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Canada’s Limitation of Carbon Emission Industries Research Paper

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Updated: Oct 13th, 2021

Global warming and global climate change are the main problems that affected the modern community. Beginning in the 1990s, a large body of legislation was enacted by the Canadian government to regulate health, safety, and the environment. Parliament declared that the environment should be clean, highways and consumer products safe, workers protected, and automobiles efficient in gasoline consumption.

It set stringent standards and tight timetables and required that standards be “practicable.” While progress has been made, the goals have not been met. Still, surveys show that the public endorses the goals and is concerned about risks to health. Some sort of regulatory reform seems inevitable, but proposals range from one extreme of making it easier for the regulatory agencies to promulgate and enforce regulations to the other extreme of abandoning the regulations and relying on the marketplace.

In contrast to many other countries of the world, Canada introduces strict legislation in order to regulate Carbon Emission Industries, namely petroleum, chemicals, and primary metals. Special attention is paid to the coal industry. The flourishing coal industry in Canada, producing perhaps twice the present tonnage by late in this century, will not come about simply because prices are rising. Government policy and behavior deeply affect both coal supply and coal demand. However, supply issues either do not involve especially high costs (for example, strip mine regulations) or do not pose especially novel problems (for example, transportation and community development) (Lee and Perl 2003).

The state supposes that a variety of means are available to reduce these problems, including fiscal incentives, grants, loans, and training programs. This is much less true on the demand side. Improvements in technology are needed to encourage users, especially small firms, to use coal, and new ways to regulate air pollution are required to provide incentives for coal users to reduce emissions that pollute the air without discouraging their use of coal (Lee and Perl, 2003).

Most economists argue for replacing air standards with monetary charges for emissions, giving the coal users an incentive to introduce the most effective antipollution techniques. The usual argument against this proposal is that charges are no more easily set than standards. This may well be true; but the great advantage of charges is that the emitters are given the flexibility to meet the standards by any legal method–using new technology, modifying their processes, or changing their product, the raw material, or the location of their plant Federal policy recently began to move in this direction (Lee and Perl 2003).

For example, experiments are being conducted in the use of offset provisions, under which emitters identify existing pollution sources and buy offsetting emission reductions; and the “bubble” concept, which allows some emissions from closely associated sources to exceed the limit as long as aggregate emissions meet the standards. These experiments could lead to major revisions in the philosophy and techniques of air pollution regulation and to significant savings throughout the economy.

Presently, due to technological limitations, the most cost-effective method of reducing energy-generated greenhouse gas emissions is through actions to reduce fossil fuel combustion. This includes energy conservation, energy efficiency, and fuel switching. Reductions in emissions from fossil fuel combustion will also function to reduce a wide range of pollutants” (Chiotti and Urquizo 2002, p. 235).

The main principle of the new policy is that effort must be redoubled to understand the relationship between emissions and health and the environment, not to buttress legislated standards but to improve policy through better information. Second, Parliament has in the past legislated as though environmental goals were absolutes, capable of being cast into targets and standards set by the executive branch on a scientific basis: at a certain number we were presumed “safe,” at another, we were in peril. In the light of the new information and the rising uncertainty about the sequences and agents of pollution and the relation of costs to results, it is time for Parliament to examine the philosophy and strategy behind air pollution control (Parker et al 2003).

Parliament should be forthright in stating the cost that is justified to avoid or remedy pollution effects. In the past, this judgment was considered a technical one made implicitly by the administration in setting standards. Far from being only technical and administrative, this judgment is most important political and social (Lee and Perl, 2003). Third, the invention of market devices, including marketable emission rights, charges, and so on, should be forcefully pursued.

Both energy and environmental objectives are likely to benefit. The argument that such approaches are tantamount to a “right to pollute” equally applies to any regulatory system with standards above zero pollution. The difference is that in the latter instance, the right to pollute is accorded free; in the former, it is paid for and goes to those willing and able to pay (Lee and Perl 2003).

In Canada, energy is now firmly established as one of modern society’s major problems. It takes its place alongside the urban problem, the health problem, the national security problem, and others. Moreover, its many facets touch on most other social issues and national objectives –from environmental quality to income distribution. Unfortunately, there is no policy or set of policies that will once again give us abundant, reliable, cheap energy.

Even the idea of a comprehensive national energy policy may be an illusion; the best one might hope for is a reasonable degree of consistency in policies that deal directly or indirectly with energy. Achievement of greater efficiency in the use of energy requires both a turnover of energy-using facilities, like motor vehicles and buildings and a change in energy-using habits and practices. Both will take time (Reitze, 2002).

