Ontario Regulation 222/07 made under the Environmental Protection Act was filed on June 6, 2007.

The Regulation provides for the assessment of environmental penalties to "regulated persons", defined as that class of persons who own or operate a plant that is found or listed in Table 1 to the Regulation or is described in Section 3 of Ontario Regulation 560/94 (Effluent Monitoring Effluent Limit – Metal Mining Sector) or which otherwise discharges sewage to a surface watercourse and which is listed in the Regulation. The industries specified are the non-municipal Municipal and Industrial Strategy for Abatement (MISA) Industries. This Regulation identifies the contravention for which an environmental penalty may be imposed, the procedure relating to the order imposing the environmental penalty and a Request for Review of a penalty, and the specific matters which may be considered by the Director upon request for a Review of a penalty.

The Regulation prescribes the formula for calculating the penalty. The amount of the environmental penalty for a contravention is the "monetary benefit" received by the regulated person as a result of a contravention plus the "gravity component" for the contravention, minus the reduction, if any, to the gravity component due to prevention or mitigation, the reduction for the presence of an environmental management system and the reduction resulting from an agreement with the Director. The Regulation also provides the Director with the discretion to reduce the amount of the environmental penalty if the Director determines that the environmental penalty by its magnitude is punitive in nature.

Monetary benefits are defined as including avoided costs and delayed costs. The amount of the monetary benefit is to be determined in accordance with the Ministry of Environment publication "Procedure for the Calculation of the Monetary Benefit Component of the Environmental Penalties".

A formula is provided for the determination of the "gravity component". The gravity component is determined by whether the contravention is a Type 1, 2 or 3 contravention as set out in Table 2 to the Regulation and whether it is less serious, serious or very serious. Other factors include the history of contraventions, the extended delay in complying with the requirement that was contravened, and the extent of the deviation from the requirement that was contravened. The penalty is increased if the Director determines that the discharge contains a toxic substance and by the number of days on which the contravention occurred.

The Regulation specifies how it is determined that a contravention is less serious, serious or very serious. The seriousness of the contravention is defined in accordance with the factors identified in the separate sections which deal with specified contraventions, such as contraventions of section 14 and 93 of the Act. For example, section 10 of the Regulation defines a contravention of section 14 of the Act as serious where the contravention causes localized injury or damage to plant or animal life, widespread or long-term interference with the normal conduct of business, widespread or long-tem loss of enjoyment of the normal use of property, widespread damage to property other than plant or animal life. Section 10 of the Regulation defines a contravention of section 14 of the Act as very serious where the contravention causes widespread injury or damage to plant or animal life, harm or material discomfort to any person, an adverse effect on the health of any person, or the impairment of the safety of any person.

Section 11 of the Regulation defines a contravention as very serious if the regulated person failed to take any effective action to prevent, eliminate or ameliorate the adverse effects resulting from the spill or to restore the natural environment. Other sections define the degree of seriousness for the contravention of a discharge limit, failure of an acute lethality test, settlement agreement or other contravention.

The Regulation specifies the factors used to calculate the reductions for prevention or mitigation, for an environmental management system and for an agreement with the Director and caps the reduction for each of these factors. The factors to be used in calculating the reduction for prevention or mitigation are specified in section 16. The steps entitling a regulated person to a reduction to the gravity component in an amount that does not exceed either 10%, 20% or 30% of the gravity component are specified. A reduction of up to 30% of the gravity component may be granted by the Director where before a contravention occurred, the regulated person installed or maintained notification system to alert the operators of the plant when the contravention occurs, developed or implemented and trained employees in the appropriate procedures to respond to a contravention and where, after the contravention occurred, the regulated person promptly eliminated or ameliorated any adverse affects of the contravention or established monitoring or sampling to minimize risk to the environment.

This Regulation comes into force on August 1, 2007.

Other regulations applicable to the class of persons subject to the Environmental Penalties Regulation, also filed on June 6, 2007 include Ontario Regulation 224/07 (Spill Prevention and Contingency Plans) and the industry sector regulations, Ontario Regulation 233/07 (Pulp and Paper Sector), 234/07 (Metal Mining Sector), 235/07 (Industrial Minerals Sector), 236/07 (Metal Casting Sector), 237/07 (Organic Chemical Manufacturing Sector), 238/07 (Inorganic Chemical Sector), 239/07 (Iron and Steel Manufacturing Sector) and 240/07 (Electric Power Generation Sector).

The Spill Prevention Contingency Plans Regulation comes into force on September 1, 2008. This Regulation requires regulated persons to develop and implement a Spill Prevention and Contingency Plan meeting the requirements as set out in the Regulation. In the event a spill occurs, the Regulation requires the owner or operator of the plant to review the Plan in order to determine whether or not amendments are required. An annual review of the Plan is to be conducted for the purpose of identifying inadequacies and revisions to the Plan are to be made as necessary to prevent, eliminate or ameliorate any adverse effects that may result from the spill.

Importantly, this Regulation imposes the obligation on an officer or director of the corporation to conduct such an annual review and for each year after 2008 to make a written statement indicating that the review was conducted, and that in the person's opinion, on January 1 of the year, the information contained in the Spill Prevention and Contingency Plan is accurate, that the Spill Prevention and Contingency Plan is adequate to prevent or reduce the risk of spills when they occur and that the Plan is adequate to prevent, eliminate or ameliorate any adverse effects that may result from the spill.

The sector specific regulations amend the regulations specific to each MISA industry to require sampling and analyses to comply with the Ministry of the Environment "Protocol for the Sampling and Analysis of Industrial/Municipal Wastewater". These Regulations come into force on August 1, 2007.

For more information, please see:

http://www.ebr.gov.on.ca/ERS-WEB-External/displaynoticecontent.do?noticeId=Mjg1NzY=&statusId=MTUwMjQw&language=en