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Vol. 136, No. 50 — December 14, 2002
Regulations Amending the Gasoline Regulations
Statutory Authority
Canadian Environmental Protection Act, 1999
Sponsoring Department
Department of the Environment
REGULATORY IMPACT ANALYSIS STATEMENT
Description
The purpose of the Regulations Amending the Gasoline Regulations, made under section 140 of the Canadian Environmental Protection Act, 1999 (CEPA, 1999), is to allow an exemption, until January 1, 2008, with respect to gasoline for use in competition vehicles from the otherwise applicable restrictions on the concentration of lead in gasoline specified in the Regulations.
Leaded gasoline production, importation and sale has been prohibited, for the most part, under the Gasoline Regulations since December 1, 1990. Approximately one million litres of leaded racing fuel were imported into Canada in 2001. This represents less than 0.01 percent of the 36 billion litres of gasoline (mostly unleaded) used annually in Canada.
Environment Canada will continue to monitor the racing sector through the reporting of the quantities of leaded racing gasoline produced, imported and sold in Canada. The Department also intends to monitor the development of environmental fuel requirements in the United States and engage in bilateral discussions as necessary. In the event that any of these measures indicate that further control action is warranted, the Minister of the Environment may proceed accordingly. This is consistent with the federal government's approach to reducing or eliminating the use of toxic substances that may be an environmental or health-related concern when released into the Canadian environment.
Re-assessment of exemption for leaded racing gasoline
The Gasoline Regulations were amended in 1998 to extend, for an additional five years, an exemption allowing the use of leaded gasoline in competition vehicles. Before the end of the exemption period, due to expire December 31, 2002, Environment Canada was to re-assess the exemption. This included examining trends in leaded gasoline use patterns, regulatory developments in the United States and other jurisdictions, any new research into health effects of lead, and other relevant issues.
A review of the racing sector was conducted in early 2002. The importation of leaded fuel has risen about 37 percent since 1998. Most of this increase (21 percent) took place from 1998 to 1999. Racing industry experts have indicated that U.S. competitors may have changed one of their earlier practices. Prior to the 1998 amendment to the Gasoline Regulations, U.S. drivers brought leaded fuels with them to Canadian events. After the amendment, American competitors began purchasing leaded fuels in Canada. This may account for some of the increase seen in the latest import figures.
The 1998 exemption had been extended until the end of 2002 based on the results of monitoring programs conducted in 1997 at two Canadian race tracks (an oval track and a drag-strip), where a worst-case scenario was produced at each location. These results had been used by Health Canada to perform a lead exposure assessment for toddlers, adolescents and pregnant women, as they are considered the most susceptible receptors of the general population. A separate case for a toddler living 800 m from the oval track was also considered. The assessment concluded that weekly lead exposures for spectators and nearby residents were acceptable when compared to the World Health Organization (WHO) Provisional Tolerable Weekly Intake (PTWI).
As no additional air sampling has been conducted since 1997, the 1997 lead exposure assessment was updated based on the worst-case scenario that the 37 percent increase in importation of leaded fuel since 1998 would be equivalent to a 37 percent increase in lead emissions at race tracks. Since the previous assessment identified toddlers as the most susceptible receptors, the current lead exposure assessment was performed using only toddlers as an indicator. The updated estimated weekly lead intake for a toddler as a spectator, both at the oval track and at the drag strip, is 47 percent of the World Health Organization (WHO) Provisional Tolerable Weekly Intake (PTWI). An additional calculation was performed based on a four-hour exposure (above calculation based on a 12-hour exposure), which was considered a more realistic scenario, and it resulted in an estimated lead intake of 42 percent of the PTWI. In conclusion, estimated weekly lead exposures for spectators at race tracks remain within the tolerable intake developed by the WHO and accepted by Health Canada.
A review of regulatory developments in other countries indicates that the United States has no plans at this time to ban or restrict the use of lead in racing fuels. Australia does not currently have restrictions on the use of leaded gasoline for racing, but is reviewing the leaded fuel-use issue.
