WTO Declares Ontario's Green Energy Act Illegal | New Fact Sheet

In December 2012, the World Trade Organization (WTO) ruled part of the Ontario Green Energy and Green Economy Act (GEA) illegal. A WTO panel decided that “Buy Local” conditions on wind and solar power projects, designed to ensure local development and jobs benefits to Ontarians, violate international free-trade rules. This decision exposes the very real barrier that these rules put in front of our economic and environmental policy options, and to the idea of sustainable development more generally.

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Ontario’s Green Energy and Green Economy Act of 2009 provided a foundation to help rebuild the province’s battered industrial economy while advancing its clean, renewable energy development capacity. While not perfect, the Act is a creative policy solution to the economic and environmental problems Canada faces.

By combining job creation and greenhouse gas reduction strategies, the GEA embodies the definition of sustainable development as recognized by the World Trade Organization and United Nations Environment Programme. So it is difficult to understand why the WTO has agreed with Japan and the European Union that parts of the Ontario policy are illegal under global free trade rules.

The WTO decision, which is being studied closely by governments around the world, says a lot about the limits that free-trade puts on our attempts to solve today’s complex but related climate, economic and social crises. However, despite this, the Harper government is pursuing even more restrictive free-trade deals with the European Union, Trans-Pacific Partnership nations, and others.