Bill C-22 (Historical)

Energy Safety and Security Act

An Act respecting Canada's offshore oil and gas operations, enacting the Nuclear Liability and Compensation Act, repealing the Nuclear Liability Act and making consequential amendments to other Acts

Part 1 of this enactment amends the Canada Oil and Gas Operations Act, the Canada Petroleum Resources Act, the Canada-Newfoundland Atlantic Accord Implementation Act and the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act (the “Acts”) primarily to update, strengthen and increase the level of transparency of the liability regime that is applicable to spills and debris in the offshore areas.
More specifically, Part 1, among other things,
(a) expressly includes the “polluter pays” principle, which is consistent with the notion that the liability of at-fault operators is unlimited;
(b) increases to $1 billion the limit of liability, without proof of fault or negligence, to which certain operators are subject in the event of a spill or damages caused by debris;
(c) provides that an applicant for an authorization for the drilling for or development or production of oil or gas must demonstrate that it has the financial resources required to pay the greatest of the amounts of the limits of liability that apply to it;
(d) establishes a regime in respect of the development of transboundary pools and fields;
(e) provides for new circumstances in which information or documentation that is privileged may be disclosed;
(f) establishes a legal framework to permit the safe use of spill-treating agents in specific circumstances;
(g) harmonizes the environmental assessment process for projects for which the National Energy Board, the Canada-Newfoundland Offshore Petroleum Board or the Canada-Nova Scotia Offshore Petroleum Board is the responsible authority, as defined in the Canadian Environmental Assessment Act, 2012, with the requirements of that Act, including by establishing timelines for carrying out environmental assessments and creating participant funding programs to facilitate the participation of the public in environmental assessments; and
(h) creates administrative monetary penalty regimes.
Finally, Part 1 makes amendments to remove certain discrepancies between the English and French versions of the Acts, as well as to modernize the language in the Acts.
Part 2 of the enactment repeals the Nuclear Liability Act and enacts the Nuclear Liability and Compensation Act to strengthen the liability regime applicable after a nuclear incident. It also provides for the establishment, in certain circumstances, of an administrative tribunal to hear and decide claims and implements certain provisions of the Convention on Supplementary Compensation for Nuclear Damage. It also makes consequential amendments to other Acts.

Energy Safety and Security Act

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, I will come back to the nuclear energy side of it, and I know there are not a whole lot of nuclear reactors up in Yukon.

The proposed legislation suggests an upper limit of $1 billion for nuclear power operators. Nuclear power operators in Canada generate about $5 billion a year in electricity, so it would seem that the cost of actually providing a bigger level of protection to Canadians is well within their grasp. In the United States it is $12.6 billion and in most of Europe it is an unlimited liability. Why, then, would the Conservatives consider $1 billion to be sufficient to protect the taxpayers and to ensure that the plants are as safe as possible?

[Ryan Leef, Conservative, Yukon, YT]

Mr. Speaker, the member for Wetaskiwin did an excellent job of explaining why the $1 billion liability would be sufficient and balanced for our country. The one thing that is important to note is it is a substantial increase. This has not changed since 1976, and here we are in 2014 looking forward to cleaner energy generation in our country.

The one thing that needs to be expressed when we talk about this is finding the balance of attracting this sort of development for cleaner, greener energy technology in our country to reduce greenhouse gas emissions. We do not want to set a limit so high that it obstructs any of that, because then we have to rely on diesel generation. I and the people of the north know this. We have to rely on burning diesel to heat our homes and to transport food on the highways. Electrical generation in our country needs to get cleaner and greener, and this would be a great way of doing that.

The member referenced the U.S. $12.6 billion liability. The member for Wetaskiwin accurately pointed out that the U.S. enjoys the benefit of being able to pool those liability plants, and individual plants are lower than the Canadian limit. While we talk about a couple of others that have unlimited liability plants that are higher than Canada, there are a number that are substantially lower, including the United Kingdom. South Africa has a $240 million limit. Spain has a $227 million limit. France is even lower at $140 million.

Canada has found the right balance to ensure we can deal with this without making it so obstructionist that we are unable to enjoy the benefits that we would get from clean energy generation and the Canadian benefit with lower and cleaner electrical costs.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Speaker, I want to come back to what my colleague just said about the liability limit for companies. If there were an unfortunate accident and the damages were much greater than the limit proposed in the bill, who would be liable for the difference? Would the private company be liable for the accident or would the taxpayers be left paying the balance yet again?