Economic data on the racing sector
Economic data on the racing sector and economic impacts on the regulatory options considered are based on a survey conducted in the Spring of 2002 of race-sanctioning bodies, track and event representatives, and fuel suppliers. Fifty-seven track and event organizers were contacted representing small, medium and large facilities in all regions of Canada. Of the twenty-nine responses received, the majority were from large racing facilities running regular weekly races where leaded gasoline is used. Thus, estimates extrapolated from the responding tracks may overstate impacts of leaded gasoline use. For this reason, the more conservative estimates for the impact of the regulatory alternatives to this industry are presented below.
It is estimated that racing events in Canada in 2001 generated $197 million (see footnote 1) in direct revenue and 904 full-time equivalent jobs. (see footnote 2) In addition, the racing industry attracted $575 million in direct expenditures by non-local people to areas with racing facilities and events including $94 million from non-Canadian visitors.
Alternatives
The economic impacts of two options were considered, using estimates developed from the survey of the racing sector reported above. The respondents represented 24 percent of the total number of racing facilities in Canada. However, there was some uncertainty regarding the proportion of economic activity in the sector represented by the respondents. To take this uncertainty into account, a range was used for the percentage of the industry represented by the respondents when determining the economic impacts of the regulatory options on the industry as a whole. The upper bound estimate for these impacts assumes that the respondents represent 20 percent of the industry, while the lower bound estimate assumes that they represent 30 percent. Based on the higher response rate from large facilities where leaded gasoline is used more commonly, the lower bound estimate for the economic impacts is reported. The impacts for each alternative are presented below:
a) To ban the use of leaded gasoline in all racing events by allowing the current exemption to expire:
This option has been rejected because results from the lead exposure assessment (outlined above) indicate that current levels of exposure to lead do not constitute a health concern. In addition, leaded racing gasoline is allowed in the United States and a ban in Canada could result in the cancellation of large racing events dependent upon leaded fuel, and that attract a large share of spectators, or relocation of these events to the United States. This could result in the closure of some facilities and losses in revenue to those that continue to operate. Based on survey data, the estimated economic impact of allowing the exemption to expire is a loss of $118 million in revenues and 329 jobs in the racing industry. In addition, areas hosting events would lose $275 million in direct expenditures by non-locals, including $67 million from non-Canadian visitors. b) To exempt all racing vehicles from restrictions on the use of leaded gasoline:
This option has been selected. The revised lead exposure assessment showed that weekly lead intakes under a range of lead-use situations remain within the tolerable intake levels developed by the World Health Organization. However, based on the reported increase in imports of leaded racing fuels since 1997 and on-going concerns regarding lead toxicity, limiting the exemption to an additional five years was considered prudent.
Benefits and Costs
Benefits
The Regulations will continue to allow the racing industry to maintain its current status for the next five years. Large racing associations in the United States and local owners will be able to plan with certainty for that period.
Cost to the Industry
No additional costs to the industry are expected from these Regulations, because reporting requirements for the industry have not changed.
Cost to the Government
No additional cost to the Government is expected from the promulgation of these Regulations, since the annual reporting requirements and compliance promotion and enforcement requirements have not changed.
Consultation
A discussion paper, describing how the re-assessment of the exemption for leaded racing gasoline was conducted and proposing to extend this exemption with no time limit, was distributed to stakeholders for comments in June 2002. These stakeholders included race track owners and race-sanctioning associations, equipment designers and suppliers, fuel suppliers and distributors, non-governmental organisations and provincial and territorial governments. Environment Canada also consulted with other federal departments.
Consistent with the requirements of subsection 145(2) of CEPA, 1999, the Minister of the Environment offered to consult with the governments of provinces, and members of the CEPA National Advisory Committee who are representatives of aboriginal governments on the proposal to extend the exemption under the Gasoline Regulations. None of the parties took up the offer to consult within 60 days of the offer being made. Written comments were received from only two racing-sector organisations supporting the Regulations, as they believe that harmonization of Canadian and U.S. policy is a necessity. However, Environment Canada also heard from two suppliers opposing the Regulations and asking for a ban on leaded racing gasoline on the basis that unleaded fuels and engines running on unleaded fuels are available.
