U.S. EPA Issues the Latest Revision to the Risk Management Program (RMP) Chemical Release Rules

Written by Pillsbury Winthrop Shaw Pittman LLP

The United States Environmental Protection Agency’s (U.S. EPA’s) revised Risk Management Rules, designed to reduce the risk of the accidental release of hazardous chemicals, have been published in the Federal Register.  The citation to this action is 84 FR 69834 (December 19, 2019).  The rule is effective on December 19, 2019, but also provides for some staggered compliance dates for emergency response exercises and updating certain risk management plan provisions.  These revisions were triggered by EPA’s review of several petitions for reconsideration of EPA’s January 13, 2017 amendments to the rules set forth in 1996 at 40 CFR Part 68, which implemented the chemical accident preventions provisions required by Section 112 (r)  of the Clean Air Act.  Many of the 2017 requirements have been rescinded by this action.

On November 21, 2019, the U.S. EPA released a pre-publication copy of its Reconsideration of the revised Risk Management Program (RMP) Rules. In an accompanying statement, the agency noted that it has taken steps to “modify and improve” the existing rule to remove burdensome, costly and unnecessary requirements while maintaining appropriate protection (against accidental chemical releases) and ensuring responders have access to all of the necessary safety information. This action was taken in response to U.S. EPA’s January 13, 2017 revisions that significantly expanded the chemical release prevention provisions the existing RMP rules in the wake of the disastrous chemical plant explosion in West, Texas. The Reconsideration will take effect upon its publication in the Federal Register.

Background
As recounted by the D. C. Circuit in its August 2018 decision in the case of Air Alliance Houston, et al. v. EPA, in 1990, the Congress amended the Clean Air Act to force the regulation of hazardous air pollutants (see 42 USC Section 7412). An initial list of these hazardous air pollutants was also published, at Section 7412 (b). Section 112(r) (codified at 42 USC Section 7412 (r)), authorized the U.S. EPA to develop a regulatory program to prevent or minimize the consequences of a release of a listed chemical from a covered stationary source. The U.S. EPA was directed to propose and promulgate release prevention, detection, and correction requirements applicable to stationary sources (such as plants) that store or manage these regulated substances in amounts determined to be above regulated threshold quantities. The U.S. EPA promulgated these rules in 1996 (see 61 FR 31668). The rules, located at 40 CFR Part 68, contain several separate subparts devoted to hazard assessments, prevention programs, emergency response, accidental release prevention, the development and registration of a Risk Management Plan, and making certain information regarding the release publicly available.  The U.S. EPA notes that over 12.000 RMP plans have been filed with the agency.

In response to the catastrophe in at the West Plant, the U.S. EPA issued substantial amendments to these rules, covering accident prevention (expanding post-accident investigations, more rigorous safety audits, and enhanced safety training), revised emergency response requirements, and enhanced public information disclosure requirements. (See 82 FR 4594 (January 13, 2017).) However, the new administration at the U.S. EPA, following the submission of several petitions for reconsideration of these revised rules, issued a “Delay Rule” on June 14, 2017, which would have extended the effective date of the January 2107 rules until February 19, 2019. On August 17, 2018, the Delay Rule was rejected and vacated by the D.C. Circuit in the aforementioned Air Alliance case (see 906 F. 3d 1049 (DC Circuit 2018)), which had the effect of making the hotly contested January 2017 RMP revisions immediately effective.

Reconsidering the January 2017 Revision
On May 30, 2018, the U.S. EPA issued a notice of proposed rulemaking (see 83 FR 24850) to reconsider the reinstated RMP revisions and amendments, and the agency has now decided the issues raised in this rulemaking. Basically, it appears that the U.S. EPA is returning the rules to their pre-January 2017 stage and format. Over the years, these rules have been amended with some frequency, and the agency argues that these actions have all been discretionary once it finalized the basic 1996 version. Accordingly, it is acting well within its discretion to revise and rescind large portions of the 2017 amendments. Obviously, this is a complex regulatory program, but here are some highlights. The 2017 revisions to the Risk Management Program have been rescinded regarding safer technologies and alternatives analysis, third-party audits, incident investigations, and information availability. The U.S. EPA is also modifying regulations relating to local emergency coordination, emergency response exercises, compliance dates and public meetings. In addition, “this action rescinds almost all the requirements added in 2017 to accident prevention program provisions,” including again third-party audits. No longer will incident investigations be required to include a “root cause analysis,” or to consider a “near miss” that never resulted in an accidental release. The emergency response amendments are modified to allow facilities to share only that technical information necessary to implement the local emergency response plan. The agency and many commenters were concerned that the earlier rule risked the exposure of national security information. However, some of the 2107 changes to required public meetings have been retained. Finally, the U.S. EPA will establish new compliance dates to reflect these actions.

In the preamble, the U.S. EPA recognizes that the spate of recent chemical plant incidents has created concerns with these topsy-turvy regulatory proceedings. The agency points out that in several well publicized cases, these rules would not even have been applicable because the chemical release at issue was not a substance listed as a hazardous air pollutant in the statute or the implementing regulation, or in threshold quantities. Also, in the West fire and explosion, the Bureau of Alcohol, Tobacco Firearms and Explosives (ATF) believes that the cause was not an accident, but a deliberate act. Finally, the U.S. EPA argues that it is unfair to burden all covered plants with a complicated and costly regulatory program when it is clear to the agency that only a handful of chemical plants are the source of the great majority of complaints.

What’s Next?
With revised Risk Management Rules now published in the Federal Register, these actions will likely be subject to another judicial challenge. The U.S. EPA has made a strong case that it is acting well within its statutory authority and consistent with the Administrative Procedure Act. However, the challenges will be serious and substantial.

This article has been republished with the permission of the author.  It was first posted on the Pillsbury Winthrop Shaw Pittman LLP website.


