March/April 2007

MAC Economic Commentary

Environmental progress of Canada’s mining industry

By P. Stothart

While much can happen between now and then, it does seem likely that the next federal election campaign will bring greater focus upon environmental issues than has traditionally been the case.

Among other factors, the Liberal Party has recently selected a former environment minister as its new leader. The Green Party has also chosen a long-time environmentalist as leader and is jockeying for participation in any televised federal leaders debates. The Conservatives have tabled clean air legislation and are working through regular announcements and communications, to establish an environmental image. The NDP and Bloc Quebecois are traditionally perceived as being defenders of the environment.

While each of the three major federalist parties will be highlighting this theme, it is evident that each will also bring environmental baggage to an upcoming election campaign. The Liberals had a thirteen-year period of government, during which they made progress on some issues, though lagged on others – such as climate change. The Conservatives have displayed a disorganized environmental effort in their first year as a government and remain dogged by past remarks by Stephen Harper expressing skepticism on climate change. The NDP retains an image as a party where the big spending and regulatory hand of government will be used to fix everything – regardless of commercial or fiscal implications.

The confluence of these political forces suggests that more rigorous environmental demands will be placed upon industry in the coming months, particularly in the air pollution and climate change areas. In the present political atmosphere, it is unlikely that any party will advocate on behalf of voluntary measures, for example. While numerous industry groups and associations, including MAC, will be calling for a balanced and achievable environmental plan, there is no guarantee that this will be the outcome of the present political debate. Indeed, the parliamentary committee recently decided to redraft the clean air act, which presents an interesting case study - the government has unveiled its intent to regulate and each opposition party will undoubtedly aim to "out-green" the other through advancing ways to toughen this proposal.

The Canadian mining industry, for its part, is well-placed to respond to whatever new environmental challenges may emerge from the ongoing process. The industry has a long record of enhancing environmental performance, improving occupational health and safety, and responding to social issues within a sustainable development framework.

For example, the mining sector, through its industry association, introduced the Towards Sustainable Mining (TSM) initiative in 2004. TSM requires MAC members to report on performance indicators and targets for tailings management, energy use, greenhouse gas emissions management, external outreach, and crisis management. New indicators are being developed for biodiversity and aboriginal relations. MAC produces a public report with TSM results each year. http://www.mining.ca/www/Towards_Sustaining_Mining/index.php.

Canadian mining companies have also made significant progress over the past decade in reducing emissions of key pollutants. The table highlights the progress of MAC member companies (representing most of Canada’s mining production) in reducing environmental releases over the 1993 to 2003 period. For example, mercury releases have been reduced by 91 per cent, cadmium and zinc each by 71 per cent, and lead by 68 per cent during the decade. This reflects the success of investment by mining companies in cleaner processes and technologies in response to early-stage voluntary actions and Canadian laws.

 

Beyond these improvements in specific key pollutants, the industry has also improved its energy management practices and, consequently, its performance on greenhouse gas emissions.

For example, the non-ferrous metal smelting and refining industry has reduced its energy requirements from 50 terajoules per kilotonne of production output in 1990 to 42 in 2004. This 18 per cent improvement reflects industry investment in energy management and efficient process technologies. The industry has reduced greenhouse gas emissions from 1.9 kilotonnes of CO2 per kilotonne of production output in 1990 to 1.3 in 2004. This 33 per cent improvement is due to investments in energy efficiency and to a shift away from heavy fuel oil and natural gas energy sources towards electricity produced from cleaner sources.

The industry is also actively involved in environmental partnerships, such as the Mine Environment Neutral Drainage initiative, through which Canadian mining companies and governments have reduced Canada’s liability due to acidic drainage by some $400 million over eight years. This initiative is relevant to proposed, active, and abandoned mines. In general, the assessment and remediation of orphaned and abandoned mine sites across Canada has received increased national attention since the establishment in 2002 of another mining industry-government partnership - the National Orphaned/Abandoned Mines Initiative.

The Canadian mining industry is rightly viewed as a world leader in its environmental performance. Companies have invested heavily over the past 15 years in process improvements as well as in new end-of-pipe and remediation technologies. The industry will continue to improve in response to whatever new environmental targets and requirements may be stipulated by the government. Conversely the industry expects the Canadian government to do its part - by encouraging new clean investment through the appropriate tax treatment and by developing environmental performance targets that are achievable and that reflect Canada’s place in a competitive world economy.


Paul Stothart
Paul Stothart is vice-president, economic affairs, at the Mining Association of Canada. He is responsible for advancing the industry’s interests regarding federal tax, trade, investment, transport and energy issues.

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