Vol. 147, No. 25 — June 22, 2013

Regulations Amending the PCB Regulations and Repealing the Federal Mobile PCB Treatment and Destruction Regulations

Statutory authority

Canadian Environmental Protection Act, 1999

Sponsoring departments

Department of the Environment and Department of Health

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issue

Polychlorinated biphenyls (PCBs) are industrial compounds that are regulated by the PCB Regulations. By 2010, as a result of the accelerated timelines for destruction, roughly 2 850 tonnes or around 40% of PCBs in equipment subject to the PCB Regulations had been destroyed.

The PCB Regulations set an end-of-use deadline of December 31, 2009, for high PCB concentration equipment that contains PCBs in a concentration of 500 mg/kg or more, with the possibility of a use extension up to December 31, 2014, upon application to the Minister of the Environment. However, owners of certain types of high concentration equipment in the utilities sector, namely current transformers, potential transformers, circuit breakers, reclosers and bushings (hereinafter referred to as high concentration electrical equipment), have expressed concern that the current deadline does not provide sufficient time for identification and removal from service of an estimated 50 000 pieces of high concentration electrical equipment, which are currently in use at electrical generation, transmission or distribution facilities across Canada.

Industry stakeholders estimate that this high concentration electrical equipment represents approximately 1% of all equipment containing PCBs currently in use in Canada. The high concentration electrical equipment, which contains an estimated 385 tonnes of pure PCBs, is wide-spread, and the testing for PCB content is not readily feasible because testing can only occur during maintenance shutdowns or other scheduled outages. The regulated community has indicated that a deadline of December 31, 2025, would provide sufficient time to identify and remove from use all high concentration electrical equipment while avoiding the negative implications of unscheduled power outages.

In addition to the concern expressed by the utilities sector, modifications are needed to the PCB Regulations, including updating references to other legislation, adding text to improve clarity, and addressing inconsistency between the English and French versions of the PCB Regulations as identified by the Standing Joint Committee for the Scrutiny of Regulations (SJCSR). It is also necessary to repeal the Federal Mobile PCB Treatment and Destruction Regulations (the FMTD Regulations), as they are no longer required.

Background

Polychlorinated biphenyls are synthesized and commercialized industrial compounds that were used mostly to cool and insulate electrical transformers and capacitors. PCBs are persistent, toxic substances that pose a potential hazard to human health and the environment, and have been banned from manufacture or sale in (for re-use) and import into Canada since 1977.

The PCB Regulations, which came into force on September 5, 2008, were made under the Canadian Environmental Protection Act, 1999 (CEPA 1999) with the objective of addressing the risks posed by the use, storage and release to the environment of PCBs, and to accelerate their destruction. The PCB Regulations set different end-of-use deadlines for equipment containing PCBs at various concentration levels. A preliminary strategic environmental assessment has concluded that extending the end-of-use deadline for certain equipment containing concentrations of PCBs greater than 500 mg/kg may result in a small negative environmental effect if releases were to occur. However these effects are not considered to be significant due to the very remote possibility of releases occurring.

The regulated community consists of owners of PCBs and equipment containing PCBs primarily in industry sectors such as electric utilities, pulp and paper manufacturing, iron and steel manufacturing, and mining and mineral manufacturing. According to the Canadian Council of Resource and Environmental Ministers, these sectors accounted for approximately 68% of the PCBs and equipment containing PCBs inventory in 2007; the remaining 32% of the PCB inventory was owned by federal and other governments, hospitals and schools, and other miscellaneous industry sectors.

International context

The PCB Regulations were developed to enable Canada to meet its international obligations. Canada is a party to both the United Nations Environment Programme’s Stockholm Convention on Persistent Organic Pollutants (Stockholm Convention) and the United Nations Economics Commission for Europe’s Persistent Organic Pollutants Protocol (2003) to the 1979 Convention on Long-range Transboundary Air Pollution (LRTAP).