About the Author

Anthony B. Cavender provides guidance and counseling relating to enforcement and compliance.  He has represented clients in Superfund matters, and in RCRA and Clean Water Act enforcement proceedings.  He is a Senior Counsel in the firm’s Houston office and a member of the Environmental & Natural Resources practice section. His practice focuses on the Clean Water Act, the Resource Conservation and Recovery Act and Superfund. Before joining Pillsbury, Anthony was a member of the legal department of Pennzoil Co., specializing in these areas as well as general corporate legal matters. He served on various energy industry committees and trade associations.

Ontario: Wind up of Municipal Hazardous or Special Waste Program

On November 21, the Ontario Resource Productivity and Recovery Authority (RPRA) closed a 45-day consultation period on Stewardship Ontario’s proposed Municipal Hazardous or Special Waste (MHSW) Program Wind-Up Plan. RPRA held two webinars and five in-person sessions across the Province to solicit feedback from interested stakeholders. The Authority has been directed to approve the proposed Wind-Up Plan no later than December 31, 2019.

The MHSW Program allows Ontario residents to safely dispose of household products that require special handling, such as single-use batteries and propane tanks. Industry stewardship organizations are responsible for recovering additional hazardous waste products, including automotive materials; paints and coatings; pesticides, solvents and fertilizers; and proprietary carbon dioxide cylinders.

Background

In April 2018, the then Ontario Minister of the Environment and Climate Change directed the wind up of the MHSW Program on December 31, 2020 as per the Waste Diversion Transition Act, 2016. Following wind up, hazardous or special materials will transition to the new, mandatory individual producer responsibility (IPR) framework under the Resource Recovery and Circular Economy Act, 2016.

In December 2018, the Minister of the Environment, Conservation and Parks (MECP) amended the timeline for the wind up of the single-use batteries component of the MHSW Program to June 30, 2020.

In July 2019, the Minister issued new directions including extending the timeline to wind up the MHSW Program to June 30, 2021; the Batteries Program wind up remains June 30, 2020.

Stewardship Ontario submitted its proposed MHSW Wind-Up Plan to the Authority by the September 30, 2019 deadline set by the Minister. As part of the wind-up process, the Minister directed the Authority to consult on the proposed plan before considering approval. As directed by the Minister, the Authority anticipates its approval of the plan by the end of the year.

MHSW Program wind up

Until the wind-up date, the MHSW Program will continue to operate without disruption. This includes the operation of the industry stewardship plans managed by the Automotive Materials Stewardship, Product Care Association, and SodaStream.

Single Use Batteries

The Minister of the Environment, Conservation and Parks has directed Stewardship Ontario to wind up the program for single-use batteries on June 30, 2020. This change will allow for a coordinated policy approach with the wind up of the Waste Electrical and Electronic Equipment Program.

 

 

 

Urgent Canadian Action is needed on PFAS — the Forever Chemicals

Written by Bev Thorpe and Fe de Leon for the Canadian Environmental Law Association

The class of chemicals called PFAS (Per- and Polyfluoroalkyl Substances) are often referred to as ‘the forever chemicals’ because they are highly persistent in the environment and will take hundreds if not thousands of years to disappear from the soil and groundwater where they accumulate.  The Netflix film, The Devil We Know, and the newly released film, Dark Waters, have brought these chemicals to popular awareness.  As we now know, two substances in this chemical class – PFOS and PFOS – are the focus of multi-million dollar lawsuits due to the cover up of data demonstrating health impacts such as increased cholesterol, kidney cancer, testicular cancer, low birth rates, thyroid disease, and weakened immunity.  Over 99% of all Canadians tested by Health Canada’s biomonitoring surveys, have PFOA and PFOS in their blood and other organs including communities in the far north.  Producers of PFOS and PFOA voluntarily stopped production in 2002 resulting in a slight decrease of these two PFAS in sampled populations, but other PFAS are now turning up in Canadians. Yet the Canadian regulatory response to this crisis is lacking urgency and transparent communication with impacted communities.

PFAS is widely present because  for over sixty years these chemicals have been used as stain, oil and water repellant chemicals in  clothing, carpets, grease-proof paper, ski wax, cookware and cosmetics and also widely used in firefighting foam and other industrial applications.  Their widespread use raises the question why it took so long to highlight the risk to human health and wildlife and why regulatory response has been so slow.  This is partly because scientists lacked the analytical capability to measure these chemicals in the environment until recently.  At the same time, PFAS, as with thousands of chemicals were historically allowed on the market with no toxicological screening requirements.  Even today, most new  PFAS, which industry is now switching to as replacements for PFOA and PFOS, lack full toxicological data yet they remain unregulated and on the market.

In Canada most uses for PFOS were prohibited in 2016 aside from exemptions for specific uses.  In 2012, the federal government concluded that PFOA was an ecological concern. But Health Canada maintains that PFOS and PFOA are not a concern for human health at current levels of exposure.  Most recently in June 2019 Transport Canada allowed airports to use PFAS-free firefighting foam, which shows a more precautionary approach as it targets the whole class of PFAS, but this is only a start.  There are over 5,000 PFAS in use and they are just as persistent in the environment as PFOS and PFOA, with many known to be highly mobile in rivers, lakes and groundwater.  None of these are restricted in Canada.

For Canadian adults, our main exposure to PFAS is via household dust, ingestion of food and air – in fact studies of air in Vancouver homes found levels of PFAS were twenty times higher than air outside the homes due to PFAS inside the homes.  Children, infants and toddlers are most at risk from PFAS exposure due to hand-to-mouth contact with PFAS treated products.  In addition, Canadian research has demonstrated PFAS in the leachate and air of landfill sites, due to the amount of PFAS in the clothing, carpets and consumer goods that have been discarded into landfills over the years and which are now leaching these chemicals into the environment.  PFAS are found in the air and effluent from wastewater treatment sites as well as in the sewage sludge which can be spread on land.

