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Environmental analysis of the 2007 federal budget

Canada has a comprehensive, results-oriented ecoAction plan to clean our air, help address climate change and creat...


Canada has a comprehensive, results-oriented ecoAction plan to clean our air, help address climate change and create a healthier environment. It is only through a healthier environment that Canadians can create the quality of life and standard of living to which we all aspire, within the context of todays global economy.

The three Es of the environment, the economy and energy are inextricably linked. A strong, modern economy requires people and businesses to be energy-efficient. As an emerging energy superpower, we can fuel our own economy, providing the means to afford things that matter to Canadians. Only with a clean and healthy environment will we attract and keep the modern, knowledge-based jobs we need. The global imperative to address climate change will require that Canadian industry invest in infrastructure and new technologies to produce and use energy more efficiently, thereby increasing our resource productivity, the sustainability of our economy and our quality of life.

As Canadians, we all know the importance of personal responsibility when it comes to the environment. Government has a role to play as well. As part of the Governments ecoAction plan, Budget 2007 contains 20 initiatives to encourage environmentally conscious action. In addition, Budget 2007 includes $8 billion to extend the Gas Tax Fund at $2 billion per year for another four years, which will help municipalities invest in areas such as urban transit, and water and wastewater treatment projects (included in Chapter 5).

In Advantage Canada,

Canadas New Government committed to:

Create a cleaner, healthier environment that improves the quality of life of Canadians.

Pursue efficient regulation using market-based instruments wherever possible and ensure no sector bears a disproportionate cost.

Complement regulation with targeted initiatives that are cost-efficient, and lever funding from the private sector and other orders of government.

Support the development and deployment of new environmental and energy technologies.

Budget 2007 includes measures to reinforce actions already taken in the past year to improve air quality and help address climate change with new investments in cleaner energy development and in the use of cleaner transportation. It also includes significant investments to support conservation and takes immediate steps on a new National Water Strategy.

Clean Air and Climate Change

For the first time ever, the Governments clean air agenda makes greenhouse gas emissions and air pollution from major industry sectors subject to regulation. It will also impose regulations on fuel consumption for light-duty vehicles for transportation. The clean air agenda is a move away from voluntary approaches and a patchwork of regulatory processes across the country, toward a national and mandatory system that will achieve real results.

As part of this agenda, the Government will soon announce short-term targets for reductions in greenhouse gas emissions and air pollutants from key industrial sectors. The Government has also committed to establish medium- and long-term targets for additional reductions. The Government has established a long-term goal of reducing greenhouse gas emissions by 45 to 65 per cent from 2003 levels by 2050. This is an ambitious goal that will be met through the actions of businesses in every sector of the economy, of all levels of government and of individual Canadians.

The new regulatory framework for industry will provide a strong foundation for the Government to begin working with the private sector, provinces and territories, and other countries to get real results for Canadians on climate change and air pollution in an efficient and effective way.

The Government is also implementing clean energy and clean transportation initiatives that will accelerate progress in addressing air pollution and climate change. These actions will promote:

Increased energy efficiency, development and deployment of renewable energies, and more sustainable use of traditional energy sources through technological innovation.

A cleaner, healthier environment that improves Canadians quality of life.

A sustainable economy.

Investing in Cleaner Energy

The Government has invested $2.4 billion in new environmental ecoENERGY Initiatives for cleaner energy, renewable energy, energy efficiency and new environmental technologies.

Recent Federal Initiatives in Support of Cleaner Energy and Energy Efficiency

Since 2006, the Government has announced significant measures in support of cleaner energy and energy efficiency. These measures include:

$1.5 billion for the ecoENERGY Renewable Initiatives to increase Canadas renewable energy supplies, including the ecoENERGY for Renewable Power incentive, which is expected to produce 4,000 megawatts of renewable electricity (e.g. wind, biomass, small hydro, solar photovoltaic, geothermal, tidal and wave).

$300 million for the ecoENERGY Efficiency Initiatives to promote smarter energy use, including the new ecoENERGY Retrofit Initiative to support energy-efficiency improvements in homes, small buildings and industries.

$230 million for the ecoENERGY Technology Initiative for energy science and technology to fund the research, development and demonstration of clean energy technologies.

