Modernization of Approvals Proposed Legislative Framework for Modernizing Environmental Approvals February 2010

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Table of Contents Your Input..................................................................................................................................... 1 Background .................................................................................................................................. 1 The Need for Continued Modernization...................................................................................... 3 The Current Approvals System ............................................................................... 3 Setting the Context for the Future............................................................................ 4 A Framework for the Future..................................................................................... 5 Electronic Service Delivery.......................................................................................................... 8 Tools for Business .................................................................................................... 8 Tools for the Public................................................................................................... 8 The Registry................................................................................................................................. 8 Risk Evaluation ......................................................................................................... 9 Registration Process .............................................................................................. 10 A.

Eligibility Screening................................................................................... 10

B.

Submission ............................................................................................... 11

C.

Declaration and Registration Confirmation ............................................. 11

D.

Operational Requirements ....................................................................... 12

E.

Maintaining the Registration and On-going Periodic Declarations ........ 12

F.

Compliance ............................................................................................... 13

Transition................................................................................................................. 13 Relationship Between the Registry and Certificate of Approval Process............ 14 Certificates of Approval.............................................................................................................. 15 New Certificate of Approval Process..................................................................... 16 A.

Single, Site-wide Approval ....................................................................... 16

B.

Multi-site and System-wide Approvals .................................................... 17 I

C.

Quality and Complete Submission Requirements ................................. 17

D.

Operational Flexibility ............................................................................... 18

E.

Transition and Continuous Improvement ................................................ 19

F.

Financial Assurance and Environmental Clean-up................................. 20

G.

Harmonization of Existing Hearing Requirements ................................. 21

H.

Strengthening of Refusal, Suspension and Revocation Powers ........... 21

I.

Service Guarantees ................................................................................... 22

Drivers for Change..................................................................................................................... 24 The Path Forward ...................................................................................................................... 24

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

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Introduction

Your Input The Ontario government intends to introduce legislation that, if passed, would enable the implementation of a modernized environmental approvals system in Ontario. As part of its Innovation Agenda and commitment to Open for Business, the Government is working towards “modernizing the provincial regulatory framework and moving to global best practices, with a goal of continuous improvement.” To find out more about Ontario’s Innovation Agenda, please go to the Ministry of Research and Innovation’s website: http://www.mri.gov.on.ca/english/default.asp To find out more about Open for Business, please go to the Ministry of Economic Development and Trade’s website: http://www.ontariocanada.com/ontcan/1medt/en/ofb_main_en.jsp

The Ministry of the Environment (the “Ministry”) expects to begin introducing changes to the environmental approvals system by September 2012. To achieve this goal, the Ministry is examining practices in leading jurisdictions. The Ministry will also be consulting with a variety of stakeholders, including the business community, Aboriginal communities and environmental Non-Governmental Organizations to help inform development of the new process. This document identifies the challenges facing the current environmental approvals process in Ontario and outlines a possible framework for modernization. The primary purpose of this document is to seek broad public and stakeholder feedback on this framework and its various components, in order to inform the development of enabling legislation. If, after introduction in the Legislature, the enabling legislation is passed, there will be future opportunities for the public and stakeholders to comment on the development of regulatory proposals required to implement a new approvals system. Please take the time to review this document and provide us with your comments and advice. To find out more about Certificates of Approval as they are done today (i.e., Environmental Protection Act, s. 9 and s. 27 and Ontario Water Resources Act, s. 53), please go to the Ministry website: http://www.ene.gov.on.ca/en/business/cofa/index.php.

Background The Ministry’s current approvals system is focused on issuing Certificates of Approval. Under Ontario’s environmental laws, business owners and operators who carry out certain kinds of activities must apply for and obtain Certificates of Approval before they can 1

PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

operate in Ontario. The Ministry looks at each Certificate of Approval and satisfies itself that the activity would not: 

Be likely to cause an adverse effect or harm the environment

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Be done in a way that does not comply with environmental laws

Unless the activity is specifically exempted, a Certificate of Approval is required for any one of these activities: 

Emitting contaminants into the atmosphere, ground or surface water

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Providing potable water (i.e., drinking water)

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Storing, transporting or disposing of waste

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Establishing infrastructure such as landfills, sewage and water treatment and distribution systems There are a number of activities that are specifically exempted in legislation or regulation from any approval requirements. For example, there are existing exemptions for equipment in residences (e.g., furnaces, air conditioners, etc.). Some of these exempted activities may be addressed under other legislation, regulations or processes (i.e., the Nutrient Management Act, Building Code, etc.).

Each Certificate of Approval is site or activity-specific and can be customized to the individual circumstances and characteristics of the facility and its local environment. Certificates of Approval place legally binding requirements on the owner or operator of a facility to conduct activities in a way that prevents or minimizes impacts to the environment. If at any time, a requirement in a Certificate of Approval is not followed, the Ministry may take actions to encourage compliance. Some activities, regardless of whether they need a Certificate of Approval, may be required to do an environmental assessment under the Environmental Assessment Act. Environmental assessment is a process that includes mandatory public consultation and evaluates the potential environmental effects and benefits of a project before a decision is made for it to go forward. Where an environmental assessment is required, a Certificate of Approval can only be issued once the environmental assessment is complete and a decision is made that the activity should move forward. The proposed new modernized approach to the approvals process will not include any changes to the environmental assessment process. In addition, the proposed new modernized approach to the approvals process is not intended to include legislative changes to the existing processes relating to Permits to Take Water (PTTW), Renewable Energy Approvals, Drinking Water Systems and Municipal Licensing, nor is it intended to impact requirements related to existing licensing and certification programs such as pesticides and well drillers.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

