Ontario’s New Water Opportunities Strategy
Will it Make the Province a Leader in Water Technology?
In his Speech from the Throne earlier this year1, Premier Dalton McGuinty announced the creation of a strategy that seeks to make the province the North American leader in the development and commercialization of new technologies and services for water conservation and treatment.
The strategy is part of the “Open Ontario Plan”, which aims to spur job creation and foster a climate where business can thrive, as well as accelerate the province’s nascent economic recovery from the recession.
The key elements of the water strategy are as follows:
- introduce a new Sustainable Water Opportunity Act to support the development of new technologies and practices for water conservation and treatment
- improve the efficiency of Ontario’s water and wastewater infrastructure
- work with researchers and entrepreneurs to create jobs and to attract clean water expertise and investment in the province
- promote Ontario’s water technology sector at home and abroad.
The market for water technologies is huge, and growing. The Conference Board of Canada estimates the global market for water technology at more than US$400 billion per year, and doubling every five to six years.
The government sees Ontario as ideally placed to ride the coming wave, since it has a head start with the many water technology firms already located here, from start-ups to established companies. The government estimates that 22,000 people are currently employed by water technology companies in Ontario.2
The strategy seeks to mimic last year’s Green Energy Act, which is intended to make Ontario the North American leader in renewable energy generation and technology industries.3
The water strategy is described in more detail in a report entitled “The Water Opportunity for Ontario”, released in March 2009 (the “Water Opportunity Report”)4. The Water Opportunity Report is the result of a collaborative effort of the Ontario Centre for Environmental Technology Advancement (OCETA), XPV Capital Corporation, several branches and agencies of various levels of government, as well and NGOs, colleges and universities, and the private sector.
The Water Opportunities Act , 2010
As this article was going to press, the Water Opportunities Act, 2010 was introduced. The side bar provides is a summary of the Act. The details of the Act will come in future regulations.
The OCETA Water Opportunity Report called for legislation with four main objectives:
- encourage sustainable water behaviour
- adopt transparent costing and accounting of water use
- support water technology demonstration and early adoption
- attract early stage, innovative water technology companies to Ontario.5
Encouraging Sustainable Water Behaviour
We can expect water conservation to be a major focus of the regulations to come under the Act. Ontarians currently use about 260 litres of water per capita per day, nearly twice as much as citizens of comparable countries like Germany, the United Kingdom and the Netherlands.
On the same day as the Throne Speech, a group of environmental non-profits issued a press release calling for a greater emphasis on water conservation, including measures such as implementing water efficiency standards, mandatory efficiency labelling for water fixtures, and linking infrastructure grants to water conservations goals.6 The Water Conservation Alliance has gained support with some 40 members. Private sector companies in the water and housing business and a regional municipality have joined the campaign.7
By April 2010, the government had already announced that it is intending to mandate water-saving toilets. The proposal would require that all toilets sold in the province use no more than six litres of water per flush. The Ontario Building Code already restricts the installation of toilets using more than six litres per flush; the new proposal would make it illegal to sell them.
It’s estimated that replacing a 13 litre per flush toilet with a six litre model would save an average household about 35,000 litres of water a year.
The government expects to introduce a regulation under the Green Energy Act to implement the new high-efficiency toilet rules, which will likely require compliance by January 1, 2011. The proposed legislation was posted to the Environmental Bill of Rights Environmental Registry for public comment.8
Adopting Transparent Costing and Accounting of Water Use
Transparent costing and accounting of water use is expected to increase the motivation to adopt more efficient water technologies.
As reported in these pages in the previous issue of Influents, there is currently a private member’s bill, introduced by David Caplan, MPP for Don Valley East, before the provincial legislature.9 The bill would require municipalities to implement full cost accounting and full cost recovery for water and wastewater infrastructure – a concept introduced and supported in the O’Connor report on the Walkerton tragedy, as well as water reforms such as a Water Board to oversee rate setting.
Since the writing of our last article, the bill survived second reading and was referred to the Standing Committee on General Government, in February 2010. The Association of Municipalities of Ontario raised concerns about the Caplan Bill, including about the potential effect on water rates. The Water Opportunity Report and the proposed Water Opportunities Act approach this issue in a way that responds to municipal concerns about the private members bill.
The Water Opportunity Report focuses on transparency in costing and accounting and providing more information to water users, in order to encourage the adoption of more efficient water technologies, conservation measures and management practices.
