Environment Committee on April 1st, 2019

[Darren Fisher, Liberal, Dartmouth—Cole Harbour, NS]

Thank you, Mr. Chair.

It's a shame we don't have enough time with you. I'll get to this pretty quickly.

Ms. Ryan, you were saying you think we should stick to domestic versus international. I kind of agree with you. However, we're surrounded by coasts, so we impact international and we're impacted by international. It is kind of interesting. I think it's important that we focus on what we can actually accomplish through policy and legislation. The jurisdiction issue is big within our country, for sure.

Is the G7 plastics charter binding? What penalties are there for countries that don't adhere to that charter? Also, I understand the EU has done some things that might go over and above the charter. Time is short, but could you also quickly touch on what they've done?

[Dany Drouin, Acting Executive Director, Plastics Initiative, International Affairs Branch, Department of the Environment]

The plastics charter, like everything related to G7, is not a binding commitment, but countries that come to the table and endorse those documents are thinking of implementing them. In some ways, it's not legally binding as a treaty would be, but there is a real commitment that is made.

The EU has been doing different things related to single-use plastics in particular, but also in terms of putting forward the road map to get to the objectives of the charter.

[Darren Fisher, Liberal, Dartmouth—Cole Harbour, NS]

Switching gears for a second, going to EPR, in 2009 the provinces and territories came up with the action plan for EPR. Has anybody worked on that? Has there been work done on the action plan for EPR, specifically for plastics? I know there are different EPR systems in the provinces, but have they—

[Jacinthe Seguin]

Specific to plastics, as you know, there isn't one. One of the many categories is not exactly plastics; it's packaging. There are also automotive products, textiles and construction.

The first thing that provinces did was to put in place their legislative authorities, because when it came out in 2009, they didn't have the right authorities, so they put them in place. That takes time. All the provinces have those authorities now, and some of them have been able to move much faster in implementing programs.

B.C. and Quebec have strong EPR programs that include packaging, but with all kinds of different administrative burdens and approaches. That's one of the things we'd like to get to move up, to have the “best in class” type of EPR programs.

The 9% recycling rate is national, but some provinces, particularly B.C., have a much higher recycling rate, 20% to 30%. If everyone was at “best in class”, which is B.C. right now, then the rate would be so much higher in Canada. Where it's been slow is with durable products, durable goods, so we have to remember that plastics are not just in packaging but in cars and construction materials.

[Darren Fisher, Liberal, Dartmouth—Cole Harbour, NS]

Do we have the ability to legislate EPR federally for the provinces?

[The Chair]

I'm afraid we're out of time there.

[Jacinthe Seguin]

That's another million-dollar question.

[The Chair]

With that, we're going to suspend. I'd like to remind our colleagues at the table that we always have the ability to invite the departmental officials back if we find that there's more we need to know.

Thank you so much for coming today and sharing the information you have. We may be seeing you again.

[The Chair]

All right. We're ready to get going here.

Thank you to our two witnesses who are here today. We have Benoit Delage, with Conseil régional de l’environnement et du développement durable de l’Outaouais. We'll start with his opening statement, once we have everybody's attention, please. Then we'll move to Mr. Wilson from the Smart Prosperity Institute, and we'll hear his testimony.

Gentlemen, welcome.

Mr. Delage, we'll give you about seven minutes for your opening comments. As with the previous panel, when there's one minute left, I'll flash the yellow card. When you're out of time, I'll give the red card. Wrap it up as quickly as possible.

Once we go through both, we'll get into 18 minutes of questions and answers. I apologize again for the delay in getting to you today. Fortunately you're both local, so I hope that if we felt we needed to, we could invite you back.

Mr. Delage, you may start.

[Benoit Delage, General Director, Conseil régional de l'environnement et du développement durable de l'Outaouais]

Good afternoon.

Thank you for inviting me.

The committee's work is very important. Canadians are expecting a lot from you and their government. It's becoming clear that people are feeling anxiety about the environment, and they want immediate action.