If this situation seems worrying, it is.  We lack full transparency of where contamination sites are in Canada and full accountability for who is responsible for the cleanup. Remediation is expensive and technically challenging which may partly explain such inaction.  The region downstream of Hamilton airport has still not been cleaned up eight years after high levels of PFAS contamination were discovered.  The extent of contamination in Canada is difficult to know, unlike the disclosure afforded to US citizens by many US state regulatory bodies.  The use of PFAS in firefighting foam at military bases, airports and refineries is increasingly acknowledged to be a common source of  water contamination but public information is absent on site specific monitoring data or even if groundwater wells are being monitored.  In December 2018 Health Canada released Canadian Drinking Water Guidelines for PFOS and PFOA which are substantially weaker than US based guidelines and to date British Columbia is the only Canadian province to establish provincial drinking water regulations.

We urgently need to see federal and provincial governments take action to phase out the entire class of PFAS in consumer and industrial use; strengthen Canadian drinking water standards to be more protective of children’s health and radically increase public right to know about the presence of PFAS in consumer products, local drinking water, and discharges into our communities. Tackling these forever chemicals requires an informed and coordinated public response which has sadly been lacking to date.

This article has been republished with the permission of the authors.  It was first published on the CELA website.


About the Authors

Bev Thorpe is an environmental consultant and principle author of CELA’s reports on PFAS.  Bev works with advocacy networks, companies and governments to advance an economy without the harm of hazardous chemicals.  She is a long time member of the Coming Clean network in the USA and she works with European and Asian networks.

Fe de Leon is a researcher with the Canadian Environmental Law Association (CELA) and has worked extensively on toxic substances particularly in the Great Lakes Basin, on the federal chemicals management plan and on international efforts to address persistent toxic substances through the Stockholm Convention on Persistent Organic Pollutants, the Great Lakes Quality Agreement, and a global treaty to address mercury.

Environmental Liability Policies: The Extent Of Coverage

Written by Robert Emblem, Partner and Gabrielle Dumas-Aubin, Senior Associate, Clyde & Co

The authors wish to thank Raphaëlle Dussault for her contribution to the article

Soil contamination can expose landowners and businesses to significant liability. But Clyde & Co recently secured a Quebec ruling that demonstrates they should not assume that environmental liability insurance policies offer blanket protections against environmental risks. Indeed, there are significant differences between the types of coverage that they can offer.

In its judgment, in Paquet & Fils Ltée the Quebec Superior Court ruled on the applicability of an environmental cleanup and liability insurance policy for storage tanks. The defendants, a pool of insurers, issued the policy to the plaintiff, Paquet & Fils Ltée, a distributor of petroleum products, for its gas station located in Saint-Damien-de-Buckland, Quebec.

This lawsuit came about following the plaintiff’s discovery of contaminated soils at its gas station. The plaintiff had not conducted environmental testing when it acquired the site, nor when it dismantled the gas station.

It presented a claim to the Encon Group Inc. (which was acting as an insurance manager for the defendants) under the policy for the cost of decontamination. Encon denied coverage on the grounds that the plaintiff did not prove that the source of contamination originated from a storage tank leak during the period of insurance, as required under the policy.

The plaintiff sued the defendants contesting the denial of coverage, claiming that by taking such a position, the defendants never assumed any risk under the policy. It also argued that the defendants have been acting in bad faith when they initially issued the policy and following the receipt of its notice of claim. In particular, the plaintiff asserted that before issuing the policy, the defendants should have investigated the risk further instead of relying on the plaintiff’s statements. The plaintiff also argued that the defendants failed to advise it of the importance of identifying the source and age of the contamination. Finally, had it not been for the defendants’ late denial, the plaintiff claimed, it could have resumed its commercial activities at the site without having to decontaminate it.

Clyde & Co lawyers responded for the defendants that they were justified in denying coverage since the plaintiff failed to demonstrate, on a balance of probabilities, the existence of a “release,” within the meaning of the policy, during the period of insurance.

Initial comments

The court began by reviewing general interpretation principles for insurance policies. It explained that it was up to the insured first to establish that the claimed damage or loss falls within the initial grant of coverage. Following that, the insurer could prove that an exclusion applied. The court also noted that when the policy is unambiguous, it should give effect to clear language, reading the contract as a whole.

The court added that the insured could meet its onus by any means, including a presumption of fact, provided that it is serious, precise and concordant. That said, it notes that a presumption of fact cannot be deduced from a pure hypothesis, vague suspicions or mere conjecture. The court concluded that no presumption of fact was of assistance to the plaintiff in this case.

Policy triggers

The court explained that for coverage to be triggered under the policy, the plaintiff must prove, among other things, (1) the source of the contamination (i.e. a “release” originating from a “storage tank system”) and (2) the age of the contamination (i.e. started on or after the “retroactive date” specified in the policy).

It emphasized that the policy only covers a “release” originating from a “storage tank system” as opposed to one that occurs in the context of the plaintiff’s operations. Reviewing expert opinions and testimony, it indicated that it could not reasonably infer that a “release” had occurred. Even the plaintiff’s expert could not exclude that the plaintiff’s operations might have been the source of the contamination.

The court noted that no one had noticed or recorded a leak or any irregularity, which might suggest that a leak originated from a storage tank during the coverage period (on or after the “retroactive date”). In particular, it stressed that none of the experts could determine when precisely the contamination happened or how recently.

The court concluded that, in the absence of serious, precise and concordant facts proving that a release started during the period of coverage, the plaintiff could not demand that the defendants pay for the decontamination.