Lead times for new energy sources and technologies are also long. Moreover, energy is now so intertwined with other objectives that sorting out their effects on each other is likely to continue to be time-consuming but inescapable. Consequently, little can be accomplished in less than half a decade. Given these characteristics of the energy problem, a few guidelines can be suggested. First, there is ample room for lowering demand without changing lifestyles–through realistic fuel prices and programs to offset their effect on low-income users and inflation; through simplified regulations and cost-effective subsidies; and through wide distribution of technical information.

Second, a balanced supply program is needed to keep us from becoming dependent on specific resources and technologies that in the long run may be more costly and environmentally less attractive than others. Third, energy being an international problem, and exclusively Canada.-oriented policy is neither desirable nor practical. International understandings, some already on the books, are essential; and the effect of high energy costs on developing countries, and ways to alleviate it, needs attention (Sousa, 2006). Fourth, while all conventional energy sources are flawed and carry risks, there is little prospect of significant changes over the next decade.

Thus, the major effort must be to reduce risks and to demonstrate that those remaining are the price we must pay for a rising standard of living, both here and abroad. For the same reason, utmost care is called for before any conventional source is permitted to vanish. Finally, contingency plans are vital for dealing with shocks and surprises to make them less wrenching (Lee and Perl 2003).

A special issue within the air pollution area is the easing of coal into industrial facilities not using it now, and especially into smaller-sized plants. Coal-burning technology that reduces noxious emissions and can be profitably operated on a small scale exists in the form of small gasifiers and fluidized-bed combustion. Because oil would be replaced, the introduction of such equipment into the industry is a high priority for the 1990s and justifies government assistance not only in research and development but also in facilitating the acquisition and installation of the equipment.

The high cost of acquisition and waiting until day-to-day reliability has been established are major retarding factors. Loan guarantees and perhaps tax rebates are no less justified here than for energy conservation investment. It is estimated that by the end of the century up to 400 million tons of coal could be substituted for industrially burned oil and gas. In assessing this figure it is useful to remember that this much coal is equal to about 4.5 million barrels a day of oil, or only about one-fourth of current oil consumption. Thus a quick and substantial dent in the oil market through coal substitution in the industry is not in the cards (Lee and Perl 2003).

In Canada, environmentally motivated regulations on strip mining and water quality are complex. The aim of the new policy is to protect these resources from emissions and pollution. There is concern about the problems arising from sudden, substantial population growth in heretofore sparsely settled locations, often with no expectation of permanence (the boomtown).

Transportation poses problems: some eastern railroads are run-down; some western railroads need more trackage and rolling stock; some major hauling roads that would have to carry greatly increased coal tonnage are in poor condition, and coal slurry pipelines have failed to develop because of opposition by the railroads and by some western state and environmental interests that do not favor coal mining west of the Ontario or that oppose the use of water as the carrier in such lines. “Under the Kyoto Protocol, Canada committed to reducing its 2010 GHG emissions (or those during the commitment period of 2008 – 2012) to 6 % below those of 1990. Assuming that all regions and all economic sectors would be expected to reduce their respective GHG emissions by this magnitude, the Kyoto Gap at various levels of accounting can be estimated” (Kulshreshtha and Junkins 2001, p. 101).

The industries will have to adapt to new regulations and restructure their manufacturing and plant facilities. It will require huge investments and financial support from the government. This, in turn, requires a willingness to invest valuable time in structure per se. Quasi-structural elements like cross-disciplinary, multilevel committees, task forces, and teams require fostering, attention, and support.

Thus, quasi-formal relationships to coordinate and exchange information are legitimated in these firms by the widespread investment of sanctioned time. Industries in these areas are restructuring because of technological change and/or deregulation. The newcomer has an advantage in an industry undergoing restructuring. Current industry participants have invested in the old technology and are slower to adopt the new rules of competition.

The strategic forces are causing paradoxes for companies. To be responsive and integrated, companies need small, fast-acting business units. But to get critical mass in technology, companies need large functions. The solution for some companies is to use a functional organization with product, project, or program overlays. Previously, these overlays or functions were referred to as a matrix-like organization.

Taking into account the coal industry, it is possible to say that two aspects of coal remain to be discussed. Coal conversion is taken up in the next section. The other is increased carbon dioxide in the atmosphere, which could drastically change the global climate. A ten-year perspective need not focus on the event itself but on improving our understanding of the problem. The carbon dioxide syndrome is a potentially powerful impediment to the use of fossil fuels, especially coal, worldwide (Cormier et al 2006I).