I spent part of the weekend reviewing your action plan. I prepared a brief that you should be receiving in the next few days, once it's been translated. I want to commend you. The plan takes account of the circular economy in quite a meaningful way. A circular economy strategy is very beneficial to a nation's economic development.

I'd like to draw your attention to three of the priority result areas. The first is collection systems, the idea being to keep all plastic products in the economy and out of the environment. A parallel could be drawn with contaminated soils, in the sense that the negative externalities are high because the substance is not disposed of properly. Furthermore, the market has not been able to hold bad actors accountable.

In Quebec, we've been able to set up a traceability scheme to track the movement of contaminated soils. A similar system should be used for plastics. Much of the plastic that leaves recycling plants ends up in the environment or is shipped to other countries. Scientific monitoring is needed in order to understand where the substances wind up accumulating. Applying the extended producer responsibility, or EPR, model to the plastics industry can have a positive impact. Our experience in Quebec has shown that EPR outcomes can really vary from product to product, so it's important to make sure that the industry-wide scheme is robust enough to be effective.

At the end of the day, producers should find their own ways to have their products recycled. All the government should do is ensure that the industry has achieved the desired results. That brings me to my first recommendation, adopting a plastics traceability system and an extended producer responsibility scheme to account for all of the negative effects of pollution. The secondary objective would be to raise the value of recycled resins and ensure processors have access to them. Currently, what we are hearing from the recycling industry is that these materials aren't adequately available and that companies struggle to incorporate recycled materials into new products.

The second priority result area I'd like to draw your attention to is empowering Canadian households, businesses and institutions. Through social media, people have learned that a lot of plastic waste ends up in the environment, to the outrage of many. A recent movement called Break Free from Plastic has led to cleanup initiatives in 42 countries, and the collected plastics were audited. In Canada, the top five polluters were responsible for 42% of the plastic trash collected: Nestlé, Tim Hortons, Coca-Cola, Pepsi and McDonald's. It's clear industry has a role to play. In Quebec, the cost of cleaning up garbage along the side of the road has risen 43% since 2011. People's lack of civic-mindedness has a cost, and it is being borne by entire communities, municipalities and government departments. The time has come for the industry to step up and take responsibility for dealing with these plastics.

The pressure has sparked innovation. A deposit return scheme is a great way to hold all actors accountable and should be applied to single-use plastics—something we're seeing more and more. Some Montreal coffee shops, for instance, belong to a program where customers can buy a cup of coffee and then leave the cup at another participating coffee shop, where they can get another cup. The cup isn't reusable; it has a deposit on it.

According to media reports, the big companies are looking at a similar system. The same applies to windshield wiper fluid containers; they are no longer necessary because people can get their fluid filled right at the gas station.

Putting pressure and restrictions on industry brings about innovation on the reuse front. Transferring the financial burden to industry is key if all stakeholders are to pay less.

The last priority result area I would like talk to about is number eight: research and monitoring systems. Indeed, this process is taking a long time and more data is certainly needed. Right now, we don't know where all this is going. We don't understand the full scope of plastic waste, so taking the time to make the right decisions is essential.

It may be tempting to move quickly and impose bans, but that can have adverse effects, as we saw in the case of biodegradable and oxo-biodegradable bags. They had a harmful impact on the environment.

Systemic change is really what's needed in terms of economic drivers. The way we manage plastics currently is costing us all dearly.

That's why I recommend supporting research and businesses, as CREDDO is doing. We are one of 16 industrial symbiosis networks in Quebec. I manage a team of three people who travel around to support companies and help develop circular economy initiatives. We are active in the area of agricultural plastics, not to mention many others, in the Outaouais region, and it's working.

Businesses are willing to act and change their business model because they see that it is profitable. The situation simply has to change because it's not a level playing field. We need more data to bring about a circular economy, especially in the plastic sector.

Thank you.

[The Chair]

Thank you very much.