All comments received were taken into consideration. In addition, any person, association, industrial corporation, etc. still wishing to raise concerns or comments about the proposed Regulations can do so during the 60-day period after the prepublication of these Regulations in the Canada Gazette, Part I.
Compliance and Enforcement
Since the proposed Regulations will be promulgated under the Canadian Environmental Protection Act 1999, CEPA enforcement officers will apply the Compliance and Enforcement Policy implemented under the Act. Their compliance promotion activities are limited to the distribution of the Act, the regulations and the CEPA 1999 Compliance and Enforcement Policy. The Policy outlines measures to be implemented by Environment Canada scientists and engineers to promote compliance, including education, information and consultation on the development of proposed regulations.
This Policy sets out the range of possible responses to alleged violations: warnings, directions and environmental protection compliance orders, ticketing, ministerial orders, injunctions, prosecution and environmental protection alternative measures (which are an alternative to a court prosecution after the laying of charges for a CEPA 1999 violation). In addition, the policy explains when Environment Canada will resort to civil suits by the Crown for cost recovery.
When, following an inspection or an investigation, a CEPA enforcement officer discovers an alleged violation, the officer will choose the appropriate enforcement action based on the following criteria:
— Nature of the alleged violation
This includes consideration of the seriousness of the harm or potential harm to the environment, the intent of the alleged violator, whether it is a repeat violation, and whether an attempt has been made to conceal information or otherwise subvert the objectives and requirements of the Act.
— Effectiveness in achieving the desired result with the alleged violator
The desired result is compliance with the Act within the shortest possible time and with no further repetition of the violation. Factors to be considered include the violator's history of compliance with the Act, willingness to cooperate with enforcement officers, and evidence of corrective action already taken.
— Consistency in enforcement
Enforcement officers will consider how similar situations have been handled in determining the measures to be taken to enforce the Act.
Bernard Madé, Chemicals Control Division, National Office of Pollution Prevention, Environment Canada, Ottawa, Ontario K1A 0H3, (819) 994-3648 (Telephone), (819) 994-0007 (Facsimile), Bernard.Made@ec.gc.ca (Electronic mail), or Céline Labossière, Regulatory and Economic Analysis Branch, Policy and Communications, Environment Canada, Ottawa, Ontario K1A 0H3, (819) 997-2377 (Telephone), (819) 997-2769 (Facsimile), Celine. Labossiere@ec.gc.ca (Electronic mail).
Notice is hereby given, pursuant to subsection 332(1) of the Canadian Environmental Protection Act, 1999 (see footnote a) , that the Governor in Council, pursuant to section 140 of that Act, proposes to make the annexed Regulations Amending the Gasoline Regulations.
Any person may, within 60 days after the publication of this notice, file with the Minister of the Environment comments with respect to the proposed Regulations or a notice of objection requesting that a board of review be established under section 333 of the Canadian Environmental Protection Act, 1999 (see footnote b) and stating the reasons for the objection. All comments and notices must cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to the Executive Director, National Office of Pollution Prevention, Environmental Protection Service, Department of the Environment, Ottawa, Ontario K1A 0H3.
A person who provides information to the Minister of the Environment may submit with the information a request for confidentiality under section 313 of the Canadian Environmental Protection Act, 1999 (see footnote c) .
Ottawa, December 12, 2002
EILEEN BOYD
Assistant Clerk of the Privy Council
REGULATIONS AMENDING THE GASOLINE REGULATIONS
AMENDMENTS
1. The definition "primary supplier" in section 2 of the Gasoline Regulations (see footnote 3) is repealed.
2. Subsection 3(2) of the Regulations is replaced by the following:
(2) Until January 1, 2008, these Regulations, except for sections 2 and 11, do not apply in respect of gasoline for use in competition vehicles.