The Need for Continued Modernization The Current Approvals System The Ministry’s current approvals system, which includes approvals under the Environmental Protection Act , was first established in the 1970’s and has largely been viewed as effective in protecting the environment. However, the legislation regarding approvals has not adapted to keep pace with changes in economic activity and technology to meet the evolving needs of business and Ontarians. The Environmental Commissioner of Ontario (ECO) highlighted this issue as it relates to the current Certificate of Approval (C of A) process: “The difficulties experienced in obtaining approvals may have a detrimental effect on business in Ontario, pushing leading edge businesses with innovative environmental technologies to other jurisdictions where obtaining approvals is easier. It may also be impacting our environment by deterring facilities from applying for (and obtaining) approval to implement improved environmental technologies to replace older, less effective processes.” - Office of the Environmental Commissioner of Ontario (2007) Doing Less with Less: How shortfalls in budget, staffing and in-house expertise are hampering the effectiveness of MOE and MNR

Ontario’s current system remains relatively inflexible in requiring that all activities go through the same approval process, regardless of the complexity and potential risk the activity may present. This prevents the Ministry from focusing more resources on potentially unique or more complex applications. In the past this has resulted in a backlog of applications, costing business time and money. The approvals process is also largely a paper-based system. This makes it challenging for individuals wishing to access public records in a timely fashion or to complete transactions electronically. The Ministry has been using the current Certificate of Approval process for more than 30 years. However, most recently within the last decade, the Ministry has introduced a number of initiatives aimed at improving delivery, including: 

Pre-screening applications

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Providing “comprehensive” Certificates of Approval for facilities that need some flexibility to operate within defined limits without obtaining amendments (currently for air and select waste activities only)

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Providing focused application processes for simple, generic activities

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Improving the instructions and guidance information so applicants are better able to submit correct and complete applications

Modernizing approvals is about building upon these successes to make it easier for the Ministry to deliver its services in a timely and effective manner – which in turn makes it easier for businesses in Ontario to plan and finance projects. As a result, the Ministry is proposing to move forward by building on lessons learned and past successes to create a modernized environmental approval process in Ontario.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

Setting the Context for the Future Setting the Foundation Before we can determine the path forward, it is important to understand the goals we are trying to achieve. Establishing these goals provides the foundation for developing an effective and robust framework for changing how the Ministry does business in relation to environmental approvals. As a result, the Ministry has identified the following goals that set the foundation for modernizing approvals in Ontario: 1. Maintaining and, where possible, enhancing protection of the environment and human health 2. Enhancing the delivery of services to businesses in Ontario 3. Improving public transparency and availability of information A View from Other Provinces and Countries With the above goals in mind, the Ministry has looked at comparable, leading jurisdictions to identify best practices most relevant to Ontario relating to the structure and delivery of approvals processes. Some key best practices have been identified below and are categorized with the above goals in mind: 1. Maintaining and, where possible, enhancing, protection of the environment and human health: 

A broad range of leading jurisdictions consider risk and/or complexity when determining the best manner in which to protect the environment when regulating a facility (e.g., there are tiered, risk-based approaches found in Alberta, Michigan, Massachusetts, British Columbia, California and the United Kingdom)

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A number of leading jurisdictions consider the site as a whole – including all the environmental impacts at the site, across all media (i.e., air, land, water) – instead of on a piecemeal, media by media basis (e.g., the United Kingdom and Alberta have approvals and processes that cover the entire site and are multi-media in nature)

The B.C. Ministry of Environment has three tiers for its Waste Discharge Regulations: 

The first tier is for complex or unique activities that require detailed technical review and customized approvals.

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The second tier is for moderate risk activities and requires registration with the Ministry of Environment and following a code of practice or regulation.

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The last tier is for the lowest risk activities and exempts those activities from any formal approval requirements.

http://www.env.gov.bc.ca/epd/waste_discharge_auth/intro.htm 2. Enhancing the delivery of services to business: 

A significant portion of leading jurisdictions examined are moving towards some form of electronic submission for approval applications (e.g., Florida uses the Electronic Permit Submittal and Processing System (EPSAP) for application submission and review, the United States Environmental Protection Agency has an electronic submission process for permitting storm water systems)

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A broad range of leading jurisdictions allow for administratively simpler approaches for those operations that are less complex (i.e., have standard requirements) and/or pose a lower-risk to the environment. Many of these jurisdictions require these types of activities to use a Registry – a system that has standard rules for operation and where the process of registering is self-directed. (e.g., Alberta and British Columbia have notification or registration requirements coupled with standard codes of practice for lower-risk activities)

The State of Florida has implemented EPSAP, the Electronic Permit Submittal and Processing System, that: 

Provides for the electronic submittal of air permit applications

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Eases completion of forms

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Allows for flexibility when reviewing – either online or in print

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Has a process to check quality and completeness of applications

http://www.dep.state.fl.us/air/emission/epsap/default.htm 3. Improving public transparency and availability of information 

All leading jurisdictions allow for broad public consultation on the approvals process. For example, British Columbia requires submission of a Public Consultation Plan to the regulator prior to approval

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Some leading jurisdictions use online, publicly accessible tools to provide information on facilities and activities (e.g., Nova Scotia provides an online database of pesticide approvals)

The United States Environmental Protection Agency (US EPA) has implemented a Facility Registry System (FRS) that provides detailed facility data from which the public can map, view, query and obtain reports. According to the US EPA, “the FRS responds to the increasing demand for access to high quality information and the public need for one source of comprehensive environmental information…” http://www.epa.gov/enviro/html/facility.html