The proposed Water Opportunities Act builds on the existing regulatory requirement for financial plans by requiring municipal water sustainability plans which include: (1) an asset management plan for the physical infrastructure; (2) a financial plan; (3) a water conservation plan (if the plan is for a municipal water service); (4) a risk assessment and plan to deal with any risks that may interfere with the future delivery of the municipal service (including the risks posed by climate change); (5) strategies for maintaining and improving the municipal service, including meeting future demand, the more efficient use of water, and co-operation with other municipal service providers; and (6) such other information as may be prescribed in regulation.
As described in our previous article, the first round of municipal financial plans under the Financial Plans Regulation will be due in July. These financial plans must show that the drinking water system is “financially viable”. Municipalities required to prepare a financial plan will get a preview of the effects and opportunities presented by full accounting of water and wastewater systems.
Supporting Water Technology Demonstration and Early Adoption
This goal will likely be promoted by establishing a reference customer network of “early adopters” and demonstration sites for clean water technologies. These may include municipalities; First Nations communities; industrial sectors such as pulp and paper, mining, agriculture, food and beverage, automotive and chemical; and energy generation facilities.
These reference customers would provide feedback, promote market acceptance and accelerate the adoption of clean water technologies.
What sorts of new technologies can we expect? The Water Opportunity Report describes four main categories of technologies and solutions:
- Demand Destruction. Solutions that reduce water consumption also help reduce the amount of chemicals, energy, and other inputs in water treatment processes and can reduce costs and environmental impacts.
- Wastewater to Product. Technologies exist to recover metals, fertilizers and other materials from industrial wastewater streams, and new technologies are being developed to help recover and generate energy from wastewater. Conceivably, every municipal wastewater treatment plant could be a renewable energy generator, not to mention a potential source of revenue.
- Reuse. Technologies such as membrane bioreactors, advanced oxidation and ultraviolet disinfection enable the reuse of wastewater streams.
- Infrastructure Renewal. Extending the life of the existing infrastructure has the potential to reduce capital expenditure requirements. Technologies include leak detection equipment, in-situ pipe rehabilitation techniques that allow utilities to repair pipes without digging trenches, technologies that increase the treatment capacity of land constrained wastewater treatment plants that have exceeded their design capacity, instrumentation technologies that allow for remote monitoring and control, improved waterborne contaminant detection technologies, and “smart water grid” solutions to optimize the existing infrastructure.10
Attracting Technology Companies to Ontario
The Water Opportunity Report identifies the need to brand Ontario as a leader in sustainable water as a key to attracting water technology firms and capital.
It also looks to three jurisdictions that have made significant progress as water technology leaders -- Germany, Israel and Singapore – in order to learn from and emulate their accomplishments.
Germany has strong partnerships and associations that facilitate exchanging experiences, promoting innovation, creating trust and collaboratively solving problems. It has also successfully migrated German water standards, technical specifications and regulatory frameworks to developing countries, which assists in gaining a commercial foothold in new markets.
Driven by water scarcity and security concerns, Israel has been a leader in developing new technologies such as desalination, water re-use and drip irrigation. It has also created new technology incubators that have attracted large amounts of capital investment.
Singapore has numerous financial incentives in place that have attracted firms such as General Electric, Siemens and CH2MHill to establish sophisticated facilities in that state.
These case studies provide examples of the type of initiatives that Ontario may implement. Ontario will certainly build on its strengths, which include its geographic advantages (abundant water resources, easy access to global markets), well-developed regulatory framework, and its research capacity.
Conclusion
If the Ontario government follows through on its ambitious strategy, almost anyone with an interest in water or wastewater can expect to be effected by the Water Opportunities Act.
The legislation has been posted to the government’s Environmental Registry. This is your opportunity to review the draft legislation, comment on it, and think about what opportunities it may hold for you.
FOOTNOTES
1. Delivered March 8, 2010, available at http://www.premier.gov.on.ca/news/event.php?ItemID=11282&Lang=En
2. See http://news.ontario.ca/opo/en/2010/04/ontario-taps-into-clean-water-expertise.html
3. See “Renewable Energy Projects Under the Green Energy Act” Influents (Fall 2009).
4. Available at http://www.oceta.on.ca/TheWaterOpportunityforOntario_Mar_2010.pdf
5. Page 7.6. See http://www.marketwire.com/press-release/Water-Opportunities-Act-Must-Set-Targets-for-Ontarios-Water-Use-1128417.htm
7. See http://www.conserveourwater.ca/
8. EBR registry no. 010-9765. At the time of writing, the public comment period was set to close June 10, 2010.
9. See “Is Sustainable Funding for Water and Wastewater Systems Finally Coming to Ontario?” Influents (Winter 2010).
10. Pages 13-14.
11. At http://www.ebr.gov.on.ca , Registry no. 010-9940.