Economic Analysis of a Proposal to Modernize the Pulp and Paper Effluent Regulations

TITLE: Economic Analysis of a Proposal to Modernize the Pulp and Paper Effluent Regulations Objective The objective of the study is to:

Develop a socio-economic profile for the pulp and paper sector, which includes facilities engaged in the transformation of cellulose fibers. Assess and evaluate the impacts of the proposal to modernize the Pulp and Paper Effluent Regulations. The study will provide data inputs on impacts for Environment and Climate Change Canada’s, herein referred to as the Department, cost benefit analysis of the proposed regulatory changes, including the impacts on: environmental protection measures; administrative improvements; and compliance and administrative requirements.BACKGROUND The objective of the Pulp and Paper Effluent Regulations (PPER) under the Fisheries Act is to reduce the threats to fish, fish habitat and human health from fish consumption by decreasing the level of deleterious substances in pulp and paper effluents discharged to water frequented by fish. The PPER sets national effluent quality standards based on secondary wastewater treatment achievable in the 1980s. In addition, it requires pulp and paper mills to conduct site-specific environmental effects monitoring (EEM) studies to determine if effluent has an impact on fish health, fish habitat and human usability of fisheries resources. EEM studies were included in the regulations to help assess whether the effluent quality standards are protective of the receiving environment. If EEM studies show that the effluent is impacting the receiving environment, mills are required to determine the causes of and solutions for the observed impacts. The PPER were successful in reducing the amounts of deleterious substances discharged and compliance with regulatory standards is high. However, EEM studies have shown that effluent from approximately 70% of pulp and paper mills have impacted fish and fish habitat. In September 2017, the Department shared the consultation document entitled, Proposed Modernization of the Pulp and Paper Effluents Regulation – Consultation Document, with industry, environmental non-governmental organizations (ENGOs), Indigenous Peoples, provincial governments, and other interested parties. The purpose of initial consultations was to seek feedback from interested parties on the initiative to modernize the PPER. The current PPER limits reflect achievable late -1980s performance standards and remain generally less stringent than those of the provinces on a production basis. Additionally, Canadian mills, in general, consistently discharge effluents with the most suspended solids, biochemical and chemical oxygen demand and nutrients per tonne of production compared to competitors in the European Union and United States. The Department is proposing to set limits in line with today’s industry standards for existing substances (biochemical oxygen demand and suspended solids) and for new substances (chemical oxygen demand, nutrients) and parameters (pH, temperature). The goal is to improve protection by aligning with other jurisdictions, encouraging use of modern best available technologies/techniques and optimal wastewater operations while not requiring tertiary treatment. The current scope of the PPER may not capture new transformation projects. The Department is proposing to revise the scope to capture facilities producing pulp but also any product made directly from pulp or a pulping process. The revised scope is expected to capture foreseeable bio-products such as sugar and Nano materials. It will not capture biofuels unless production uses a pulping process. The Department proposes to make several improvements based on the administration of the PPER such as focusing EEM studies on effects that are potentially of higher risk to the environment and clarifying requirements for closing and idle mills. REQUIREMENTS This study will inform the Department’s preparation of its cost benefit analysis and Regulatory Impact Analysis Statement of the proposed modernization of the PPER. In order to assist the Department in its development of the modernize PPER, the Contractor must research, gather and provide information and data requested below, and provide the results of its research to the Technical Authority in the form of a report.