A Framework for the Future With the goals for modernization as set out above, and with a detailed examination of the best practices in other jurisdictions, the Ministry is proposing a framework that outlines an approach to how the environmental approvals system in Ontario could be modernized. The proposed new approvals model would incorporate the following key components to integrate best practices and complement and deliver on the foundational goals discussed previously: 1. Introducing a new, simplified process for activities that could be categorized as either “lower-risk”, “less-complex” or that have standard requirements, while continuing to be protective of the environment and human health 2. Focusing resources on the facilities and activities that are truly unique, complex or pose a potential risk to the environment and human health

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

3. Providing service delivery standards and online tools to support government-tobusiness interaction for approvals related processes 4. Improving public transparency through improved reporting and an online public information website to access approvals related information In keeping with practices in other leading jurisdictions, the Ministry is proposing to introduce a system where the appropriate tools would be applied to achieve the best environmental outcomes for each type of activity being considered. Many of these leading jurisdictions have found that a significant portion of the activities that they regulate pose a “lower-risk” to the environment and human health or would be considered to be standard, well understood and relatively less complex. The proposed new, modernized approach would simplify regulatory processes for these activities, while improving the approvals process for the remaining activities.

Proposed Key Modernization Components Public Public Public Information Information Website

Public Transparency

Two Path Structure

(Viewing, (Viewing, Reporting Reporting & & Querying Querying ))

Potentially unique or complex activities

Lower-risk, Lower-risk, standard standard or or less less complex complex activities activities

On-line On-line Tools Tools

Electronic Service Delivery

(Account (Account Setup, Setup, Electronic Electronic Submission, Submission, Payment Payment & & Tracking) Tracking)

Regulated Community

As a framework, the proposed new approvals system would have the following two paths: 1. Registry Process: In this process, selected activities would be registered with the Ministry providing that they meet specified eligibility requirements. The facility registering the activity would be required to operate according to rules established in regulation. These rules would be protective of the environment and human health and compliance with these rules would be subject to audit by the Ministry. 2. Certificate of Approval Process: In this process, applications for those activities not in the Registry would be made to the Ministry. This would lead to a decision by the Ministry based on the detailed technical review of documentation submitted by the applicant and public input. It may result in the issuance of a single, site-wide approval or a single, multi-site/system-wide approval. The approval may incorporate flexibility, while maintaining appropriate and effective environmental requirements.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

For both the Registry and Certificate of Approval processes, it is proposed that submissions will be made electronically to the Ministry. Businesses will use a onewindow, online system to access their account. Through this online system, it is proposed that a business will be able to submit information, track status and remit fees related to their registrations or Certificate of Approval applications.

The proposed changes would enable an improved, modern approvals system for Ontario businesses – while maintaining and, where possible, enhancing environmental protection.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

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Proposed Framework

Electronic Service Delivery It is proposed that the Ministry establish a process that will provide online tools to enhance government-to-business interaction related to the approvals processes, as well as improve public transparency.

Tools for Business It is proposed that online tools be developed that will facilitate the process for businesses to register specific activities and/or submit applications for Certificates of Approval. Some of the proposed features of this process would include: 

Account Setup and Management – Businesses would use a single account number that could be used to access environmental approvals related services.

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Electronic Submission – Businesses would submit required information electronically for both the Registry and the Certificate of Approval process.

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Electronic Payment – Businesses would be able to electronically remit fees for the Registry and Certificate of Approval applications.

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Service Tracking – Businesses would be able to track online the status of any approvals related services – for example, the status of their Certificate of Approval application.

Tools for the Public In order to improve public transparency, it is proposed that information posted on the Registry and information submitted through the Certificate of Approval process would be publicly available. It is proposed that members of the public would have the ability to view, search and query on the website. Information posted on the proposed website would, however, be subject to the requirements of the Freedom of Information and Protection of Privacy Act – particularly as it relates to confidential and proprietary information. As a result, certain information, due to its proprietary or confidential nature may not be posted publicly.

The Registry It is proposed that legislative changes would enable implementation of a registration system for selected activities that would be considered lower-risk, standard, well understood or relatively less-complex. It is proposed that the new registration system would involve a simpler and timelier process than is required today to obtain a Certificate of Approval. The proposed registration would be required for activities that have been identified by regulation and would replace the existing Certificate of Approval requirements for those activities. A registration would address all of the emissions resulting from an activity – 8

PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

including emissions to air, land and water. Facilities engaged in these activities would register using an online Registry system. As part of the registration process, those who are registering would have to declare that they meet specified eligibility requirements and operate according to specific performance rules. The requirements the activity must meet, including operational requirements, would be established in the regulation. It is proposed that the Registry system have the following features that provide certainty of process and make it less complex and more efficient for businesses in Ontario to use than the current Certificates of Approval process: 

Standard, across-the-board requirements for eligible activities

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Regulatory requirements proportionate to the risk and complexity of the activity

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Electronic service delivery using online tools

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Timely service with confirmation of registration given immediately once all the requirements of the regulation are met and entered into the system

Risk Evaluation It is proposed that activities considered for the registration process be identified based on an objective analysis of several factors. This includes the risk posed by the activities to the environment and human health. For the purposes of this document, some terms are defined below: 

An “activity” means a stand-alone operation or process that can be described independently of any particular industrial sector. Groups of related activities may be combined to define a given “sector”

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A “facility” is a physical structure or grouping of structures where one or more “activity” takes place for a particular purpose

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A “site” is a physical location or area where there may be one or more “facility” located