It deserves continuing and methodical attention. Responsibility for research must be firmly lodged in a government unit with links to policymaking bodies so that the problem is not shrugged off as a scientific curiosity. Publication of the periodic Status Report, issued by the Department of Energy’s Carbon Dioxide and Climate Research Program, is a step in the right direction. Many are looking for new energy sources and technologies to help supply the nation’s future energy needs.

Most of these new sources and technologies are reasonably well-known. The great unknowns are how quickly they can be expected to provide significant amounts of energy and at what cost. The discussion here is confined to a few that figure prominently in the public debate but not always with adequate information or perspective (Lee and Perl, 2003).

If pollution abatement were inexpensive, the matter would be closed. There are health effects, and it is prudent to lower emissions and reap these benefits. But pollution control, particularly for sulfur oxides, is expensive. Furthermore, stringent control could result in the prohibition of technologies such as direct burning of coal and reduced use of such fuels as high sulfur coal. Thus there have been repeated reevaluations of the health effects of sulfur oxides.

The fundamental issues to decide are: What are the health effects of sulfur dioxide and other sulfur oxides? How far are these sulfur oxides transported from the source of emission? What abatement techniques will serve to reduce emissions and the consequent health effects? What other effects, such as reduced visibility and acid rain, are important and how can they be controlled? (Cormier et al 2006I).

Sulfur dioxide is relatively easy to measure, and its control does not pose serious technological problems. The Canadian Environmental Protection Agency has set emissions and ambient air standards for sulfur dioxide. But both laboratory and epidemiological work indicate that sulfur dioxide may not be the primary culprit affecting health, at least not at the concentrations occurring in urban areas. In contrast, sulfates, particularly acid sulfates, are harmful to health.

However, they are difficult to measure and result from the chemical transformation of sulfur dioxide in the atmosphere. Accordingly, it is not easy to determine whether ambient air quality is “satisfactory”; emissions regulations on these pollutants would be irrelevant. A major difficulty has resulted because sulfur dioxide is regulated, but is not terribly harmful, while acid sulfates are harmful but unregulated (Macdonald, 2007).

This has led the agency to be unresponsive to the issues raised by its critics, and vice versa. Although it has not been proved that sulfates are harmful in the concentrations that occur in urban areas, analysis of groups exposed to different pollution levels demonstrates a statistical association between sulfates and mortality rates that persists even after adjusting for the principal factors that might vitiate the relationship. Although neither reduced visibility nor acid rain has the emotional quality of life-endangering air pollution, they are important (Desel, 2002).

The investment requirements for the steel industry undoubtedly will be large. Certainly, investing 25 percent of new capital in environmental and safety control is a much heavier than average burden. And there is no doubt about the intensity of foreign competition and the need to modernize the plant and reduce costs. However, the increased costs are a tiny proportion of the cost of making steel. If the industry were robust and profitable, sufficient funds could easily be secured to cover mandated investments and the small increases in cost would have little effect on sales. The scarcity of investment funds stems from the unattractiveness of the industry to new investors; low rates of return to investment have resulted from foreign competition, the rapid rise in wages, and, to a small extent, social regulations (Lee and Perl 2003).

Thus the lesson is that the steel industry is in a difficult position because of its low profitability, compounded by its failure in the past to control emissions. If conditions are created that make the industry viable, health and safety regulations will not stand in the way. If conditions do not change, these regulations will not be the cause of the industry’s reduction in capacity (Hardy, 2007). The steel industry’s dilemma is a social and economic problem, not one of environment and safety.

The above controversies demonstrate that setting standards is both time-consuming and cumbersome, that often the wrong substances are regulated, and that implementation and enforcement are expensive and inadequate. Moreover, there are contradictions among regulations–perhaps because of a general failure to step back to look at the complete picture. Although social regulation has brought society closer to achieving its desired goals, the last decade and a half have revealed major flaws.

Regulatory reform is desirable; indeed, it is necessary. But regulatory reform is confronted with diverse proposals that must be sharpened to deal with the underlying problems. It is important to understand the sources of the current difficulties in order to arrive at some notion of what reforms are necessary and likely to work (Lee and Perl 2003).

Both the praise and blame for social regulation to date rests primarily with Parliament. It writes the legislation, oversees it, amends it, sets appeal mechanisms and budgets, and confirms the regulators. To its credit, Parliament quickly understood the problems and the public’s desire for improvement. The initial legislation drafted to deal with these problems was less praiseworthy because Parliament succumbed to rhetoric rather than trying to deal with those problems.