In addition, the Government has allocated up to $339 million for the development and implementation of the new clean air regulatory agenda.

Budget 2007 includes new funding and a rebalancing of tax incentives that will further encourage investments in cleaner energy, spurring technological innovation for the more sustainable use of traditional energy sources, making the most of our clean energy resources, promoting energy efficiency and strengthening our advantage as an energy superpower.

The Canada EcoTrust for Clean Air and Climate Change

Climate change and air pollution affect all jurisdictions. Our response must be national in scope. Accordingly, on February 12, 2007, the Prime Minister announced a new Canada ecoTrust for Clean Air and Climate Change. The Canada ecoTrust for Clean Air and Climate Change will provide support to those provinces and territories that identify major projects that will result in real reductions in greenhouse gas emissions and air pollutants. The provincial initiatives supported by the Canada ecoTrust for Clean Air and Climate Change will complement industrial regulations and existing federal initiatives. Projects could include provincial technology and infrastructure development, such as carbon sequestration, and clean coal and electricity transmission, that will lead to a significant decrease in greenhouse gas emissions and air pollution. The Government will invest over $1.5 billion in the trust.

Clean Energy and the Oil Sands

The capital cost allowance (CCA) system determines how much of the cost of a capital asset a firm may deduct each year for tax purposes. CCA rates are generally set so as to spread the deduction over the useful life of the asset. This ensures a neutral tax treatment for different types of assets, so that investment is allocated to its most productive use.

Accelerated CCA (ACCA) is sometimes used to promote investment in certain emerging industries and in clean energy technologies that have broad social benefits in terms of reduced environmental impacts. By accelerating the timing of capital cost deductions, ACCA defers taxation and improves the financial return from investments in particular assets.

CCA rates are reviewed and updated on a regular basis to ensure that they reflect current information on the useful life of assets. Budget 2007 proposes a number of changes of this nature, described in Chapter 5. ACCA must also be kept up-to-date. Budget 2007 proposes to re-target ACCA, as described below, to reflec
t the new economic and environmental challenges that face us today. Going forward, the Government commits to identify additional
areas where ACCA and other measures can be used to help industries like the oil sands invest in promising new clean energy technologies like carbon capture and storage.

Resources like the oil sands have helped to position Canada as a global energy superpower. Canadians across the country are reaping the benefits from this valued resource through increased employment opportunities and the development of new and improved technologies. Additional investment on the order of $100 billion is expected over the coming decade. ACCA was provided for investments in the oil sands at a time when it was an emerging sector and special support was appropriate to help offset some of the risk associated with early investments. With Canadas oil sands sector now healthy and vibrant, ACCA is no longer required. Budget 2007 will phase out the existing ACCA for assets in this sector, leaving in place the regular 25-per-cent CCA rate for these assets. This will improve fairness and neutrality among the oil sands and other sectors, particularly other oil and gas and renewable energy resources.

To ensure a stable investment climate, the existing ACCA will be fully grandfathered for oil sands assets in project phases that commenced major construction prior to March 19, 2007. For other projects that have not yet begun major construction, in recognition of long project timelines, Budget 2007 will allow companies to maintain the ability to claim ACCA until 2010, with the rate being gradually reduced between 2011 and 2015. Further details on the transition are outlined in Annex 5.

Recognizing the importance of energy to our economic and environmental objectives, Budget 2007 will also extend and expand the scope of incentives for clean energy production. The existing ACCA that encourages industries, including the oil sands to invest in equipment that generates energy more efficiently or by using renewable energy sources will be extended to equipment acquired before 2020. It will also be expanded to cover wave and tidal energy, and additional solar energy and waste-to-energy technologies.

Budget 2007 also provides $15 million in 200708 to the Canada School of Sustainable Energy, one of the centres of excellence identified in Chapter 5. This is a collaborative research initiative of the University of Alberta, the University of Calgary and the University of Lethbridge focused on improving the recovery of energy from traditional sources, lowering the environmental impact of fossil fuels and developing alternative forms of energy.

Together, these steps will help ensure we continue to strengthen Canadas position as an energy superpower, in a way that helps to preserve our environmental legacy.