Illusory coverage and the insurers’ failure to investigate

The court also rejected the argument that the defendants never actually covered any risk. If, during the policy period, the plaintiff had observed a leak originating from its “storage tank system,” had conducted a proper investigation as required by the policy, and notified the defendants, there is no reason why coverage would have been denied.

The court also found that the defendants had no obligation to collect additional information to assess the risk at the time of the application for insurance. It made a distinction between the present matter and the case where the defendants would seek to cancel the policy for misrepresentation or non-disclosure of the material facts that affected their acceptance of the risk or setting the premium.

As for the allegations of bad faith, the court noted that the claims adjuster advised the plaintiff early on that, in the absence of an investigation establishing a “release,” coverage could be denied. The claims adjuster had also asked for additional information related to the source and age of the contamination. What’s more, the court concluded that the plaintiff did not demonstrate the seriousness of its alleged intention to resume its commercial activities. As a result, the defendants did not act in bad faith.

Takeaway

Ultimately, it is the insured’s responsibility to conduct environmental testing, in particular when acquiring a property, applying for an insurance policy or before dismantling facilities. These tests could be crucial to determine whether and to what extent coverage is available under an environmental liability policy. The plaintiff has not appealed the judgment.

This article has been republished with the permission of the authors.  It it was originally published on the Clyde & Co website.


About the Authors

Robert Emblem, Partner

Having worked on secondment with a leading Lloyd’s syndicate in the mid-1990s, Bob has also developed a large insurance coverage and defense practice. He represents insurers, reinsurers and insureds in the areas of commercial general liability, professional liability, media/technology liability, directors’ and officers’ liability, fidelity, contingency and property insurance. In addition to providing coverage and regulatory advice to insurers and reinsurers, he regularly performs policy wording reviews and claims audits.

Bob is a member of both the Ontario and Quebec bars, has wide-ranging experience in both the Common Law and civil law systems, and is fluently bilingual in English and French. Bob regularly appears before all levels of the Quebec courts as well as arbitration and mediation panels throughout North America.

Bob is one of the leading experts in Canada in the area of course of construction insurance and co-authored Commercial General Liability Insurance published by Butterworths. He speaks regularly at conferences and delivers papers for the Barreau du Québec, the Canadian Institute, the Canadian Bar Association, Insight, Canadian Defence Lawyers, the Insurance Bureau of Canada and other organizations.

Gabrielle Dumas-Aubin, Senior Associate

Gabrielle joined Clyde & Co in 2016, where she provides advices on managing and monitoring claims and insurance coverage for Canadian and foreign insurers. Gabrielle analyzes complex claims and draws up legal opinions on professional liability and general liability risks.

She graduated from the University of Ottawa with the honorary mention summa cum laude. During her studies, Gabrielle received numerous scholarships and was a research assistant for various professors. She completed her studies with a master’s degree in law at Oxford University in 2014.  Gabrielle is a member of the Young Bar Association of Montreal and of the Bar of Quebec in 2013.

Ontario Government Proposes new rules around Administrative Monetary Penalties

The Ontario government recently proposed amendments to regulations dealing with Administrative Monetary Penalties (AMPs) under the Ontario Environmental Protection Act.  The reason given for the proposed amendments was that they would remove regulatory overlap and result in regulations that are focused and streamlined.

An AMP is a financial penalty for non-compliance that provides an incentive to the violator to return to compliance and deter future non-compliance.  Administrative penalties are used across the Government of Ontario in regulated program areas such as forestry, consumer protection, energy, and waste diversion.

Deficiency in the Existing AMPs

AMPs are regularly used in other jurisdictions, particularly Canada and the United States, to support the enforcement of environmental laws (e.g. British Columbia, Alberta, Canada, Quebec, Ohio, Vermont and Minnesota).

AMPs, as a compliance and enforcement tool (i.e. environmental penalties), are currently available to the Ontario Environment Ministry for some land, water and air violations, but are limited in scope. This gap leaves many program areas with limited enforcement tools and affects the ministry’s ability to effectively hold polluters accountable.  In addition, some of the acts proposed to be amended that are enforced by the Ontario Environment Ministry do not have the enabling authority to issue administrative monetary penalties (e.g. Safe Drinking Water ActPesticides Act), while others are out of step with best practice (e.g. Nutrient Management Act, 2002).

Jeff Yurek, Ontario Environment Minister

Proposed Amendments

The are proposed legislative amendments expand and/or clarify enabling authority to issue administrative monetary penalties for environmental violations under key environmental statutes, including:

  • Nutrient Management Act, 2002
  • Ontario Water Resources Act
  • Pesticides Act
  • Safe Drinking Water Act, 2002

The proposed amendments would enable administrative monetary penalties to be issued for a broad range of environmental violations under the acts mentioned above. To take effect, violations that may be subject to an administrative monetary penalty would be prescribed in regulation.

The proposal, along with recent amendments to the Environmental Protection Act, would replace existing monetary penalties (i.e. environmental penalties) under the Environmental Protection Act and Ontario Water Resources Act.

Key provisions under the proposed administrative monetary penalty approach are set out under each act and include:

  • set maximum penalty amounts or higher if the economic benefit achieved via the violation was higher (penalty amounts would be set by a regulation). The maximum penalty amounts set in the acts are as follows:
    1. Ontario Water Resources Act – $200,000 per contravention (same as the Environmental Protection Act)
    2. Pesticides Act – $100,000 per contravention
    3. Safe Drinking Water Act, 2002 – $100,000 per contravention
    4. Nutrient Management Act, 2002 – $10,000 per contravention
  • ability to review and/or appeal the administrative penalty
  • an annual report listing the administrative penalties issued in the last calendar year
  • provisions to enable the implementation of administrative monetary penalties in regulation (e.g. how to set administrative monetary penalty amounts, who they can apply to, and how violators can seek reductions in penalty amounts for taking action to prevent or mitigate the contravention

The government argues that the broader use of AMPs would help it take strong action against illegal activity, ensure that polluters are accountable for their actions, and deal with environmental violations that do occur, more efficiently and appropriately.  Prosecution would continue to be used as an enforcement tool but may be limited to serious violations.

