In 2019, the City of Toronto declared a climate emergency and adopted a net-zero emissions by 2050—or sooner—target. Yesterday, the City held true to its word, passing its Net Zero Strategy. The Strategy targets net-zero community emissions by 2040—a decade sooner than most major North American cities with climate action plans.
Sustainability Solutions Group and our partners at whatIf? Technologies helped Toronto develop its strategy. We modelled emissions reduction action pathways to explore how the city could reach net-zero emissions by 2040 and 2050. We found that not only is pursuing net-zero by 2040 technically feasible, it results in fewer emissions overall, provides health and well-being benefits to residents sooner, and actually costs less than pursuing net zero by 2050. So, while many municipalities have typically considered the pursuit of less ambitious climate targets to be a more cautious approach, Toronto’s pursuit of net zero by 2040 could mark the beginning of an era where the opposite will be the case.
It comes as no surprise that the effort required to reach net zero by 2040 is immense. Over the next 20 years, the community needs to retrofit nearly 300,000 homes and apartment units, and over 2,000 commercial buildings. Every viable rooftop needs to be fitted with solar panels, all food and organic waste must be composted, and all vehicles need to be electric. For context, over 1.1 million gasoline-powered cars are currently on Toronto’s roads.
Despite the great level of effort required to get to net zero by 2040, modelling shows that Toronto does not need to lean on any untested solutions to complete the actions of the strategy. Namely, electric vehicles, high-performing building materials, solar panels, and battery storage systems are all on the market and in operation today. While new technologies are not required to meet the target, the mass deployment of green technologies is likely to spur innovations and improvements that could enable the city to achieve carbon neutrality even sooner.
All in all, reaching the net-zero target by 2040 requires $146 billion in investments from the City, other levels of government, businesses, residents, and financial institutions over the coming decades. At first glance, these numbers may make the task seem insurmountable, but the investments required amount to just 5% of the city’s GDP for a decade. Many of these investments result in reduced energy bills, vehicle bills, and avoided carbon tax costs, amounting to $114 billion in savings and avoided costs. The sooner the City and the community acts, the more money the local government and Torontonians will save in the long run.
Financial modelling shows that pursuing net zero by 2040 will cost the community $135 million less than pursuing this target by 2050 because savings will start sooner. The net-zero actions also produce a broad range of societal benefits which result in direct and indirect financial paybacks beyond those discussed above. For example, our analysis showed that improved air quality from electrifying vehicles could result in health benefits valued at nearly $1 billion per year. Increased walking and cycling will reduce heart disease, and transit improvements will result in increased access to jobs and services without the need for vehicle ownership. Investments in net-zero actions will result in the creation of approximately 50,000 new jobs. In other words, reducing emissions will also advance multiple municipal and community objectives.
Electrification of building energy systems and vehicles is often cited as a big challenge—will the grid be able to accommodate the increased demand? While adaptations to the grid will be needed (for example, through improved controls and energy storage options), at a high level the net-zero pathway mitigates grid overload by increasing efficiencies first to minimize the increase in electricity demand. This is done, for example, through building retrofits, increasing the performance of new buildings, and encouraging the use of transit over personal vehicles.
Another issue with electrification is the emissions associated with the provincial grid, which are projected to increase over the coming decades. For Toronto to achieve net zero, the grid will either need to decarbonize, or the city will need to invest in costly carbon offsets or renewable energy certificates, which will deliver far fewer co-benefits.
Our modelling shows that while the challenges and effort required for the city to reach net-zero emissions are significant, it is possible and beneficial to do so. Toronto stands to gain in many areas—financial and otherwise—from pursuing its target of net zero by 2040. Toronto’s Net Zero Strategy puts the city in a position of opportunity, setting an example for the country and other cities to follow.