Promoting Cleaner Transportation

In the past year, Canadas New Government has announced more than $2 billion for investments in a cleaner and more efficient transportation system. Budget 2007 builds on these investments by encouraging the purchase of more fuel-efficient vehicles, the retirement of older, more polluting vehicles, and domestic production of renewable fuels. These measures will reduce greenhouse gas emissions and air pollution, promote technological innovation and improve the health of Canadians.

Recent Federal Initiatives in Support of Cleaner Transportation

Since 2006, the Government has announced significant measures in support of cleaner transportation. These measures include:

$1.3 billion for public transit infrastructure, and $605 million over three years for a 15.5-per-cent tax credit for the purchase of monthly transit passes to increase public transit use, which will ease traffic congestion in our urban areas and improve air quality. Budget 2007 proposes to strengthen the tax credit (see Chapter 5).

$962 million towards FLOW, the federal governments new long-term transportation action plan for the Greater Toronto Area. Funding is sourced from Ontarios allocation of new infrastructure programs. This plan includes five transit projects in Toronto, York Region, Brampton, Mississauga and Durham Region.

$10 million for the ecoMobility program, which will help reduce urban passenger transportation emissions by encouraging increased transit ridership and the use of other sustainable transportation options.

$36 million for the ecoFriendly Vehicles initiatives to provide information, such as the benefits of advanced vehicle technologies (e.g. hybrids) and fuel consumption information, and to encourage consumers to purchase fuel-efficient vehicles.

$61 million for the ecoFreight program to take new steps to reduce the environmental and health effects of freight transportation through the use of technology.

Incentives for Purchasing More Fuel-Efficient Vehicles

Canadians purchase about 1.5 million new passenger vehicles annually, and about 12 per cent of Canadas total greenhouse gas emissions are generated by daily driving. Everyone has a role to play in reducing the amount of emissions that come from vehicle fuel consumption. Industry has a role in improving the efficiency of transportation and in promoting the development and adoption of cleaner transportation technologies. For its part, the Government has committed to introduce tougher fuel-efficiency standards for new passenger vehicles and light trucks that will be sold in Canada beginning with the 2011 model year.

Canadians have the choice to contribute to a cleaner environment when selecting what type of vehicle best meets their needs. Providing a financial incentive to help Canadians that want to make an environmentally responsible choice is a sound investment in Canadas future and the health of Canadians.

To increase consumer purchases of more efficient advanced technology vehicles before the new fuel-efficiency standards take effect in 2011, Budget 2007 proposes a new Vehicle Efficiency Incentive (VEI) structure that will cover the full range of passenger vehicles available today. The VEI will have three distinct components and come into effect March 20, 2007:

1. A performance-based rebate program offering up to $2,000 for the purchase of a new fuel-efficient vehicle.

2. Neutral treatment of a broad range of vehicles with average fuel efficiency that are widely purchased by Canadians.

3. A new Green Levy on fuel-inefficient vehicles.

These measures, together with a new initiative to encourage Canadians to retire older, more polluting vehicles, will be broadly revenue-neutral.

New Rebate for Fuel-Efficient Vehicles

Manufacturers now offer a number of vehicles that are eligible for the performance-based rebate program. Current models qualifying for the rebate will include hybrid electric vehicles, conventional fuel efficient vehicles and the most efficient of the E-85 fuel and flex fuel vehicles. The list of eligible vehicles will be established by Transport Canada by combining the city and highway fuel-efficiency ratings.

The thresholds will be based on a combined 55 per cent city and 45 per cent highway rating. Initially, new automobiles with a combined fuel consumption rating of 6.5 L/100 km or less and minivans, sport utility vehicles (SUVs) and other light trucks with fuel consumption of 8.3 L/100 km or less will be eligible for a rebate. These thresholds will be reviewed periodically. The basic rebate amount will be $1,000, and an additional $500 will be added for each half litre per 100 km improvement in the combined fuel-efficiency rating of the vehicle below these thresholds. The maximum rebate value will be $2,000. Efficient E-85 fuel vehicles will be eligible for a rebate of $1,000. Eligible new vehicle purchases or leases as of March 20, 2007, will qualify for the rebate.