If passed, these proposed legislative amendments would allow for future regulations to implement administrative monetary penalties to more violations, such as, but not limited to:

  • illegal sewage discharges into waterways
  • selling pesticides without a license
  • failing to have a certified drinking water operator
  • violating terms of a permit to take water

Criticism of the Proposal

Environmental activists decried the proposal and charged that it will result in lightened consequences for polluters.  Keith Brooks, spokesperson for Environmental Defence, stated in press release, “It is highly deceptive of the Ontario government to claim that it is doing more to hold polluters accountable, when they are actually cutting the penalties polluters face.”

The environment critic from the Ontario New Democratic Party, Ian Arthur, an MPP for Kingston and the Islands, stated: “The Ford government has proposed eliminating an existing $100,000-per-day penalty for environmental polluters and replacing it with a one-off fine of $10,000. Further, the government is pushing to cap environmental fines at an overall maximum of $200,000.”

 

Nova Scotia’s Auditor General Concerned about Mine Contamination

In a recent report issued by Nova Scotia’s Auditor says more work needs to be done to address contaminated mine sites throughout the province.

“I drew attention to this accounting because the cost to clean up the province’s contaminated sites could significantly change in the future as the province collects more information on these sites,” Michael Pickup, Nova Scotia’s Auditor General said.

This was the first year the report drew attention to accounting for contaminated sites. The report showed that contaminated site liabilities increased to $372 million in 2019 compared to $107 million five years ago.

According to Pickup’s report, the Department of Lands and Forestry’s investigations of contamination at abandoned mine sites is lacking, leaving a risk of unknown financial, ecological and human health concerns. The report also found an additional 63 mine sites with no liability for remediation because the contamination extent is unknown.

Historical Gold Mining Area Map for Nova Scotia

“Those sorts of legacy sites, unfortunately, date from a period in which there really wasn’t environmental science and people just didn’t have a good understanding of our impact on the environment,” says Sean Kirby, the Executive Director of the Mining Association of Nova Scotia.

Greener Cleanup Metrics

The United States Environmental Protect Agency (U.S. EPA) “Principles for Greener Cleanups” provide a foundation for planning and implementing cleanups that protect human health and the environment while minimizing the environmental footprint of cleanup activities.

The U.S. EPA has developed 14 greener cleanup metrics that may be used to quantify specific portions of the footprint, such as the amounts of refined materials, public water or diesel fuel that are used or the amount of wastewater and hazardous waste that is generated.

 

Category Metric Unit of Measure
Materials
Refined materials used or conserved tons
Unrefined materials used or conserved tons
Waste Hazardous waste generated or avoided tons
Non-hazardous waste generated or avoided tons
Water Public water used or conserved million gallons
Groundwater used or conserved million gallons
Wastewater generated or avoided million gallons
Other water used or conserved million gallons
Energy Grid electricity used or conserved megawatt hours
Diesel used or conserved for equipment gallons
Diesel used or conserved for transportation gallons
Gasoline used or conserved for equipment gallons
Gasoline used or conserved for transportation gallons
Other energy used or conserved (variable)

The metrics provide an optional means for regulators, private industry and other cleanup partners to collect and track site-specific footprint information across multiple sites in a uniform and transparent manner. On a site-specific level, use of the metrics can help decision makers prioritize and select best management practices (BMPs) that could be implemented to minimize the footprint. The metrics may be applied to any type of site cleanup, including ones conducted through Superfund, RCRA or brownfield regulatory programs or voluntary initiatives.

Due to wide variations in cleanup project scopes and regional or local priorities, environmental footprints associated with other core elements of a greener cleanup may be quantified through additional metrics chosen by project stakeholders. Parties interested in quantifying a cleanup project’s environmental footprint at a more detailed level may use EPA’s Spreadsheets for Environmental Footprint Analysis (SEFA).

Questions about the Greener Cleanup Metrics may be forwarded to: Carlos Pachon, EPA/Office of Land and Emergency Management, or Hilary Thornton, EPA/Region 4.

 

Alberta Court Of Appeal Sets The Guideline For Extending Limitation Period For Environmental Claims Under The Environmental Protection And Enhancement Act

Written by Chidinma Thompson and Miles F. Pittman, Borden Ladner Gervais LLP

Introduction

In Brookfield Residential (Alberta) LP (Carma Developers LP) v Imperial Oil Limited, 2019 ABCA 35 (“Brookfield“), the Alberta Court of Appeal unanimously confirmed the Court of Queen’s Bench treatment of the test that applies when an application is made to extend a limitation period under Alberta’s Environmental Protection and Enhancement Act RSA 2000 c.E-12 (“EPEA“). This decision overruled the approach proposed in Lakeview Village Professional Centre Corp. v Suncor Energy Inc. 2016 ABQB 288 and has significant implications for parties to environmental claims. While the law in this area has advanced in a short period of time, there is an issue of whether contractual limitation period can be extended under section 218.

Background

Brookfield Residential (Alberta) LP formerly known as Carma Developers LP (“Brookfield”) brought a claim in negligence for environmental liability against Imperial Oil Limited (“Imperial”). Brookfield had acquired a property that had been a well site drilled and operated by Imperial 60 years prior to the action.

Imperial brought an application for summary dismissal, on the basis that the claim was statute barred under the Limitations Act RSA 2000, c L-12. Brookfield cross applied for an extension of the limitation period under section 218 of the EPEA.