Even worse, Parliament failed to perceive the inadequacies in the legislation and correct them. Parliament has not solved the difficult problems associated with giving the agencies practical goals, resolving conflicts among legislation, and finding workable mechanisms for implementation. Certainly, there are no easy or obvious solutions, as demonstrated by the welter of proposals for reform. But there are some problems that only Parliament can handle (Lee and Perl 2003).

Much of the responsibility for the current situation belongs to the regulators themselves. It is not a sufficient qualification for agency administrators to know the law (or the science, the engineering, or even the economics) and have a true desire to protect the environment (or workers or consumers). The achievement of a goal–even one supported by the majority of people and written into law–by means of setting and enforcing standards require all these disciplines in addition to good sense and political judgment (Lee and Perl 2003).

The views of the standard-setting and enforcement process that are often expressed by regulators are “it is all politics”; “science speaks for itself”; and “our hands are tied.” The first view is that, because the electorate wants a clean environment, any progress toward this goal is desirable–as long as political forces support it. Thus scientific evidence and analysis, the weighing of costs and benefits, or even engineering feasibility are viewed as either irrelevant or as tools for gathering support.

But how long will popular and Parliament support persist for hasty, ill-conceived regulations and implementation plans? Parliament disciplining of the Federal Trade Commission and the Consumer Product Safety Commission (at least until recently) provides one answer.

The second view is that the scientific facts speak for themselves and determine each decision. Unfortunately, this evidence is rarely clear or unequivocal. The laboratory studies find that animals react to a particularly toxic substance at high levels of exposure; an extrapolation is necessary to estimate the effects at low levels (for example, in the case of vinyl chloride). Generally, there are no data on human effects.

Scientific analysis will, at best, provide a range of estimated effects and help identify a number of possible exposure levels that might be chosen. However, other considerations will be necessary to choose a particular exposure level. If the quantitative analysis is not used to identify the proper range and nature of uncertainties, the result is likely to be decisions that waste resources and fail to protect–decisions that can be challenged in court or before Parliament (Lee and Perl 2003).

Some critics concern that unsatisfactory performance resulted because of the restrictions of the statutes; there was no reason to muster the best scientific evidence, to sponsor research that would improve the evidence, to perform analysis, or to monitor the successes and failures of past regulations and implementation techniques. Indeed, anything except what they did seems to have been prohibited by Parliament or the courts. Yet as solicitors and regulators have changed and as the courts have had a chance to rule, it has become evident that the legislation is sufficiently broad to support diverse interpretations (Lee and Perl 2003). There is no excuse for being carried away by current crises and failing to engage in systematic thinking.

Instructing one agency to protect the environment, another to protect workers, and a third to protect consumers invites chaos. Each agency must be instructed on priorities and what to do when conflicts emerge. For example, it is not sufficient to order an agency to make the environment sufficiently clean to protect health. Who is to be protected (for example, cigarette smokers with emphysema, persons who suffer from eye irritation)? What margins for safety are needed? How should conflicts such as that between electricity costs and clean air be resolved? These are questions of values; although they are difficult to resolve, Parliament is the body that must do so.

If agencies gave more attention to priority setting and then discussed the priorities with Parliament and the public, much would be done to clarify public goals and the conflicts among those goals. Developing and publishing such information would not be a radical change in current procedures. Some of this information is developed in the budget process; publishing it should enhance the care with which the information is developed. The Regulatory Council could set guidelines for the publication of the information (Lee and Perl 2003).

The new policies and restrictions aimed to improve technologies and introduce cleaner production cycles. For the legal community to take action on an environmental issue-in this case, acid deposition–scientists ideally must provide information on three areas:

  1. the degree of change in the composition of the atmosphere or the environment caused by sulfur and nitrogen emissions;
  2. the degree to which this change in composition causes an impact on ecological systems; and
  3. the extent to which these impacts are reversible, or in other words, the extent to which some benefit results from a change in policy to control emissions.

Once these three scientific areas are addressed, policymakers can determine whether environmental changes are severe enough to take political or legal action. In assessing proposed answers to those questions, it is necessary to keep in mind the nature and great complexity of the physical system, that is, the environment, in which acid deposition occurs. The emissions of sulfur and nitrogen to the atmosphere have substantially increased as a result of fossil fuel combustion and mineral ore smelting. To understand the environmental consequences of these increased emissions, processes in several linked systems must be examined.

