Canada Gazette

Whereas, pursuant to subsection 48(1) of the Canadian Environmental Protection Act (see footnote a), the Minister of the Environment published in the Canada Gazette, Part I, on June 5, 1999, a copy of the proposed Gasoline and Gasoline Blend Dispensing Flow Rate Regulations, substantially in the annexed form, and persons were given an opportunity to file comments with respect to the Regulations or to file a notice of objection requesting that a board of review be established and stating the reasons for the objection;

Whereas, pursuant to subsection 34(1) (see footnote b) of the Canadian Environmental Protection Act (see footnote c), the federal-provincial advisory committee has been given an opportunity to provide its advice under section 6 of that Act;

And whereas, in the opinion of the Governor in Council, pursuant to subsection 34(3) of the Canadian Environmental Protection Act (see footnote d), the proposed Regulations do not regulate an aspect of a substance that is regulated by or under any other Act of Parliament;

Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of the Environment and the Minister of Health, pursuant to subsection 34(1) of the Canadian Environmental Protection Act (see footnote e), hereby makes the annexed Gasoline and Gasoline Blend Dispensing Flow Rate Regulations.

(b) a petroleum distillate, or a mixture of petroleum distillates, oxygenates or additives, that is suitable for use in a spark ignition engine and that has the following characteristics, as determined by the applicable test method listed in the National Standard of Canada standard CAN/CGSB-3.5-94, Unleaded Automotive Gasoline, as amended from time to time:

(i) a vapour pressure of at least 38 kPa,

(ii) an antiknock index of at least 80,

(iii) a distillation temperature, at which 10% of the fuel has evaporated, of not less than 35°C and not greater than 70°C, and

(iv) a distillation temperature, at which 50% of the fuel has evaporated, of not less than 65°C and not greater than 120°C. (essence)

"gasoline blend" means any mixture of gasoline and oxygenate that is suitable for use in a spark ignition engine. (mélange d'essence)

(a) a maximum design loaded weight rating specified by a manufacturer of more than 3856 kg;

(c) an area enclosed by the geometric projection of the basic vehicle, which includes tires but does not include mirrors or air deflectors, along the longitudinal axis of the vehicle onto a plane perpendicular to that axis, of more than 4.2 m². (véhicule lourd)

"on-road vehicle" means any self-propelled vehicle that is designed to be driven on roads. (véhicule routier)

"oxygenate" means an oxygen-containing, ashless, organic compound that, when added to gasoline, increases the oxygen content in the gasoline. (produit oxygéné)

"retailer" means any person who owns or operates any establishment at which gasoline or a gasoline blend is sold or offered for sale for use in an on-road vehicle. (détaillant)

"wholesale purchaser-consumer" means any person that is not a retailer and that stores gasoline or a gasoline blend in a storage tank of at least 2100 L for use in an on-road vehicle. (grossiste acheteur-consommateur)

2. These Regulations apply to the flow rate from any nozzle that is used to dispense gasoline, or a gasoline blend, that contains benzene, but do not apply to the flow rate from any nozzle that is used exclusively to dispense gasoline or a gasoline blend into heavy-duty vehicles.

3. No retailer or wholesale purchaser-consumer shall use or offer for use a nozzle to dispense gasoline or a gasoline blend into an on-road vehicle if the flow rate from the nozzle exceeds 38 L/min.

4. (1) A person shall determine the flow rate referred to in section 3 by measuring the amount of time it takes to dispense 10.0 L of gasoline or a gasoline blend from the nozzle with the nozzle operated at the maximum flow rate.

(a) use a digital stopwatch that reads to at least 0.01 seconds to measure the dispensing time;

(b) use the dispenser's volume meter to measure the dispensed volume of gasoline or gasoline blend; and

(c) start the stopwatch when the dispenser's volume meter indicates that 2.0 L of gasoline or gasoline blend have been dispensed.

(3) The person shall use the following formula to calculate the dispensing flow rate of gasoline or a gasoline blend from the nozzle, in litres per minute:

T_i is the reading of the stopwatch, in seconds, when the person starts the stopwatch;

T_f is the reading of the stopwatch, in seconds, when the person stops the stopwatch;

V_i is the reading of the dispenser's volume meter, in litres, when the person starts the stopwatch; and

V_f is the reading of the dispenser's volume meter, in litres, when the person stops the stopwatch.

