April 4, 2005

Federal budget bill slips in significant CEPA amendment

A budget implementation bill introduced by federal Finance Minister Ralph Goodale includes a small but significant amendment to the Canadian Environmental Protection Act, 1999 (CEPA). Bill C-43 would amend CEPA to facilitate the future addition of greenhouse gases to the list of substances under the act. This will allow the Environment Minister to regulate emissions and implement the proposed large final emitter regime and emissions trading system as components of Canada's strategy for meeting its commitments under the Kyoto Protocol.

Part 15 of the bill proposes to revise section 64 of CEPA to state that a substance meeting the criteria set out in section 64 may be added to CEPA's Schedule 1 List of Toxic Substances. It further proposes to change the name of the Schedule 1 List to "List of Substances," removing the word "toxic."

Although the move has upset and angered opposition parties and environmental groups, industry representatives have indicated that they are more concerned about uncertainty relating to Canada's plans for meeting Kyoto Protocol commitments and more interested in seeing a clear, definitive plan.

Other highlights of the bill include:

*provision of $600 million in federal gas tax revenue sharing in 2005-06 for municipalities to support environmentally sustainable infrastructure projects;

*establishment of a new agency, reporting to Environment Canada, to manage the $1-billion Climate Fund, which will provide incentives for the reduction and removal of greenhouse gases;

*establishment of a Technology Investment Fund to provide companies regulated under the proposed large final emitter regime with a compliance mechanism that encourages investments in greenhouse gas mitigation research and development;

*provision of an additional $300 million for the Green Municipal Funds, $150 million of which will be used to help communities clean up and redevelop brownfields; and

*a $100-million transfer to British Columbia to help battle the mountain pine beetle.

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