More information on the program, including the vehicles eligible for the rebate, will be published on Transport Canadas website (www.tc.gc.ca). The lists of eligible vehicles will be updated as information on new vehicle fuel-efficiency ratings
becomes available. Consumers purchasing or leasing (long-term leasing for a period of at least 12 months
) an eligible vehicle should keep a proof of purchase or a copy of the lease agreement. Consumers will be asked to show proof of registration, in Canada, of the new vehicle. While the introduction of rebates for eligible fuel-efficient vehicles is proposed to take effect March 20, 2007, the payment of rebates will be made once administration and delivery systems have been put in place. The Government is aiming to make rebate payments by fall 2007. Budget 2007 commits $160 million over the next two years to provide the performance-based rebate.

New Green Levy on Fuel-Inefficient Vehicles

For new passenger vehicles (excluding trucks) with fuel-efficiency ratings of 13.0 L/100 km or more, the incentive structure will include a new Green Levy on these vehicles, payable by the manufacturer or importer when vehicles are delivered into the Canadian market. The fuel-efficiency rating will be based on the same combination of city (55 per cent) and highway (45 per cent) fuel consumption ratings used to establish the parameters for the rebate.

The new Green Levy will start at $1,000 for passenger vehicles with combined fuel-efficiency ratings of at least 13.0 L/100 km but less than 14.0 L/100 km. The rate will increase in $1,000 increments for each full litre per 100 km increase in the combined fuel-efficiency rating above the 13.0 L/100 km floor, to a maximum of $4,000, for vehicles with ratings of 16.0 L/100 km or more. The levy will apply to new vehicles delivered by a manufacturer or importer to a purchaser (usually a dealer) after March 19, 2007. Inventories of vehicles held by dealerships will not be subject to the new Green Levy. Certain consumer purchase contracts entered into before March 20, 2007, will also be grandfathered. With the introduction of the new levy, the existing excise tax on heavy vehicles will be eliminated effective March 20, 2007.

It is expected that this measure will increase federal revenues by $110 million in 200708 and $105 million in 200809.

Getting Old Cars Off the Roads

Older vehicles built before the 1995 model year accounted for 35 per cent of light-duty vehicles in 2005. Permanently removing older, high-emitting vehicles from Canadian roads through “scrappage” programs improves our air quality and helps to reduce smog-forming and greenhouse gas emissions. Environment Canada currently provides operating support for programs such as Car Heaven run by the Clean Air Foundation, and B.C. Scrap-it. These scrappage programs are operated by not-for-profit organizations, and provide small incentives to promote the retirement of older vehicles and ensure scrapped vehicles are recycled according to environmental guidelines. Budget 2007 will provide $6 million over the next two years for a seven-fold increase in current annual federal support delivered through Environment Canada for scrappage programs.

Budget 2007 also provides up to $30 million over the next two years for incentives to be designed by Environment Canada and Transport Canada in consultation with stakeholders that will remove older, high-emitting vehicles from Canadian roads.

Greening the Federal Vehicle Fleet

The Government of Canada has a fleet of about 26,000 vehicles and is active in reducing vehicle emissions from its fleet. The Government is targeting a 15 per cent reduction in greenhouse gas emissions per vehicle-kilometre from 200203 levels. Federal departments now have about 1,400 alternative fuel and hybrid vehicles in use, and vehicles purchased for the federal fleet must be capable of operating on alternative fuels, where cost-effective and operationally feasible. In addition, where it is available, all gasoline purchased for federal road vehicles must be ethanol-blended. Federal departments are also required to demonstrate leadership in fleet management, so that acquiring and disposing of vehicles minimize negative effects on the environment. A November 2006 Treasury Board Directive renews the challenge to the federal government to take action to reduce emissions from its vehicle fleets.

Investing in Cleaner Fuels

Renewable fuels are cleaner fuels that reduce air pollution and lower greenhouse gas emissions. The Government recently announced a regulation requiring a 5 per cent average renewable content, such as ethanol, in Canadian gasoline by 2010. The Government also intends to develop a regulation for diesel fuel and heating oil to contain 2 per cent average renewable content, such as biodiesel, by 2012, once it has been verified that the new blended fuel is safe and effective for our Canadian climate and conditions. Renewable fuel production is a new market opportunity for farmers and rural communities. Budget 2006 included $365 million to assist farmers in realizing opportunities through agricultural bioproducts, including renewable fuels.