The Stockholm Convention requires Parties to the Convention to make determined efforts to identify, label and remove from use equipment that contains PCBs in various concentrations and volumes by 2025. The LRTAP requires Parties to make determined efforts to remove from use equipment containing high concentration PCBs in specific volumes by a specific date as well as to destroy PCB liquids in an environmentally sound manner. Since the PCB Regulations came into force, timelines in LRTAP have been changed to align with the Stockholm Convention.

The Federal Mobile PCB Treatment and Destruction Regulations

The FMTD Regulations, made under Part 4 of the Canadian Environmental Protection Act,1988 (CEPA 1988), came into force on December 14, 1989, and include provisions for permitting mobile treatment and destruction systems on federal and aboriginal lands. The FMTD Regulations were developed as part of the Federal PCB Destruction Program (the Program). By the time the Program wound up in 1995, permanent hazardous waste (including PCBs) treatment and destruction facilities were already established or planned in several provinces. The operation of these facilities is now regulated and authorized by provincial governments. Furthermore, the FMTD Regulations now fall under Part 9 of CEPA 1999, which does not provide authority to issue operating permits. Therefore, there is no longer a need for the Government of Canada to contract the use of mobile PCB treatment and destruction facilities, which means that the FMTD Regulations are no longer required.

Objectives

The objectives of the proposed Regulations Amending the PCB Regulations and Repealing the Federal Mobile PCB Treatment and Destruction Regulations (the proposed Amendments) are to

  • ensure the timely and orderly phase-out of high concentration electrical equipment with minimal disruptions to the power supply;
  • update the regulatory text and provide clarity to the regulated community while addressing inconsistencies identified by the SJCSR between English and French regulatory texts; and
  • repeal the FMTD Regulations, which are no longer required.

Description

The proposed Amendments would extend the end-of-use deadline for high concentration electrical equipment (i.e. current transformers, potential transformers, circuit breakers, reclosers and bushings) that contains PCBs in a concentration of 500 mg/kg or more from December 31, 2009, to December 31, 2025.

In addition, the proposed Amendments would update a legislative reference contained in paragraph 2(2)(b) of the PCB Regulations by changing the reference from “section 4 of the Hazardous Products Act” to “section 5 of the Canada Consumer Product Safety Act.” The proposed Amendments would also correct certain inconsistencies between the English and French regulatory texts and clarify the application of section 16 and section 33.

As part of this regulatory proposal, the FMTD Regulations would be repealed, as they are no longer required.

“One-for-One” Rule

The “One-for-One” Rule would be applied to the proposed Amendments. Although the proposed Amendments would not impose a new administrative burden on businesses, they would result in an “out” of one regulatory title under the rule.

The proposed Amendments would make no changes to the reporting requirements of the PCB Regulations. Under the PCB Regulations, PCB equipment owners are required to submit an annual report on their progress in identifying and removing PCBs from use until all of their PCBs are destroyed. Owners of high concentration electrical equipment that would be affected by the proposed Amendments also own other types of PCB equipment, much of which is subject to a regulated end-of-use deadline of 2025 under the PCB Regulations. Under the proposed Amendments, owners of high concentration electrical equipment would report annually on the progress of PCB destruction from all PCB equipment and would have the same level of reporting effort overall. (see footnote 1) As a result, the proposed Amendments are not expected to result in any change to the administrative burden.

The repeal of the FMTD Regulations is not expected to have any impact on the administrative burden of the regulated community. The FMTD Regulations have not been required.

Small business lens

The small business lens does not apply to the proposed Amendments as there are no costs to small businesses. The proposed Amendments would only affect large utility companies with an average of 3 400 employees. Furthermore, as the FMTD Regulations are inactive and serve no purpose, and they were only applied to PCB treatment and destruction facilities operating on federal lands, and since the FMTD Regulations are not required, the repeal of the FMTD Regulations would have no effect on the small business community.

