7 Aug 2014

Canadian regulators sleep while industry pollutes

That's toxic waste going into your river
As I predicted, a levee failed in British Columbia, releasing 5 million tons of contaminated water into local rivers and threatening downstream aquifers, people and ecosystems.*

How did I "predict" this? By looking at the weak penalties and enforcement by the BC government. Mine operators knew three years ago that the levees were weak, but they did not act to prevent a breach. Will they pay 100 percent of the damages? I doubt it.

What's to be done? Read this post from last September -- the solution is to impose an insurance requirement that will risk real money if a spill occurs.

Bottom Line: Spills will happen "too often" as long as low spill penalties do not impact profits.

* I started tracking this phenomenon five years ago when (you guessed it!) a TVA levee broke and released tons of toxic waste into local rivers...


RP said...

In general we underprice risk and socialize losses leading to a sub-optimal economic as well as environmental outcome. Probably the most blatant example is the Giant Mine near Yellowknife where the operator shut down and probably left the Canadian taxpayer with a billion dollar liability.

Fracking will likely turn out to be many times worse. The energy industry, the insurance industry and governments assure us there will be no damages. But eventually 100% of the well casings will leak methane into the groundwater and the atmosphere.

We simply don't know how to internalize environmental costs, and even if we did, market triumphalism (ignoring the moral limits of markets) will overrule common sense until the damages get so large that conventional wisdom about governance will change.

David Zetland said...

@RP -- We DO know how to internalize, but "we" lack the political mechanism or will to do so. I think the majority doesn't give a fuk about the environment or future. It's a problem that's always existed but now matters -- to the point of our despair...

Analogy: We take care of the planet like a renter with "free" energy and no desire to patch holes in the walls. We should care about it as if we're owners who pay for energy, but most people think that someone else has to bear the responsibility of ownership when we all do.

Wainstead said...

Now thousands of natural gas wells are being drilled across Ohio and Pennsylvania. I wonder of those wells will be "abandoned" just like many oil wells were in Texas.


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