CPCA Corner: Problem Formulation and Informed Substitution
Problem Formulation and Informed Substitution
CPCA is part of a larger industry group of associations/companies that supported and assisted in the development of a report on informed substitution and problems it presents as they relate to alternative assessments. The report is now finalized and was submitted to federal officials early in the year to help them better appreciate the challenges with problem formulations in the chemical industry before they consider including further mandatory requirements in the chemical assessment process. If informed substitution is made an integral part of the assessment process it could be problematic for a number of manufacturing industries. Compelling an industry to substitute alternative substances for certain product formulations, regardless of the costs or the impact on performance, will have a negative impact for a wide range of finished products now in commerce.
Amendments to CEPA Coming
While it is fully expected that amendments to the Canadian Environment Protection Act (CEPA 1999) will be considered by the current Government, it is not expected to be taken up by the federal Cabinet until sometime in the Fall of 2020 or in the first part of 2021. The latter is now more likely the timing under current circumstances. How- ever, there is an undefined legislative package expected for all stakeholders to view related to CEPA amendments and that will be available before year-end. An industry group focused on the potential CEPA amendments was formed in January and recently reconsidered the most recent Parliamentary Environment Committee recommendations for amending CEPA.
The industry group, of which CPCA is a member, will prepare formal responses and refine industry positions with respect to those amendments endorsed by the federal government in its June 2018 follow-up report to the Standing Committee on Environment and Sustainable Development. CPCA will continue to discuss specific industry positions developed in concert with its members in 2017 and determine if those positions are still valid or need updating. Once that is completed, advocacy efforts will focus on those recommendations as it relates to this government initiative. Part of that effort will include an all industry position to be submitted to the current government strongly recommending maintaining a risk-based approach for chemical assessment under the CMP. It will also include the need to address two major government priorities, namely, “informed substitution” for alternative assessment and “prioritization of chemicals in commerce.” CPCA will continue to solicit member views on both of these matters and refine current positions as needed.
NEW VOC Limits on Horizon for Architectural Coatings
As part of ongoing federal government actions to reduce VOC emissions in Canada, they are now proposing an amendment to the VOC Concentration Limits for Architectural Coatings Regulations later this year. CPCA provided all architectural paint manufacturer members a copy of a recent report on the current status of VOCs in architectural coatings in Canada and the association is now considering the implications of that report and how the industry should engage with officials going forward. The final report on the state of VOC emissions per the current limits in Canada will inform federal officials on the regulatory development of a revised proposal on VOC limits for 37 architectural paint categories and possibly more.
The national paint survey focused on a comparative analysis of the VOC limits in architectural coatings in Cana- da and various US jurisdictions such as the estimates of VOC emissions reduction expected from the adoption of both CARB and SCAQMD VOC limits; the adoption of the OTC Phase II limits; and the results of a preliminary “cost impact analysis” specifically related to a conversion to OTC II and CARB 2019. For CARB 2019 being adopt- ed, VOC limits would be more restrictive in 37 of the 66 categories of products having been surveyed compared to 25 categories for OTC II and 40 for SCAQMD. Additionally, there were 14 categories for which ECCC have not considered imposing any limits.
It is suggested in the report that government can achieve very significant VOC emissions reduction by align- ing with OTC, CARB or SCAQMD’s VOC content limits in the U.S. (i.e. in the order of 4.4 – 7.7 kilotonnes of VOCs per year or 38-65 per cent of current VOCs). It concluded that significantly higher VOC emissions reduction can be achieved from the adoption of CARB 2019, compared to the adoption of OTC Phase II as well as a lesser cost impact, hence largely weighing in favour of CARB 2019.
However, the overall cost-effectiveness is less attractive for establishing new VOC content limits for colourants. Moving forward there will need to be full consideration of the impacts of moving in any direction and the impacts that it would have on both SMEs and large companies operating in Cana- da and the varying climates across the country.
