Christopher J. Williams October 9, 2013 Wind Farms Municipalities and Environmental Regulation – Applicable Law? Christopher J. Williams October 9, 2013

Introduction Legislative reforms of municipal enabling legislation and decisions of the Supreme Court and Court of Appeal empower municipalities to regulate and prohibit regarding environmental and health protection 114957 Canada Ltée (Spraytech, Société d'arrosage) v. Hudson (Town), 2001 SCC 40, [2001] 2 SCR 241 (“Spraytech”) Croplife Canada v. Toronto (City) (2005), 75 O.R. (3d) 357 (“Croplife”)

Introduction Counter to this are recent legislative initiatives ostensibly designed to further environmental goals which directly restrict municipal authority and jurisdiction (i.e. the Green Energy Act) The Courts may also be retrenching from the empowering decisions and rhetoric found in cases such as Spraytech and Croplife

Traditional Municipal Role in the Regulation of Wind Farms Wind turbines would meet the definition of “building” in the Building Code Act, 1992 Would also be considered “development” or a “use of land” as contemplated by the Planning Act Would have to conform to Official Plans, zoning by-laws and related by-laws enacted under Part V of the Planning Act Receive site plan approval pursuant to section 41 of the Planning Act

Traditional Municipal Role in the Regulation of Wind Farms If required, obtain a minor variance under section 45 of the Planning Act Conform to whatever conditions are attached pursuant to the subdivision and consent authorities as set out in Part VI of the Planning Act Many of the above are applicable law as set out in the Building Code

The Statutory Framework Municipal Act, 2001 Can regulate, prohibit and provide for system of licensing and permitting for: economic, social and environmental well-being of the municipality health, safety and well-being of persons protection of persons and property, including consumer protection structures, including fences and signs (Part II, Municipal Act, 2001) prohibition of nuisances (s. 128)

The Statutory Framework Regulate noise and vibration (s. 129) Regulate or prohibit odour and dust (s. 129) Natural person powers (s. 9) Can regulate, prohibit and discriminate (s. 8) Powers to be interpreted broadly (s. 8)

The Statutory Framework BUT: Section 14(1) – municipal by-law not effective if it conflicts with an order, license or approval issued under Provincial or Federal Act as well as any Provincial or Federal Act or Regulation Conflict if the by-law frustrates the purpose City of Toronto Act, 2006 and other municipal enabling legislation have similar provisions

The Statutory Framework Green Energy Act (“GEA”) Wind farm as a “Renewable Energy Project” Planning Act exemptions (s. 1) Removes all zoning, site plan, subdivision control, etc. Section 5(1) allows the LG in C by regulation to designate renewable energy projects which are then not subject to any municipal regulations on their use or operation Regulation designates solar and geothermal but not wind

The Statutory Framework All wind farm approvals pursuant to a new section of the Environmental Protection Act (“EPA”) (Part V.0.1) Now all the wind farm needs is a Renewable Energy Approval (“REA”) issued under the EPA Concurrently the Building Code was amended to add REA’s issued under section 47.3 of the EPA as applicable law [1.4.1.3.(vi.1)]

The Statutory Framework Environmental Protection Act (“EPA”) Wind farm subject to one-stop approval in accordance with O. Reg. 359/09, O. Reg. 521/10 Municipality’s role is to comment on the approval and some limited right to appeal to the Environmental Review Tribunal Section 47.3(1): “A person shall not engage in a renewable energy project except under the authority of and in accordance with a renewable energy approval…”

Applicable Law and the Role of the Chief Building Official Where conflict appears between provisions of the EPA and its Regulations and any other Act or Regulation regarding natural environment, or something dealt with in the EPA or its Regulations, the EPA and its Regulations prevail If a REA has been issued by a Director pursuant to section 47.3 of the EPA then the only “applicable law” that the Chief Building Official needs to consider is section 47.3

Applicable Law and the Role of the Chief Building Official The situation may be different for conditional permits as their “applicable law” means any general special Act and all regulations and by-laws enacted thereto that prohibit the proposed use building Can a Chief Building Official go behind a permission or approval issued by a Director under section 47.3 of the EPA to see that in fact all prerequisites were complied with leading up to the approval?

