Risk Management and Crisis Response Blog

B.C. government enforces ‘polluter pays’ principle with Environmental Management Act

Nov 24, 2023 4 MIN READ
Deirdre A. Sheehan

Partner, Regulatory, Indigenous and Environmental, Calgary

Emily MacKinnon

Partner, Disputes, Vancouver

Jennifer Fairfax

Partner, Litigation; Regulatory, Indigenous and Environmental, Toronto

Elie Laskin

Associate, Disputes, Vancouver

Construction site

On November 8, 2023, proposed amendments to British Columbia’s Environmental Management Act, SBC 2003, c 53 (EMA) received royal assent.

This article updates our earlier blog post, “The ‘polluter pays’ principle: Proposed amendments to the Environmental Management Act may usher in a new era for B.C. industrial companies,” which summarized the proposed amendments and how they might affect regulated entities.

The article reviews the recent amendments to the EMA in British Columbia, which aim to enforce the “polluter pays” principle and make owners of specified facilities responsible for environmental cleanup and decommissioning. The article explains who is considered an owner, what types of facilities are subject to the new requirements, and what obligations and risks owners may face under the amended EMA. It also provides some background and context for the amendments and their potential implications for regulated entities.

Since the EMA received royal assent, the EMA now enables the government to enforce planning and financial assurance and “cleanup” requirements on “owners” of “specified facilities” engaged in industrial or commercial purposes with the potential to cause pollution or contamination. This is a significant change to the legislative regime that stakeholders ought to keep in mind in considering potential environmental liabilities relating to the decommissioning of projects or the environmental cleanup of abandoned facilities.

This article provides a brief primer regarding who is most affected by the EMA amendments – owners of specified facilities – and the legislative requirements that can now be placed on those persons.

Who is an ‘owner’?

“Owners” are defined in the EMA as anyone who is in possession, has the right of control, or otherwise has any legal or equitable interest in a facility (which includes any land or building, and any machinery, equipment, device, tank, system, or other works).

Regulations enacted under the EMA may carve out certain exclusions for some owners. We expect to see these come into place in the next few months.

What are ‘specified facilities’?

“Specified facilities” are defined as those used for “a prescribed industrial or commercial purpose or activity”: that is, those purposes and activities set out in Schedule 2 to the EMA’s Contaminated Sites Regulation. Such prescribed activities include chemical, electrical, mining, metal smelting, petroleum and natural gas, waste disposal, and wood and pulp and paper industries, among others.

What do owners of specified facilities need to do to be onside the new requirements?

The Ministry of Environment and Climate Change Strategy (the ministry responsible for administering the EMA) may now require an owner of a specified facility to:

  1. Submit a “decommissioning and closure plan” for its facility (see s. 91.82); and
  2. Provide financial security, the amount of which will be determined by the Ministry, for environmental cleanup in advance of such decommissioning (see s. 91.84).

Further, if a specified facility is deemed “abandoned” by the Ministry, environmental officers now have the power to enter the abandoned facility and carry out any actions for the purpose of decommissioning and closing the facility. They may also seek cost recovery for those actions against any “accountable person,” including owners or persons in control immediately before operations ceased.

Ultimately, the government takes the position that “[t]hese legal requirements will uphold the “polluter pays” principle, placing the responsibility for industrial-site cleanup with the owners”[1] rather than the “taxpayer”. The government has stated: “Our government’s new legislation will ensure industrial owners and operators whose operations could pollute our environment are accountable for cleanup. For too long, taxpayers were left on the hook for costs incurred and abandoned by some operators.”[2]

It remains to be seen how these new requirements and powers will play out in practice.

[1]  See the press release from the BC Government on these amendments at https://news.gov.bc.ca/releases/2023ENV0031-000681. See also Orphan Well Association v. Grant Thornton Ltd., 2019 SCC 5 at para 29 for a discussion of the “polluter pays” principle.

[2]  Ibid.