Item - 2023.IE3.3

City Council considered Items IE3.3 and IE3.4 and EX4.2 together.

The Infrastructure and Environment Committee recommends that:

1. City Council adopt the Corporate Policy on Submissions and Filings as contained in Attachment 4 to the report (April 19, 2023) from the Executive Director, Environment and Climate.

2. City Council direct the Chief Planner and Executive Director, City Planning, in consultation with the City Solicitor and the Executive Director, Environment and Climate, to review options to discourage the installation of new combustion uses of  methane (“natural gas”) as part of the update to the Toronto Green Standard to Version 5.

3. City Council direct that a copy of the TransformTO 2022 Annual Report be provided to the appropriate Federal and Provincial Ministries, highlighting the enormous gap between Toronto’s growing fiscal responsibilities and the limited revenue tools available to it and therefore the ability of Canada and Ontario respectively, to reduce climate pollution, meet our international commitments and avoid the worst impacts of climate change.

4. City Council direct the City Manager, in consultation with relevant Divisions, Agencies, and Corporations, to develop an intergovernmental advocacy approach that:
 

a. identifies the scope and scale of investments needed to support implementation of TransformTO;

b. establishes expectations of funding from federal and provincial governments; and

c. works towards a reliable, long-term funding model.
 

5. City Council direct the City Manager to collaborate with GTHA municipalities and organizations, such as The Atmospheric Fund and Clean Air Partnership, in a regional approach to intergovernmental advocacy for climate action and funding.

6. City Council urge the Government of Canada to:

a. Enact and enforce strong and robust Clean Electricity Regulations consistent with a net-zero electricity grid and that enable broad decarbonization of all other sectors; and

b. Enact the proposed Zero-Emission Vehicle (ZEV) sales mandate on their proposed timeline and at minimum maintain their current level of stringency.

7. City Council direct City of Toronto staff to engage their Federal counterparts on the development of the Clean Electricity Regulations and Zero-Emission Vehicle (ZEV) sales mandate, and to advocate for regulations that will support and enhance our ability to achieve TransformTO goals for climate and health.

The year 2022 can be viewed as an important foundational year for the Transform TO Net Zero Strategy's ('the Strategy') new net zero goal, building on the climate change mitigation work implemented to date by the City and its partners.  Where 2021 set the stage for what should and must happen in reaching net zero through energy and emissions modelling, 2022 ground tested the realities, provided opportunities for cross-corporate partnerships and started work on priority actions with the intention to support their scaling. Toronto continues to be a leader in global climate action through initiatives such as building one of the world's largest waste energy transfer projects, enabling sustainable building practices through accelerated implementation of the Toronto Green Standard, being the first major North American city to introduce a carbon budget, and by having many actively engaged residents taking action.

This report provides an update on progress made in 2022 towards laying the groundwork for achieving the Strategy's greenhouse gas reduction targets and how Toronto's progress steers advancement on the five critical steps that underpin the Strategy's success. This report also provides information on the work underway with the TransformTO Short-Term Implementation Plan 2022-2025, the status of related Council directives, as well as progress made towards the 2030 sector goals. Finally, this report responds to a Council direction to provide a policy for how Divisions should refer to TransformTO Net Zero Strategy goals and targets in comments for public consultation processes and legal filings.

Toronto continues to be a leader in global climate action through initiatives such as building one of the world's largest waste energy transfer projects, enabling sustainable building practices through accelerated implementation of the Toronto Green Standard, being the first major North American city to introduce a carbon budget, and by having many actively engaged residents taking action.

Overall, 100 per cent of the 30 Short-term Implementation Plan actions and 97 per cent of the 40 Council directions adopted as part of the Strategy are either in progress or complete. Many of these actions establish the tools and programs that allow net zero decisions and investments to be made now and going forward. Staff continue to develop programs and policies to support this transformational direction.

Moreover, accountability systems that clarify the roles where implementation support is critical have been put in place. In 2022, this included establishing an Accountability and Management Framework (2022.IE29.10) to guide the City's inclusive implementation of the Strategy. A Net Zero Climate Leadership Table (NZCLT) and an external Climate Advisory Group (CAG) are now in place to guide decisions and provide accountability for implementation.

To support and inform the above-mentioned accountability structure, Council will also be considering a framework to establish a carbon budget which will link climate actions with the annual financial budget process and provide more information on the expected impact of the City’s actions to reduce GHG emissions and to better inform fiscal decision making.

The full financial impacts for the required investments to achieve the Council adopted 2025 and 2030 GHG reduction targets and ultimately getting to net zero by 2040 are still to be determined. Technical modelling estimates suggest that over the next thirty years, the total investment required by the entire community, that is, the City corporation, the business community, other levels of government, and individual residents, is $145 billion. Annual investments between $4-9 billion per year will be needed over the next 17 years, with most investments needed in the near term. This number includes the financial investments made by homeowners towards retrofitting an estimated 450,000 homes and buildings, or about 27,000 home retrofits each year until 2040, as well as individual purchases of 333,000 electric vehicles before 2030.  These investments will need to be complemented by provincial government actions to support and maintain a clean and carbon-free provincial electricity grid. 

Toronto's 2020 community-wide greenhouse gas inventory shows progress toward our targets.  In 2020, Toronto's community-wide emissions were 14 megatonnes (MT) of carbon dioxide equivalents, or greenhouse gas emissions.  This is 43 percent lower than in 1990, meaning that Toronto has exceeded its target of 30 per cent reductions community-wide by 2020.  However, these reductions can largely be attributed to decreased transportation emissions in 2020 related to COVID-19 travel restrictions. As COVID-19 economic recovery efforts gain momentum, GHG emissions are expected to approach pre-pandemic levels. The latest data shows that Toronto’s community-wide emissions must be nearly cut in half in the next seven years to meet the 2030 target.

Continued ambitious climate actions and programs will be critical to reaching the City’s 2025 target of 45 per cent GHG emissions reduction from 1990 levels. Further, these efforts must be scaled up to reach Toronto’s community-wide future targets of a 65 per cent reduction by 2030 and net zero by 2040.

The required scale and pace of change to achieve our shared climate targets is a shared responsibility with the community, financial institutions, businesses and other orders of government and will require new partnerships, funding models and financial mechanisms to make the needed investments.