Applicable Law and the Role of the Chief Building Official Is it then up to the Chief Building Official to ensure that REA conditions are properly fulfilled before issuing a building permit? What if ongoing REA conditions or terms of the REA, such as noise monitoring, were violated? Could the building permit be revoked? A Chief Building Official may find itself in the position of issuing a building permit which conforms to applicable law in the face of very express and clear municipal opposition, including by-laws which would not be included with “applicable law” prohibiting same

Regulation of Wind Farm/ Renewable Energy Projects Wainfleet Wind Energy Inc. v. Township of Wainfleet Background Matter we were in involved in on behalf of Wainfleet Wind Energy Inc. (“Wainfleet”) A very recent decision of the Superior Court of Justice and, in my mind, the last word on the municipal role in the regulation not only of energy projects

Regulation of Wind Farm/ Renewable Energy Projects Surprisingly, no appeal Following are almost verbatim from the Decision Introduction Wainfleet Wind Energy is in the process of developing a five turbine renewable power facility in Wainfleet, Ontario. It sought a declaration that a municipal by-law enacted by the Township under the Municipal Act, 2001 relating to wind turbine development should either be quashed or does not apply to its project

Regulation of Wind Farm/ Renewable Energy Projects The Township defended its by-law, and argued that if the by-law is unenforceable or ultra vires, certain provisions of Regulation 359/09 made under the EPA and certain provisions of the Planning Act are contrary to section 7 of the Canadian Charter of Rights and Freedoms and as a result are invalid

Regulation of Wind Farm/ Renewable Energy Projects Background Facts Wainfleet Wind Energy has completed an REA application to the Ontario Ministry of the Environment for approval of its wind farm project The Province’s regulations provide that industrial wind turbines (“IWTs”) must be constructed at least 550 metres from identified noise receptors and that applicants for approval must provide detailed information concerning noise to be generated by the project

Regulation of Wind Farm/ Renewable Energy Projects The Township passed a by-law pursuant to the Municipal Act, 2001 requiring IWTs to have a minimum two kilometre setback from “property” as defined in the by-law and imposed restrictions on noise levels

Regulation of Wind Farm/ Renewable Energy Projects Issues: The application raised the following issues: Is the by-law void for vagueness and uncertainty? Is the by-law in conflict with provincial law? Is the by-law outside the Township’s municipal authority? Is the by-law applicable to Wainfleet Wind Energy’s project? If the by-law is unenforceable or ultra vires because of inconsistency with provincial law or regulation, is the law or regulation in violation of section 7 of the Charter?

Regulation of Wind Farm/ Renewable Energy Projects Court Findings Is the by-law in conflict with provincial law? The Municipal Act, 2001 clearly contains provisions to allow control of nuisance and noise as well as health and safety matters. The Planning Act was specifically amended to prevent any zoning by-law from applying to renewable energy undertakings but no similar amendment was made to the Municipal Act, 2001

Regulation of Wind Farm/ Renewable Energy Projects Therefore, the Court was not satisfied that the fact that both the EPA (as amended by the GEA) and the by-law relate to IWTs and apply different standards means that the latter frustrates the purpose of the former, despite the fact that the preamble of the GEA refers to, among other purposes, the removal of barriers to renewable energy projects The Township apparently intended to submit the by-law to the MOE for its consideration as part of the approval process. Even if the by-law was valid, the Court failed to see how the Director could find it relevant to the approval process

Regulation of Wind Farm/ Renewable Energy Projects Is the By-law outside the Township’s Municipal Authority? The Court agreed with the position of the Township that the municipality has a continuing role to play in renewable energy projects as appears from s. 5 of the GEA and Regulation 15/10. Those provisions indicate that most municipal by-laws no longer apply to the extent that they would prevent or restrict a designated project with certain exceptions relating to health, safety, heritage and the environment. However, wind energy is not one of the designated renewable energy projects and as a result there is no legislated prohibition to the continued application of municipal by-laws

Regulation of Wind Farm/ Renewable Energy Projects Summary The by-law is invalid and without force and effect as a result of vagueness and uncertainty. This determination arises from the definition of “property” contained in the by-law and on the agreement of the parties that the indemnification provisions of the by-law were an invalid exercise of municipal power If the by-law was otherwise valid, and if the applicant is successful in securing approval (REA) for its wind power generating facility on terms that are in conflict with the by-law, the by-law would be without effect pursuant to subsection 14(1) of the Municipal Act, 2001

Regulation of Wind Farm/ Renewable Energy Projects If the by-law was otherwise valid, there would have been a conflict between the by-law and Provincial legislation if evidence established that the effect of the by-law was to prohibit IWT development anywhere within the Township. In that event, the by-law would be without effect pursuant to subsection 14(2) of the Municipal Act, 2001 The enactment of the by-law- was not outside the Township’s municipal authority

Regulation of Wind Farm/ Renewable Energy Projects As to the constitutional issue, it is not necessary to determine whether the Provincial enactments under the GEA and EPA deprive the residents of Wainfleet of various protections afforded under the Charter, since the Court has not relied on those legislative provisions in making the decision. It is well-established that constitutional issues should not be decided where it is not necessary to do so

Recent Developments Now municipalities’ agreement to a “renewable energy project” in their municipality for new projects is a factor in their permission for a FIT contract

Thank You Christopher J. Williams Partner T 1.416.865.7745 F 1.416.863.1515 E cwilliams@airdberlis.com