Mr. Wilson, I'll turn it over to you for about seven minutes. Just so everybody knows, I understand we have a guest on the phone, Mr. Usman Valiante. We'll turn it over to you, but I want to make sure that everybody knows they can direct questions to either of you for the Smart Prosperity Institute.

[Michael Wilson, Executive Director, Smart Prosperity Institute]

Wonderful.

Thank you for the opportunity to appear.

The Smart Prosperity Institute is a clean economy research network and think tank at the University of Ottawa. We've appeared in front of this committee and the Senate committee on issues such as this quite regularly. Carbon pricing and climate policy, clean innovation and environmental impact assessment are some of the different areas that we do research on. We focus on public policy research to grow the economy and to protect the environment concurrently. We're evidence-based and non-partisan.

One of the major areas that we've turned our minds to now is the circular economy and plastics waste. We're active on the issue, both as a research institute and as part of the Circular Economy Leadership Coalition. I'll speak about that coalition briefly in my remarks as I go on.

As you noted, Mr. Chair, I'm here with my colleague Usman Valiante. Usman is one of Canada's foremost experts on the policies that we can use to manage plastics waste, and he was the lead author on the major report we released on the topic. I have copies of that if people are interested. Usman will participate in the question and answer period.

I should say thank you to the clerk and to the chair for accommodating that request at the last minute. It's an idea that I kind of had at 2 o'clock on a Sunday, so thank you for getting him on the line for this.

In my remarks, I'll speak quickly on three issues. First, I'll tell you why there's such a significant corporate and civil society interest in plastics right now. Second, I'll talk about the policies that government can activate in order to make progress on the issue. Finally, I'll share some thoughts on the role that civil society and business can play—complementing the government role—to help move this issue along.

First, Environment Canada testified earlier on the urgency of the issues, the actions the government is taking, the science behind it all and the commitments we've taken on, so I won't spend much time on this. I just want to convey a couple of points that are perhaps supplemental to that.

At SPI, at my institute, we tend to focus on issues where we see an environmental problem and a significant economic opportunity that can be realized in addressing that problem. With regard to plastics, studies have shown that, globally, somewhere between $100 billion and $150 billion of economic activity is jeopardized by allowing plastics to be disposed of and not reused. There's a huge economic potential in addressing this issue. As Ms. Ryan mentioned, we're capturing only about 12% of plastics within the recycling system in Canada. The exact amount is debatable, but a significant part of that 12%, even, is not actually recovered and reused within the recycling system.

It's partly due to this that we launched the Circular Economy Leadership Coalition last year at the G7 environment ministers' meeting in Halifax. I won't go into the details of this, but you can visit the website. It's an initiative made up of some of Canada's largest and most significant retailers and civil society organizations. It's chaired by Unilever Canada and The Natural Step Canada, and it's working to make Canada a world leader in a sustainable, prosperous, zero-waste, low-carbon emissions circular economy.

My second point—probably the most salient to the work that you're undertaking now—is what governments can do on this issue. I have copies of our policy brief, and we can answer more questions on that. We looked at six policies that governments at different levels can activate in order to make progress on plastics. They're designed to reduce the waste of plastics and recapture the value of those plastics back into our economy.

The first is a broad class of policies that assign property rights and responsibilities to end-of-life plastics. Extended producer responsibility was mentioned, and it's the most significant of these and the most commonly cited. It induces producers of plastics to be responsible for the end-of-life phase of their products, and the result is that there's a supply of reused plastics that become available for manufacturing and available to the economy—again, recirculating them through the economy. British Columbia has probably the most cited and best-known set of EPR programs in the country, but there is little question—I'd say no question—that there aren't enough of these in the country, and that the ones we have aren't working well enough and are too fragmented to really be able to achieve the levels of plastics waste reduction that we want to achieve across the country.

The second set of policies gets to one of the questions that one of the members asked earlier. They are policies that set recycled content performance standards. They either set a minimum percentage of recycled content that has to be in a product or in packaging, or they can operate as a tax mechanism whereby you pay less and less tax the closer your recycled content comes to the legislated or government-sanctioned standard.

