$2.25, or $0, The Bigger Issue at Hand to the Recent B.C. – Nestle Ground Water Sale.

The recent sale of groundwater extraction rights to Nestle by the B.C Government [1] does not simply outline the gross undervaluation of an essential resource but actually goes a step further and introduces a much more complex debate: how or if we should be assigning a price tag to these natural resources.

The current price on groundwater in B.C. for large-scale uses is set at $0, so while the increase to $2.25/million litres is an improvement (¢10/TRILLION litres would be as well), it is still a ridiculous pricing when compared with other provinces.

This undervaluation of natural resources is nothing new. In fact it happens all the time, and everywhere across the globe. It is especially the case in underdeveloped nations that have few working industries but the natural goods and services their environment have, which becomes easier and cheaper for corrupt governing bodies to sell off to the extraction sector than to properly develop themselves. At least in Canada, and other developed nations, we have the resources and institutions to make these extractive processes less damaging and more accountable, i.e. the Environmental Impact Assessment process.

Aside from the under cutting of essential resources for human life, in case that wasn’t exciting enough, this sale has highlighted a broader and much more complex debate on whether we should be assigning a price for natural goods like water and how could/should it be done.

This option is problematic but is continuously backed by policy makers and international governing bodies such as the World Bank, the UN Convention on Biological Diversity, and the IUCN.[2] They see the global market as a way to regulate resources and avoid their mistreatment. Most importantly the issue lies in this simply being the a continuation of the neoliberal agenda thinking process that a market value can solve every issue known to humans.

This ideology has promoted environmental injustice in under developed nations by exporting the extraction sector to countries without any other industry on which to rely. Some corrupt officials will choose to sell off natural resources cheaply, without any protective services, instead of developing them safely for the benefit of their own constituents. This often occurs because it seems as if it is their only option in part, if not wholly, because of the neoliberal structure.

Before we start slapping price tags on our one and only planet’s gifts, we should start rethinking the structures that have led us to this point, and who are still entrenched in their seats of power, more than willing to allow the status quo to continue. If we push nature into the global market then we run the risk of simply continuing the mechanisms that have brought us to this point of expected environmental collapse.

On a final note, just to add some confusion to the matter, would putting a price on the environment be all bad? The answer is likely no. Nature is already being exploited so if we were to start assigning prices, a concept that corporations and those who are adding to the planet’s destruction can understand, it may actually influence them to implement better practices and cleaner mechanisms. In EIA, the precautionary principle to environmental development, monitoring and compliance checking is one of the core ideals, but is often the source of most of the processes downfalls. If we were to monetize nature, maybe the penalties would finally begin to prop these steps up to the forefront of EIA.

Before completely ending I would like to suggest further readings, found within the following references section into the matter as this post has barely even skimmed the surface of the entire debate, especially [3] which has an excellent write up on the debate as well as a lively commentary rebuttal by several expert professionals, and [4] which is a transcript of a lecture on this topic, also offering the recording of said lecture (be warned it is lengthy at 1 hour and 18 minutes, but absolutely worth it).

[1] Fumano, Dan. (2015, March 9th). Outrage Boils Over as B.C. Government Plans to Sell Groundwater for $2.25 per Million Litres. The Province. Retrieved from http://www.theprovince.com/news/Outrage+boils+over+government+plans+sell+groundwater+million+litres/10865416/story.html

[2] McAfee, Kathleen. (1999). Selling Nature to Save it? Biodiversity and the Rise of Green Development. Environment and Planning D: Society and Space, 17:2. 133-154.

[3] Unmüßig, Barbara. (2014, August). Monetizing Nature: Taking Precaution on a Slippery Slope. Great Transition Initiative. Retrieved from http://www.greattransition.org/publication/monetizing-nature-taking-precaution-on-a-slippery-slope

[4] Monbiot, George. (2014, July). Put a Price on Nature? We Must stop this Neoliberal Road to Ruin. The Guardian. Retrieved from http://www.theguardian.com/environment/georgemonbiot/2014/jul/24/price-nature-neoliberal-capital-road-ruin