The Court of Queen’s Bench Decision

The Court of Queen’s Bench dismissed Brookfield’s application to extend the limitations period pursuant to s.218 of the EPEA and granted Imperial Oil’s summary dismissal application on the grounds of no merit to the claim given the ultimate limitation period expiry. The Court applied the section 218 factors: (a) when the adverse effect occurred, (b) whether the claimant exercised due diligence in discovering it, (c) whether there would be prejudice to the defendant’s ability to defend the claim; and (d) any other criteria the court considers relevant.

The Court considered when the environmental damage occurred and determined that there was insufficient evidence to pinpoint when the damage had occurred. The Court found that Brookfield’s expert’s report contained instances of “mere speculation” and that the report “ignore[d] the years when the well was a flowing oil well and the years when it was used for salt water disposal.” The Court found that Brookfield had exercised a reasonable amount of due diligence in ascertaining environmental damage. The Court, having found no additional criteria was required to be considered pursuant to 218(3) (d), turned to whether Imperial would be prejudiced by the action if allowed to proceed. The Court found that Imperial would suffer prejudice if the limitations period was extended for the following reasons.

First, the passage of a great deal of time meant that there would be a significant number of lost witnesses, lost documents, and lost records. Further, Imperial would not have the ability to sample and test the contamination themselves, and therefore the ability to test various causation sources. The inability for Imperial to defend itself was at the heart of the prejudice.

Second, the Court found that the standard of care appropriate at the time in question would be nearly impossible to establish. As a claim in negligence, the standard of care required of Imperial at the time would be critical to both litigants’ cases. The Court held that “[e]volving standards of conduct and new standards of liability eventually make it unfair to judge actions of the past by the standards of today.”1The Court concluded that permitting an action to go ahead more than 60 years after the Defendant last was involved in the Well would be an abuse.

The Court of Appeal Decision

The Court of Appeal confirmed that section 218 applications under the EPEA are to be heard pre-trial. In doing so, the Court of Appeal rejected the approach proposed in Lakeview Village Professional Centre Corp. v Suncor Energy Inc. 2016 ABQB 288 (“Lakeview“) and held that Lakeview should not be followed. The Court in Lakeview approached section 218 as a procedural matter, suggesting that in some cases it would be possible to extend the limitation period under s. 218 in a preliminary application, but in other cases it might be appropriate to defer the decision until trial when there will be a full evidentiary record. The Court of Appeal determined that the Lakeview approach is wrong for two reasons.

First, it is inconsistent with the wording of section 218 which provides that the limitations period may be extended “on application.” Second, the approach is ultimately circular. Waiting until trial to decide a 218 application defeats the purpose and entire repose that the Limitations Act was intended to bring. It would deprive the defendant of the entire benefit of the limitations defence, which is avoiding the distractions, expense, and risks of litigation after the prescribed time has passed. The claim may proceed and be successful on its merits at trial, only to be defeated by the defendant’s limitations defence. Yet, the defendant has undergone the entire effort and expense of trial.

In assessing the 10 years ultimate limitation period in this case, the Court of Appeal confirmed that limitation period does not recommence every time the cause of action or the property is transferred. More importantly, the Court differentiated between the damage to the land (continuing adverse effect) from the continuous breach of duty or course of conduct that that would start the limitation period running anew every day. The Court of Appeal further confirmed that the competing policy objectives of the Limitations Act and the EPEA must be weighed in assessing a section 218 extension application. The Court of Appeal confirmed that the ultimate decision on whether or not to extend the limitation period includes an element of discretion that should not be disturbed unless they are based on an error of principle, consider irrelevant factors, or are clearly unreasonable. In this case, the decision by the chambers judge not to extend the limitation period was amply supported by the record.

Implications

Since the addition of section 218 to EPEA in 1998, extension of limitation period for environmental claims did not attract attention until Lakeview in 2016 and Brookfield in 2017. Jurisprudence was sparse and there was no defined judicial guidance on the application of the statutory factors in exercising the discretion to extend limitation period. Lakeview was the first attempt to articulate an approach which did not work in Brookfield. The Alberta Court of Appeal has established the required guidance in this decision. It is noteworthy that inLakeview there was no application by the defendants for summary judgment as in Brookfield, and this fact was irrelevant to the Court of Appeal’s determination that extension of limitation period under EPEA must be decided pre-trial.

This decision provides more certainty for environmental damage litigants. Given that the main battle will now be fought at the front end, a potential effect is that section 218 applications will invariably be followed by cross-applications for summary dismissal. Further, parties have to put forward their best case at this early stage and the evidentiary requirement is significant. However, the application of the section 218 factors is fact driven, and ultimately, the success of each case will depend on its own facts.

While section 218 expressly addresses statutory limitation period, a question has arisen as to whether the Court can extend contractual limitation period under section 218. We will continue to monitor developments in this area and provide further updates.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

This article has been republished with the permission of the authors.  It was first published on the BLG website.


About the Authors

 

Concern over potential slow response time at Burnaby crude oil storage facility

A recently disclosed fire protection audit report on the Burnaby, British Columbia crude oil storage terminal has raised concerns of local politicians and residents.  The facility is owned by TransMountain Pipeline.  The report estimates that the planned response time to a major event, such as a serious spill or fire, at six hours.

The Burnaby storage terminal is the end point of the Trans Mountain Pipeline System. It is a distribution point for crude oil and refined products to local terminals – the Parkland refinery and the Westridge Marine Terminal. The Burnaby terminal currently has 13 tanks with a combined storage capacity of 1.6-m bbl with secondary and tertiary containment.

The fire protection audit was commissioned by the National Energy Board (now the Canadian Energy Regulator [CER]) in 2016.  The audit was conducted by PLC Fire Safety Solutions, a company provide quality fire safety engineering services.

