Evidence of meeting #42 for Natural Resources in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was accident.
A recording is available from Parliament.
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
What did you mean by that? I'm sorry. I'm confused by that answer.
You're still saying that it's not the operator. Subclause 16(2) isn't about preventing the operator from making a claim. It's about everybody else, right?
5:10 p.m.
Senior Legislative Counsel, Advisory and Development Services Section, Department of Justice
Mr. Cullen had asked a question about subclause 16(1), which was about the operator's employees as in subclause 16(1).
In subclause 16(2), you're right, it's a different scenario. We're talking about something else then. We're talking about the failure to provide electricity from the plant.
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
This is anybody who is an electricity user who experiences costs because they've lost electricity, because their meat goes bad or whatever, right? They can't make a claim.
5:10 p.m.
Senior Legislative Counsel, Advisory and Development Services Section, Department of Justice
That's right.
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
My concern, frankly, is that when a 600-megawatt power plant goes down, it's hard to replace that. If we move to 1,000 megawatts.... These plants are only going to get bigger, I expect. ACR will be 1,000 megawatts, right? If that goes down, that has a big impact. It's hard for the supplier to replace that from somewhere else and you're likely to have a blackout for a while.
I'm still interested in hearing a better argument for why that would not be compensable. I'm not clear on it. As I understand it, the company itself would be limited to $650 million. Now, of course, if the total damages were $400 million, then this would still not be compensable for the person who had lost their business due to the power outage during that period.
5:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
I think you had identified the issue previously. It's a question of the remoteness of the damage, and these aren't direct damages. They are more indirect and could be much broader. So the focus of the legislation was to address those people who would be directly affected.
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
But the remoteness question would be under tort law, applied anyway by the courts. The courts would decide which damages were too remote, and they would say some of these are too remote but some of them aren't. They could. This prevents them from making that decision. It overrides that and takes that process away, and the opportunity for someone to make a claim of that sort is gone, right, because there's a policy decision that what you're trying to do here is too remote.
5:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
But that isn't just reserved for this particular head of damage that exists throughout the legislation, where heads of damage are defined to reflect directness to the nuclear incident.
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
I will just go back for a moment. Once the operator's damages are paid, thanks to its insurer or whatever, $650 million, is there somewhere else that someone can look for damages or for compensation under the act? Does it then turn to government?
5:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
Yes, that's correct.
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
So, generally speaking, throughout the act, after that cap, the person can turn to government for compensation. But what you're saying is that the individual who suffers economic loss of this particular type due to the failure of provision of electricity can't do that.
5:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's right, and other areas as well, because there is--
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
And the reason is that you want to focus the taxpayers' dollars on the people who are most dramatically affected?
5:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
Correct.
5:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
This is quite similar to the way the courts have decided over the years to say, “Okay, we're going to choose; we know that when people are suing a company, the company may only have so much in terms of assets and resources, and therefore we're going to make choices about who is going to qualify as close enough to this and who is too remote, who we think are a little too far out.” So those who are most directly affected are the ones who are going to get compensated here, as they use up these resources, as they exercise a judgment, so to speak.
5:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's correct.
5:15 p.m.
Senior Legislative Counsel, Advisory and Development Services Section, Department of Justice
I have just a very small clarification. Of course, we cannot in our legislation and do not attempt to bind a future parliament, so obviously a parliament can appropriate money for whatever it wants to appropriate money for. We do not presume to tell a future parliament what it can or cannot do, but under this scheme, the limit is established.
5:15 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
Mr. Chair, I just want to make sure that I'm clear. I thought I was clear and I thought you said yes when I asked the question, but I just want to make certain. This clause really is covered by other insurance. If I am a merchant plant who built a plant to provide energy to a customer somewhere and I have an incident, then the $650 million would be covered under this policy for things that happened. But for the supply of energy that I committed to and I contractually agreed to, that would be in a contract I have with that customer or those customers, and that would have its own set of clauses and damage clauses in it and carry its own insurance under that. And the same thing would happen with a utility who had a deal with another.... They would just have the flexibility within their system to draw from somewhere else to provide that. But that's covered under other insurance, private insurance policies, and there's no way we would ask the government to come in for that.
5:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's correct. If those policies exist, they stay in place. In fact, the legislation addresses that. It says that any contracts of insurance are not superseded by this legislation.
5:15 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
Sorry, Mr. Chairman. Did you say the contracts of insurance, or do you mean the contracts between the customer and the provider of electricity? That's the contract he was referring to--the first contract, anyway.
5:15 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
In a contract, typically, you have some insurance policy--
5:15 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
The first question is, is it under contract that the suit is taking place?