3. Paragraph 11(1)(e) of the Regulations is replaced by the following:
(e) the total quantity of leaded gasoline sold to each of the entities specified in subparagraph (d)(i) or at each of the locations specified in subparagraph (d)(ii) and the total quantity of any other leaded gasoline produced or imported for use or sale in Canada, or sold or offered for sale in Canada.
COMING INTO FORCE
4. These Regulations come into force on the day on which they are registered.
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Regulations Amending the Electricity and Gas Inspection Regulations
Statutory Authority
Electricity and Gas Inspection Act
Sponsoring Department
Department of Industry
REGULATORY IMPACT ANALYSIS STATEMENT
Description
The Electricity and Gas Inspection Regulations currently prescribe two means for establishing a supercompressibility factor where line pressures are less than or equal to 100 psig. The proposed modification would prescribe a third means of establishing a supercompressibility factor for a limited range of line pressures below or equal to 30 psig. To ensure that accuracy in measurement is maintained, a companion amendment would introduce additional contractor record-keeping provisions. The proposed modification that was drafted in consultation with stakeholders would allow for a cost-effective means of establishing a supercompressibility factor for the lower line pressures (below 30 psig) that do not warrant purchasing the monitoring equipment required for higher pressures. Doing so would ensure that acceptable levels of measurement accuracy can be met at lower line pressures.
Background
The Electricity and Gas Inspection Act requires that the cubic foot or cubic metre be used as the unit of measurement when natural gas is sold on the basis of volume measurement. Because the volume that a given amount of gas will occupy is dependant on the applicable conditions of temperature and pressure, these conditions must be standardized to provide a defined and consistent unit of measurement for the purposes of trade. In Canada, natural gas sold on the basis of volume is standardized as being the volume that the gas would occupy at a pressure of 101.325 kPa (14.73 psig) and at a temperature of 15 °C (60 °F).
Explanation of Supercompressibility Factor
When natural gas is sold by volume, a meter is used establish the basis of the charge for the gas supplied. The volume of gas measured by the meter at metering conditions of temperature and pressure is converted to its equivalent volume at standard conditions of temperature and pressure through the application of correction factors that are established on the basis of the ideal gas law.
In converting a volume of gas to its equivalent volume at standard conditions of temperature and pressure, an additional factor must be considered in the conversion. This factor is referred to as the supercompressibility factor. Natural gas becomes more compressible as pressure increases and, as a result, the relationship between pressure and volume does not follow that of the ideal gas law.
In summary, the supercompressibility factor corrects for the deviations from the ideal gas law that the gas being measured exhibits. The degree of correction (value of the supercompressibility factor) is unique to the gas being measured and is established on the basis of the gas density and composition, and on the temperature and pressure conditions at the time of metering.
The Proposed Amendment
Section 40 of the Electricity and Gas Inspection Regulations prescribes how a supercompressibility factor is to be established for the purposes of converting a volume of gas to standard volume, and section 11 prescribes record-keeping requirements for meter owners. It is these sections of the Regulations to which an amendment is being proposed.
The proposed amendment to section 40 would modify the prescribed means of establishing a supercompressibility factor by providing a third option for determining this factor on pressure-factor metering installations for which the line pressure does not exceed a pressure of 30 psig. The proposed companion amendment to section 11 would introduce additional contractor record-keeping requirements to ensure the proper application of the section 40 provisions.
At present, on metering installations where the line pressure is less than or equal to a pressure of 100 psig, contractors have the option of establishing the supercompressibility factor through the use of continuous monitoring equipment or using a supercompressibility factor equal to one (1) to convert the volume of gas to standard volume. Where a contractor uses a supercompressibility factor equal to one, the volume established will be less than the true standard volume of the gas.
The proposed change to the prescribed procedure will allow contractors to establish the supercompressibility factor based on an assumed flowing gas temperature on metering installations where the line pressure does not exceed a pressure of 30 psig and where pressure is controlled using an approved and verified pressure factor metering regulator.