In May, the National Energy Board (now the CER) issued a report on Trans Mountain’s fire preparedness at three oil terminals in Burnaby, B.C., and Edmonton, Alberta. The CER report notes that TransMountain’s response time goal for assembling staff and contractors to initiate the fire fighting activities as six hours.  In its report, it states the TransMountain reduce the response time to four hours.

The PLC Safety Solutions report on the Burnaby terminal concluded in the emergency response plans were generally in compliance, but it raised questions about the time and manner in which the company’s own firefighting team could respond.

“Since there is currently no mutual aid agreement with the Burnaby Fire Department, initial response will be limited and response time could be six hours,” concludes the report.

The fire protection audit report was recently made public after the local Member of Parliament filed a Freedom of Information request.  In response to the report being made public and the  Since the report was prepared, the Canadian Energy Regulator has stated that the response time has been reduced to four hours.

TransMountain Pipeline issued a news release in response to the report’s finding being made public, stating, “At our terminals, we are ready to respond immediately with people and equipment. Trans Mountain has mutual aid agreements in place with other industrial operators in the areas where we operate, and contracts with response companies to provide fire responders to the terminals.”

The Burnaby crude oil storage terminal has been in operation for more than 65 years.  There has never been a storage tank fire.

 

Federal Government Passes Controversial Environmental Legislation and Tanker Ban

Written by Blakes Environmental Law Group

The Government of Canada has enacted two new pieces of environmental legislation, significantly altering the process for federal project approvals in Canada. It has also passed extensive amendments to the rules regarding navigable waters and fish habitat protections that had been previously changed through omnibus legislation in 2012.

On June 20, 2019, the Senate passed three bills:

  1. Bill C-69, the controversial Act entitled An Act to enact the Impact Assessment Act and the Canadian Energy Regulator Act, to amend the Navigation Protection Act and to make consequential amendments to other Acts
  2. Bill C-48, Oil Tanker Moratorium Act
  3. Bill C-68, Act to Amend the Fisheries Act

All three bills received royal assent on June 21, 2019. Bill C-69 and significant portions of Bill C-68 will come into force later, through orders-in-council. Once in force, the bills will result in significant changes to how the government manages and approves projects in Canada. For more information on Bills C-69 and C-68, please see our February 2018 Blakes Bulletin: Federal Government Overhauls Canadian Environmental Legislation.

BILL C-69

Originally introduced in the House of Commons in February 2018, Bill C-69 toured the country and was amended three times before ultimately receiving royal assent over a year after its introduction. The final Senate vote was 57 to 37 with one abstention. Highlights of Bill C-69 include the repeal of the National Energy Board Act (NEB Act) and the Canadian Environmental Assessment Act, 2012 (CEAA), signalling the end of the National Energy Board (NEB) and the Canadian Environmental Assessment Agency. To replace them, the new Canadian Energy Regulator Act (CERA) and Impact Assessment Act (IAA) respectively, will create two new regulators: the Canadian Energy Regulator (CER) and the Impact Assessment Agency (Agency).

The CER, like the NEB, will continue to govern the lifecycle of federal energy projects, including interprovincial and international pipelines and transmission lines, offshore energy projects, and international energy trade. However, the new Agency will take over all impact assessments and evaluate projects based on several mandatory factors, including project need, economic and social effects, and Indigenous knowledge related to the project. The Agency or appointed review panel must report to the Minister of Environment and Climate Change Canada (Minister) or the governor-in-council on the positive and negative impacts of the project. This is in contrast to the existing procedure, where the NEB presides over project reviews and makes recommendations to the government. Cabinet or the Minister, however, will remain responsible for final determinations on the public interest.

The new IAA process will include an early planning stage and proponent impact statement prior to the commencement of an impact assessment. An impact assessment may be led by the Agency or a review panel, which may include panel members from lifecycle regulators such as the CER. Like the CEAA, the IAA will apply to designated projects; however, the regulations indicating which projects will be designated have not yet been finalized.

Bill C-69 was not passed with flying colours. The first round of amendments to the bill were made on the recommendation of the Standing Committee on Environment and Sustainable Development (ENVI). The ENVI Committee Report was prepared with input from Indigenous Peoples, companies and individuals. The initial round of amendments included changes such as clearer timelines, clarification around factors to be considered in project review (only feasible alternatives to be considered, both positive and negative impacts), clarification of transitional provisions and allowance for integrated review panels to ensure projects are subjected to only one review.

The first round of amendments was approved and Bill C-69 was sent to the Senate, where it was referred to the Standing Senate Committee on Energy, the Environment and Natural Resources (Senate Committee). After touring the country to hear from interested parties nationwide, in May 2019, the Senate Committee recommended, and the Senate subsequently adopted, nearly 200 amendments to the bill.

After the extensive amendments were approved by the Senate, Bill C-69 went back to Parliament. On June 13, 2019, the federal government accepted 99 of the amendments passed by the Senate and rejected the remainder. Of those 99, the majority were accepted as drafted, but a substantial portion were further amended. The resulting version of the bill (which has not yet been consolidated and released) was passed by the Senate on June 20, 2019.

Amendments

The accepted amendments are primarily amendments to the IAA. Among those amendments approved by the government and ultimately passed by the Senate are several changes to the IAA which re-allocate powers from the Minister to the Agency. For example, the ability to suspend time limits, or to determine relevant factors to consider in an assessment. Also, the Minister is not allowed to direct the Agency, its employees, or any review panel members with respect to a report, decision, order, or recommendation to be made under the IAA.

Several amendments recommended by the Senate Committee would have modified the mandatory considerations for project approvals set out in section 22 of the IAA, but all were ultimately rejected. Also included in the rejected Senate amendments were those which would have decreased the IAA’s obligations to consider the impacts of proposed projects on climate change. The resulting version of the IAA does not require the Agency to consider a project’s impact on climate change on a global level, to account for provincial enactments respecting climate change, or to explicitly exclude greenhouse gas emissions generated from another downstream physical activity or project from the definition of direct or incidental effects. The requirement to consider a project’s impact on Canada’s ability to meet its international climate change obligations remains.

