Multi-Sector Air Pollutants Regulations, response to comments: part 4

Part 4 - General

Waivers, Deferrals or Extensions

5.1 A number of stakeholders requested that the Regulations should contain provisions for waivers, deferrals or extensions for situations where an obligation of the Regulations cannot be met in a timely fashion due to circumstances beyond the regulatees’ control.

Response: Changes to the regulatory text that were made as a result of other comments limited the need for waivers, deferrals, or extensions. These changes will address, in part, the requests for waivers, deferrals or extensions.

For example, with respect to boilers and heaters, the proposed regulatory text in the Canada Gazette, Part I (CGI), required that an initial test be conducted, to verify compliance, in the same calendar year as the equipment was commissioned. Industry commented that it may be difficult to meet that timeline if the equipment was commissioned late in the calendar year. The regulatory text was revised and now allows a regulatee six months to conduct an initial test, regardless of when in the calendar year it was commissioned. As a result, an extension is no longer necessary.

For example, with respect to engines, industry commented that it may not be possible to conduct a performance test in the prescribed period when the engine is not operational. As a result, the test may be postponed until the engine is operational again. Also, a nine-month grace period was added for newly-acquired engines that have never been equipped with an emission control system to provide more time to install such a system (see question 3.4).

Alternative Rules

5.2 Stakeholders were concerned that quantification methods, such as for sampling, monitoring, testing and measurement methods or protocols, that are accepted in provincial or territorial regulations are not incorporated into the proposed Regulations. In addition, stakeholders were concerned that a facility could be regulated by both federal and provincial/territorial authorities for the same pollutants but possibly with different quantification requirements.

Some stakeholders proposed adding a specific reference to the Alberta Continuous Emissions Monitoring System (CEMS) Code (1998) as an allowable reference method under the definition of “CEMS Reference Method”.

Stakeholders also requested that the Regulations allow the use of a prediction emission monitoring system (PEMS) as an acceptable alternative rule.

Response: The regulatory text has changed as a result of these comments. The Department seeks to limit overlapping regulatory requirements, and recognizes that allowing the use of data collected ‘based’ on requirements accepted by provincial or territorial regulations can reduce administrative burden and still achieve federal objectives. As a result, the Alberta CEMS Code, for example, is now incorporated by reference into the Regulations.

The Regulations allow the Minister to authorize the use of alternative rules that are not the same as the ones set out in documents incorporated by reference in the Regulations. An application must be submitted to and approved by the Minister prior to the use of an alternative rule to satisfy regulatory requirements. 

The Department also is open to enter into equivalency agreements with interested provinces provided that they meet the conditions in the Canadian Environmental Protection Act (CEPA).

5.3 Stakeholders requested that the Alternative rule provisions be applicable for any method, for any purpose and for any process across the entire Regulations.

Response: The regulatory text has changed as a result of this comment. The Minister may now approve alternative rules to replace any rule set out in a document incorporated by reference in the Regulations that concern sampling, analyses, tests, measurements or monitoring of emissions.

5.4 Stakeholders expressed concern regarding the requirement that the responsible person must, without delay following the audit, get a signed copy of the report, from the auditor.

Response: The regulatory text has changed as a result of this comment. The responsible person must receive a signed report from the auditor within 30 days following the audit.

5.5 Stakeholders expressed concerns about the additional burden to send to the Department information detailing the procedures that were followed by an auditor to assess compliance with the CEMS Quality Assurance/Quality Control manual.

Response: No changes to the regulatory text arose as a result of these comments. The Regulations do not specify audit procedures or methodologies; therefore, information on the audit process is needed to assess the validity of the audit.

5.6 Stakeholders requested that in-house expertise be recognized as an auditor for the purpose of the Regulations.

Response: No changes to the regulatory text arose as a result of this request. The role of the auditor is to attest that the rules set out in the CEMS Reference method or in an approved alternative rule to the CEMS Reference method are being followed and that the CEMS is meeting the specifications stated in the relevant documents. Furthermore, the Department requires that an auditor is someone that is independent of the responsible person to minimize situations of conflicts of interest between the auditors and the responsible person. The Regulations also set out requirements concerning the qualification of the individual conducting the audit.

