CCPA aims sky high on federal clean air agenda.

Canada's Chemical Producers' Association (CCPA) has sent a letter to federal ministers to suggest several key adjustments to the implementation of the clean air regulatory agenda (CARA). The CCPA believes that these suggestions will provide "fresh thinking" to make the regulations more effective and timely in delivering the environmental, health, and economic objectives the government has set.

In the area of greenhouse gas (GHG) reductions, the CCPA believes the greenhouse part of the plan can work, but there are several aspects that could be improved and that would help the government better achieve its objectives. The CCPA's major concern is that the suite of compliance mechanisms provided for by the government is both complex and more limited than expected. As a result, companies are having difficulty figuring out how they can be in compliance with the proposed regulations. The technology fund was initially considered to be a major safety valve if companies could not meet their GHG reductions, but the current design has dramatically limited its potential as a compliance mechanism, according to the association. If the fund is fixed, the CCPA said the GHG part of CARA can work.

Other issues that require attention in the GHG reductions segment include credit for early action. Many in the chemical industry and several provinces (particularly Quebec and Ontario) say it is important to improve credit for early action. Cogeneration is another key to GHG reduction and this will be reviewed. The clean fuels standard relating to GHG emissions for new plants must recognize multiple fuel sources and not be based only on using natural gas. This is putting the competitiveness of the chemical and other sectors at risk.

On the air pollutant part of CARA, the association is concerned about the benchmarking process used to set targets. The CCPA recommends that Ottawa consider setting health-based national ambient air quality standards or objectives for the provinces to achieve and only regulate federally in a "back stop" role if provinces are not doing so. This would be somewhat similar to the U.S. approach. Until new federal standards are developed, existing CCME ambient standards could be used and made mandatory.

The third major suggestion is that federal provincial overlap needs to be actively discussed. Given the speed the industry needs to move forward on CARA, both for GHGs and air pollutants, the association says a better bridge needs to be built between what federal and provincial ministers are indicating to industry and what is discussed in implementation details with officials.

The fourth major suggestion deals with the accelerated capital cost allowance. The key to reduction of both GHGs and air pollutants is capital investment. With high energy costs, a high dollar, and relentless Asian competition, industry will have difficulty attracting the needed capital to make these investments. For that reason the accelerated capital cost allowance provisions introduced in the federal budget were extremely important.

Canada's Chemical Producers' Association