The first process is, of course, the emission process, because it determines the injection rate of sulfur and nitrogen to the first environmental reservoir–the atmosphere. Within the atmosphere, there are several processes (transport and chemical and physical transformations) that control the deposition rate to the next environmental reservoir–the soils. Then, within the soils, there are again processes that control the injection rate of sulfur and nitrogen to the third, and final, reservoir-the surface waters. Once the chemical and physical changes in the atmosphere, soil, and surface water reservoirs are understood, the biological changes can be addressed (Lee and Perl 2003).

The effects of acidification are the least controversial with respect to this reservoir. There are thousands of lakes and streams in North America and Europe that are sensitive to acidification. A large number–thousands, in fact–have acidified, and we know that their biological populations are extremely sensitive. Once pH decreases below 6–just slightly acidic–biological damage begins to occur. Moreover, even if acid deposition does not increase, there are thousands of streams that will be acidified owing to the phenomena of delayed acidification. For example, in the mountains, it is estimated that in the next few decades, a large portion of the native trout streams will be acidified.

One of the uncertainties about surface-water acidification is the rate of continued acidification. Although systems all over the world will continue to acidify, there is as yet no way to predict the exact rate, for example, whether systems are going to double acidity in two years or ten years. Undoubtedly, they would recover. Freshwaters in some areas of the world–north of about 40 degrees latitude–would recover very quickly. Freshwaters in other parts of the world, because of differences in the soil composition, would recover very slowly (Lee and Perl 2003).

The main benefit of the new policy is that the regulation of emissions from all new plants on the basis of standards related to the best available technology not involving excessive cost; a two-stage approach for overall reductions in emissions; the setting of a Community target for an overall reduction in SO 2 emissions–this would need to be substantial, were “substantial” meant an improvement on the reduction envisaged by the 1985 Sulphur Protocol; the setting up of appropriate programs, member State by member State, for achieving the overall reduction–programs that would take account of the scale of the emissions from different countries, their contributions to overall pollution in Europe, special situations (related to their stage of economic development, the nature of locally available fuels, and the overall effort involved), and other relevant criteria; and comparable action in relation to emissions of NOx.

While the overall reduction targets for sulfur dioxide, nitrogen oxides, and possibly dust aim at securing a major decrease in the overall emission of sulfur dioxide, nitrogen oxides, and possibly dust in the short term, emission limit values for new plants are intended to ensure–as existing plants become redundant and are replaced by new ones–that emissions in the long term fall to only a fraction of present-day levels. A temporary derogation from the emission limit value for nitrogen oxides is also allowed “in the event that monitoring reveals that due to unforeseen reasons, the emission limit value is not being complied with.” The operator shall in that case be required to take all appropriate primary measures to achieve compliance as soon as possible and in any case within one year (Macdonald, 2007).

It will be further noted that the directives for sulfur dioxide and suspended particulates and for nitrogen dioxide leave open the possibility for important derogations from the time schedule within which the limit values must, in principle, be met. According to the preamble of the directives, the measures to be taken in pursuance of the directives must be economically feasible and compatible with balanced economic development (Macdonald, 2007). Furthermore, the directives do not even provide for a standstill with respect to pollution levels that, at the time of the implementation of the directives, are low in relation to the applicable limit values and possibly do not even provide for such a standstill with respect to pollution levels that at that time exceed the applicable limit values.

To some extent, new regulations and restrictions put on carbon emission industries will help Canada to solve the problem with North America. It appears to be extremely difficult to reach an international agreement on the level of stabilization and the measure of emission reductions to be achieved within a given period of time which show great differences in location, size, population, economic development, use of various forms of energy sources, and consequently also in their level of contributing to the problem of acid rain.

These differences also call for differentiation of the burden of Canada in reducing and eventually eliminating the problem of acid rain in American in general. Thus, apart from the problem of reaching an agreement on the level of stabilization and reduction of the overall emission of the pollutants causing acid rain, there also remains the intricate problem of the equitable apportionment of the burden of the necessary reduction of the overall emission or how to share equitably the overall emission that may still be permitted without giving rise to a significant extraterritorial environmental interference.

Through all this also plays the problem of the availability or nonavailability of pollution prevention or abatement technology and the economic feasibility of applying this technology (Macdonald, 2007). The element of the economic feasibility in itself also permits a certain differentiation in the burden of countries to prevent and abate acid rain. However, in certain matters differentiation is hardly possible, that is, with regard to substances and objects which form part of the trade or traffic between


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