Upon evaluation of the risk posed by a given activity, it is proposed that the decision to require facilities engaged in that particular activity to register, instead of obtaining a Certificate of Approval for the activity, would be made through regulation. Prior to the development of these regulations, the Ministry would consult with industry, environmental Non-Governmental Organizations, community groups and other interested stakeholders to help inform their development. Before considering the details of the registration process, it is important to understand how risk can be considered as a factor. One of the common themes among leading jurisdictions has been the consideration of risk when making smarter, more effective decisions about who to regulate and how to regulate. A “one-size fits all” view, which does not consider the risk posed by a given facility or operation, is often impractical and does not effectively target resources to address the highest priority issues. In general, risk is the consideration of the probability of something occurring and the potential impact should it happen. From the Ministry’s perspective, risk reflects both the environmental and human health impact of an activity and the probability that the impact would occur. The evaluation of risk

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involves an objective understanding of the factors that contribute to the risk of a given activity – for example, the complexity of the activity, the types of emissions from the activity, how close the activity is to things such as daycares, residences, wetlands, etc. Once risk has been evaluated for a given activity, the Ministry can more effectively and efficiently determine the most appropriate way to regulate the activity while protecting the environment and human health. An Example Considering Risk Consider the comparison of the following two activities: Activity A

Activity B

Well understood and relatively stable

Constantly changing technology

Simple processes

Complex processes

Small quantities and types of chemicals used

Large quantities and types of chemicals used

Few emissions

Significant emissions

Emissions can be controlled using standard technologies

Effectiveness of emission controls is dependent on site specific conditions

Emissions would likely not cause an impact to the environment or human health

Improperly controlled mission have a good possibility of causing a significant environmental or human health impact

Given the scenario above, the Ministry may determine that activity “A” is of a lower-risk than activity “B.” As a result, the Ministry may focus more resources on ensuring that activity “B” is in compliance with Ontario’s environmental laws and is operating in a way that would minimize impacts to the environment.

Registration Process It is proposed that those facilities that engage in activities that are subject to registration would register using an online tool. It is anticipated that the online Registry tool would guide the user through the registration process by identifying and posing questions based on the requirements of the regulations. The changes being considered for the registration process include the following key components: A. Eligibility Screening It is proposed that regulations would have a description section that clearly lays out the activities that are subject to registration. The criteria in the regulations would determine whether a particular activity qualifies for registration. Those activities that do not meet the eligibility criteria established in the regulations may instead be required to apply for and obtain a Certificate of Approval. Examples of the types of criteria that could be used in the description of an activity requiring registration may include, but are not limited to: 

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

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Zoning at the site

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Distance to a sensitive receptor (e.g., daycare, hospital, residences)

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Distance to a sensitive environmental feature (e.g., wetland, Niagara Escarpment)

Size of the operation 

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Production capacity (e.g., number of products produced daily)

Design 

Production processes

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Types of pollution controls

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Containment structures (e.g., to prevent spills)

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Types of emission sources

Quality and quantity of emissions

It is proposed that the particular eligibility criteria identified in the regulation for a given activity would be based on the evaluation of several factors, including the activity’s risk to the environment and human health, as discussed in the previous section. B. Submission It is proposed that those that satisfy the screening criteria may be required to submit additional information set out in the regulation. The requirement to submit additional information or documentation for a particular activity may be dependent on the nature of the activity that is being registered. For example, the regulation for a relatively simple activity with limited emissions may not require any additional information; however, a more complex activity may require specific technical documentation as part of the registration. Additional information to be submitted electronically may include items such as: 

Technical specifications

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Site plans/drawings

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Certificates (e.g., training certifications, etc.)

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Financial assurance, if applicable

Where technical information is required, a person who has relevant technical knowledge and understanding of the operations at the facility would need to attest to the accuracy, quality and completeness of any individual documents submitted. C. Declaration and Registration Confirmation It is proposed that once eligibility has been established, and any additional information has been submitted, the registrant would be required to declare that the submitted information is accurate. It is proposed that an accountable person would be required to make this declaration. An accountable person would be the highest ranking employee at the facility who has management responsibilities relating to the facility and activity– this may include, for example, the owner, an officer or director of the company, plant manager or other person in authority.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

Once the registration is complete, the declaration made by an accountable person and any applicable fees are paid, the online Registry system would provide the user a confirmation of the registration. It is proposed that the registrant would retain the confirmation as a record that the facility has successfully registered the activity, as per the regulations. It is proposed that once a declaration is made and the registration is complete, the information would be posted to the public information website – subject to rules under the Freedom of Information and Protection of Privacy Act. It is also proposed that individual registrations would not be required to be posted on the Environmental Bill of Right’s Environmental Registry, nor would they be subject to appeals by third parties. D. Operational Requirements The regulations for a given activity may also include requirements to operate in a particular way. These operational requirements would likely be dependent on the nature of the activity that is being registered. For example, the regulation for a relatively simple activity with few emissions may not have many requirements around how to operate. However, a more complex activity may have specific, detailed operational requirements. Operational requirements may include conditions such as: 

Providing reports to the Ministry or the public

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Maintaining specific types of records

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Establishing and maintaining specific documented procedures (e.g., maintenance procedures, testing procedures, start-ups, shut-downs, malfunctions)

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Operating within defined parameters (e.g., hours of operation, operating within certain production levels)

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Implementing specific best management practices

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Following industry codes of practice

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Taking specific training

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Self-monitoring and reporting.

