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

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Mr. Speaker, there is a lot to deal with in the member's question.

Those of us who live on the west coast are very conscious of nuclear accidents. We were concerned about possible radiation coming on the shores of British Columbia as a result of the Fukushima plant accident. Government monitoring has been cut, so it is hard for us to determine the exact extent of this radiation.

However, I am quite excited about a new technology called fusion. A very active company in my riding called General Fusion is trying to move toward a much safer use of nuclear energy. I try to visit it every year and see its progress and it is going quite well. I am proud of its work and hopefully that technology will develop.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

Mr. Speaker, if there is one issue that sets us apart from the members across the way, it is natural resources.

Today, in response to a question I asked as to why nuclear energy was not included in Bill C-22, the minister more or less said—I do not have his exact words in front of me—that when disaster struck Japan, it was so bad—those are my words—that the government had to take matters into its own hands.

If I understand what this government is saying, we will pay once disaster strikes. Canadians will pay for everything that happens with regard to health, cancer, the environment, and cleanup. We saw what happened in Lac-Mégantic.

The NDP prefers to plan ahead. When a company sets up somewhere, can we estimate the environmental cleanup cost in the event of an accident? What would be the human cost and the health-related cost in the event of an accident?

We have to look at this from a sustainable development standpoint. That is the right approach. We need to have green development—we are indeed a green party—for our country so that Canadians can have what is best for them and their children.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Mr. Speaker, planning is essential and that is what we have been proposing since we were elected as the official opposition in 2011, and beforehand. My colleague from St. John's East could probably tell us how long we have been arguing for the need for a national energy strategy when we do forward planning, not only inclusive but comprehensive. That is greatly lacking on the other side. Those members are content to have foreign companies come in and do whatever they want in Canada. We think that is not the right way to go and more Canadians are agreeing with us.

[Jack Harris, NDP, St. John's East, NL]

Mr. Speaker, I am pleased to have an opportunity today to speak on third reading of Bill C-22. Third reading, of course, is the opportunity to debate the bill after the committee has, we hope, improved it during committee hearings by listening to experts from all sides, accepting recommendations from experts as to how the bill can be improved, and, in most Parliaments, accepting amendments from the opposition seeking to make the legislation better.

Unfortunately, in this Parliament we do not see much of that. In fact, it is very rare for amendments from the opposition to be accepted by the government, even when it agrees with them. In an incident during the debate on a justice bill, 88 amendments were made in committee; the government rejected them all, only to try to make them itself at third reading, and they were ruled out of order. That is how obstinate the government can be.

I spoke as well on second reading, and my colleagues in the NDP, the official opposition, as you may know, Mr. Speaker, supported this bill at second reading. We saw it as an improvement over the existing regime and we supported it in the collegial hope that when evidence was heard from experts in committee, their expertise, knowledge, and understanding would be taken into account and there would be a better bill at third reading. Unfortunately, the 13 amendments that were presented by the official opposition were all rejected by the government. Not only that, it limited the debate. There was a request for an additional week to deal with some of the debates and discussions that needed to take place, and that was refused.

I can say that there are some things New Democrats like about this bill, and I will repeat them because I think we are responsible for some of them.

This bill, in one form or another, without the oil and gas part of it, the nuclear side, has been before Parliament previously. This is, I think, the fifth time. At one time, the NDP was the only party that opposed the bill when the cap was raised from $75 million to $650 million. It is now up to $1 billion, so that is an improvement over what would have existed if the bill had gone through a couple of years ago, and New Democrats take credit for arguing that the $650 million limit was inadequate. There has been an improvement in that way, so we are pleased to say that we have had some effect on this aspect.

The real problem, of course, was that for some 38 years Canada's nuclear industry has had a cap of $75 million of liability. This is an industry that can cause enormous amounts of damage not only to the environment but also to the health of individuals for many years to come. We noticed that with the Fukushima situation in Japan, the Chernobyl disaster in Ukraine, and, of course, with Three Mile Island a number of years ago in the U.S. These were very serious accidents, and to say that we are going to have an absolute total liability of $75 million is clearly a direct subsidy to an industry—a licence, in fact, to not only pollute but also to cause extraordinary harm to the citizens of a country.

That is what we are talking about here. Some people might call it a subsidy to the industry, but it is also a licence to pollute, to destroy the environment, and to take risks.

