Yesterday, the Government of Canada introduced Bill C-30, Canada's Clean Air Act, and released a Notice of Intent to Develop and Implement Regulations and Other Measures to Reduce Air Emissions.  Bill C-30 amends the Canadian Environmental Protection Act, 1999 ("CEPA") to empower the federal government to regulate "air pollutants" and greenhouse gases.  The Notice of Intent sets out a framework for achieving 45 to 65 percent air emission reductions from 2003 levels by 2050.  Together, Canada's Clean Air Act and the Notice of Intent form the government's Clean Air Regulatory Agenda.

The amendments to CEPA under Canada's Clean Air Act empower the federal government to address designated smog-related substances ("air pollutants") and greenhouse gases separately from CEPA's current regulation of toxic substances.  Proposed reporting and remediation obligations for "air pollutants" and greenhouse gases are consistent with current CEPA requirements with respect to toxic substances.  Under the Bill C-30 amendments, indoor air quality would be regulated under CEPA and national air quality objectives would be issued within three years.  The current CEPA amendments do not impose any emission reduction obligations as this is to be achieved through future regulations.

Noticeably, the new Clean Air Regulatory Agenda contains no absolute targets for reducing greenhouse gas emissions.  Only a long-term goal of an absolute reduction of Canada's emissions by 2050 has been established.  To determine how that absolute reduction would be achieved, the government proposes to seek advice from the National Round Table on the Environment and the Economy. The Agenda contains no mention of the Kyoto Protocol, and the government has made it clear that it does not believe Canada's Kyoto target is achievable.  The government has noted that its intensity-based emission targets for greenhouse gases will yield a better outcome than those set out under the previous government's "Project Green" plan (which included an absolute emissions reduction target of 45 Mt for large industrial emitters for 2008-2012).  The Notice of Intent provides various timelines for the introduction of regulations regarding air emissions, as follows:

Immediate Term
• Consultations regarding industrial intensity-based greenhouse gas emissions reduction targets for regulations to be introduced by fall 2008.
• Within 12 months, regulations to reduce "air pollutant" emissions from various off-road and marine vehicles and engines (including diesel equipment used in construction, mining, forestry and agriculture as well as forklifts).
• Within 12 months, regulations to align requirements for volatile organic compound emissions from various consumer and commercial products (such as paints, cosmetics and cleaning products) with US requirements and, thereafter, further requirements related to similar emissions (including those from portable fuel containers and printing, aerospace and automotive sectors).
• Within 12 months and thereafter, regulations to align fuel, vehicle and engine "air pollutant" regulations with US standards.
• Seek commitment of railway industry for continued greenhouse gas emission reductions and imposition of air pollution standards consistent with US requirements.

Short-term (2010-2015)
• Fixed cap reduction targets to be adopted for "air pollutant" emissions.
• Intensity-based emissions reduction targets to be adopted for greenhouse gas emissions.
• Emission reduction regulations for the railway sector and auto industry (beyond current commitment of auto industry to reduce greenhouse gas emissions by 5.3 Mt by 2010).

Medium-term (2020-2025)
• Further greenhouse gas emissions intensity reduction targets to "support the establishment of a fixed cap".

Long-term (2050)
• Absolute reduction of Canada's greenhouse gas emissions between 45 and 65 percent from 2003 levels.

Compliance mechanisms for meeting emissions targets are to be developed in consultation with industry and may include private emissions trading systems (with no government participation) and a system of credits for early action, technology investment or domestic offsets.  Amendments to CEPA under Bill C-30 anticipate regulations relating to "tradeable units" with failure to remit a tradeable unit being an offence resulting in liability of a fine (to be determined under future regulations) or imprisonment (consistent with the current offence provisions in CEPA).

It remains to be seen whether the minority federal government's Clean Air Regulatory Agenda will be supported in Parliament.  News reports indicate that all three opposition parties plan to vote against Canada's Clean Air Act, and, on Tuesday, opposition parties fast-tracked a parliamentary committee review of a Private Members' Bill that would require the federal government to honour Canada's Kyoto commitments. 

The Notice of Intent, published in the Canada Gazette October 21, 2006, provides for a 60-day comment period from the date of publication.

The foregoing is a summary of a recent development in environmental law.  If you would like additional information about this or any other environmental law topic, please contact Sarah Powell, Alexandria Pike or Katie Goldberg Zwick in the Toronto office at (416) 863-0900.  With respect to Québec environmental law, please contact Michel Pelletier in the Montréal office at (514) 841-6400.

Davies Ward Phillips & Vineberg LLP, with over 235 lawyers, practises nationally and internationally from offices in Toronto, Montréal, New York and an affiliate in Paris and is consistently at the heart of the largest and most complex commercial and financial matters on behalf of its North American and overseas clients .

The information and comments contained herein are for the general information of the reader and are not intended as advice or opinions to be relied upon in relation to any particular circumstances.  For particular applications of the law to specific situations, the reader should seek professional advice.