It is proposed that the registered facility operate within the requirements established for the activity. Otherwise, it would not be in compliance with the regulations and as a result, the Ministry may take action to see that compliance is achieved. E. Maintaining the Registration and On-going Periodic Declarations It is proposed that facilities that have a registration may be required to declare on a regular basis that their registration is accurate. How often declarations would be required would be set out in the regulations. However, in between declarations, it is proposed that the legislation require an accountable person to make sure the registration is accurate. Therefore, if there are any changes to the facility’s operations that may affect the accuracy of the registration, the registration would need to be updated to reflect the change. There also may be times when it is necessary for an activity to be entirely re-registered. The following may be reasons for having to re-register an activity:

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

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Original registration requires updating or re-declaration as a result of amendments to the eligibility requirements of a regulation for a given activity

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It is a requirement resulting from a compliance action taken by the Ministry (e.g., an audit finds significant discrepancies in the original registration, and as a result the Ministry requires that the facility redo the registration)

It is proposed that not making a declaration or not maintaining the accuracy of a registration would be an offence, which may result in action by the Ministry to see that compliance is achieved. F. Compliance It is proposed that registrations be subject to a range of tools to promote compliance – including education and outreach, voluntary abatement and both periodic and random audits as well as traditional field inspections, both proactive and responsive (e.g. because of a complaint or incident at the site). Should a registrant not comply with Registry requirements or other environment-related requirements, the Ministry may take action to make sure that compliance is achieved. It is proposed that non-compliance may result in one or more of the following actions in proportion to the degree/severity of the non-compliance: 

Using traditional abatement and enforcement tools (e.g., orders and charges under the Environmental Protection Act)

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Using compliance tools that are defined in the regulations. These may include tools such as increasing the frequency of declarations, increasing reporting requirements, or requiring training

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Suspending a registration. In this case, it is proposed that a registration could be suspended where there is an on-going, serious history of non-compliance. A facility whose registration is suspended would not legally be able operate. Those whose registration has been suspended would have an opportunity to request the suspension be lifted after they show that they are in compliance with the relevant regulations

Transition It is proposed that the regulation that defines an activity to be registered would also set a date in the future when an existing Certificate of Approval covering that activity would no longer be valid. From that date forward, those activities would require a confirmation of registration in order to operate. Prior to the date where the Certificates of Approval are no longer valid, facilities with those activities would have an opportunity to register. There would be a period of time between when the regulation comes into force and when the Certificates of Approval are no longer valid. It is proposed that as soon as an activity is registered, the Certificate of Approval for that activity would no longer be valid. If an activity is not registered by the date set in the regulation, the Ministry may take action to see that compliance is achieved.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

Relationship Between the Registry and Certificate of Approval Process The Ministry is proposing to have the ability to allow an activity to be subject to a Certificate of Approval, rather than a registration under the following two circumstances: 1. Where the Ministry determines that it would be in the interest of the natural environment for the activity to go through the Certificate of Approval process rather than a registration. This may be required where: a. The regulation does not deal with a unique aspect at a given facility which may benefit the environment. For example, a facility may be proposing a new technology or process, which would be more beneficial to the environment, but not addressed by the operating requirements in the regulation. As a result, the Ministry may allow that activity to be subject to a customized Certificate of Approval. b. The regulation does not deal with a unique aspect at a given facility that may pose a unique risk - for example, its location or the use of a non-standard process. 2. Where the Ministry determines that it would be administratively more efficient for the activity to be part of a Certificate of Approval, rather than a registration. For example, a particular facility may be subject to Certificate of Approval requirements for the majority of its operations, and the Registry for a small fraction. In this case, instead of requiring the facility to undergo two processes, the Ministry may allow the facility to cover all of its activities under the Certificate of Approval process. In both of the situations above, it is proposed that the Ministry may impose the requirement to apply for a Certificate of Approval or may be requested to do so by the person registering. Summary: Proposed Registry Related Legislative Changes In summary, below is a listing of the key proposed legislative changes related to the new Registry process. Registry Setup and Transition 

Legislative authority for the Ministry to establish, maintain and operate a Registry

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Remove the requirement to obtain a Certificate of Approval for those activities identified in regulation

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Regulation making authority to establish dates in the future when a registration would be required, and that Certificates of Approval related to an activity subject to registration would not be valid

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Discretionary authority for the Ministry to require a Certificate of Approval instead of a registration where it is in the interest of the environment/human health or for administrative effectiveness

Risk Evaluation and Requirements 

Regulation making authority establishing which activities would be subject to the Registry

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Regulation making authority defining eligibility criteria, submission requirements and operational rules for activities that would be required to be registered

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Regulation making authority to prescribe financial assurance requirements for activities that are registering

Accountability 

Regulation making authority to require persons with relevant technical expertise to prepare and sign-off on specific technical documents

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Authority to require an accountable person to attest to the accuracy of the registration, be responsible for maintaining and updating the registration on an on-going basis and to periodically declare that the registration remains accurate

Compliance 

Discretionary authority for the Ministry to suspend a business from the Registry on the basis of a history of non-compliance

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Regulation making authority to establish tools that would be used to address noncompliance with the Registry

Please note, this is not an exhaustive list of the proposed legislative changes, and may be subject to change as the framework legislation is developed.

