New provisions introduced into the climate change plan would allow oilsands operations in Alberta and the coal-fired power plants of Ontario to offset 100 per cent of their pollution by paying themselves "pre-certified investments."
"They can pollute as much as they want as long they pay a certain minimal amount of money into a fund," said Nashina Shariff, associate director of the Toxics Watch Society of Alberta. "So basically, it gives them a good ride until 2018."
Greenpeace supporter protests near in Edmonton during last month's Alberta provincial election.
Meantime, Environment Canada has confirmed that millions of tonnes of pollution from small facilities will be exempt for companies in sectors such as oil and gas, natural gas pipelines, electricity, chemicals and fertilizers.
A department estimate in December predicted about 10 million tonnes of greenhouse-gas pollution would not be covered as a result of the exemptions proposed to reduce administrative burdens on the smaller companies, including 20 to 30 per cent of emissions from small oil and gas companies outside of the oilsands sector.
Shariff said it appeared the government has introduced loopholes that were tailor-made to help out oilpatch companies and coal-fired power plants. She also questioned new incentives for nuclear power and credits for cogeneration - using heat from combustion to produce more power and save energy - that allow facilities to benefit from their business-as-usual practices.
Environment Minister John Baird said his department would ensure that companies would face bigger penalties or fines if pre-certified investments didn't result in substantial reductions in pollution.
"You can't just pay in and hope for the best. This will only go to mass, transformative technology that has guaranteed deliveries," said Baird. "I think electricity is the best example if you're tearing down a coal-fired power plant and building a new hydro dam that's obviously going to yield 100 per cent reductions quicker, faster, better."
An industry spokesman said there still aren't enough details to assess whether the plan is tough or weak, but added he thought the "pre-certified investments" proposal was an intriguing idea.
"It's an interesting flexibility mechanism. We're intrigued and we will be looking at it," said Pierre Alvarez, president of the Canadian Association of Petroleum Producers.
He said there were many unanswered questions about how the federal plan would correspond to the Alberta climate-change policies. Despite exemptions for some of the smaller companies, he noted other federal policies, along with provincial measures such as the new carbon tax introduced by the British Columbia government, would have an impact on operations.
Baird has proposed regulating pollution from industry by placing caps on the growth of its emissions. The system would require facilities to make reductions on their own, or purchase credits from companies that deliver equivalent and certified reductions in their own operations on a public exchange market.
Baird's plan is to reduce Canada's overall annual emissions by 150 million tonnes below 2006 levels by 2020. But while the country's pollution levels are supposed to be going down, federal officials estimated that annual emissions from the oilsands sector would rise from 25 million to 75 million tonnes over the next 10 years under Baird's Turning the Corner plan.
Alvarez said the 10-year period of allowing the so-called pre-certified investments would be a short time for many companies to prepare to deploy new technologies and deliver reductions that meet the government's new targets.
"When you start designing an oilsands project, (it) is a hundred of millions of dollars exercise that take years at the engineering phase and can often take two or three years at the approval stage," he said. "Ten years to some may sound like forever in the world of the boards (business executives) that are making decisions these days; 10 years is not very long, particularly in the areas where the technology has not been finalized."
Although Baird indicated in April 2007 he would introduce draft regulations by this spring to cap the growth of pollution from industry, he confirmed this week that regulations would now be delayed until the fall.