JOC ARCHIVES

October 2, 2010

CEMENT ASSOCIATION OF CANADA

Canadian cement producers may be at a disadvantage due to a patchwork of climate change regulations.

FEATURE | Concrete & masonry

Cement Association of Canada pushes for harmonized climate change legislation

The patchwork of climate change regulatory initiatives in each of the five provinces, where cement is produced, is the most significant threat to the competitiveness of the nation’s cement industry, says the Cement Association of Canada (CAC).

Michael McSweeney, president and CEO of Ottawa-based CAC, said the legislative and regulatory regimes in the five jurisdictions – British Columbia, Alberta, Ontario, Quebec and Nova Scotia – need to be harmonized if Canada’s cement industry is to be competitive and attract and retain investment.

He said provincial legislation and regulations in the jurisdictions are critical because of their impact on cement manufacturers’ costs of production.

“Cement is an energy-intensive and trade-exposed sector in Canada,” McSweeney said.

“It takes a lot of energy to turn limestone into cement.”

The CAC fears the Canadian cement industry will have to meet multiple carbon pricing systems across the country.

“Our hope is that governments will get together and harmonize their programs so there’s only one, because multiple systems make us uncompetitive,” he said.

The climate change programs in the five provinces in question all have different rules and targets.

For example, B.C.’s carbon tax on combustion emissions is currently $20/tonne of CO2, the equivalent of about $40/tonne of coal, which is used to make cement.

The CAC expects that the tax will have cost the B.C. cement industry $67 million by 2012.

Next door in Alberta, the province’s Climate Change and Emissions Management Amendment Act provides for a $15/tonne CO2 payment to a technology fund for excess emissions over the established target. Quebec’s carbon levy on fossil fuel inputs is about $8/tonne of coal consumed.

The targets of the provinces’ programs are different, too.

In BC, the goal of the tax is a six per cent economy-wide reduction in green house gas (GHG) emissions below 2007 levels by 2012; 18 percent reduction by 2016; and 33 percent reduction by 2020.

The goal of Ontario’s Action Plan on Climate Change is a four per cent economy-wide reduction in GHG emissions below 1990 levels by 2014 and a 15 per cent reduction by 2020.

Quebec is seeking a 20 per cent reduction below 1990 levels and Nova Scotia’s Energy Strategy and Climate Change Action Plan is aiming for a 10 per cent economy-wide reduction in GHG emissions below 1990 levels by 2020.

In addition, B.C., Ontario and Quebec, which together count 85 percent of cement manufacturers in Canada, are members of the Western Climate Initiative (WCI), a group of states and provinces that was formed to combat climate change caused by global warming.

The WCI plans to lay the foundation for an international cap and trade program in the U.S. and Canada.

The first phase of the plan is slated to be implemented in 2012, followed three years later by a broader cap on carbon emissions.

McSweeney said B.C.’s membership in the WCI is problematic for that province’s cement manufacturers.

“Washington State has decided not to implement a cap and trade program in 2012,” he said.

“It allows their exports to undercut B.C. cement manufacturers in British Columbia.”

In recent years, imports of cement from Washington have increased to 16 per cent of total cement sales in B.C., partly as a result of the effect of B.C.’s carbon tax.

McSweeney said the CAC has been busy lobbying governments in B.C., Alberta, Ontario and Quebec.

“We meet regularly with many government people, including such elected officials as premiers, cabinet ministers and MLAs,” he said. “We want to be part of a climate change solution, but at the same time we don’t want to make ourselves uncompetitive.”

As an illustration of the Canadian cement industry’s desire to be green, McSweeney cited the example of Portland-limestone cement (PLC).

While PLC has been used in Europe for more than 25 years, its use in the cement making process is new to Canada. Portland-limestone cement reduces greenhouse gas emission caused by traditional methods of cement manufacturing by about 10 per cent per tonne, while producing concrete that is similar in strength and durability to the concrete that is produced using existing general use hydraulic cements.

The industry will move to have PLC recognized in the LEED building rating system for reducing the clinker content of the cement in concrete and, in so doing, qualify for LEED credits.

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