Certificates of Approval In addition to the Registry, it is proposed that legislated improvements be made to the Certificate of Approval process. Just as today, under the proposed process when an application is received and appropriate public consultation completed, the Ministry will consider the application and make a decision on whether or not to grant the approval. In approving an application, the Ministry may impose terms and conditions in the Certificate of Approval with the intent of protecting the environment and human health. The requirements in the Certificate of Approval, including operational requirements, would be customized on a site by site basis. Some key changes are being considered for the Certificate of Approval process to make it more responsive and flexible for businesses in Ontario, while being more protective of the environment. Some of the changes being considered for the new Certificate of Approval process are: 

Issuing a single, site-wide environmental Certificate of Approval for a given facility (i.e., one approval for the site that would cover all media – air, waste and wastewater)



Providing an opportunity for operational flexibility (i.e., ability for the applicant to make future changes to their operations without amending the Certificate of Approval, within given operational parameters)



Allowing for multi-site or system-wide approvals (e.g., sewage systems, natural gas distribution systems)



Improving the quality of applications by setting complete submission and quality requirements in regulations

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS



Setting a process for transitioning to the new process and continuous review and improvement of approvals

The following table compares the existing Certificate of Approval process with features that could be in the modernized approach. Feature

Existing Process

Proposed Process

A site may have multiple approvals covering multiple emissions

One approval per site covering all emissions

Site-by-site approvals

Allows for single approval for multiple sites or entire system

Media specific approvals

One approval covers all media

Flexibility for a limited number of facilities

Broadly available

Yes

Yes

Complete submission required for applications

No legislated requirement

Legislated requirement

Continuous review and improvement of approvals

No legislated requirement

As required

None

Depending on application type and completeness of application

Site-wide

Multi-site/system-wide approval Multi-media (i.e., air, waste, wastewater) Flexibility (operational changes without amendments) Detailed technical review

Service guarantees

New Certificate of Approval Process It is proposed that those facilities that must obtain a Certificate of Approval would use an online, electronic tool to submit their application for approval to the Ministry, including any supplementary documentation that may be required. The changes being considered for the new Certificate of Approval process include the key components proposed in more detail below. A. Single, Site-wide Approval Currently, for any given site, the Ministry may receive Certificate of Approval applications separately for each media (i.e., air, waste, wastewater) and may receive multiple applications within each media (i.e., for each emission source). As a result, a single site may have multiple approvals, which often leads to a complex regulatory situation for both the Ministry and the approval holder. To address this issue, it is proposed that the Ministry issue a new single, site-wide approval in place of individual approvals under the Environmental Protection Act (EPA) and the Ontario Water Resources Act (OWRA) (i.e., EPA s. 9, s. 27 and OWRA s. 53). As

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

a result, facilities at a given site, and any future changes to that site would be reflected in a single Certificate of Approval that would encompass multiple media (i.e., air, waste and wastewater). As is the process today, the Ministry would conduct a detailed technical review of the application prior to the Director making a decision. However, in the proposed new process the review would be coordinated to consider all media impacted by the facility. Based on the technical review and comments received as a result of public consultation (e.g., posting on the Environmental Bill of Rights’ Environmental Registry), the Director would make a decision as to whether to approve the application, approve the application with conditions or refuse the application in its entirety. B. Multi-site and System-wide Approvals It is proposed that the Ministry have the ability, in certain circumstances, to issue a single Certificate of Approval for multiple sites or for a “system”. In the current process, although the emissions and requirements for multiple sites or parts of a system operated by a single entity may be very similar, the Ministry often receives and must consider individually, multiple applications for each of the various sites or parts of a system. A multi-site Certificate of Approval would cover activities of a similar nature and with similar emissions by the same business at multiple facilities under the same Certificate of Approval. A multi-site Certificate of Approval would cover all media and associated emissions (i.e., air, waste, wastewater). A system-wide Certificate of Approval would cover the approval of a physically interconnected system operated by a single business or operator and that is used in its entirety for a specific purpose (e.g., a utility distribution system). A system-wide Certificate of Approval would cover all media and associated emissions (i.e., air, waste, wastewater). C. Quality and Complete Submission Requirements A significant portion of the application packages that the Ministry receives are either incomplete or are of poor quality. On an application by application basis, addressing this issue costs the Ministry time and resources, which in turn affects how quickly approvals can be made. It is proposed that in order to help ensure the completeness and quality of submitted applications, applicants be required to do the following: 

Meet specific regulatory requirements related to the quality of the submission and completeness of the application



For specific technical documentation, require preparation and sign-off by a person with relevant technical expertise (for example, for air emissions, a technical expert may be required to sign-off on the Emission Summary and Dispersion Model report)



Obtain sign-off of the application or particular document from an accountable person (e.g., principal, director, owner, or other individual with management responsibilities, who is accountable for the accuracy of the information provided)

When addressing the quality of applications requiring technical documentation, it is proposed that the applicant or the person preparing the application provide documentation

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

on the methodology that was used to control quality of the submission (e.g., levels of review, version control, sign-offs) and its application. Technical documentation may include such things as: Emission Summary Dispersion Model (ESDM) reports for air emissions, Design and Operation reports, detailed technical plans, etc.

When addressing complete submission requirements, it is proposed that applicants be required to submit all relevant information detailed in the regulations and guidance material. The requirements may differ depending on the nature of the facility seeking approval and the types of emissions that result from the facility. This may include: 

Technical drawings



Site plans



Description of the activities performed at the site



Financial assurance



Operating and contingency plans



Technical designs



Quantification of the emission(s) from the site



Assessment of the impact of emissions from the site

As part of the initial detailed screening of the application performed by the Ministry, the application would be reviewed to make sure it meets the quality and complete submission requirements. If the application is considered deficient, the Ministry may reject the application on those grounds and notify the applicant. The State of Minnesota has developed internal checklist documents for reviewing applications with sections to assess both the administrative and technical completion of submissions. http://www.pca.state.mn.us/publications/forms/aq-f0-acc02.pdf D. Operational Flexibility Typically, when a change is made to a facility that has to be approved by the Ministry, the Certificate of Approval must either be amended or replaced by a new approval. As a result, the approval holder is often required to submit multiple applications over the lifetime of the facility - often for minor changes. To provide some flexibility to business, it is proposed that the Ministry introduce legislative amendments allowing facilities to make changes at their operations without the need for obtaining an amendment to their Certificate of Approval. As part of its ongoing efforts to improve service delivery, the Ministry has, on a limited basis, already introduced approvals that allow for some operational flexibility (i.e., “Comprehensive” Certificates of Approval for air emissions and municipal waste transfer stations).