5.7 Stakeholders requested that the alternative rule requirements be simplified by removing the approval process and the requirement for the responsible person to keep all records related to application and approval of alternative rules. In addition, the Department was asked to set for itself, in the Regulations, a service standard of 90 days or less for the approval or refusal of an alternative rule.

Response: No changes to the regulatory text arose as a result of this comment. The Department recognizes that the approval process increases the administrative burden. Nevertheless the Minister must maintain authority to approve alternative rules that would be used to satisfy the requirements of the Regulations, and such judgement cannot be deferred to another entity. Records must be maintained on-site so that they are available for review by an enforcement officer.

The Regulations do not include a service standard for the review and approval of a proposed alternative rule. However, the Department is committed to conduct its review and communicate its decision as promptly as possible.

5.8 Stakeholders requested that the Regulations include a commitment to publish, on the CEPA Registry or on another web-based platform, the alternative rules that have been approved for use to meet requirements in the Regulations. 

Response: The regulatory text has changed as a result of these comments. The Department removed the requirement for the publication of alternative rules and does not plan to publish accepted alternative rules. Even though an alternative rule may be approved in one circumstance, it does not mean it will automatically be approved for other circumstances. The Department anticipates that alternative rule proposals will be specific to the circumstances and the equipment for which a proposal is made. 

5.9 One industrial stakeholder expressed support for the publication of guidance material on the definition, application and the administration of the Alternative rules.

Response: No changes to the regulatory text arose as a result of this comment. Guidance material for many aspects of the Regulations will be provided after publication.

Reporting, Sending, Recording and Retention of Information

5.10 Industry stakeholders supported the Department’s efforts to work with the provinces and territories on an electronic reporting system. The stakeholders insist on the importance of being able to attach documents and reports, of various types, to minimize transcription errors.

Response: No changes to the regulatory text arose as a result of these comments. The Department is aware of the importance of offering an intuitive electronic reporting system in which documents of several formats can be uploaded. The Department is working to provide an efficient reporting system.

5.11 Stakeholders asked for more information on what makes up a record for the Regulations, specifically (1) what actions are needed, (2) why records are made, (3) why must records be kept for several years, (4) why are reporting requirements set in the Regulations since they must collect similar recording and reporting to the provinces. In addition, stakeholders shared concerns on the requirement for records to be made as soon as possible, but not later than 30 days after the day on which the information is recorded or becomes available. This was viewed as being too restrictive. The commenters recommended that the period be extended to at least 90 days.

Response: The regulatory text has changed as a result of this comment. The “as soon as feasible, but no later than” expression has been removed. The requirement is now to make a record within 30 days. The requirements to measure, collect, report and how long records are kept are set out in the Reporting, Providing, Recording and Retention of Information section of the Regulations. These requirements are specified in the Regulations since the way a responsible person obtains data, the value and its metrics are important for reporting and compliance verification.

5.12 Stakeholders indicated that record-keeping practices amongst the persons affected by the Regulations varied and if an enforcement officer is to visit a site, companies should be given time to produce records that might not be found on site. The stakeholders noted that many records are created, maintained and stored on electronic media. The Regulations should recognize that these records may be on servers that are not located in Canada but accessible from Canadian locations. Stakeholders were also concerned that, in the boilers and heaters part of the proposed Regulations, the 30-day time period to inform the Department on changes to the civic address, ownership, name of responsible persons, etc., is too short and adds more administrative burden. Commenters suggested that the information be sent with the annual reports.

Response: The regulatory text has changed as a result of these comments. The Regulations require that the record or the copy of a report, notice, information or application that was provided to meet the requirements of the Regulations for a boiler, heater or cement kiln must be kept, as the case may be, at the facility where the boiler or heater is located or at the cement manufacturing facility.

Records or copies of documents linked to engines reports are to be kept at:

1. any place in Canada other than the facility where the engine is located, if that place is indicated in the engine registry; and
2. the facility where the engine is located, in any other case.

