Proposed amendments to the Environmental Management Act aim to uphold the “polluter-‎pays principle” and represent the first phase of the BC government’s “public interest bonding ‎strategy”‎

On May 8, 2023, Bill 29 - the Environmental Management Amendment Act, 2023 (“Bill 29”) received its first reading in the British Columbia legislature. Bill 29 proposes a series of amendments to the Environmental Management Act, S.B.C. 2003, c. 53 (the “Act”), with the intent to uphold the “polluter-pays principle” by placing the responsibility for industrial-site cleanup with the owners. Bill 29 is said to represent the first phase of the “Public Interest Bonding Strategy”, an initiative introduced by the Ministry of Environment and Climate Change Strategy (the “Ministry”) in 2020.

Generally, the amendments seek to enable future provincial regulations which would give government the authority to collect, use and enforce financial assurance requirements under the Act -- meaning that companies would be obligated to plan for decommissioning and closure of their operations, and may be required to provide financial security for this cleanup in advance.

More particularly, Bill 29 introduces the following significant amendments to the Act:

1. Amends the authority to suspend a permit or approval and clarifies the effect of a suspension of a permit or approval;

    

2. Repeals the authority to abandon a permit or approval issued under the Act;

    

3. Introduces a new “Division 2.2 - Decommissioning and Closure of Facilities” under Part 7 of the Act setting out new rules relating to “specified facilities”. “Specified facility” is defined in Bill 29 as a “facility used for a prescribed industrial or commercial purpose or activity”. If Bill 29 is passed, it is expected that further details on what constitutes a “prescribed industrial or commercial purpose or activity” would be set out in the regulations to come.
   
   The proposed Division 2.2 broadly gives a director authority to order an owner or operator of a “specified facility” to:
   
   
   1. provide information about operations and activities taking place at the facility, substances present at the facility and the financial conditions of the owner or operator;
   2. prepare and submit a decommissioning and closure plan and to address deficiencies in the plan;
   3. decommission and close a specified facility after operations at the facility have ceased; and
   4. provide security in relation to the decommissioning and closure obligations.
   
   

   Again, we expect that additional detail relating to these director authorizations will be provided in the regulations to come.

   Further, this Division 2.2 would authorize the government to:

   1. issue a stop work order if a person fails to comply ‎with orders of a director in relation to a decommissioning and closure plan;
   2. enter an abandoned facility and carry out ‎decommissioning and closure, with the government and its ‎employees being immunized from liability in relation to that work;‎ and
   3. recover costs incurred to ‎decommission and close an abandoned facility; and
      
      
4. Enacts regulation-making powers in relation to decommissioning and closure, decommissioning and closure plans, the authority of a director to make orders in relation to decommissioning and closure plans, and the costs that can be recovered by the government for the decommissioning and closure of abandoned facilities.

Overall, Bill 29 has been introduced as a complement to the Contaminated Sites Regulation, B.C. Reg. 375/96 and an attempt to “lessen the financial burden on taxpayers, enhance economic opportunities for site redevelopment and protect human health and the environment”(British Columbia, Draft Report of Debates of the Legislative Assembly (Hansard)‎, ‎42nd Parl, 4th Sess, (8 May 2023)). 

The Ministry has announced that “existing and future high-risk industries regulated under the Act will be considered” and that “projects with the highest potential risk will be addressed first”. This aligns with previous guidance from the government that states “historic sites with no ongoing industrial activities are out of scope, as the ability to collect financial assurance has passed” and “the focus of the Public Interest Bonding Strategy is to prevent the creation of future contaminated sites”. It is expected that clean-up and reclamation of such “historic sites” will continue to be managed through the Province’s Crown Contaminated Sites Program and via regulation of contaminated sites under the Act.

Finally, the Ministry states that if Bill 29 is passed, “comprehensive engagement and assessment” will follow in order to establish regulations and that any new regulations will include a transition period to give industry time to adapt.