To meet the requirements of the proposed regulations, over 2 billion litres of renewable fuels will be required, creating tremendous business opportunities for Canadian renewable fuel and agricultural producers. Budget 2007 invests up to $2 billion in support of renewable fuel production in Canada to help meet these requirements, including up to $1.5 billion for an operating incentive and $500 million for next-generation renewable fuels.

Up to $1.5 billion over seven years will be allocated towards an operating incentive to producers of renewable alternatives to gasoline, such as ethanol, and renewable alternatives to diesel, such as biodiesel, under conditions where industry requires support to remain profitable. Incentive rates will be up to $0.10/L for renewable alternatives to gasoline and up to $0.20/L for renewable alternatives to diesel for the first three years, then decline thereafter.

In order to ensure companies do not earn excessive profits, government support will not be provided when rates of return exceed 20 per cent, determined annually. Support under the program to individual companies will be capped to ensure that benefits are provided to a wide range of participants in the sectornot just the largest oil-producing companies.

Budget 2007 also makes $500 million over seven years available to Sustainable Development Technology Canada to invest with the private sector in establishing large-scale facilities for the production of next-generation renewable fuels. Next-generation renewable fuelsproduced from agricultural and wood waste products such as wheat straw, corn stover, wood residue and switchgrasshave the potential to generate even greater environmental benefits than traditional renewable fuels. Canada is well positioned to become a world leader in the development and commercialization of next-generation fuels. For example, Ottawa-based Iogen is one of Canadas leading biotechnology firms. It operates the worlds only demonstration scale facility to convert biomass to cellulosic ethanol using enzyme technology.

Concurrent with the implementation of the operating incentive program to promote additional domestic production of renewable fuels, the excise tax exemptions for ethanol and biodiesel will be eliminated as of April 1, 2008.

Protecting Canadas Natural Heritage

Canadians are proud of their countrys natural beauty. It is the most beautiful country in the world, from the majestic peaks of the Rocky Mountains to the rugged rocks of Gros Morne National Park in Newfoundland, to the spectacular Nahanni River in the Northwest Territories.

Canadas forests, lakes and rivers, and wildlife are symbols of our national identity and culture. The environment is our source for food and water, and it sustains our economic and recreational activities. Canadians know they have a responsibility to conserve our natural environment for the use and enjoyment of future generations.

Recent Federal Initiatives in Support of Canadas Natural Heritage

Since 2006, the Government has announced significant support for nature conservation and a cleaner and healthier environment:
In Budget 2006, the Government exempted donations of ecologically sensitive land mad
e under the Ecogift program from capital gains tax.

The Government has also announced $300 million to protect Canadians and their environment from toxic substances.

$2 million towards the restoration of Vancouvers Stanley Park National Historic Site of Canada.

Budget 2007 includes additional funding for:

$225 million for the Nature Conservancy of Canada to conserve ecologically sensitive land in southern Canada.

$30 million in funding to support an innovative model of sustainable land and resource management development in the Great Bear Rainforest on the central coast of British Columbia.

Building on these initiatives, the Government will strengthen conservation of sensitive land and species, and preservation of our cultural and natural heritage.

Conserving Sensitive Lands

Conserving ecologically important lands and natural capital in the Northwest Territories, including the Mackenzie Valley, and promoting sustainable economic development are investments in our future. The Mackenzie River is Canadas longest river. It is home to Dene, Inuvialuit and Mtis people and provides habitat to hundreds of species of birds, some of the largest caribou herds in the world and a rich diversity of other wildlife. This area includes part of the important boreal forest region that stretches across Canada from the Yukon to Newfoundland and Labrador. Budget 2007 provides $10 million over two years to create or expand protected areas in the Northwest Territories, supporting the Protected Area Strategy of the Northwest Territories.

Preserving the National Capital

The National Capital Commission (NCC) safeguards and preserves the Capitals most treasured cultural and natural heritage assets for future generations. As noted by the NCC Mandate Review Panel, funding in recent years has not been sufficient for the NCC to maintain these assets. Budget 2007 proposes to address these needs by providing $30 million on a cash basis in capital and operating funding over the next two years to the NCC. On a budgetary basis, this amounts to $11 million.