There is a third set of policies we look at, and this is going to sound a little bit administrative and bureaucratic, but it's actually incredibly important. Government has a really significant role in creating common definitions, performance standards, and measurement and assessment protocols. Those really are the keys to enabling policies to operate harmoniously across the country or across an economy. Without them, you really fall, in this area, into fragmented systems and fragmented markets and policy directions. From Ms. Ryan's remarks, you can see the incredible suite of policies and actions that can be activated for plastics waste. Having some level of consistency across them becomes really important to the market actors who are out there trying to respond to them.

The last three we looked at—I'll be really brief—are prohibitions or bans on certain plastics, economic instruments to internalize the costs, and pricing for greenhouse gas emissions associated with the burning of plastics.

My last point—and I'll be extremely brief on this, Mr. Chair—is about what organizations like ours or coalitions like the ones we put together, or other civil society organizations that are out there, can do to help on this. I suggest that the federal government needs to think creatively about how to use outside-of-government organizations. As I alluded to, and as you can draw from Ms. Ryan's remarks, a lot of action is needed at different levels of government, and the risk of differing or non-aligned market signals is really significant. Some of the outside-of-government players can play a role in raising awareness about the solutions that can be activated and in socializing some of those solutions for politicians; in research that helps inform government policies and business practices; and in developing some of the solutions and policy frameworks. One example that a lot of people cite is the UK Plastics Pact, which in the U.K. is incentivizing businesses to reduce their plastic waste.

Thank you.

[The Chair]

Thank you. I'm sorry to cut you off on that.

We'll jump right into it.

Will, you have the first six minutes.

[William Amos, Liberal, Pontiac, QC]

Thank you, Chair.

Thank you to our witnesses.

It's a pleasure to see you, Mr. Delage. You live in my riding, and CREDDO is an important player in the Outaouais area. We are very grateful for everything you and CREDDO are doing in the Pontiac and Outaouais area.

I'd like to ask you about the regulatory role the federal government could or should play in this area. I took notes when Mr. Wilson was speaking, and I may have questions for Mr. Valiante as well. I realize how much expertise he has, having worked with him about 10 years ago.

I'd like to know which areas the federal government should look at in terms of making regulations or passing legislation in order to send the markets a clear signal. I heard all the ideas that were proposed in connection with the circular economy, and government officials expressed their interest in that regard. That said, we need specific proposals for federal regulatory measures. That was evident in the case of microbeads. I'd like to know, though, where your organizations stand on other issues of concern.

[Michael Wilson]

Given the time, Usman, do you want to lead this one off?

[Benoit Delage]

I'd like to answer quickly, if I may.

Currently, the plastics used by recycling facilities doesn't sell at a high enough price. Adding value to the plastic is key, because it doesn't really have any value as we speak. If we can't process it locally, if we can't make sure that it's recycled in Canada and that by-products are developed locally, it will always end up in the environment.

Knowing where the plastic is going and taking the necessary steps to raise the price are essential. The fact of the matter is that people are not inclined to recycle what doesn't have value. Essentially, that means building the negative externalities of plastic into the cost, and that can be done in a number of ways.

[William Amos, Liberal, Pontiac, QC]

Maybe I'll address this one to Usman, since he hasn't had the opportunity to jump in.

I understand the comments that Mr. Delage has made about the importance of costing and ensuring that the real value of plastic is reflected so that a circular economy around repeat usage can be achieved, but where is the specific federal role in achieving this? Are we talking about legal or regulatory mechanisms, or am I a lawyer looking in the wrong place and really there are other, more effective mechanisms that should be used?

[Michael Wilson]

I'm not sure he's hearing this, so let me get started.

I think there are a few areas where the federal government can play a really valuable role. Some are on the harder, more regulatory side, and some are on the softer, more suasive and market-oriented side. For what you did on microbeads and other areas where you have very clear jurisdiction over the toxic contaminant aspect of a constituent of plastics, you can play a very strong role under the Canadian Environmental Protection Act in either regulating them out of the production system or managing their life cycle in the production system. You've done that with certain toxins in plastics, and there may be other ones the federal government could look at.