Consultation

Given that the proposed Amendments would not have any negative impacts on stakeholders who are expected to support the proposed Amendments, no formal stakeholder consultation was held. Environment Canada proposes to hold a consultation session with regulatees who would be affected by the proposed Amendments in collaboration with a national industry association. All stakeholders, including environmental non-governmental organizations, will be notified of the publication of the proposed Amendments in the Canada Gazette, Part Ⅰ, and will be provided an opportunity to comment on them during the formal 60-day public consultation period after the publication.

Rationale

The proposed Amendments would extend the deadline for removal and destruction of PCBs in roughly 50 000 pieces of high concentration electrical equipment from December 31, 2009, to December 31, 2025. This would provide the regulated community with sufficient time for identifying, transporting and destroying PCBs from existing equipment while spreading out the costs of compliance and avoiding unscheduled power outages. To estimate the impacts, this analysis incorporates the same methodology developed for Environment Canada in support of the Regulatory Impact Analysis Statement for the PCB Regulations, which included estimates on the costs of decommissioning per equipment type and scientific assumptions on PCB releases from equipment and the risks of spills and fires derived from the United States Environmental Protection Agency. (see footnote 2)

For the purposes of this analysis, the assumption is made based on the best information available that the proposed Amendments would affect owners of the roughly 50 000 pieces of high concentration electrical equipment who have end-of-use extensions to December 31, 2014. It is also assumed that regulatees would start to decommission and replace an equal number of pieces of high concentration electrical equipment on average every year, with the entire stock of 50 000 pieces of equipment replaced by either 2014 or 2025. Given this pace of compliance, it is estimated that a present value cost of $73 million (3% discount rate) would occur in order for the 2014 end-of-use deadline to be met compared with a present value cost of $62 million for the 2025 end-of-use deadline to be met, which implies an incremental decrease in compliance costs in present value terms of approximately $11 million, or around $0.7 million per year. However, this is a conservative estimate as it does not take into account the value of avoided disruptions to the electricity supply that may also occur if regulatees were forced to meet the end-of-2014 deadline.

These benefits to industry would be offset by costs for the potential increase in environmental releases of PCBs from spills and fires. The potential increase in spills and fires would be a direct cost to owners of high concentration electrical equipment in terms of increased costs of cleaning up spills and mitigating damages from fires involving PCBs, which consist primarily of replacing, transporting and destroying PCBs. Using the same model as sourced above, the present value of these additional costs to electrical equipment owners is estimated to be approximately $0.5 million in total over the period.

The extension of the end-of-use deadline would also result in a slower phase-out rate of high concentration electrical equipment, and could therefore result in greater potential damage to the environment. It is estimated that up to an additional 90 kg of PCBs could be released between 2015 and 2025 (or 8 kg per year on average) as a result of the proposed Amendments. However, based on the releases to the environment reported to the National Environmental Emergencies Centre for 2010, it is likely that the actual release of PCBs will be considerably lower. (see footnote 3)

As the releases of PCBs are expected to be low, the potential environmental impact is expected to be negligible. Moreover, even though PCBs are recognized as a potential hazard to human health, the full extent of human health implications remains unknown. All Canadians are exposed to very small amounts of PCBs through food intake and, to a lesser extent, through air, soil and water. As a result, all Canadians have PCBs in their bodies, making linking the specific adverse health effects to PCBs released from the equipment very difficult to isolate and assess. However, given the small amount of PCB releases, the environmental and health impact of the proposed Amendments is expected to be low.

The proposed Amendments would not have an impact on Canada’s international agreements and obligations. Canada is a party to both the Stockholm Convention and the 1979 Convention on LRTAP, which require parties to make determined efforts to identify, label and remove PCBs from in-use high concentration equipment by 2025. The proposed Amendments to the PCB Regulations would continue to respect this time frame.