[Ryan Leef, Conservative, Yukon, YT]

Mr. Speaker, the one thing we have to reflect on is what benefits Canadians receive from cleaner energy technology. I am not so inclined to deal with the worse-case scenarios because what we have, as was noted, is a mature, responsible, well-developed, and extremely safe industry that happens to provide tremendous benefits to Canadians from coast to coast to coast with clean energy generation.

An increase in the limited liability from $40 million up to $1 billion is a substantial increase. It is remarkably higher than other countries.

If we are going to talk about the unfortunate and very unlikely event of a disaster, then we have to be realistic about the clean-up and the capacity to do that. We can look at Fukushima for example, as the member for Wetaskiwin pointed out. Despite the unlimited liability that Japan carried, there was no way the corporation could cover those costs, and Japan ended up having to step in and pick up those costs.

It does not matter what we set the liability amount at. If we make it so outlandish that there is no capacity to deliver it, then it is an unrealistic point we are making in legislation. We are ensuring we strike that perfect balance so as to invite that development, invite that industry, so Canadians can enjoy the benefits of safe, clean, green energy technology at an affordable rate with reasonable and sensible protection for Canada and its environment.

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, I appreciate the opportunity to speak to the bill, which ironically is titled the energy safety and security act. I say ironically because nothing in the bill actually talks about energy security, which is something that residents in my riding and across Canada have been asking the government to protect for many years. Energy security means actually providing that we have a reliable and secure source of energy in our homes, in our businesses, and in our workplaces.

The bill is weaving its way through and has taken forever. There are portions of the bill that are to ratify international obligations. It was introduced by the government on several previous occasions, and each time the government was the cause of the bill actually not proceeding. First, it was the quick call of an election in 2008 before the four years was up, then a prorogation actually eliminated the ability for that bill to go forward, and finally, an election was called before the bill finished wending its way, so it has been on the books for several years.

There is some importance to the speed with which the bill goes through, but obviously the government wants to take its time and discuss it over a long period of time. However, another bill, Bill C-24, was voted on in an absolutely tearing hurry just this afternoon, and yet I was not able to speak on it.

I have had meetings with constituents who have expressed serious concerns and serious reservations about the core of a bill that would give the minister the ability to take away the citizenship of persons born in Canada, which is an unprecedented thing in Canada and should have had a considerable amount of opportunity for members to discuss, yet the government moved time allocation with only about five hours of debate on this subject. It boggles the mind why that is so much more necessary to be hurried along than this bill, on which the government has taken years and years.

I will focus mostly on the nuclear side of this, because I have some personal concerns about the nuclear side of it. There have been a number of serious events on this planet involving nuclear power generation. Those events involving nuclear power generation have brought, I think, into crystal clear relief the fact that we have completely underestimated the costs of an actual disaster in these things. We are treating these nuclear power plants as just a piece of the landscape, but when in fact they go wrong, the cost is absolutely enormous.

Three Mile Island was a relatively small disaster. It was the first of the biggies, but it was a small disaster in terms of what actually happened. Nobody was killed and there were no bodily injuries, but the cleanup took 14 years and $1 billion, starting in 1979. A billion dollars was what was needed in 1979 for a small problem. Now we are in 2014, 35 years further along, and $1 billion is all that the nuclear industry has to put up if there is a liability involving a nuclear problem at a nuclear plant.

Let us fast-forward just seven years to Chernobyl. Chernobyl had $15 billion in direct losses. That is the plant itself, direct losses at the time on the site, a number of deaths, a whole lot of injuries; and over the next 30 years, it is estimated that because of the thousands upon thousands of residents of Ukraine and Belarus who will develop cancer, those costs could be over $500 billion.

We are not suggesting that the nuclear industry in Canada is capable of covering a cost of $500 billion, but to suggest $1 billion is all that is necessary is laughable, particularly when this industry is now quite robust and has been around a long time in relative terms.

The government is suggesting only $1 billion. That is actually a subsidy to this industry. We do not need to be subsidizing the nuclear power industry in this country, particularly when just two years ago the government gave away the CANDU licence to SNC-Lavalin. Now, a private corporation is actually in control of the development of our nuclear reactor system. It is not a corporation that is getting a whole lot of good reviews lately.

Then we come to 2011 and Fukushima. This is by far the worst of the nuclear disasters. It really brings home just how bad things can get when things go wrong in ways that are not expected. That is the essence of what nuclear designers are trying to do: figure out what we can do to protect against the unexpected.