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

This “operational flexibility” would allow for changes within operational parameters established by the Ministry as conditions in the Certificate of Approval. The operational parameters defined in the Certificate of Approval may include, but not be limited to: 

Size of the facility and production (e.g., a facility could increase production up to a specified rate)



Quality and quantity of emissions (e.g., a facility could make changes as long as it demonstrates that it is in compliance with applicable standards)



Nature of the facility’s operations (e.g., a facility could make changes as long as it continues to produce/do what it indicated in the approval)

It is proposed that the person seeking the approval must include in their application the parameters dealing with operational flexibility. The Ministry could issue an approval with some, none or all of the operational flexibility parameters that were applied for as part of the conditions on the approval. The State of Minnesota offers a flexible air permit which is for small and medium sized facilities with air emissions that have a qualifying Environmental Management System (EMS). With this permit, these facilities can operate as long as, for most pollutants, they have emission levels below a given amount. This operationally flexible permit eliminates the need for minor and moderate permit amendments, and from some recordkeeping and reporting requirements. http://www.pca.state.mn.us/programs/ems.html#flex E. Transition and Continuous Improvement The Ministry of the Environment is committed to a process of continuous improvement that leads to effective, on-going protection of the environment and human health. In order to achieve this goal, it is important that Certificates of Approval are based on the latest policies and standards and have requirements that are reflected equitably across all facilities in a given sector. For example, a facility which was granted a Certificate of Approval 30 years ago may not have the same conditions in their approval that a similar facility engaged in the same business must meet today. In order to address the issue, it is proposed that the Ministry institute an approach that would result in the transition of existing approvals to the new process and the regular ongoing update of approvals. In the interim, as existing approvals are transitioned to the new process, it is proposed that all approvals issued under the existing legislation (i.e., under s. 9 and s. 27 of the Environmental Protection Act and s. 53 of the Ontario Water Resources Act) be considered to be approvals under the new process (i.e., it would be as if the existing approvals were issued under the new amendments to the legislation). Transition Dates It is proposed that sectors be identified in regulation and be required to submit an application for review of their existing approval(s) (i.e., those approvals issued under the existing legislation). The facilities in the identified sectors would have to submit a complete application prior to the dates specified in the regulation. The Ministry would review the applications provided and either amend, revoke or replace the existing approval with a new, single site-wide approval. It is also proposed that facilities who fail to submit a complete, quality application by the dates specified in the regulation would be subject to the broad range of existing

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

compliance tools to encourage transition, including the possibility of imposing an administrative penalty. Amendments Prior to the Transition Dates A facility may make a change at its operations which would require an amendment to one or more existing Certificates of Approval well in advance of a transition date in the regulation. In this instance, it is proposed that the Ministry have the discretion to consider amending the existing approval or issuing a new single, site-wide approval to replace all of the existing approvals at the site. For example, if a facility is applying for a minor amendment to an approval that was originally issued under the existing legislation, the Ministry may choose to amend that approval only. However, if the amendment is more substantial or covers more than one media (i.e., air, waste or wastewater), the Ministry may choose to require the applicant to submit an application for a single, site-wide approval. Continuous Improvement On an ongoing basis, it is proposed that the Ministry could add, as a condition in the approval, the requirement to submit an application for review of the approval at some point in the future (e.g. 5, 10, 15 years). This would allow the Ministry to review and update approval requirements on a periodic basis moving forward. The need for continuous improvement, as it relates to approvals, is reflected in the Provincial Auditor’s 2004 Report: “To help ensure that emissions of airborne contaminants are limited to levels that are safe for human health and the environment, the Ministry should: 

Improve its information systems so that a periodic risk-based assessment can be conducted on all Certificates of Approval to determine the extent to which each certificate needs to be updated to reflect significant changes in air quality guidelines” - Office of the Provincial Auditor of Ontario (2004) 2004 Annual Report

F. Financial Assurance and Environmental Clean-up The Ministry is concerned with instances where there is a need to manage material left at a site or operate treatment facilities in order to prevent damage to the environment. This can occur at facilities that are no longer operating for any reason but typically occurs because of financial difficulties or because the operation has reached the end of its lifecycle. Usually the material has little or no value and therefore there is a cost for safe management or disposal. The Ministry takes this possibility into account by requiring companies to provide an assurance that funds are set aside to pay for the costs of safe management or disposal. The Ministry currently secures this financial assurance under the authority of the Environmental Protection Act. The Ministry is authorized to require the provision of financial assurance as conditions of orders and approvals made under both the Environmental Protection Act and the Ontario Water Resources Act. A business operating in Ontario could be subject to additional financial assurance requirements beyond what is required by the Ministry of Environment to address other issues; for example to deal with the reclamation of mines, pits and quarries, or to address the impact of forest harvesting operations.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

In general, financial assurance is calculated based on estimates of the future cost to manage environmental conditions at a site in the event of the closure or abandonment of an operation. In practice, because the financial assurance supplied is based on estimates and not every eventuality can be anticipated, the calculated sum may not be adequate to cover the actual cost of a clean-up at the time a facility is closed. As a result, the Ministry is proposing changes that would allow the Ministry to assign responsibility for clean-up and costs to a parent company where financial assurance was absent or inadequate. Financial assurance is a security that may be required by the Ministry. It can be collected to provide funds to address any one of the following: 