This modification would give stakeholders a more cost-effective method for establishing supercompressibility on certain metering installations and under prescribed limitations that have been established to support an acceptable level of measurement accuracy and uncertainty. Affected parties were consulted in the development of the proposed amendment. They support the modification and will continue to be kept informed of the progress of this amendment via its publication in the Canada Gazette and its posting on Measurement Canada's Internet site. This amendment was announced in the 2000-2001 Industry Canada's Report on Plans and Priorities, and the Senior Policy Committee identified it as having a low impact on the economy.
Alternatives
Option 1 — Maintain the Status Quo
The alternative to the proposed modification would be to leave sections 40 and 11 untouched. The requirement for continuous monitoring equipment to be used in establishing a supercompressibility factor on all metering installations currently requires stakeholders to invest in specialized metering equipment. For certain low-pressure metering installations, the cost of this equipment may be significant or prohibitive when assessed against the measurement gains obtained from the application of supercompressibility correction. The current regulations present an all-or-nothing approach to the establishment of a supercompressibility factor at the lower gas pressures, and the tendency among most stakeholders is to leave volume uncorrected for supercompressibility rather than purchase the necessary monitoring equipment.
Option 2 — Introduce the possibility of applying supercompressibility correction without the need for the continuous monitoring of gas temperature under certain conditions and controls
The proposed modification would allow contractors or service providers to establish standard volume with supercompressibility correction at very little cost to the meter owner, where such a practice is warranted by the metering installation and the type of equipment in use. The proposed modification presents an alternative which, in terms of the acceptable means for establishing a supercompressibility factor, falls between the two currently prescribed options available to stakeholders. The modification also includes the limitations necessary to ensure that the establishment of a supercompressibility factor by this means is justified in terms of the metering technology in use, and that the degree of correction established by this means is limited to acceptable levels of measurement accuracy.
Benefits and Costs
Impact on Service Providers
Under the proposed modification, service providers would experience a net benefit from the additional option for establishing supercompressibility. Without the modification at lower gas pressures, service providers have the option of either purchasing additional monitoring equipment or not accounting for the deviation in the established standard volume of gas and then absorbing the resulting losses associated with the decrease in standard volume quantities when gas is sold to the end user. Under the option presented, the benefit incurred by service providers would correspond to the opportunity cost (in millions of dollars) associated with not purchasing monitoring equipment. In the long term, service providers may possibly redirect the savings into improving the efficiency of their operations, upgrading their equipment or hiring additional employees.
Impact on Consumers of the Service
In the long term, consumers of natural gas may benefit indirectly from this modification because of a possible redistribution of service providers' resources into improving the efficiency of their operations. Under this model, consumers may experience an improvement in service delivery and lower costs. In the short term, residential consumers will be untouched by this proposal because supercompressibility correction is not performed on metered volumes at the delivery pressures associated with residential consumer services, owing to the fact that correction values at these pressure levels are considered to be insignificant. On the other hand, commercial consumers will either be unaffected by this amendment or, in those instances where supercompressibility was not accounted for in the past and service providers opt to establish correction under the proposed amendment, commercial consumers could experience a change (dependant on service pressure) in the range of roughly + 0.04 percent to + 0.5 percent with regard to the establishment of gas quantities at standard conditions.
Impact on Manufacturers of Supercompressibility Monitoring Equipment
In the long term, and assuming that service providers will redirect resources into upgrading equipment, it is possible that manufacturers may benefit from an increased demand for devices and equipment.
In the short term, manufacturers should experience no impact from the proposed amendment, as it is predicted that a service provider's demand for monitoring equipment will remain unchanged.
Consultation
The Canadian Gas Association represents approximately 270 Canadian members, including major natural gas distribution and transmission companies, energy service providers, gas brokers and service suppliers, and a significant portion of the meter manufacturing sector across the country. The members of this association were consulted on the proposed amendment. The above service providers and device manufacturers have confirmed that this modification will have a net positive impact on their operations and, therefore, support the proposed amendment.