Fukushima will probably cost between $250 billion and $500 billion when it is done. Nobody is absolutely certain. There is an untold human cost of Fukushima. They have had to evacuate and evict 159,000 people from the area around Fukushima. Though those people have not been told this, they can probably never go back to their homes.

Caesium-137, radioactive caesium, has a 30-year half-life. That radioactive material is now all over the ground, in the water, and in the air, in the area around that reactor. Because of a 30-year half-life, that means it will be centuries before those places are safe to inhabit again. Those people are still paying mortgages on their homes, but it will be centuries before they can go back to them.

That is the magnitude of what a nuclear disaster is really all about. I am afraid the government really does not understand just what it is dealing with in terms of tossing out the number $1 billion as if it is somehow an appropriate number to suggest the nuclear industry would have to come up with.

I am of two minds on the whole notion of nuclear energy as being a good thing for Canada. My father-in-law came back from World War II. He was a pilot in the RAF. He went to Chalk River and helped build those first few reactors at Chalk River. He was part of the design team that designed the CANDU system. His name was Roy Tilbe. He has passed on now, but he had a fierce loyalty to the nuclear industry generally and a fierce dedication to trying to make it a safe industry.

He would be appalled to think that the taxpayers have to pick up the ball if the industry is not safe enough. That is essentially what the government is suggesting to the industry, after six or seven years of dithering on what to do, by offering a paltry $1 billion as all that is required. The costs are of such magnitude that $1 billion is dwarfed by what those costs really are in the sense of a nuclear accident.

Let me talk about another cost that nobody here has talked about. Nuclear reactors in Canada and elsewhere have effluent, an output, waste. Nuclear waste is very toxic. It is something that people should not go near.

I was up on a little tour of Chalk River, where they showed us their nuclear waste management site. They did not call it a disposal site, but a management site. We went on a little bus. There was a bunch of Japanese and German tourists on the bus with us. We went around to the management site, and we were told that inside the steel cylinders encased in concrete was the waste. We know that the steel lasts about 150 years and the concrete lasts about 75 years, so every 75 years, the concrete has to be replaced and every 150 years the steel has to be replaced.

I asked the guide how long that would have to be done. I was told 75 years for the concrete and 150 for the steel. No, I said; I asked how long we had to manage the waste. I was told 500,000 years.

Has anybody really recognized what that means? What will $1 billion be worth in 500,000 years? Who will be around? Will SNC-Lavalin still be around? Will I still be around? The safety of Canadians should be paramount, and the industry should be held accountable.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, when we look at the nuclear industry, we see it is ultimately the responsibility of governments to work hand in hand with other governments, so that we achieve the safest possible environment where there is nuclear waste or by-products from using nuclear energy.

One of the products we use extensively is isotopes for X-rays and so forth. It needs to be acknowledged that there is a very real practical need in medicine. Having those isotopes is of critical importance for scans and so forth. I wonder if the member could comment on that. There is a lot of discussion about nuclear reactors, but there are other aspects of the nuclear industry of which we need to be aware.

[Mike Sullivan, NDP, York South—Weston, ON]

In fact, Mr. Speaker, it was the Prime Minister who fired the nuclear safety officer when she declared that the reactor that was preparing these much-needed isotopes was operating in an unsafe way because some procedures had not been followed with regard to earthquake-proofing that reactor. The answer from the government was, “To hell with safety; let's fire the regulator”.

[Jeff Watson, Conservative, Essex, ON]

Seriously? Watch your language a little.

[Mike Sullivan, NDP, York South—Weston, ON]

Sorry; “To heck with safety; let's fire the regulator.”

Nuclear energy is perhaps a good thing, but we need to understand it and we need to understand just how dangerous it can be if it goes wrong, and that is something I do not think the government understands.

[Tarik Brahmi, NDP, Saint-Jean, QC]

Mr. Speaker, I want to come back to the argument we sometimes hear that there is little chance of such events ever occurring. Our colleagues opposite say it is strictly theoretical.

I was living in Europe when the Chernobyl disaster struck. The media told us we had nothing to fear since the clouds stopped at the borders. That is actually what the media reported at the time.

Ukraine was heavily criticized at the time for its deplorable management of nuclear power plants. However, even a country like Japan, with its advanced safety mechanisms and technologies, had to deal with a major incident like the one in Fukushima.

Can my colleague speak to that part of the argument we keep hearing, about the unlikelihood of a nuclear accident?