One of the things about liability is the obligation to look after the damages that are caused. That is what the polluter pays principle is. If people pollute the environment and make a mess, they need to clean it up. If someone says they do not have to clean it up, there is going to be a bigger mess. Anybody who has teenagers in their homes knows that. If teenagers are told they do not have to clean up after themselves, that they can leave their dishes wherever they want and throw their clothes on the floor because someone else will look after that, then there are going to be a lot of messy dishes and a lot of clothes on the floor. Saying that people have liability and responsibility makes the operators, whether of offshore oil and gas or of a nuclear facility, care more about safety. Obviously there is going to be a safety regime, but it makes them take responsibility in a way that they might not otherwise and it gives safety a bigger priority.

The $1 billion sounds like a lot, but not when it is put into perspective. I heard the member for Wetaskiwin. I think he was trying to be reasonable. He said that the $1 billion liability is going to cost and that it will be the consumers who will have to pay for it. He said it would add $2 or maybe $3 a year to each consumer's electricity bill. I will take him at his word; I do not know the numbers. He must have some reference for those numbers.

However, if it was $5 billion liability, it would cost consumers $10 or $15 per year. We are talking about $1 a month. For the protection that we are talking about here, maybe that is reasonable. Maybe people opposite think it is unreasonable. I do not think it is unreasonable if we are talking about having protection versus not having protection and about having an incentive for a nuclear operator to pay greater attention to avoid accidents.

It is a little bit a question of degree, but it is also a question of principle. We have asked to see the polluter pay principle in both aspects of this bill. In the oil and gas section there is a $1 billion absolute liability, whether the operator is at fault or not, and in the case of fault on the part of an operator in the oil and gas industry, there is an unlimited liability. They have to find the resources or insure against the resources up to whatever the cost of the damage is.

It can be argued, and we would argue, that the $1 billion is enough in terms of absolute liability if we are looking at an accident in the Gulf of St. Lawrence or in the Arctic. Absolute liability means that it starts getting cleaned up right away, regardless of who ultimately has to pay.

That is what fault is all about. Lawyers will fight over who is responsible or what percentage of the fault lies with this party or that party. That is fair. I am not opposed to lawyers, as some people in this House seem to be. Lawyers have a role to play; I played one myself. The Speaker probably did a fair bit over his career as well. In the meantime, absolute liability is designed to make sure that the job gets done.

This is a question that has to be dealt with. Although the liability may be spread in fault after it is all over, and we are still seeing that in the Gulf of Mexico case with Deep Horizon, absolute liability means that it gets started right away. The work is done to clean up the damage that has been done because they are going to be responsible regardless of what the fault is, and we have that.

I am going to just end here. The reason we are not supporting the bill now is that it does not include the polluter pay principle on the nuclear liability side and it does not include the principle of sustainability. Even with the $1 billion absolute cap, it gives the minister the right to waive it or lower it at his discretion. That is the wrong thing to do, because it opens up the door to all sorts of lobbying and favouritism.

Everybody would lobby, presumably, because if it is available to them, why should they not? Why should they not seek an exemption? Why should they not seek to lower their liability because of the consequences it might have for shareholders of the company or for some other aspect of their operation?

Based on those problems, the failure to accept reasonable amendments to this bill, and the failure to recognize these principles in the bill, we cannot support this bill at third reading.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, I want to thank my colleague for his speech, which truly enlightened us about the possibilities and the limitations within this bill. I would like my colleague to elaborate on some of these limitations he talked about in his speech.

In his view, what improvements could be made to the bill? Can he talk about the NDP'S proposals to improve this bill that the government unfortunately left out?

[Jack Harris, NDP, St. John's East, NL]

Mr. Speaker, the improvements that we sought to make would have been to ensure that the principle of sustainability was contained in the bill and spelled out to demonstrate the requirement that there be a recognition of these principles of sustainability when one is dealing with inclusive participation, the precautionary principle, and equity or fairness with sustainable development between the environment and industry, but we do not have that. One of those aspects is, of course, the issue of absolute liability.

The total maximum liability for the nuclear industry is set at $1 billion. However, we know the extent of the accidents that have happened. Experts say that these accidents can happen somewhere in the world every 10 years, so it is not beyond the realm of possibility.

Obviously the industry tries to be as a safe as it can, but why should the people of Canada accept that liability beyond $1 billion when it seems that it is possible for the industry itself to accept it for a reasonable amount of money?

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I thank my colleague for his speech.

If we look at the nuclear sector specifically, one of the deficiencies of the bill is the issue of financial liability for all the suppliers and contractors working with operators. Right now, they are unfortunately not included and that might create problems in the supply chain, leaving only operators liable.