Delivering Results on Environmental Enforcement

Canada has tough environmental regulations, and Canadas New Government is strengthening them. However, regulations mean nothing to polluters in the absence of a strong team of environmental enforcement officers.

Environment Canada will hire over 100 more enforcement officers, strengthening its capacity a further 50 per cent to enforce environmental protection laws and to achieve better environmental outcomes. Budget 2007 provides $22 million over two years to Environment Canada for enforcement capacity.

Protecting Species at Risk

Protecting Canadas species at risk and their critical habitat preserves our natural heritage. Budget 2007 provides $110 million over the next two years to Environment Canada, Parks Canada, and Fisheries and Oceans Canada for more effective implementation of the Species at Risk Act, resulting in a total of $100 million per year dedicated to implementing the act.

National Water Strategy

Canada has the third-largest supply of fresh water in the world. Our country is also fortunate to be home to majestic lakes and rivers, and ocean playgrounds. Through Budget 2007, Canadas New Government is taking action to improve the water we drink, clean polluted waters, help maintain water levels in the Great Lakes, protect our ecosystems and ensure the sustainability of our fish resources.

Cleaning Up the Great Lakes

The Great Lakes are one of the most important freshwater resources in the world. They contain 20 per cent of the worlds surface freshwater supplies and 80 per cent of the lake and river water in North America. Forty million people in Canada and the U.S. rely directly on the Great Lakes drainage basin as a source of drinking water.

There are environmentally degraded areas in the Great Lakes arising from past industrial practices, which create lake-wide effects on water quality. Budget 2007 allocates $11 million over the next two years to clean up contaminated sediment that poses a risk to human health and ecosystems in eight areas of concern identified under the Canada-U.S. Great Lakes Water Quality Agreement: Hamilton Harbour, Niagara River, Detroit River, St. Marys River, Thunder Bay, Peninsula Harbour, St. Clair River and Bay of Quinte.

The health of the Great Lakes is affected by actions on both sides of the Canada-U.S. border. The International Joint Commission is an independent binational organization whose purpose is to help prevent and resolve disputes between Canada and the U.S. relating to the use and quality of boundary waters. Budget 2007 provides $5 million over the next two years to the Commission to carry out a study with the U.S. on the flow of water out of Lake Superior. The review will address the impacts of these outflows on water levels and the affected communities. Funding will also support outreach by the Commission on water issues in border communities.

Budget 2007 also allocates $12 million over two years to support the clean-up of Lake Simcoe, which has been affected by excessive amounts of phosphorus from both urban and rural sources.

Addressing Water Quality in the Lake Winnipeg Basin

Water quality in Lake Winnipeg has deteriorated due to the accumulation of nutrients in the lake. Budget 2007 provides $7 million over the next two years to Environment Canada to develop a targeted science plan and a Canada-Manitoba Agreement to support the long-term sustainability of the lake and its contribution to economic activities, recreation and watershed functions. These investments would support the development with the provincial government of a basin-wide plan for water pollution, water availability and water resource management.

Investments in Fisheries Science Research

A healthy environment and clean oceans are essential to the sustainability of Canadas fisheries and require a sound understanding of the resource and its complex ecosystems. This better understanding contributes to strengthening fisheries management and resource conservation for the benefit of fishermen and fisherwomen.

To honour the Governments commitment to invest in fisheries science and research, Budget 2007 provides $39 million over the next two years to the Department of Fisheries and Oceans.

Renewal of the Canadian Coast Guard Fleet

In addition to providing core services such as search and rescue, icebreaking, aids to navigation, environmental response and communications and traffic services, the Canadian Coast Guard supports the Department of Fisheries and Oceans critical scientific research and fisheries enforcement activities. These include assessing fisheries resource stocks, monitoring ecosystems and supporting Canadas interests in the Northwest Atlantic Fisheries Organization.

In support of the Canadian Coast Guards role in fisheries science and enforcement, and more generally its large-vessel fleet requirements, Budget 2007 provides funding of $324 million to the Canadian Coast Guard for the procurement, operation and maintenance of an additional six new large vessels: four midshore patrol vessels and two offshore fishery science vessels.