Compliance and Enforcement
The proposed amendments will be enforced by Measurement Canada inspectors and officers. The "Offences and Punishment" section of the Electricity and Gas Inspection Act prescribes penalties and legal procedures for infractions to the Act and Regulations. Penalties include fines with monetary limitations and legal sanctions. The proposed amendment will not require the introduction of any new compliance or enforcement mechanism.
Mr. Gilles Vinet, Vice-President, Program Development Directorate, Measurement Canada, Industry Canada, Standards Building, Tunney's Pasture, Ottawa, Ontario K1A 0C9, (613) 941-8918 (Telephone), (613) 952-1736 (Facsimile), vinet.gilles @ic.gc.ca (Electronic mail).
Notice is hereby given, pursuant to subsection 28(2) of the Electricity and Gas Inspection Act, that the Governor in Council proposes, pursuant to subsection 28(1) of that Act, to make the annexed Regulations Amending the Electricity and Gas Inspection Regulations.
Interested persons may make representations concerning the proposed Regulations within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I and the date of publication of this notice and be addressed to Gilles Vinet, Vice-President, Program Development, Measurement Canada, Department of Industry, Tunney's Pasture, Standards Building, Ottawa, Ontario K1A 0C9 (Tel.: (613) 941-8918; fax: (613) 952-1736; E-mail: vinet.gilles@ic.gc.ca).
Ottawa, December 12, 2002
EILEEN BOYD
Assistant Clerk of the Privy Council
REGULATIONS AMENDING THE ELECTRICITY AND GAS INSPECTION REGULATIONS
AMENDMENTS
1. Section 11 of the Electricity and Gas Inspection Regulations (see footnote 4) is amended by adding the following after subsection (6):
(6.1) An owner's records shall contain the following information respecting the determination of a supercompressibility factor:
(a) details of the system, including the location of each point of supply of gas; and
(b) the method by which the supercompressibility factor of the gas sold is determined.
2. Section 40 of the Regulations is replaced by the following:
40. For the purpose of paragraph 35(e),
(a) subject to paragraphs (b) and (c), the supercompressibility factor for any meter shall be established based on
(i) the pressure exerted by the gas within the meter and the temperature of the gas flowing through the meter as determined by continuous monitoring at the meter location,
(ii) the relative density, the carbon dioxide content and the nitrogen content of the gas being measured, as determined by
(A) a gas sampling process, if the process gives results that are representative of the gas at the meter location, or
(B) continuous monitoring at the meter location, and
(iii) if the parameters of the gas referred to in subparagraphs (i) and (ii) vary, either the time weighted or the volume weighted averages of those parameters during the period that the volume of the gas is measured by the meter; (b) the supercompressibility factor for any meter for which the pressure exerted by the gas within the meter expressed on the gauge pressure scale does not exceed 207 kPa in the International system of units, or 30 psi in the Imperial system of units, may be established based on
(i) the pressure exerted by the gas within the meter, established and maintained through the use of a pressure factor metering regulator that has been approved and verified under section 9 of the Act,
(ii) an assumed flowing gas temperature of 59°F or 15°C, and
(iii) the relative density, the carbon dioxide content and the nitrogen content of the gas being measured as determined by a gas sampling process, if the process gives results that are representative of the gas at the meter location; or
COMING INTO FORCE
3. These Regulations come into force on the day on which they are registered.
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In this document, all amounts are in Canadian dollars for 2001.
All employment estimates refer to full-time equivalent jobs (includes seasonal, part-time and full-time employees).
S.C. 1999, c. 33
S.C. 1999, c. 33
S.C. 1999, c. 33
SOR/90-247
SOR/86-131
NOTICE:
The format of the electronic version of this issue of the Canada Gazette was modified in order to be compatible with extensible hypertext markup language (XHTML 1.0 Strict).