That seems problematic to me. I think my colleague will agree that, if all of the stakeholders in the supply chain are liable for problems and damages caused by a nuclear accident, we can obviously hope that they will adopt better practices. I would like to hear his thoughts on that.

[Jack Harris, NDP, St. John's East, NL]

Mr. Speaker, it is a bit complicated in one sense, but the insurance principle is basically that we spread the risk. The more people who share the responsibility, the easier it is to manage the risk. That is the basis of insurance.

Why should there not be liability for people who happen to be suppliers? If they are excluded from liability, then that seems to be a problem. We believe that they should be included in the responsibility for accidents. If they are participating in that industry, they should participate by bearing some of that risk themselves.

The House resumed from September 15 consideration of the motion that Bill C-22, 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, be read the third time and passed.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Mr. Speaker, I will be sharing my time with the member for Sarnia—Lambton today.

Mr. Speaker, I am pleased to join in the debate today on an extremely important piece of legislation: the energy safety and security act. The act would ensure the continued safety and security of Canada's offshore oil and gas and nuclear energy industries, helping to make a world-class regulatory regime even better while strengthening protection for Canadians and the environment.

Bill C-22 would modernize Canada's laws to ensure accountability in these industries and to protect taxpayers if a serious incident resulted in cleanup costs and compensation.

Our government has made a firm commitment, under our plan for responsible resource development, that no major resource project will proceed unless rigorous environmental protection measures are in place. Bill C-22 reflects this commitment by strengthening safety and security in Canada's energy sector by focusing on prevention, response, accountability, and transparency.

The energy safety and security act would give Canada one of the strongest liability regimes in the world, providing a solid framework to regulate Canada's offshore and nuclear industries into the future.

The legislation would also support the responsible promotion and development of our offshore and nuclear industries, which are essential to Canada's economy.

I would first like to speak about the strong regulations we have in our nuclear sector.

Canada has a proud and distinguished history in the development and application of nuclear technologies for peaceful purposes. Canada has been involved in almost every aspect of the nuclear industry, from uranium mining and processing to the development of our CANDU reactors for clean power generation to the production of medical isotopes. As well, in many aspects of nuclear science, including our regulatory regime, we have been world leaders.

The task of overseeing Canada's safety in the nuclear sector falls to the Canadian Nuclear Safety Commission, or CNSC, Canada's nuclear regulator. As hon. members are aware, the CNSC is independent with respect to licensing and regulatory matters. It reports to Parliament through the Minister of Natural Resources.

Our government places the highest priority on the protection of health, safety, security, and the environment in relation to nuclear activities in Canada. That is why we have ensured that the Canadian Nuclear Safety Commission has the resources it needs to do its mandated job.

The CNSC's compliance and enforcement system includes a number of enforcement actions, such as increased regulatory scrutiny, licensing, decertification, and prosecution. As part of our government's plan for responsible resource development, the CNSC has received an additional tool to ensure safety and environmental protection in Canada's nuclear sector: the Administrative Monetary Penalties Regulations. These new regulations authorize the use of financial penalties for violations of the Nuclear Safety and Control Act.

Our Canadian nuclear industry is strong. Unlike the NDP, our government is committed to taking the necessary steps to make it even stronger. If the NDP had its way, it would shut down the nuclear industry entirely, putting 17,000 highly skilled Canadian workers out of work and bankrupting Canadian businesses. This is obviously unacceptable

The government supports a strong and safe nuclear industry, and Bill C-22 further demonstrates our commitment to nuclear safety.

A key feature of Bill C-22 is the $1-billion protection it would provide. In the case of Canada's nuclear industry, we would be strengthening the liability regime to increase the amount of compensation available for civil damages from $75 million to $1 billion

Canadians can be assured that the CNSC would continue to diligently oversee all aspects of the Canadian nuclear industry to ensure that public health, safety, and security, as well as the environment, were protected.

I would now like to briefly touch on other parts of the bill that deal with the offshore.

Bill C-22 would also apply to oil and gas companies operating in the offshore, where we would be raising the absolute liability to $1 billion from its current levels of $30 million in the Atlantic offshore and $40 million in the Arctic.

With these measures, the energy safety and security act would reinforce, in unprecedented fashion, the polluter pays principle, which would protect Canadian taxpayers.

