Mandatory connection to the grid (of green energy projects).
“We expect that [the mandatory connection to the grid] will give renewable projects priority on the grid and will jump start the industry,” explained Sharon Wong, partner at Toronto-based Blakes, Cassels and Graydon and specialist in commercial litigation and regulatory law with an emphasis on energy regulation.
Wong’s colleague, Tim Bermingham, noted a “fundamental flaw” in how the legislation is currently structured which prevents retroactive application of the policies set out in Bill 150. “That is not an effective agreement,” said Bermingham during the forum, “and the wording needs to be revised in order to provide the streamlined approach the government has proposed.”
Despite the possible difficulties inherent with change, the five legal experts agreed that companies and industries already looking at adaptation and risk mitigation—such as property & casualty carriers—and the impact of green and renewable energy on business practices, will be ahead of the curve.
Originally published in Canadian Insurance Business Magazine in April 2009