The ECCC performance assessment of the Canadian Architectural VOC regulations achieved in 2015 (based on 2014 data) estimated the total VOC emissions of architectural paint products on the Canadian market at 16 Kt. The current and more comprehensive 2018-2019 national survey data gathered in the survey suggests the total VOC emissions are in the order of 11.7 kilo- tonnes. Just over a period of five years, the Canadian architectural sector achieved VOC reductions in the order of 4.3 Kt or 27 per cent. Any consideration of new VOC limits should recognize this situation before jumping to the stricter and most punitive CARB 2019 limits for 36 categories of paint products. Why would Canada jump to CARB now, a model that was not adopted by any other US state, while the Canadian paint industry has already made significant reductions under current regulations? The self-imposed VOC emissions reduction performance achieved by the paint industry shows it continues to actively reduce VOC emissions from its products, independent of any heavy regulatory efforts. Paint manufacturers must also respond to a growing trend in the industry with consumer expectations for lower VOC products, which will not abate any time soon.
These and other factors will be a major part of CPCA’s advocacy effort as we enter into deliberations with federal officials on the way forward with new limits for an architectural coatings. To this end, CPCA has already provided substantial feedback to government officials on all the concerns gleaned in discussions with member companies on this new government initiative.
Ongoing Waste Woes in Ontario
CPCA continues to advocate for the return of more than $16 million improperly charged to paint stewards in Ontario, all of which are CPCA members when the paint recycling program was operated by Stewardship Ontario before the program was
taken over by Product Care in 2015. However, Stewardship Ontario, supported by the Resource Recovery Authority, has consistently refused to return the money paid by paint manufacturers, which has been held in trust for several years. That trust however has been broken as Stewardship Ontario has said it plans to keep approximately $10 million to wind up the MHSW program. This is being done despite the fact that they only operate two material categories with
80 per cent of the materials having moved to other program operators for a number of years; more than five years in the case of paint and coatings. No reasonable explanation has been provided by Stewardship Ontario or the authority as to what the funds will be used for and why it is so high. The fiduciary responsibility to the industry stewards has been ignored and the responsibility is rather to an organization that is but a shell, with no staff for the past several years and requiring recently hired consultants and an Executive Director to wind up Stewardship Ontario. The other Industry Steward Organizations (ISO) are run by their own program operators under annual plans approved and monitored by the Oversight Authority.
To make matters worse, this means less of the funds arbitrarily taken from stewards will not be used for the purposes the money was originally intended, waste recovery and recycling. Further, the Minister directed Stewardship Ontario to ensure those funds – in the order of $53 million in total – would, in fact, be used for fee reductions for the benefit of consumers. As usual, the waste file in Ontario remains a problem for all concerned, especially industry, which has committed to recycling and the paint industry has met and exceeded targets for paint recycling in Ontario since the inception of the program. Other jurisdictions across Canada do not have heavy-handed authorities demanding funds for more staff and more office space, with very little prospect of getting better outcomes for waste reduction as is the case in Ontario. It is an ongoing saga of mountains of red tape and growing costs for industry in the province on the waste file.
Code of Practice MEKO
The federal government’s recent report on the evaluation of the MEKO Code of Practice concluded that industry failed to meet the requirements under the Code. As a result, it is expected that additional use restrictions related to the anti-skinning agent will soon follow, which may include mandatory regulations as the risk management approach. Overall, the MEKO survey results showed low participation rates, which revealed to the government that the Code was not widely adopted. Based on the limited responses, overall 80-90 per cent of MEKO concentrations were largely unchanged compared to five years ago, while the consumer education program part of the Code was poorly implemented and hard to find. Many companies did not have information on their websites on the Code. The Performance Measurement Report for the Code will be made public in the First Quarter of 2020. There are ongoing discussions as to whether Health Canada will opt for a specific MEKO regulation or some other measure to be determined in the coming weeks.
Increased Supply Chain Transparency for Chemicals
CPCA participated in recent interviews and a workshop on the federal government’s efforts to obtain more transparency of chemicals in the supply chain. This initiative has been driven largely by ENGOs who feel that the existing mechanisms in place to ensure full transparency in the supply chain are not enough in terms of protection for human health and the environment. They want to ensure there is more transparency not only for consumer product labels but within the entire supply chain from raw material supply, to distribution along the chain, to the manufacturers, down to the consumer. While the objective has not been clearly defined, nor the approaches they envision in terms of what is needed in addition to existing hazard communications platforms, they want to explore other issues like digitalization, circular economy challenges, competitiveness, etc., that might enhance the transparency for the benefit of all.