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Pipeline Busts and the Laissez-Faire Environmental Protection Provided by the EIA Process

arkansas oil spill

Photo taken in the wake of the pipeline leak in Mayflower, Arkansas, 2013

Environmental emergency crises requiring swift containment and recovery actions have become synonymous with the oil and gas industry, because of their history of spills. There are countless examples where monitoring checks were called into question, such as the the spill in Mayflower, Arkansas, or the Lac-Mégantic tragic train derailment, or  the seepage into the Yellowstone River or the diesel spill that affected Longeuil, and bigger disasters, with widespread damage to massive systems like the BP Deepwater Horizon spill or the continual damage to the Nigerian Delta. These are but a few examples out of hundreds.

oilinfographics

The amount of these calamities show they are more than simple coincidence and are indicative of a more serious issue within the industry of environmental protection during the post development stages, during operations and the dismantling of a project. This is not restricted to the oil and gas industry. In the early stages of development, the process of Environmental Impact Assessment (EIA) helps to guide a project to environmental responsibility. However it has been widely documented by EIA experts that the later stages of the process have fallen by the wayside. The rigidity of checks and standards during the early EIA stages become more relaxed as regular operations begin and responsibility falls on the proponent of the original project.[i] [ii] Recognizing this need for better industry monitoring practices, many critical studies have looked into its improvements and have suggested numerous possibilities.[iii] [iv] [v] The dilemma of the monitoring phase is the lack of commitment on the proponent’s part to responsible monitoring programs. Reactive measures prevail. This is opposite to the rest of the EIA process, which is geared towards prevention.

bpoilspill infographicThe misstep of EIA is that there is a “build it and forget about it syndrome” (Noble, 2010), which has allowed many corporations to profit in spite of disastrous events, by arguing the extent of the damage and paying less fines, as well as getting away with less than required remedial processes again and again. Tighter regulations and standards need to be adopted during the monitoring and follow-up stages in order to prevent these types of disasters from happening. Transparency within the project’s operations is also vital in maintaining an environmentally safe project. Greater involvement of citizens in the immediate area of the project can also have a beneficial relationship between corporation and community, promoting a greater corporate social responsibility and a mutual trust,[vi] though such programs still hinge on the effort of the proponent and their commitment to preventing environmental damage, and providing proper clean up if such issues do occur.[vii]

EIA as a whole needs to be refocused to the entire life-cycle of a project, not only the beginning stages, otherwise it fails its main prerogative of environmentally protective development, and mitigating serious ecological disasters.

[i] Noble, B. (2010). Introduction to Environmental Impact ASsessment: A Guide to Principles and Practice (2nd ed.). Ontario, CA: Oxford University Press. p. 160.

[ii] Weston, J. (1997). Planning and Environmental Impact Assessment in Practice (1st ed.). New York, NY: Routledge. p. 141-142.

[iii] Hunsberger, C. A., Gibson, R. B., & Wismer, S. K. (2005). Citizen Involvement in Sustainability-Centered Environmental Assessment Follow-Up. Environmental Impact Assessment, Review 25. p. 609-627.

[iv] Arts, J., Marshall, R., & Morrison-Saunders, A. (2005). International Principles for Best Practice EIA Follow-Up. Impact Assessment and Project Appraisal, 23:3. p. 175-181.

[v] Marshall, R. (2012). Environmental Impact Assessment Follow-Up and its Benefits for Industry. Impact Assessment and Project Appraisal, 23:3. p. 191-196.

[vi]  Lawe, L. B., Wells, J. & Mikisew Cree First Nations Industry Relations Corporation (2005). Cumulative Effects Assessment and EIA Follow-Up: A Proposed Community-Based Monitoring Program in the Oil Sands Region, North Eastern Alberta. Impact Assessment and Project Appraisal, 23:3. p. 205-209.

[vii] Birk, J. & Noble, B. (2011). Comfort Monitoring? Environmental Assessment Follow-Up Under Community-Industry Negotiated Environmental Agreements. Environmental Impact Assessment, Review 31. p. 17-24.

Progress or Stagnation? Canadian Environmental Assessment and Protection Under the Newest FIPA.

by Douglas Zannis Wylie

Let’s begin with Ricker Mercer’s Rant from two years ago on the newly ratified Chinese FIPA gives an excellent base to our topic.

