Thursday, October 10, 2013

Ontario's Environmental Commissioner Weighs in on Environmental Penalties for Spills to Air

Review of Application R2012014:
2.2.15 Need for Environmental Penalties for Spills to Air
(Review Denied by MOE)

 Keywords: Environmental Protection Act (EPA); Ontario Water Resources Act (OWRA); air
pollution; air quality

 Background/Summary of Issues

Under the Environmental Protection Act (EPA) or the Ontario Water Resources Act (OWRA), the
Ministry of the Environment (MOE) can issue an environmental penalty order as an abatement tool
to require certain violators to pay a penalty when a spill or unlawful discharge to water or land
occurs. Currently, MOE cannot issue environmental penalty orders for air violations. In December
2012, the ECO received an application requesting a review of the legislation, regulations and
mechanisms that enable the environmental penalties program, in order to consider expanding the
scope of the program to include discharges and emissions of pollutants to air, including a review of
section 182 of the EPA and O. Reg. 222/07 – Environmental Penalties made under the EPA.

The application was sent to MOE for consideration.

Environmental Penalties

MOE uses a number of compliance and enforcement tools to address violations of the ministry’s
laws; the tool used should be proportionate to the risk presented by the incident, the compliance
history, and the response of the violator. The variety of tools available to MOE includes education
and outreach, warnings, orders and prosecutions.

An environmental penalty order is a mandatory abatement tool that is used by MOE to encourage
companies to comply with environmental laws and to allow for swift remedial action in the event of
a spill, discharge, or other environmental violation. An order can only be issued to the
approximately 140 facilities that belong to one of nine industrial sectors prescribed in the
Municipal-Industrial Strategy for Abatement regulations. The issuance of an order is not a form of
prosecution; in fact, a person can be given an order and prosecuted for the same violation. MOE’s
Compliance Policy (2007) recommends the use of environmental penalty orders as an option for
responding to violations that fall into compliance categories II and III, which are generally more
severe. In Part 3.4 of our 2007/2008 Annual Report, the ECO observed that environmental penalties
should provide MOE staff with “a faster, less resource intensive, and less costly means of bringing
contraveners into compliance with provincial environmental laws” than prosecutions alone.

Expanding the Framework to Air Pollution

The applicants alleged that under the current regulatory framework, it is challenging for MOE to
swiftly and successfully prosecute air violations. According to the applicants, the absence of court charges and fines for air violators over the past several years demonstrates the need for more tools
to penalize air polluters. The applicants stated that, while charges and fines for air violations are
rare,  this is not an indication of compliance, as Hamilton industrial operators regularly violate
Ontario’s opacity rules, but are rarely, if ever, charged and fined.

The applicants stated that the significant health and economic costs associated with poor air quality
justify the need to ensure MOE has effective tools for abatement.

The applicants requested that MOE undertake a review to consider broadening the framework to
include spills to air, since the environmental penalties framework has proven to be beneficial for
spills to land and water. They suggested that expanding the program could provide a viable and
efficient abatement approach to ensuring that Ontario’s air rules are upheld, and assist in reducing
air emissions.

The Ontario Community Environment Fund

The funds collected through environmental penalty orders are directed to the Ontario Community
Environment Fund (OCEF), a dedicated fund that is used to support local projects focused on
environmental remediation, research and education relating to spills and restoration of the
environment, and projects related to spill preparedness, in the areas where the violations occurred.
The applicants proposed that, should MOE expand the environmental penalty program to include
spills to air, funds collected from penalties could be used for projects and initiatives focused on
research and education related to spills to air, similar to the OCEF. This would assist in making
necessary improvements to air quality and public health in Ontario communities.

Five-Year Review

Under the EPA, at least every five years, the Minister of the Environment is required to review the
operation of the environmental penalty program, including its effects on prosecutions, and provide
any recommendations on the contraventions to which, and circumstances in which, orders should be
issued. The applicants requested that the five-year review consider the expansion of the scope of
environmental penalties to include air emissions.

