Cap and Trade - Business

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Cap and Trade - Find out how cap and trade affects your natural gas bill and what you can do to reduce the cost

How much does cap and trade cost?

Estimate the cost of cap and trade

Example: cubic metres

Under Ontario's cap-and-trade program, which began Jan. 1, 2017, Union Gas is required to buy carbon units (also known as emissions allowances or credits) for the natural gas your business consumes, if applicable. This cost is included in the Delivery charge on your natural gas bill (regardless if you purchase your gas from Union Gas or an energy marketer). The cap-and-trade cost is determined in part by the market and currently is about 3.3 cents per cubic metre (m3) of natural gas used. The total cost for your business will depend on how much gas you use. To estimate the approximate cost of cap and trade on your bill, use the calculator found on this page.

Union Gas has applied to the Ontario Energy Board (OEB) for an increase in delivery rates as outlined in its 2018 Cap-and-Trade Compliance Plan, filed with the OEB on Nov. 9, 2017. This application is currently under review. If approved, this means an increase in cap-and-trade costs to 3.6 cents per cubic metre of natural gas used effective Jan. 1, 2018. We expect the cost could increase over the long term as the province's cap on greenhouse gas (GHG) emissions is lowered. The OEB reviews and approves all cap-and-trade costs before they are included on your bill. As the price of carbon units changes, the charge on your bill will be adjusted accordingly. You pay what Union Gas pays - no more, no less.

Some businesses with large emissions may need, or are able, to acquire their own carbon units.

  • Businesses emitting more than 25,000 tonnes of CO2 equivalent (tCO2e) annually (about 13 million cubic metres of natural gas, assuming natural gas is the only source of emissions) are required to acquire their own carbon units.
  • Those businesses emitting 10,000 to 25,000 tCO2e annually (five million to 13 million cubic metres of natural gas emissions) have the option of acquiring their own carbon units or having Union Gas buy carbon units on their behalf and recovering these costs on their natural gas bill.

Large customers managing their own cap-and-trade compliance are responsible for all costs associated with covering their own emissions (called customer-related costs). These customers will only be charged for costs related to covering Union Gas' operation emissions (called facility-related costs) and program administration on their natural gas bill.

Reducing the impact on your bottom line

Use less, pay less. Because the cap-and-trade cost is charged per cubic metre of gas used, the impact of cap and trade on your operating budget depends on the amount of natural gas you use. Union Gas has a wide range of energy saving programs and incentives to help you improve efficiency and performance while reducing your overall energy and cap-and-trade costs.

Union Gas is dedicated to emerging low carbon technologies

Funds generated by the cap-and-trade program will be used by the provincial government to support programs outlined in the Climate Change Action Plan (CCAP). Union Gas continues to advocate for funding to help customers and businesses make the shift to cleaner energy solutions such as:

A transport truck driving

Compressed and Liquefied Natural Gas for transport

Compressed Natural Gas (CNG) and Liquefied Natural Gas (LNG) are low-carbon, low-cost alternatives to diesel. Switching diesel vehicles to CNG or LNG will significantly reduce transportation emissions, which account for more than one-third of Ontario's GHG emissions. Learn more about how you can save money and energy by investing in CNG or LNG technologies for transport.

Learn More
Cow farm producing renewable natural gas

Renewable Natural Gas for a sustainable future

Renewable Natural Gas (RNG) is a carbon-neutral fuel generated by decomposing organic material in landfills, waste treatment plants and farms. Fully interchangeable with conventional natural gas, it has the potential to become a clean and sustainable energy source for Ontario. Find out more about how RNG is being used.

Learn More
A combined heat and power operation

Combined Heat and Power for independence from the grid

Combined Heat and Power (CHP) uses natural gas to generate both electricity and heat. By harnessing waste heat from the power generation process, CHP systems reduce energy costs and GHG emissions, while ensuring power quality and reliability. See how CHP is helping Ontario businesses control costs.

Learn More

Crucial to a strong, low-carbon Ontario

Natural gas is a vital resource for the provincial economy, fuelling commercial and industrial operations that support thousands of direct and indirect jobs. No other fuel contributes more to the economic vitality of Ontario, fostering our prosperity today and our prospects for tomorrow. Visit to understand the vital role of natural gas in Ontario’s clean energy mix.


Keeping energy costs low

Natural gas costs less today than it did 10 years ago and massive deposits, newly discovered right here in North America, ensure that it will continue to be your most affordable energy source for many years to come.

Strengthening Ontario's economy

Access to reliable and affordable energy allows businesses to thrive in a highly competitive environment. The natural gas industry supports hundreds of thousands of direct and indirect jobs, across the country and in your own community.

Cleaning the air

Natural gas is by far the cleanest burning conventional fuel, cutting greenhouse gas emissions by 25 per cent versus diesel and oil. It’s also a crucial low-emission partner to intermittent renewable energy sources like wind and solar, able to generate up to 30 per cent of Ontario’s electricity when the wind isn’t blowing and the sun isn’t shining.

Making things you use every day

Composed of hydrocarbons, an essential component in plastics, natural gas is needed to make over 6,000 household products, from sippy cups and running shoes to toothbrushes, tires and trash bags. Life wouldn’t be the same without natural gas.

General help with Cap and Trade

For questions specific to the cap-and-trade program excluding emissions reporting and technical help for the Compliance Instrument Tracking System Service (CITSS), contact Ontario Government Cap and Trade Help Information:

Telephone Icon1-888-217-3326 (toll-free)

For help with GHG emissions reporting

Contact the Ontario Government GHG Emissions Help Desk

Telephone Icon416-649-4480 or 1-855-815-6400 (toll-free)