5. These Regulations come into force 12 months after the day on which they are registered.

The Gasoline and Gasoline Blend Dispensing Flow Rate Regulations (hereinafter referred to as the Regulations) will protect the health of Canadians by reducing emissions of benzene and other volatile organic compounds (VOCs) into the environment during the refuelling of on-road vehicles. This will be achieved by ensuring that in-use fuel dispensing flow rates do not exceed the design capacity of the filler pipes on the existing fleet of vehicles and of new on-board refuelling vapor recovery (ORVR) systems being introduced on Canadian vehicles. ORVR systems are designed to reduce refuelling vapour emissions of benzene and other VOCs by 95% and to perform effectively with fuel dispensing flow rates up to 38 litres per minute (L/min).

The Regulations will prohibit retailers and wholesale purchaser-consumers of benzene-containing gasoline and gasoline blends from using or offering for use any nozzle to dispense those fuels into on-road vehicles if the flow rate from the nozzle exceeds 38 L/min, effective 12 months after registration of the Regulations. Wholesale purchaser-consumers are primarily vehicle fleet operators with central refuelling facilities. The Regulations are based on a performance standard and allow the flow rate to be controlled by any means in the pump/dispenser system, provided that the flow rate from the nozzle does not exceed 38 L/min. This approach gives affected parties the flexibility of limiting fuel dispensing flow rates in the manner that is best-suited for their facilities. Fuel dispensers that are dedicated exclusively to refuelling heavy-duty vehicles or diesel-fuelled vehicles are not covered by the Regulations, because fuel dispensing flow rates are not expected to materially affect the refuelling emissions of those types of vehicles.

The Regulations are made pursuant to section 34 of the Canadian Environmental Protection Act (CEPA). This section provides the legislative authority to make regulations respecting the manner in which and conditions under which a product containing a substance which is specified on the List of Toxic Substances may be handled. Benzene was listed on the Priority Substances List (PSL), a list of substances requiring investigation and assessment under CEPA on a priority basis. Following its assessment as a PSL substance, benzene was declared toxic within the meaning of section 11 of CEPA. In 1997, benzene was added to the List of Toxic Substances in Schedule I of the Act and the Benzene in Gasoline Regulations were promulgated. Those Regulations restrict the level of benzene in gasoline that is supplied to a maximum of 1.0% by volume, or to an annual pool average of 0.95% with a never-to-be-exceeded cap of 1.5% commencing on July 1, 1999.

Benzene is effectively present in all gasoline and the various gasoline blends. The Regulations will reduce benzene emissions in accordance with the Government's policy on the management of toxic substances. In addition, the Regulations are consistent with the principle of supporting vehicle emission control technology with compatible fuel requirements, a fundamental approach recognized by the Canadian Council of Ministers of the Environment (CCME) Task Force on Cleaner Vehicles and Fuels.

Due to the composition of gasoline and gasoline blends and the nature of vehicle refuelling process, the Regulations will also reduce emissions of other volatile organic compounds (VOCs) that are precursors in the formation of ground-level ozone, a main ingredient of smog. Smog is primarily a summertime problem in urban areas that can have adverse effects on human health and can damage vegetation.

Gasoline and gasoline blends such as E10 (90% gasoline, 10% ethanol) and M85 (15% gasoline, 85% methanol) are fuels that consist of different mixtures of hydrocarbons. As stated earlier, these fuels effectively all contain benzene. During the vehicle refuelling process, benzene is released to the atmosphere along with other hydrocarbons through the spillage of liquid fuel from the filler pipe and from the venting of fuel vapours displaced by the rising level of liquid fuel in the fuel tank.

Liquid fuel emissions, commonly known as "fuel spitback", occur when the design of a vehicle's filler pipe is unable to accommodate the fuel dispensing flow rate. If the fuel is dispensed at a rate greater than the fuel vapours can be displaced from the fuel tank, the increased back-pressure in the system causes fuel to move up the filler pipe. This situation results in the premature shut-off of the fuel dispensing nozzle and leads to an increase in the likelihood of spitback emissions. In 1993, the U.S. Environmental Protection Agency (EPA) reported that based on its testing of a representative sample of vehicles, most vehicles exhibit spitback emissions at fuel dispensing rates greater than 38 litres per minute (L/min).

Emissions of benzene and other VOCs that occur during the refuelling of on-road vehicles have been recognized as contributors to Canada's air pollution problems for some time. In 1990, the CCME Management Plan for NOx/VOCs recommended that Environment Canada lead in the development of a CCME Code of Practice for the control of emissions from the refuelling of motor vehicles through controls at service station fuel pumps known as "Stage II" vapour recovery. While many of the initiatives recommended under the plan focused on the broader control of VOCs, it was recognized that measures such as controlling refuelling emissions would also reduce emissions of potentially toxic substances such as benzene. At that time, the assessment of benzene to determine whether or not it is toxic within the meaning of CEPA had not been completed.