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, this is exactly the point I have been making throughout, that we and the companies running these things need to be prepared for the absolute worst-case scenario. To avoid the worst-case scenario is obviously the best course of action. These corporations are not public; these are corporations whose bottom lines are to make money for their shareholders. Therefore, managing risk means asking what corners they can cut. If their liability is only $1 billion, then they might be more inclined to cut corners in the design or operation of a reactor, and that cannot happen.

We must insist that the operators be completely responsible for whatever they do, which would, in turn, make them much more conscious of avoiding the absolute worst-case scenario.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, I am pleased to speak to Bill C-22.

We recommend supporting the bill in principle at second reading and calling for greater liability and global best practices. Our position at third reading will depend on the government's response.

This bill warrants further study in committee to see whether it can be improved. It will be hard to sit down with the Conservatives and improve a bill because they think they have all the answers. We know how that goes. We have seen it before.

Bill C-22 updates the Canadian nuclear liability regime and sets out the victim compensation procedures and conditions in the event of an accident at a nuclear power plant. It maintains the principles whereby operators have limited, exclusive, no-fault absolute nuclear liability, except in the event of war or terrorist attacks.

The bill increases the limit of absolute liability from $75 million to $1 billion. It extends the deadline for filing compensation claims for bodily injury from 10 years to 30 years to address latent illnesses. The 10-year deadline is maintained for all other types of damage.

The changes in terms of nuclear liability apply to Canadian nuclear facilities such as nuclear power plants, research reactors, fuel processing plants and facilities for managing used nuclear fuel.

Bill C-22 also updates the offshore regime for oil and gas operations, in order to prevent incidents and to guarantee a rapid response in the event of a spill. It keeps the idea of an operator's unlimited liability in cases of demonstrated fault or negligence. It raises the absolute limit of liability for offshore oil and gas exploration projects and sets it at $1 billion, without proof of fault. The current limit is $40 million in Arctic waters and $30 million in the Atlantic. The bill explicitly mentions the polluter pays principle and clearly and officially establishes that polluters will be held responsible.

The bill strengthens the current liability regime, but it does nothing to protect the environment, or Canadian taxpayers, because it still exposes them to risks.

The Conservatives are constantly behind our international partners and they ignore best practices when it is a matter of recognizing the dangers of an inadequate liability regime.

We have already expressed our opposition to the inadequate limits in the matter of nuclear liability. The provisions must be considered a step in the right direction in terms of the current limits, but this bill does not adequately consider the real dangers that Canadians are facing. We hope that we will be able to deal with this point in committee, if the Conservatives let us work in committee, as I was saying.

Only the NDP takes the protection of Canadians' interests seriously, while the other parties take a cavalier attitude to nuclear safety and the safety of offshore oil and gas operations.

If the nuclear energy industry is a mature one, it must pay its way. This bill continues to subsidize the industry by making taxpayers assume any financial risk in excess of $1 billion.

Taxpayers should not have to subsidize the nuclear industry instead of subsidizing other sources of renewable energy. Other countries feel that their citizens deserve better protection in the case of a nuclear accident.

Bill C-22 has come before the House before. It was then Bill C-5, which went through the committee stage and was passed at report stage in 2008. However, it died on the Order Paper when the Prime Minister called an election, ignoring the fact that it was supposed to be held on a fixed date.

Bill C-20 made it through second reading to committee stage in 2009, but it died on the order paper when the Prime Minister prorogued Parliament. Bill C-15 was introduced in 2010 and then nothing happened for a year, until the 2011 election. This government claims that this is an important bill. Now, we have to sit until midnight until the end of June because the government says this bill is important, even though we have been talking about the same bill since 2008. All of a sudden this bill is important to the Conservatives.

The latest version of the bill does not give the public the protection it needs. Its biggest flaw is that it puts an artificial $1 billion limit on liability, even though the costs of a serious accident can be much higher than that. Taxpayers will be stuck paying for the remaining cleanup and compensation costs. In reality, the $1 billion limit is not enough, and imposing an artificial ceiling amounts to subsidizing energy corporations, since they will not have to cover the full costs of the risks associated with what they do.

I want to share some figures. The figure of $1 billion for liability may seem like a lot, but it is an insufficient, arbitrary amount if we consider the costs of cleaning up nuclear disasters and marine oil spills, which have happened in the past.

In Germany, for example, nuclear liability is unlimited, fault or no fault. Germany also has financial security of $3.3 billion Canadian per power plant. The United States has set an absolute liability limit of $12.6 billion U.S. Other countries tend toward unlimited absolute liability.

