As Ontario hikes water-taking fees, activists demand regs to keep bulk exports from U.S.

With Donald Trump calling for the renegotiation of NAFTA, the Council of Canadians says water is vulnerable to potential trade demands



After months of public outcry, the government of Ontario is vowing to bring in the highest permit fees on water bottlers the country has seen.

But it won’t be enough, say environmental activists, to deter Nestlé, the province’s biggest water taker, and friends from tapping us dry. And may open us up to lawsuits under NAFTA.

Foreign corporations can already technically sue for potential lost profits under trade deals like NAFTA. The Council of Canadians doesn’t see Nestlé heading to trade tribunals to seek compensation over the proposed fee hikes. The company has said it “fully supports” the proposed changes.

And given the backlash caused this past summer over the continuation of its water taking operations with expired permits near Guelph, “It would be a PR disaster for them,” says Council organizer Mark Calzavara. 

But with Donald Trump poised to sign an executive order calling for the renegotiation of NAFTA, and the U.S. facing a huge and growing water crisis, the Council’s Maude Barlow says water is vulnerable to potential export demands.

“There is legislation from 2012 that some feel gives us some protection but I am not convinced that the federal government has the authority to stop a province that might decide to commercially export its water in the future,” Barlow tells NOW. “If that were to happen, water exports would be subject to the same proportionality provisions that now apply to our energy. We would lose sovereign control of our water.”

University of Calgary environmental law prof, Martin Olszynski says NAFTA in its current form can’t be used to force a country to export water if it’s not currently exporting any, but adds, “The current status of freshwater at its source is very unclear [under NAFTA]. We have essentially a gentleman’s agreement at the time that NAFTA was signed that it was not intended to affect freshwater at the source. Once NAFTA is opened up, I suspect that there will be interest in clarifying this issue, from both sides pro and con.”

The Council wants to see the contentious Chapter 11 investor-state dispute mechanism that allows foreign corps to sue the Canadian government under NAFTA dropped. As well, Barlow is pushing the Trudeau government to demand that water be removed from any renegotiation of NAFTA in all its forms – as a good, a service and investment. 

The proposed water taking fees on bottlers in Ontario will go from $3.71 for every million litres to $503.71 per million litres, starting August 1. That’s roughly $865,000 annually for the 1.7 billion litres of water Nestlé is permitted to take from Ontario aquifers. The provincial government says the proposed fee hike “would further build upon Ontario’s recent actions to protect groundwater,” which includes a two-year moratorium on all new water taking permits for bottlers and stricter permit conditions. 

Raising fees beyond the proposed threshold is a complicated proposition since it risks turning water into a commodity, which has its own trade implications. Activists would rather the province ban the taking of water by bottlers altogether, which would likely prompt legal action by Nestlé and others, but they argue it’s a fight worth having. 

“We can’t afford such a frivolous and wasteful use of this limited resource,” says Calzavara. “The groundwater Nestlé takes from the aquifers near Guelph is exported out of the watershed and all over North America. It never returns to replenish the aquifer. With climate change and a growing population in the area, the community will need every drop of that water in the future.”

ecoholic@nowtoronto.com | @ecoholicnation

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