More generally across the plastics waste stream, I think the federal government is the holder of the best science on this and has a really valuable role to play in setting the performance standards that you would expect them to meet, such as extended producer responsibility systems. Then the federal government can be more creative or more flexible on how extended producer responsibility, for instance, gets delivered. The federal government could set the outcomes that would have to be achieved or the levels that are needed in order to meet either diversion targets or the environmental outcomes that you want.

Coalitions of business, NGOs and provincial and municipal governments can deliver on those commitments if they are endorsed or set out at the federal level. They have a really valuable role, as difficult as it can be, in steering the federal/provincial ship that's trying to get harmonization across the systems.

[William Amos, Liberal, Pontiac, QC]

Thank you.

I have a quick follow-up. I appreciate that there could be a great role for the feds to help shape objectives and work intergovernmentally, but what we've seen with the 2009 action plan is that the provinces actually don't hold up their end of the bargain. I want to know how we can get around that.

If there's no time for an oral commentary, perhaps Mr. Valiante—based on his experience intergovernmentally—can provide us with his opinion on what the federal government needs to do to create, without imposing, a framework whereby action is going to be delivered across the country through other jurisdictions.

[The Chair]

That's the end of the six minutes, unfortunately.

We're going to go to Mr. Miller.

You have six minutes.

[Larry Miller, Conservative, Bruce—Grey—Owen Sound, ON]

Thank you very much, Mr. Chair.

Thank you to our guests for being here.

I just wanted to point out that I got involved in municipal council back in 1991 in the township of Keppel. I was on what they then called the waste management committee. Today it's the environmental committee; the names have changed. I was actually part of the team that initiated the very first recycling in our rural part of Ontario. I believe strongly in recycling, but I'm also a realist and I realize there are limitations. You've pointed out some of them. Our recycling actually extended the life of our dump by an estimated 23 to 25 years, so there was a value for the taxpayer right there.

You talked about traceability. Remember, I have only six minutes. Very briefly, in 30 seconds, how would you define “traceability”?

[Benoit Delage]

This is how Traces Quebec, the only traceability scheme currently in operation, describes itself:

Traces Quebec is a private real-time waste tracking solution. Hosted on a web platform, Traces Quebec allows owners to follow in real time the movement of their materials and to have an encrypted, confidential and archived trace of the entire process. In the era of transparency and eco-citizenship, Traces Quebec allows organizations to demonstrate beyond any doubt their exemplary management in the disposal or treatment of these materials.

The goal is to do the same with plastics that leave recycling facilities. Now, they are sold to the best bidder, very often ending up in other countries because it costs less than sending them to landfill. Where exactly does the plastic go? Suffice it to say, it's not being utilized to its full potential.

[Larry Miller, Conservative, Bruce—Grey—Owen Sound, ON]

I'm not sure what we can do to stop plastics ending up in other countries. I would think that this is an exception more than it is the norm.

Mr. Wilson, you also talked about increasing the price, and Mr. Amos mentioned the real cost. Well, the real cost of something is what somebody is willing to pay for it. Consumers, being what we are.... I'll use an example. I get a lot of constituents who complain, “Oh, we have to stop stuff from China coming into Canada.” There's only one way to do that—it's consumer responsibility. If you and I, as consumers, don't buy it, they're not going to sell it here. They might sell it to somebody else, but overall they'll sell less. Really, at the end of the day, how does increasing the price work? The consumer ultimately pays more. The manufacturer pays more.

I have just 30 seconds left.

[Michael Wilson]

Okay, I'll give you a quick answer on it. I'm going to try to hit on a couple of points.

When we talk about passing on the costs to consumers or to producers, what we're always referring to, as economists, are any of the costs that society would otherwise bear. You internalize them to the producer of the product. These aren't new costs we're creating—

[Larry Miller, Conservative, Bruce—Grey—Owen Sound, ON]

Do you add them to the cost of the product?