Compliance with environmental requirements



Making sure requirements are met by a specified deadline (e.g. waste is removed by a certain date)



Having funds available for future clean-up or remediation of inactive sites which require long-term care and monitoring

G. Harmonization of Existing Hearing Requirements The current approvals process for waste management systems and waste disposal sites has requirements related to holding mandatory and discretionary hearings, including the circumstances when they are required or may be allowed. Hearings are held by the Environmental Review Tribunal before the Ministry makes a decision on whether to issue an approval, and the Ministry must implement the decision of the Tribunal. Hearings are different from appeals in that an appeal happens after a decision is made by the Ministry. It is not anticipated that there will be any changes to appeals related processes in regards to Certificates of Approval. In the current process, mandatory hearings are those that are required by law for specific types of waste and sewage works approvals. Discretionary hearings for other waste and sewage works may be requested by the Ministry. The current hearing requirements vary significantly depending on the media (i.e. air, waste or wastewater) of interest. For example, under approvals for air there is no ability to hold hearings, while waste and wastewater approvals allow for hearings but under differing circumstances. To provide consistent requirements under the single, site-wide approval, it is proposed that the existing hearing requirements be replaced and harmonized as one process under the new Certificate of Approval process. It is also proposed that harmonization of the hearing requirements include the following: 

The Ministry have discretion in all cases to require that a hearing be held prior to making a decision on an application



The Ministry have the ability to refer the entire approval application or only parts of the approval being considered to the Environmental Review Tribunal

H. Strengthening of Refusal, Suspension and Revocation Powers Currently, the Ministry has the ability to suspend or revoke a Certificate of Approval as specified in the legislation. However, there is no explicit ability to do so based on the

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

compliance history of an approval holder. It is proposed that the Ministry have the explicit ability to refuse, suspend or revoke an approval for reasons of non-compliance. This would be for those facilities that continually and chronically show a disregard for environmental laws. I.

Service Guarantees

It is proposed that the Ministry will provide, through policy guidance, service guarantees for the review of Certificate of Approval applications. It is anticipated that the length of any service guarantees will be dependent on the type of application that is being processed. For example, a routine amendment will likely have a much shorter guaranteed turnaround time than a new application for a complex industrial site with multiple emission sources. It is important to note that all proposed service guarantees will be subject to the submission of a complete application. Service guarantees will not start until a complete, quality application has been submitted. The State of Michigan has a number of service guarantees related to their approvals process, including: 

A service standard for the length of time needed to confirm the quality and completeness of an application – which is shorter for applications that are submitted electronically



A service standard for the actual permit decision once completeness has been confirmed – which varies depending on the type of application

http://www.michigan.gov/deq

Summary: Proposed Certificate of Approval Related Legislative Changes In summary, below is a listing of the key proposed legislative changes related to the new Certificate of Approval process: New Certificate of Approval Features 

Authority to establish a single, site-wide Certificate of Approval



Authority to establish multi-site and system-wide Certificates of Approval



Discretionary authority for the Ministry to establish conditions on the approval that allow for operational flexibility

Quality and Complete Submission of Applications 

Regulation making authority to establish specific requirements related to submission of a complete, quality application



Regulation making authority to prescribe qualifications a person must meet to prepare specific documentation



Establish the authority for the Ministry to reject an application because it does not satisfy the complete submission or quality requirements

Transition and Continuous Improvement

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS



Regulation making authority to establish transition dates for submitting applications for the review of existing Certificates of Approval



Discretionary ability for the Ministry to update approvals on an on-going basis by requiring the submission of an application for the review of a Certificate of Approval as a condition of the approval



Discretionary ability for the Ministry to require submission of an application for a new single, site-wide Certificate of Approval when an approval issued under the existing legislation is being amended

Other Authorities 

Legislative changes to harmonize discretionary and mandatory hearing requirements



Authority for the Ministry to refuse, suspend or revoke a Certificate of Approval on the basis of an on-going history of non-compliance with Ontario’s environmental laws

Please note, this is not an exhaustive list of the proposed legislative changes, and may be subject to change as the framework legislation is developed.

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PROPOSED FRAMEWORK FOR MODERNIZING ENVIRONMENTAL APPROVALS

4

Conclusion

Drivers for Change The Ministry experience in delivering the existing approvals process over the last 30 years, coupled with ongoing feedback over the years from stakeholders, has highlighted the need to modernize Ontario’s environmental approvals processes. Increasingly complex business and regulatory environments demonstrate that the Ministry can not continue to rely on a “one size fits all” process. In response, the Ministry has made a number of changes to improve service delivery. In order to continue to be protective of the environment and more responsive in the future, it is clear that the Ministry must fundamentally restructure how approvals are delivered. To meet the challenges of the future, the Ministry is proposing a new process that is consistent with other leading jurisdictions in that it: 1. Introduces a new, simplified process for lower-risk activities 2. Focuses resources on the facilities that pose a potentially higher-risk to the environment and human health 3. Provides online service delivery 4. Improves public transparency.

The Path Forward The framework outlined in this document is one step in the process for implementing the proposed changes. The Ministry encourages your feedback as we formulate amendments to be considered by the Legislature. Should the legislative amendments be passed by the Legislature, the Ministry may identify and recommend regulatory changes to implement the proposed process. At that time, the Ministry would seek further consultation with stakeholders on the specific regulatory changes required.

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