A record or copy must be sent to the Minister without delay when requested by the Minister. These records management requirements are consistent with similar requirements found in other Government of Canada regulations.

Information, such as address, ownership and name of responsible persons are needed to verify compliance and enforce the Regulations. This information must be current and up-to-date. The engines and cement parts require that the information be sent with the annual compliance reports. The boilers and heaters parts require that the information be sent no later than 30 days after changes have been made.

Compliance reports are required annually for boilers and heaters with a rated capacity of greater than 105 GJ/hr. However, there are some circumstances where the frequency of reporting is reduced.

Policy-related comments

Equivalency/Harmonization/Regulatory Duplication/Front-line Regulator

5.13 Stakeholders suggested that the Regulations should be harmonized with existing provincial requirements to provide regulatory flexibility and reduce the burden on industry. Preference was also indicated for the provinces to be the front-line regulators, including through the development of equivalency agreements, and that in the case of conflict between federal and provincial requirements that the provincial requirements take precedence.

Response: The Regulations are designed to reduce both duplication with provincial or territorial regulations and administrative burden.

 Some examples of these design features:

• Lead time to meet compliance requirements which will allow provinces and territories an opportunity to be the front-line regulator;
• Regulatees can apply to use existing provincial or territorial testing requirements, rather than those listed in the Regulations (i.e., Part 4 - Alternative Rule)
• Information requested in the Regulations is the minimum required to determine compliance
• The Department is working on adding the reporting requirements to its web-based single-window reporting tool, allowing for the use of the internet to report once, through the same form, their information and so simultaneously meet federal and provincial or territorial requirements for reporting
• The Department intends to examine how departmental officials can coordinate compliance verification activities with provincial or territorial officials
• The federal government remains open to pursuing equivalency agreements with interested provinces and territories provided the requirements of CEPA are met.

Also see response 5.2 regarding Alternative Rules above.

Alignment/Economic Disadvantage

5.14 Stakeholders proposed that the Regulations align with relevant U.S. requirements to prevent economic disadvantages for Canadians.

Response: The Regulations for boilers and heaters, and engines are comparable to the requirements for similar equipment in many U.S. states. For example, the U.S. Environmental Protection Agency (EPA)’s New Source Performance Standard for Stationary Spark Ignition Internal Combustion Engines was the basis for the emission standards and size threshold for modern engines. The Canadian and U.S. cement markets are integrated with approximately 50% of the Canadian sector’s production capacity coming from Ontario, and the cement oxides of nitrogen (NO_X) and sulphur dioxide (SO₂) emission standards are comparable to the existing Ontario regulatory emission standards without provisions for emissions trading.

Backstop/Compliance Assessment Period

5.15 Industry stakeholders asked how the two-year compliance assessment period contained in the Regulations for cement might be applied to other sectors. Similarly, one province asked how the backstop would be consistently applied and why it applies only to the cement requirements and not for boilers and heaters and engines.

Response: For background, the ‘backstop’ concept allows provinces and territories to be the first to intervene when non-compliance is assessed. For cement, a facility needs to be out of compliance for two consecutive years before enforcement actions would be taken under the Regulations. This provides provinces and territories the opportunity to take appropriate actions to bring a facility into compliance after the first year in which the emission limit was exceeded. Federal enforcement activities could only proceed after the second year of non-compliance. In this way the federal Regulations provide a second line of defense for the environment that backstops provincial actions.

The two-year compliance assessment approach, as applied to the cement sector, is not applicable to equipment-type Base-Level Industrial Emission Requirements (BLIERs) because, in some cases, the equipment provisions require refurbishment and installation by a certain deadline (e.g. by 2026 for Class 80 boilers and heaters), and not just an ongoing emission limit.

In order to meet the intent of the backstop approach and allow provinces the opportunity to act first in the case of boilers and heaters and engines, the deadlines in the Regulations were delayed by one year from the dates that were agreed upon by the federal and provincial governments during the BLIERs process. For example, the Regulations require that Class 80 boilers and heaters be retrofitted by 2026, even though the originally agreed-upon date was 2025.

The application of backstop provisions for other sectors or equipment groups as part of any future regulations will be determined on a case-by-case basis as those regulations are developed.

