Ontario: Canada’s Ethanol Powerhouse

FROM THE NOVEMBER ISSUE: Ontario leads the way in adopting E15 and meeting Canada's climate goals.
By Andrea Kent | October 15, 2019

In our industry, we know that our best advocates often come from local communities. Corn farmers, production workers, truck drivers, engineers and specialty tradespeople, even the corner store and coffee shop up the street—they all know the value a local ethanol plant creates. 

Ontario is no different. Located in central Canada, Ontario is the country’s most populous province. Here you’ll find the nation’s capital city, Ottawa, and its most populous city, Toronto (62.9 million in the greater area). You will also find abundant agriculture and a corn belt covering much of the southwestern area of the province. It’s a province abundant in natural resources and manufacturing capacity, and it benefits from proximity and shared borders with the U.S. But when I was growing up in Windsor, Ontario, in the 1990s, it was not a province without some significant challenges.

The country was in the midst of a major recession, and Ontario was particularity hard hit. At the same time, environmental concerns like acid rain and smog days were becoming increasingly dangerous. I lived in a busy, factory town where everyone drove everywhere. By the time I graduated grade school, I knew about depleting ozone levels, and by high school, everyone was talking about the “new”  phenomenon of climate change. In 2005, there were 53 days of smog advisories in Ontario issued by the Ministry of Environment, spurring calls for action. Then, less than a decade later in 2014, that number went down to zero.

So, what changed? The short answer is government policy. Ontario’s government made two pivotal policy choices: the elimination of coal power plants and the commitment to reduce heavy-emitting fossil fuel by mandating the blending  of 5 percent ethanol in gasoline. Ontario’s ethanol mandate evolved into policies adopted at the federal level as all three major parties supported and passed additional legislation to mandate and expand the ethanol industry.

Ontario’s ethanol industry generated CA $1.5 billion in economic activity in 2016. Today, it accounts for CA $1.75 billion and, when the province moves to 10 percent ethanol blending (approved in 2018), this will increase to CA $2.5 billion. It’s an impressive industry trajectory that’s led to lower prices at the pump, a reduction in toxic tailpipe emissions, lower greenhouse gas (GHG) emissions, and high-paying jobs in rural communities. And at a time when political leaders are again facing economic realities and environmental needs, Ontario is again looking to ethanol.

Last November, the newly elected Ontario government released its environment plan, which included a commitment to move to a 15 percent ethanol blend in gasoline. While still under consultation, the E15 mandate would cement Ontario’s position as a leader in ethanol use and production and make its  gasoline among the cleanest in Canada.

As with biofuel mandates anywhere in the world, success will be determined by the quality of the policy’s design and depth of commitment. To reach the full economic value and environmental benefit of E15 blending in Ontario, it’s crucial to recognize innovation and the potential of farmers, producers and fuel retailers, today and into the future. This means an implementation schedule and a carbon intensity (CI) reduction component that builds on the province’s E10 regulation and continues to drive ethanol demand.

Renewable Industries Canada (RICanada) represents the majority of Ontario’s ethanol producers and has done modeling that supports reaching E15 by 2027 and phased-in CI criteria through to 2030. The RICanada proposal also avoids drops in ethanol demand and instead provides a gradual, sustained increase in ethanol demand over time. If implemented, it would provide Ontario an economic impact of  CA $3.7 billion per year and over 1,000 new total jobs once fully implemented.

Of course, the policy is half of the equation, and public education is the other. Most Ontario drivers already have ethanol blended into their gasoline. Many don’t think about how ethanol helps the environment and supports farmers with every fill-up. RICanada’s new Ontario-wide radio ad campaign talks directly to drivers. The campaign tagline, “Driving doesn’t have to be dirty” spotlights ethanol as a clean and renewable fuel.

From its first ethanol mandate to this latest proposal, Ontario has become Canada’s ethanol powerhouse. Looking forward, there is reason for excitement. Properly implemented, Ontario’s move to E15 holds real potential of expanding markets, boosting rural economies, and fighting climate change. Looking back, it’s a reminder that solutions to the biggest, most complex problems can start close to home and get better with time.

Author: Andrea Kent
Vice President of Government and Public Relations, Greenfield Global
Board Member, Renewable Industries Canada