The Ontario Government has introduced Bill 185, an Act to Amend the Environmental Protection Act, to enable the province to establish a greenhouse gas cap-and-trade system.

The legislation would enable Ontario to act in concert with the members of the Western Climate Initiative ("WCI"), which involves seven U.S. states, Quebec, British Columbia and Manitoba.

Ontario has committed to reduce greenhouse gas emissions by 6% below 1990 levels by 2014 and 15% by 2020. Nine industrial sectors have identified to likely be involved in cap-and-trade: base metal, cement, chemical, electricity, lime, natural gas, petroleum, pulp and paper and steel. As well, companies outside these sectors may be able to create offset credits to trade in the WCI carbon market.

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