Amendments that were accepted clarify that the Agency is responsible for determining the scope of the factors that must be considered when conducting an impact assessment. A clarifying amendment that appointed review panel members will be “unbiased and free from any conflict of interest” was also included, as well as those clarifying timelines for review panels. Obligations to consult with the president of the Canadian Nuclear Safety Commission and lead Commissioner of the Canadian Energy Regulator (depending on the designated project) when establishing a review panel’s terms of reference are also included.

Global amendments include changing the adjective “adverse” to “significant” when referring to project effects, and clarifying that Indigenous knowledge includes the knowledge of Indigenous women.

Transitional Provisions and Coming into Force

Some of the accepted amendments clarify the transitional provisions and coming into force of the acts in Bill C-69. For example, the new section 182.1 clarifies that an environmental assessment commenced under the CEAA for which a decision statement has not yet been issued upon the coming into force of Bill C-69 is continued as if the CEAA had not been repealed. The new section 187.1 also confirms that a regional study commenced under the CEAA but not completed until after Bill C-69 comes into force is continued as an assessment under the IAA. Also, a regional report under the CEAA is deemed to be report under the IAA.

Completed studies, assessments and approvals under the NEB Act or the CEAA will be continued under the new legislation. If a designated project under the CEAA was determined not to require an environmental assessment, the IAA will not apply. Incomplete assessments or applications will be completed under the legislation they were commenced under, although by a new regulatory body (the Agency or the CER). NEB members may be requested to continue to hear applications that were active before them upon the coming into force of the acts.

Bill C-69 received royal assent on June 21, 2019. It will come into force on a day specified by the governor-in-council.

BILL C-48

The Oil Tanker Moratorium Act was also passed on June 20, 2019 in a Senate vote of 49 to 46, with one abstention. Like Bill C-69, Bill C-48 went on tour and faced two rounds of amendments before making it through the Senate. The Standing Senate Committee on Transport and Communications ultimately rejected the Bill. Interestingly, one of the reasons the Senate Committee recommended that Bill C-48 not proceed was that it felt, should Bill C-69 be passed into law, Bill C-48 would be unnecessary. Despite this recommendation, the Senate rejected the Senate Committee’s recommendation and passed Bill C-48 with minor amendments. The House of Commons accepted the amendments in part, resulting in a requirement to review the act in five years.

The Oil Tanker Moratorium Act will prevent all oil tankers carrying more than 12,500 tonnes of crude oil or persistent oil as cargo from stopping or unloading at ports or marine installations north of Vancouver Island to the Alaskan border. It is particularly criticized as being prejudicial to Western Canadian interests.

BILL C-68

Originally introduced in the House of Commons in February 2018, Bill C-68 was amended at the third reading stage in the House of Commons, and then further amended by the Senate after consideration by the Senate Committee on Fisheries and Oceans. It was passed by the Senate after the House of Commons agreed to accept 30 of the amendments proposed by the Senate and the Senate agreed to the House’s rejection of the rest of the Senate’s amendments.

Significant parts of Bill C-68 relate to the fishery itself but there are some key changes to the fish and fish habitat protection and pollution prevention provision of the Fisheries Act which are of relevance to project development and ongoing operations affecting fish and fish habitat. Of most importance is the repeal of the prohibitions against causing serious harm to fish and the return of the separate prohibitions on death to fish, and causing harmful alteration, disruption or destruction of fish habitat, or HADD as it is usually called. A last-minute amendment at the third reading stage had been added to create a provision which deemed the: “quantity, timing and quality of water flow necessary to sustain freshwater or estuarine ecosystems of a fish habitat” to be fish habitat. However, with significant opposition to the deeming provision from stakeholders across the country, the Senate voted to remove it, and the House of Commons agreed.

The amendments to the act expand the authority of the Ministry to establish standards and codes of practice, and also broaden the exceptions to the prohibitions not to cause HADD or the death of fish to allow for the Minister to prescribe classes of works or undertakings that can be carried out. The amendments also allow for fish habitat banks and habitat credits granted in relation to conservation projects carried out by a project proponent for the purpose of creating, restoring or enhancing fish habitats within a prescribed area.

Most of Bill C-68 will not be in force until the government issues new and revised regulations necessary to implement the amended provisions.

CONCLUSION

The adoption of Bills C-69, C-48 and C-68 completes a legislative overhaul of environmental assessment laws in Canada. This multi-year process commenced in early 2016 and included recommendations from expert panels, significant nation-wide debate and travelling Senate Committees. While the changes to the Fisheries Act would appear to set back the clock somewhat, expanded regulatory powers may offset the retroactive aspects of the amendments for new projects impacting Canadian waters.

Bills C-69 and C-48 in particular have been highly controversial, with some provinces arguing that they constitute an invasion on provincial jurisdiction to develop natural resources. Alberta Premier Jason Kenney announced his intention to challenge both of the new acts in court. Critics are concerned that project approvals, in particular for pipelines, will not be forthcoming, and that the tanker ban is a targeted attempt to interfere with bitumen production in Alberta.

Although we now have certainty regarding the specifics of the legislation that new projects will be subject to, questions remain regarding whether the implementation of the legislation will achieve one of its main objectives, which is to enhance “Canada’s global competitiveness by building a system that enables decisions to be made in a predictable and timely manner, providing certainty to investors and stakeholders, driving innovation and enabling the carrying out of sound projects that create jobs for Canadians.”


Republished with permission from Blakes. This article was originally published Blakes Business Class website.

For further information, please contact any member of Blakes’ Environmental Law group.