A nuclear liability limit of $1 billion would not have covered a fraction of the costs of the 2011 nuclear disaster at the Fukushima Daiichi power plant. The Government of Japan estimates the cleanup costs at more than $250 billion.

The government still brags about saving money for taxpayers and giving them a break. This same government is prepared to protect major corporations by setting the limit at $1 billion. However, we have seen that the disasters in other countries have cost more than $1 billion. When a disaster happens, someone has to pay. Why should Canadian taxpayers have to foot the bill for a disaster?

The NDP says that amendments will have to be put forward in committee to improve this bill. We are not against this bill, but we have to protect Canadians, who pay enough taxes already. That money is supposed to cover their own needs. The government is cutting funding for health care and all kinds of other things. Our roads are full of potholes. Everyone is mad because the government is not investing enough money in programs that people need.

The government is ready to let oil and nuclear companies get away with one heck of a deal. Their insurance should cover those costs. We cannot let them get away with not paying for insurance or paying only half as much as they should. If we do, and if a disaster happens, they will declare bankruptcy, and taxpayers will be on the hook for the bill. We have seen companies do that. As soon as the price gets too high, they declare bankruptcy. They should be the ones paying. They believe in the industry because it is profitable, so they should set money aside for possible disasters. Canadians are not the ones who should foot the bill, but that is exactly what they have to do.

The 2010 BP oil spill in the Gulf of Mexico could cost the company $42 billion to clean up. The company has been sued, and there will be criminal penalties.

Is Canada ready to foot the bill for these companies? My answer is no.

Bill C-22 does not go far enough. We will recommend changing the numbers.

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Mr. Speaker, what I have been hearing today reminds me of the philosophy of the Titanic's owners: the ship is big enough and unsinkable, so we do not even need to have enough lifeboats for everyone because there will not be a disaster.

The Conservatives' solutions seem to be wishful thinking. For example, contaminated water from the oil sands is mixed with bentonite and a polymer. Instead of having a pond full of contaminated water, you get a solid mass that you can walk on. Bentonite and all kinds of toxic substances will have to be treated. I am trying to imagine what they will do in 50 to 75 years when they want to do something with this toxic material that will be produced in unimaginable quantities. There could be millions or billions of cubic metres.

You cannot improvise when dealing with nuclear waste, which will pile up for 40,000, 50,000 or 80,000 years. We have to look beyond the immediate future. I would like my colleague to comment on that.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, I thank my colleague for the question.

When it comes to nuclear energy, we are still dealing with the unknown. No one wants nuclear waste in their backyard. That is not the case with electricity, which is a clean energy. No country wants to take another country's nuclear waste. Just try asking the Americans if they want our nuclear waste. They will say no. Just try asking Canadians if they want the Americans' nuclear waste. They will say no. Just try asking a province if it wants another province's nuclear waste. Everyone will say no. No one wants nuclear waste.

That will cause a problem. They have never found the answer. In the future, when we are stuck with something that we cannot get rid of, there will be no money to deal with it. That is why we have to protect ourselves.

If disaster strikes, things are even worse. Just think of what happened in Japan. Let me remind people that taxpayers had to pay for that, not the company. It is nice to own a company that can cause damage without any repercussions. The people will pay for the cleanup. However, who reaps the profits? None other than the company, which does not share the profits with the public. It shares them with its executives, who receive huge bonuses and treat themselves to millions of dollars in salaries. Nonetheless, if the company is not careful and causes damage, the taxpayers will pay.

The same thing is true of spills that can happen at sea. A spill could occur in Chaleur Bay or anywhere else. It can destroy an entire fishing industry. This is not Mexico. If a spill occurs in Chaleur Bay, it will stay in Chaleur Bay for a long time.

I say that the government must be careful and take action before this happens in order to protect the interests of Canadians.

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I would like to thank my colleague from Acadie—Bathurst for his speech.

My colleague is a former miner. That makes me think of the mines being closed. The taxpayers are stuck with the waste. They have to pay to clean up the mines. The Conservatives are keen on the nuclear system. They like to beat their chests and say that they are the ones protecting taxpayers.

To describe what they are trying to do to taxpayers, there is one word I would like to use, but I will not because it is unparliamentary. I will just say that what they are trying to do is coax taxpayers into paying for nuclear waste.

Could my colleague attempt to explain why the Conservatives, who say they want to protect taxpayers, are trying to make them pay for nuclear waste?