Emerging regulatory patchwork requires specialized guidance

Heightened public concern and international pressure make climate change one of the most significant sustainability issues facing Canada today. The federal government’s regulatory framework targets large greenhouse gas (GHG) emitters, and these pending regulations will create significant compliance and financial risks for these companies.

On March 10, 2008, the federal government published additional details on its Turning the Corner regulatory framework that outlines the government’s commitment to reduce Canada’s absolute GHG emissions by 20% from 2006 levels by 2020. The additional details specify how the targets will apply to each industry sector, how the offsets and trading systems will work and how credit will be provided to those companies that took early action to reduce their GHG emissions.

While waiting for the federal government’s regulations to emerge, several provinces have established their own approaches, from climate change regulations based on a “baseline and trade” system in Alberta to a carbon tax in Québec. Additionally, other provinces are entering into agreements with cross-border approaches to limit greenhouse gas emissions. When the federal regulations are finalized, they will be complicated by an equivalency clause that will allow some of the provincial systems to coexist with the new federal system. This patchwork approach promises to remain complicated enough to require specialized guidance.

How we can help

PwC’s Climate Change Services practice is monitoring developments at both the provincial and national levels and our wealth of industry-specific experience is invaluable when considering how these regulations will be applied.

We can help you manage the impact of these regulatory requirements by assessing your company’s risks and opportunities, and developing an effective short- and long-term plan for managing environmental regulatory compliance.

Our services include:

• Carbon management and climate change strategy advisory. We can assist your company in evaluating the benefits and risks associated with climate change strategic options.
• GHG data management system assessments. We can assist your company by evaluating your GHG data management systems, identifying areas of strength and areas of weakness, and providing recommendations for improvement in the controls.
• Internal reports to management. We can provide independent assurance on GHG data reported internally to senior management.
• Corporate reports to stakeholders. We can provide independent assurance on GHG reports prepared by your company and issued to external stakeholders.
• Base year determination/verification. We can assist your company in calculating or confirming your base year emissions in accordance with various recognized and emerging standards.
• Due diligence for GHG transactions. We can assist your company in evaluating GHG credit and offset opportunities, using tried and tested due diligence practices.
• Project validation and verification. We can assist your company in validating (pre-project) and verifying (post-project) GHG emission calculations for specific reduction projects.

Contact a professional in your area to learn more about what we can do for you.