As hon. members know, on our east coast there are two independent offshore boards: the Canada-Newfoundland and Labrador Offshore Petroleum Board, and the Canada-Nova Scotia Offshore Petroleum Board. The accord acts give these boards the legal authority to regulate offshore oil and gas exploration and development activities.

Members of the offshore boards have professional expertise in various disciplines, including environmental protection, law, economics, engineering, and business. They are supported by highly qualified management teams and staff with extensive experience, including in the fields of environmental protection and safety. Each board ensures that operators exercise due diligence to prevent offshore spills. As a result, drilling cannot occur unless the responsible board is completely satisfied that drilling plans comply with federal regulations and are safe for workers and the environment.

With this in mind, we have worked closely with Nova Scotia and with Newfoundland and Labrador to update and expand legislation to ensure that Canada's offshore regime continues to be world class. Offshore installations and the equipment and training required to operate them must meet strict regulatory standards that are among the highest in the world. The Offshore Health and Safety Act, which received royal assent last spring, will further strengthen Canada's safety regime by giving the offshore industry a clear occupational health and safety framework that is enforceable by law and is free of jurisdictional uncertainty.

Bill C-22 would mean that companies operating offshore would have to have the financial capacity to meet the higher liability obligations. Before any offshore drilling or production activity could take place, companies would need to prove that they could cover the financial liabilities that could result from a spill. This legislation would also establish a cost-recovery regime for the operations of the offshore boards, oblige new requirements for transparency, and create new enforcement tools, such as administrative and monetary penalties.

In conclusion, our government knows that economic prosperity and environmental protection are not mutually exclusive. We are committed to protecting the safety of Canadians and the safety of the environment. Through our plan for responsible resource development, we have taken action to ensure that Canada's vast resource wealth can be developed responsibly by putting public safety and environmental protection first. With the passage of Bill C-22, Canada would have in place one of the most modern, efficient, and stringent offshore safety regimes in the world.

Our world-class standards are supported by strong environmental laws. We have worked closely with the governments of Nova Scotia and Newfoundland and Labrador to modernize this legislation to make Canada's already world-class safety regime even better.

Bill C-22 is yet another example of our government's commitment to being a leader in safety and environmental protection while ensuring that all Canadians benefit from the jobs, opportunities, and economic growth created by Canada's natural resources. I urge the New Democrats to stop their ideological opposition to resource development and urge all hon. members to allow the passage of Bill C-22.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I want to reflect on the importance of offshore activities on the east coast, the number of jobs that have been generated, and the economic wealth that is being created because of the amount of exploration and drilling that is taking place.

The government is bringing forward legislation that would have a significant impact on the activities in that region. I am sure the member is sensitive to the fact that a number of stakeholders would want to participate in any discussion on legislation of this nature. Can the member indicate to the House to what degree the government has actually worked with different stakeholders in bringing forward this legislation?

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Mr. Speaker, our government absolutely works with stakeholders across the country, especially in these areas that are affected to make sure that the plan works for everybody. We understand that natural resource development is key for our country and has been since Canada started as a nation. Absolutely, we will continue to consult with stakeholders, as we have in the past, to make sure that it is a good plan for everybody.

[François Choquette, NDP, Drummond, QC]

Mr. Speaker, I listened to my colleague's speech.

In his opinion, why have the Conservatives done nothing to comply with international standards before now? This bill will not allow us to catch up to our international partners. The Conservatives often brag that they want to be more like the United States, but the American government has adopted an absolute liability regime of $12.6 billion U.S.

Why, then, do the Conservatives not want Canada to adopt a regime that offers at least the same amount of protection as the U.S. regime? They are always saying that Canada is ahead of the United States, so why are they not showing leadership and attaining or surpassing the level of protection in the United States?

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Mr. Speaker, we have nothing to be ashamed of on this side of the House. Absolute liability of $1 billion is significant, and there are further measures to capture more funds if it goes beyond that.

Canada is one of the top countries in the world in terms of the environment and developing natural resources. We care about them. I am from British Columbia. People in my province want to make sure that we can balance both, but we absolutely need natural resource development, as a country, to continue to prosper.

Again, $1 billion in absolute liability is significant and is among the top in the world.

[Randall Garrison, NDP, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, I listened with interest to the member's comments on this bill. I know that he and his party are great advocates of the free market. I wonder why, in this case, they are putting forward a bill that relieves the nuclear industry of some of the pressures of the free market by, in a sense, subsidizing the risks involved in that industry. Why should the nuclear industry, just like any other industry, not bear the full cost of the risk? Why should the public pick up this expense for the nuclear industry?