Improving Water Quality

The Government remains committed to working with First Nations to ensure that all First Nations residents have access to safe drinking water. Building on the Plan of Action for Drinking Water in First Nations Communities, we will continue to address the needs of communities with high-risk drinking water systems. We will also develop a regulatory regime to oversee water quality on reserve, based on the options raised by the report of the Expert Panel on Safe Drinking Water for First Nations.

Environment Canada will also work with provinces on tougher, more stringent regulations and controls to address municipal wastewater effluents. Muni
cipal wastewater effluents consist of sanitary sewage (which comes from homes, businesses, institutions and industries) and storm wa
ter. Wastewater effluents are the most significant contributor to water pollution. They can cause infectious diseases in humans, toxicity in fish and a significant decrease in biological diversity in nature.

The Governments comprehensive long-term infrastructure plan outlined in Chapter 5 will help support investments by provinces, territories and municipalities to improve water and wastewater infrastructure, including treatment facilities, sewage collection and water distribution.

One of the challenges for Canadas oceans is the ongoing practice of discharging untreated municipal waste in the oceans, such as in the Victoria and Saint John harbours. This is a practice that should be stopped. One of the priorities of the new federal infrastructure programs will be the support of communities taking action on this issue.

Keeping Our Oceans Clean

Canadas oceans are critical to the social and economic well-being of coastal and rural communities. The Government will support:

Greater water pollution prevention, surveillance and enforcement along Canadas coasts (e.g. pollution prevention from contaminated ballast waters, ship waste reduction strategy).

Further ecosystem assessment and capacity to deal with increased activity in Arctic waters (e.g. shipping, oil spills).

Increased collaboration with international partners on ocean and transboundary water matters (e.g., Gulf of Maine project with the U.S., ecosystem projects with circumpolar nations through the Arctic Council).

Through this initiative, the Government will increase the scientific knowledge required to further advance the health of the oceans. This will include creating additional marine protected areas around the Scott Islands on the Pacific Coast, Sable Island on the eastern Scotian Shelf, and Lancaster Sound in the eastern Arctic. Six other marine protected areas will also be created along Canadas coasts, with the specific location to be determined after consultations with coastal communities, environmental groups, industry and other governments.

Budget 2007 allocates $19 million over the next two years for initiatives that will contribute to keeping Canadas coastal waters clean. This funding will support the sustainable development, management and protection of ocean resources and water quality.

Summary of National Water Strategy Initiatives

Ensuring clean and safe water for Canadians is a joint undertaking by the municipal, provincial and federal governments. The federal government has over 100 programs related to water that deal with areas of federal responsibility, including drinking water on First Nation Reserves and in federal facilities, water quality relating to fish and fish habitat, oceans and their resources, and transboundary and international waters. Budget 2007 allocates $93 million over two years towards a National Water Strategy:

$11 million over two years to accelerate the clean-up of eight Areas of Concern in the Great Lakes Basin under the Canada-U.S. Great Lakes Water Quality agreement.

$5 million over two years to the International Joint Commission for further study of the Great Lakes and outreach on water quality with the U.S.

$12 million over two years to support the clean-up of Lake Simcoe.

$7 million over two years to support federal leadership in advancing the clean-up of Lake Winnipeg.

$39 million over two years to increase fisheries science research programs to strengthen fisheries management and resource conservation.

$19 million over two years to advance the health of the oceans and support greater water pollution prevention, surveillance and enforcement along Canadas coasts.

In addition, Budget 2007 allocates $324 million to enable the Canadian Coast Guard to acquire two new offshore fishery science vessels and four midshore patrol vessels to support conservation and the protection of fisheries.

The new long-term plan for infrastructure funded from Budget 2006 and Budget 2007 will provide a total of $33 billion over the next seven years to help support investments by provinces, territories and municipalities, some of which will be used for water and wastewater treatment projects.

Water quality is fundamental to Canadas prosperity, our health and our quality of life. Going forward, as part of our comprehensive ecoAction plan, the Government will continue to help ensure clean and safe water for Canadians.

Information and analysis provided by Anne Hodgson, Pathway Group (One Dundas Street West, Suite 2500, Toronto, Ontario M5G 1Z3). Contact Anne at anne@pathwaygroup.com


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