Important Concepts in Environmental Law--"Polluter Pays".

AuthorSurtees, Jeff
PositionColumns

Your parents may have told you: "If you make a mess, you have to clean it up." In a nutshell, that is the basis of the "polluter pays" principle. There is a lot wrapped up inside the simple principle of polluter pays. The roots of the principle come from economics rather than from environmentalism.

The idea is that an organization that damages the environment should pay to fix the damage it causes. In some cases the polluting organization might also be required to pay money to people that it has harmed. Since all costs that a commercial organization pays eventually get passed on to its consumers, cleanup costs will raise the prices of the goods they are selling. If the laws of economics hold true, those higher prices will cause rational consumers to seek substitute goods and then the demand for the polluting goods will fall. In theory, the rational profit maximizing organizations that had been causing the harm will respond by finding ways to produce their goods that don't pollute. Their costs will come down, the price of their goods will fall and the organization will become more competitive. If they don't react in this way, they might find themselves out of business.

This idea of 'cost internalization' is part of international environmental law. It was recognized in Principle 16 of the 1992 United Nations Rio Declaration which said "National authorities should endeavour to promote the internalization of environmental costs and the use of economic instruments, taking into account the approach that the polluter should, in principle, bear the cost of pollution, with due regard to the public interest and without distorting international trade and investment." Member states need to pass 'enabling legislation' at home before the Declaration has any effect within their borders.

Canada has done that. Many Canadian laws that protect our air, water and land incorporate the polluter pays principle. As just one of many possible examples, section 2 of the Alberta Environmental Protection and Enhancement Act says that one of the purposes of the Act is to recognize "the responsibility of polluters to pay for the costs of their actions". It puts that purpose into action in sections 108 and 109 by stating that that no one is allowed to release substances into the environment at a rate greater than what they have permission to do or at a rate that causes "significant adverse effect". If they do, then section 112 says they have a duty to repair, remedy and...

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