MOE completed its first five-year review of the program in December 2012, and found that
between August 2007 and December 2011, the ministry issued 62 environmental penalty orders for
132 violations, resulting in a total contribution of $779,482.45 to the OCEF. MOE found that
environmental penalties “fill a niche in the compliance toolkit that provides a sufficient deterrent
to unlawful discharges and allows the ministry to address non-compliance faster and more effective
than other compliance and enforcement tools.” The review did not consider or recommend
expanding the program.

 Ministry Response

In February 2013, MOE informed the applicants that it had completed its preliminary assessment of
the application and denied the review. The ministry stated that its assessment was based on the
evidence provided by the applicants, information in MOE’s files, and the Environmental Penalty
Program Five Year Review (December 2012).

MOE stated that Ontario already has a strong framework of policies, acts and regulations for
managing emissions to air and protecting air quality. The ministry advised the applicants that it is
implementing a number of measures that will further address air emissions, improve air quality, and
work to reduce both local and regional air pollution impacts in communities. This includes the

national Air Quality  Management System and Actions addressing: industrial emissions (eg sector-based technical standards under  O. Reg. 419/05 – Local Air Quality, made under the EPA),  mobile source emissions (e.g., Drive Clean program); and local community concerns (e.g.,
working with the Clarkson and Oakville communities).

The ministry advised the applicants that its existing compliance and enforcement toolkit includes a
range of tools for air violations such as education, voluntary abatement plans, orders, the issuance,
suspension or revocation of environmental compliance approvals, and prosecution. For example, the
ministry’s compliance program targets priority areas and focuses on activities that pose the highest
environmental risk. MOE further stated that “each situation is evaluated on a case-by-case basis to
determine which abatement or enforcement tool is most appropriate for obtaining quick action to
mitigate the effects of the violation, achieving compliance with environmental laws, and improve
environmental performance in the immediate and long term.”

MOE stated that Ontario’s air quality continues to improve. For example, both emissions and
outdoor levels of air pollution have decreased significantly over the past decade. MOE also
indicated that the matters sought to be reviewed are otherwise subject to periodic review and that
it completed and published its first environmental penalty program review report in December

Other Information

In 2011, MOE conducted an investigation under the Environmental Bill of Rights, 1993 over concerns
of dust emissions from the Essroc Canada Inc. (Essroc) cement manufacturing facility, north of the
Town of Picton. In reviewing MOE’s handling of that application, the ECO was disturbed that MOE’s
response was exceedingly slow and weak despite the ministry’s knowledge that Essroc’s fugitive
emissions were causing adverse effects for the applicants and area residents for almost a decade.
The ECO further found it problematic that the ministry was unable to complete the necessary
background work before the limitation period to lay charges expired, and suggested that the
ministry assess its investigative capacity and the sufficiency of the limitation period in the EPA. For
more information, see Chapter 5.3 of Part 2 of the ECO’s 2011/2012 Annual Report.

ECO Comment

The applicants raised valid points on the need for more compliance and enforcement tools to
address air violations, and the ECO believes that MOE should have at least conducted a review to
consider an expansion of the environmental penalties program.

MOE’s five-year review of the environmental penalties program found that it fills “a niche in the
compliance toolkit” because it deters unlawful discharges to land and water and allows the ministry
to address non-compliance faster and more effectively than other compliance and enforcement
tools for land and water violations. Like land and water pollution, air pollution can have adverse
effects on environmental and human health. Yet, MOE cannot issue an environmental penalty order
when a spill or unlawful discharge occurs to air. The ECO previously suggested in our 2007/2008
Annual Report that MOE consider, during its five-year review, extending the environmental
penalties program to include air.
The ECO believes that there may be a gap in MOE’s compliance and enforcement toolkit to address
air violations, as the applicants highlighted through the absence of court charges and fines for air
violators in recent years. As reported in our 2011/12 Annual Report, MOE’s slow and feeble response
in the Essroc case illustrates the need for better compliance and enforcement options for air.
Expanding the environmental penalties program to include air violations could fill this gap by
discouraging illegal discharges and enabling the ministry to address non-compliance quicker and
more effective than other compliance and enforcement tools.

The applicants also raised a convincing suggestion that, if the environmental penalties program
were extended to include air spills, MOE could also expand the OCEF to allow the funds to be used
for projects and initiatives focused on research and education related to spills to air. The ECO is

disappointed that MOE did not even comment on this suggestion.

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