Conclusion

The proposed Amendments would ensure the timely and orderly removal and destruction of PCBs from high concentration electrical equipment without unscheduled power outages or violating Canada’s international commitments. The incremental reduction in the present value cost of compliance is expected to be at least $11 million, with incremental costs to utility owners for greater spills and fires of roughly $0.5 million over the period. This proposed regulatory initiative would also make necessary modifications and alignments to the English and French regulatory texts, as well as repeal the FMTD Regulations as the FMTD Regulations have not been required. Given the small amount of PCBs expected to be released over the period, impacts on the environment and human health are expected to be low. Therefore, the proposed Amendments are expected to have an overall positive impact.

Contacts

  • Ms. Sharon Dunlop
    Senior Officer — PCB and Storage Tank Programs
    Waste Reduction and Management Division
    Environment Canada
    351 Saint-Joseph Boulevard
    Gatineau, Quebec
    K1A 0H3
    Telephone: 819-953-4950
    Fax: 819-997-3068
    Email: Sharon.Dunlop@ec.gc.ca

  • Mr. Yves Bourassa
    Director
    Regulatory Analysis and Valuation Division
    Environment Canada
    10 Wellington Street, 25th Floor
    Gatineau, Quebec
    K1A 0H3
    Telephone: 819-953-7651
    Fax: 819-953-3241
    Email: RAVD.DARV@ec.gc.ca

PROPOSED REGULATORY TEXT

Notice is given, pursuant to subsection 332(1) (see footnote a) of the Canadian Environmental Protection Act, 1999 (see footnote b), that the Governor in Council, pursuant to subsection 93(1) and sections 97, 209 and 286.1 (see footnote c) of that Act, proposes to make the annexed Regulations Amending the PCB Regulations and Repealing the Federal Mobile PCB Treatment and Destruction Regulations.

Any person may, within 60 days after the date of publication of this notice, file with the Minister of the Environment comments with respect to the proposed Regulations or a notice of objection requesting that a board of review be established under section 333 of that Act and stating the reasons for the objection. All comments and notices must cite the Canada Gazette, Part Ⅰ, and the date of publication of this notice, and be sent to Tim Gardiner, Director, Waste Reduction and Management Division, Department of the Environment, Gatineau, Quebec K1A 0H3 (fax: 819-997-3068; email: PCBProgram@ec.gc.ca).

A person who provides information to the Minister of the Environment may submit with the information a request for confidentiality under section 313 of that Act.

Ottawa, June 6, 2013

JURICA ČAPKUN
Assistant Clerk of the Privy Council

REGULATIONS AMENDING THE PCB REGULATIONS AND REPEALING THE FEDERAL MOBILE PCB TREATMENT AND DESTRUCTION REGULATIONS

AMENDMENTS

1. Paragraph 2(2)(b) of the PCB Regulations (see footnote 4) is replaced by the following:

  • (b) the sale, importation or advertising of liquids containing PCBs for use in microscopy, including immersion oils, but not including refractive index oils, which is prohibited under section 5 of the Canada Consumer Product Safety Act; and

2. (1) The portion of subsection 16(1) of the Regulations before paragraph (a) is replaced by the following:

Equipment referred to in subparagraphs 14(1)(d)(i) to (iii)

16. (1) Subject to subsections (2) and (2.1), a person may use the equipment referred to in subparagraphs 14(1)(d)(i) to (iii) until the following dates if the equipment is in use on September 5, 2008:

(2) Section 16 of the Regulations is amended by adding the following after subsection (2):

Current transformers and other equipment

(2.1) A person may, from the day on which this subsection comes into force until December 31, 2025, use current transformers, potential transformers, circuit breakers, reclosers and bushings that are located at an electrical generation, transmission or distribution facility and that contain PCBs in a concentration of 500 mg/kg or more if that equipment is in use on September 5, 2008.

3. Paragraph 23(b) of the English version of the Regulations is replaced by the following:

  • (b) until December 31, 2011 if they are destroyed by that date, at the location where they are stored, in an authorized facility that is authorized for that purpose.