Application

5.16 Stakeholders expressed a preference for facility-based requirements versus equipment-based requirements.

Response: The Regulations include some facility-based requirements. For pre-existing engines, the yearly average option provides a similar degree of compliance flexibility for an engine group as would have been obtained if a facility-based approach for different emission sources had been used. For the cement sector compliance will be assessed at the facility level.

For boilers and heaters, a facility-based approach was considered, but had limited discussion at the boilers and heaters BLIERs working group. The working group focused on an equipment-based approach that built on the CCME equipment-based emissions standards found in the National Emissions Guideline for Commercial/Industrial Boilers and Heaters, published by the CCME as Initiative N306, in March 1998. The Regulations reflect the outcomes of these discussions.

Linkage with AQMS

5.17 Stakeholders asked for an assessment and report comparing the principles/foundational elements of the Air Quality Management System (AQMS) to the Regulations. This includes describing how the Regulations relate to the AQMS elements and approaches (as described in the CCME AQMS Roles and Responsibilities document) to ensure the original intent of the BLIERs is preserved throughout their implementation.

Response: The Department has no plan to develop or publish an assessment or a report comparing how the Regulations relate to the principles or foundational elements of the AQMS of : collaborative; comprehensive; efficient; flexibility; supportive of continuous improvement; supportive of keeping clean areas clean; science-informed; transparent; and outcomes-focussed. 

The Regulations were informed by the transparent, collaborative and unprecedented AQMS process, which involved provincial and territorial governments, industry and non-governmental organizations. This transparency was reinforced through the pre-publication of the proposed Regulations for the 60-day public comment period.

Importantly, the Regulations are informed by the potential of currently available emissions-control technologies and leverages this knowledge to achieve important reductions in covered emissions for the benefit of human health and the environment.

Without compromising this environmental objective, the Regulations also provide flexibilities, such as the use of alternative methods to collect data, and reinforce the role of provinces and territories as the front-line regulator. In addition, the federal government remains open to entering into equivalency agreements with interested provinces and territories.

The Regulations also include more stringent requirements that will be phased in over time to support continuous improvement.

Cost Benefit Analysis

5.18 A stakeholder recommended that cost-benefit ratios be calculated on a regional basis, and that the policy requirements be established regionally in order to limit required actions that may not be justified from a cost-benefit perspective in some regions.

Response: Benefits and costs are distributed across Canada. As the cost-benefit analysis (CBA) requires a national scope and perspective, benefit-cost ratios are presented at the national level to reflect overall benefits and costs to Canadians. 

5.19 Stakeholders commented on the clarity of assumptions and methodology used in the analyses as presented in the Regulatory Impact Analysis Statement (RIAS).  Specifically, concerns were expressed in terms of unfamiliarity with models used to generate emission reductions and estimate benefits and data availability for the purposes of conducting independent analysis.  

Response: The Department has made extensive revisions to the RIAS text to provide clarity on key assumptions and data used in the analysis.  This includes an additional section to highlight where assumptions have changed as a result of consultation with stakeholders or updated data/methodology.  The Department has also shared information regarding assumptions with stakeholders since the pre-publication of the proposed Regulations.

5.20 Stakeholders expressed concern that air quality impacts attributable to the Regulation may not adequately consider sources of emissions from outside Canada, and the ability to improve upon background concentrations for some air contaminants. In addition, a comment suggested benefits may be overestimated due to different standards claiming the same benefits.

Response: The Department has reviewed these comments. As in the CGI analyses, air quality modelling conducted for these analyses is based on the difference between the business-as-usual emission levels and the policy scenario emission levels. The resulting difference in ambient air quality concentrations, as modelled with the Department’s A Unified Regional Air-Quality Modelling System (AURAMS), includes contributions from the U.S. airshed and accounts for background concentrations and standards in provinces and territories. The analysis finds expected improvements in particulate matter and ozone concentrations.  If assessed together, the total benefit may be higher or lower than the sum of benefits based on the individual policies, due to the non-linear relationship of chemical interactions in the atmosphere.