To expand upon Mercer’s words, FIPA stands for Foreign Investment Promotion/and Protection Agreement, and are routine trade agreements between countries in order to promote prosperity and investment between the signing parties. Canada has a total of 28 (1) agreements now as the Chinese one was ratified on Ocotber 1st, 2014. This particular FIPA has clearly been the point of much controversy since its inception in 2014. First, let’s expand on the main points of contention of this FIPA:

1)            It’s 15 years minimum before we can cancel the agreement, a 1 year notice period after that , and then an additional 15 years of coverage for Chinese assets after termination. 31 years total before we can leave this agreement while in comparison NAFTA only requires 6 months notice.(6)

2)            Chinese companies will now have the power to sue over legislation that could negatively affect their investments in Canada. Furthermore these arbitrations will take place between a Canadian representative and two non-Canadians, one Chinese, and one from the World Bank. We’ll return to these points afterwards.(6)

3)            The agreement was signed behind closed doors between Canada and China, in Russia, and was not brought to council or voted upon. Furthermore the arbitration of the lawsuits will be done secretly and will not release the details to the public.(6)

There are valid arguments to be made for and against these points, such as for point 1, a 31 year contract isn’t too long if you are referring to long-term investments; oppositely we’re locked into this deal for 31 years when our own government is restructured every 4 years. Even point 3 could be defended in that the public doesn’t need to know the details of such arbitration, even though Harper based much of his platform during election time on governmental transparency.(3)

Canada China FIPA cartoon(5)

The power to sue over legislation however is the real point of contention and is where we finally get to the relevance of the topic of this post. There exists a process called Environmental Assessment, in which experts consider and model the effects of a proposed project on the surrounding environment and its future effects. These assessments are crucial to ensure that the project meets the environmental standards set by environmental legislation.

As it stands, the assessment process, beginning in 1972, has progressed slowly and is far from perfect, many aspects of it are still only partially completed, or are being bypassed entirely.(2) A more rigorous assessment means minimizing damage done to the environment in the present and future and improved mitigation techniques to control possible harming effects to human lives. Now with this newly signed FIPA, if the Canadian Environmental Assessment Agency tries to enact stricter regulations on oil extraction, or elongate the assessment process so that proper modeling of potential risks can be completed, Chinese companies have the legal right to sue to recoup damages incurred by the strengthening of our own countries environmental protection.

It has been hard to stay impartial (or at least somewhat) throughout the critique of this agreement, but considering China has a large investment in our energy sector, for example Nexen Inc. being bought by CNOOC last year, and are only continuing to grow(4), isn’t it clear that giving China this power could significantly hinder any progress to the assessment process, progress that has already been sluggish and incomplete. Why is Harper bent on ruining the Canadian environment, something that used to define the Canadian persona, does he really want for his lasting legacy to be that of an environmental protections disaster? All indications seem to be yes.

Looking a little nervous mister Prime Minister, heavy conscience?(3)

Prime Minister Stephen Harper with China's then- Premier Wen Jiabao in 2012, when the FIPA was signed

 

Here are some external links for further reading :

An opinion letter voicing FIPA concerns, written by an international trade expert sent to Harper: http://thetyee.ca/Opinion/2012/10/16/China-Investment-Treaty/

The official FIPA agreement page: http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/fipa-apie/china-text-chine.aspx?lang=eng

References

(1) Foreign Affairs, Trade, and Development (2012) Agreement Between the Government of Canada and the Government of the People’s Republic of China for the Promotion and Reciprocal Protection of Investments. Retrieved from http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/fipa-apie/china-text-chine.aspx?lang=eng

(2) Gibson, R. B. (2002). From Wreck Cove to Voisey’s Bay: the Evolution of Federal Environmental Assessment in Canada. Impact Assessment and Project Appraisal, 20(3), 151-59.

(3) Gordon, S. (2014). Don’t Fear the FIPA. Retrieved from http://www.macleans.ca/economy/economicanalysis/dont-fear-the-fipa/

(4) Jones, J. (2014). China is Still Purchasing Canadian Oil Assets-Just Smaller Ones. Retrieved from http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/china-is-still-purcashing-

(5) Van Harten, G.(2012). Taking apart Tories’ Party Line on China-Canada Treaty. Retrieved from

http://thetyee.ca/Opinion/2012/11/05/Van-Harten-FIPA/

(6) Van Harten, G.(2012) China Investment Treaty: Expert Sounds Alarms in Letter to Harper. Retrieved from http://thetyee.ca/Opinion/2012/10/16/China-Investment-Treaty/canadian-oil-assets-just-smaller-ones/article19274478/