4. (1) The portion of subsection 33(1) of the Regulations before paragraph (a) is replaced by the following:

End of use of equipment and liquids — 2009

33. (1) The owner of the equipment referred to in paragraph 16(1)(a) or subparagraph 16(1)(b)(i) — other than the equipment for which an extension is granted by the Minister in accordance with section 17 and other than the equipment referred to in subsection 16(2) or (2.1) — or the liquids referred to in subsection 15(2) shall prepare a report that is current to December 31 of each calendar year in which the person owns the equipment or the liquids and that contains the following information:

(2) The portion of subsection 33(2) of the Regulations before paragraph (a) is replaced by the following:

Equipment and liquids for which extension granted

(2) The owner of the equipment referred to in paragraph 16(1)(a) or subparagraph 16(1)(b)(i) — other than the equipment referred to in subsection 16(2) or (2.1) — or the liquids referred to in subsection 15(2) for which an extension is granted by the Minister in accordance with section 17 shall prepare a report that is current to December 31 of each calendar year in which the person owns the equipment or the liquids and that contains the following information for each piece of equipment or container of liquid:

(3) Section 33 of the Regulations is amended by adding the following after subsection (3):

End of use of equipment — 2025

(4) The owner of the equipment referred to in subsection 16(2.1) shall prepare a report that is current to December 31 of each calendar year in which the person owns the equipment and that contains the following information:

  • (a) the information required under paragraphs (1)(a), (b) and (d); and

  • (b) the quantity of liquids containing PCBs in the equipment, expressed in litres, the quantity of solids containing PCBs in the equipment, expressed in kilograms, and the concentration of PCBs in the liquids and the solids, expressed in mg/kg,

    • (i) that are stored on December 31 at the person’s PCB storage site,

    • (ii) that are sent, in that calendar year, to an authorized facility that is a transfer site,

    • (iii) that are sent, in that calendar year, to an authorized facility that is authorized to destroy them, or

    • (iv) that are destroyed in that calendar year.

5. Subsection 39(1) of the Regulations is replaced by the following:

Date of submission of report

39. (1) The person who is required to prepare a report in accordance with subsection 33(1), (2) or (4) or with any of sections 34 to 38 shall submit it to the Minister on or before March 31 of the calendar year following the calendar year for which the report is made.

CONSEQUENTIAL AMENDMENT

6. Item 1 of the schedule to the Regulations Designating Regulatory Provisions for Purposes of Enforcement (Canadian Environmental Protection Act, 1999) (see footnote 5) is repealed.

REPEAL

7. The Federal Mobile PCB Treatment and Destruction Regulations (see footnote 6) are repealed.

COMING INTO FORCE

8. These Regulations come into force on the day on which they are registered.

[25-1-o]

  • Footnote 1
    For all types of equipment containing PCBs in concentrations between 50 and 500 mg/kg, the deadline for removal from service is 2025. Also, for ballasts and pole top transformers, which could contain concentrations between 50 and 500 mg/kg or above 500 mg/kg, the deadline for removal from service is 2025.

  • Footnote 2
    The modelling in support of the Regulatory Impact Analysis Statement (RIAS) for the PCB Regulations was based on the “Economic Impact Analysis of Proposed Revisions to the CEPA 1999 Chlorobiphenyls Regulations and Storage of PCB Material Regulations Final Report” developed for Environment Canada by the Headwater Environmental Services Corporation in 2005. The RIAS can be found in the Canada Gazette, Part Ⅱ, Vol. 142, No. 19, under SOR/2008-273 (published on September 17, 2008).

  • Footnote 3
    The actual release of PCBs in 2010 as reported to Environment Canada was less than 5 kg.

  • Footnote 4
    SOR/2008-273

  • Footnote 5
    SOR/2012-134

  • Footnote 6
    SOR/90-5

  • Footnote a
    S.C. 2004, c. 15, s. 31

  • Footnote b
    S.C. 1999, c. 33

  • Footnote c
    S.C. 2009, c. 14, s. 80