The CCME Plan recognized that the U.S. EPA was considering the adoption of national regulations to control vehicle refuelling emissions through vehicle-based technology known as on-board refuelling vapour recovery (ORVR), an alternative to Stage II control systems at service station fuel pumps. Accordingly, the CCME Plan suggested that the implementation of Stage II systems in Canada be reassessed with regards to developments in the United States. While a CCME Code of Practice for Stage II vapour recovery was published in 1995, controls have not been implemented in Canada as a result of the developments described below.

The U.S. EPA subsequently adopted regulations to control vehicle refuelling emissions (i.e. liquid spitback and vapours) through the vehicle-based technology. The Agency indicated that these actions would result in significant reductions in VOC emissions, including substantial reductions in benzene emissions. As an inherent part of these measures, the EPA also adopted a national regulation (effective January 1, 1998) to limit the dispensing flow rates of gasoline and methanol to 38 litres per minute to ensure that vehicle refuelling emission control systems would be effective under in-use conditions and that the desired environmental benefits of new vehicle technology would be achieved.

In 1994, in its Discussion Paper-Costs and Benefits of Stage II Vapour Recovery (CPPI Report No. 94-2), the Canadian Petroleum Products Institute (CPPI) recognized that vapours emitted when refuelling motor vehicles contribute to air quality problems and that those emissions should be controlled. However, CPPI recommended that Canadian policy-makers consider vehicle-based systems as the most effective and economically-efficient method of reducing vehicle refuelling emissions as opposed to Stage II systems installed at service station fuel pumps. Pursuant to a recommendation of the CCME Task Force on Cleaner Vehicles and Fuels (1995), Canada has harmonized its national vehicle emission standards with those of the U.S. EPA effective with the 1998 model year. The new standards include requirements that an increasing percentage of new light-duty vehicles and light-duty trucks be equipped with systems to reduce emissions that occur during the refuelling process.

As a result of the harmonized regulatory approach and the highly integrated nature of the North American automotive market, ORVR systems being introduced on new Canadian vehicles are the same as those in the United States and are designed to handle vapour rates and fuel tank pressures associated with a maximum fuel dispensing flow rate of 38 litres per minute. Fuel dispensing flow rates of gasoline and gasoline blends greater than 38 L/min could overload the design capacity of ORVR systems, causing excess vapor emissions of benzene and other VOCs. Further, flow rates greater than 38 L/min could also cause fuel to "spitback" on the vehicle, the ground, or on the persons performing the fuelling due to design changes to fuel tanks and filler pipes.

In August 1997, the dispensing flow rate of gasoline was measured at 150 retail stations in Ontario by officials from Measurement Canada. The tested fuel dispensers included a wide range of refuelling nozzle and pump combinations that are representative of those found in the Canadian marketplace. The survey indicated that 38% of the gasoline dispensers were operated at flow rates that exceed 38 L/min and that flow rates reached as high as 52 L/min. This proportion of fuel dispensers exceeding 38 L/min accompanied with a rising number of vehicles equipped with ORVR systems would increase the likelihood of refuelling emissions in Canada.

The situation described above is different for diesel-fuelled vehicles and heavy-duty vehicles. The low volatility of diesel fuel contributes to a very low concentration of vapours in the fuel tank of diesel-fuelled vehicles compared to gasoline-fuelled vehicles, which reduces the possibility of "spitback" emissions during refuelling. Further, while subject to refuelling emission standards, diesel-fuelled vehicles are expected to comply with the ORVR standards without the use of a control system due to the low volatility of diesel fuel. In the case of heavy-duty vehicles, the typical use of very short filler necks allows fuel to be dispensed directly into the fuel tank, thereby minimizing "spitback" emissions. Also, heavy-duty vehicles are not equipped with ORVR systems because refuelling emission standards have not been adopted for these vehicles. Since fuel dispensing flow rates are not expected to materially affect the refuelling emissions of these types of vehicles, fuel dispensers that are dedicated exclusively to refuelling heavy-duty vehicles or diesel-fuelled vehicles are not covered by the Regulations.

Consideration has been given to the following alternatives: the status quo (i.e. no intervention); controlling fuel dispensing flow rates through voluntary mechanisms; controlling fuel dispensing flow rates through provincial regulations; and controlling fuel dispensing flow rates through a national federal regulation.

As indicated previously, a survey conducted by Measurement Canada suggests that approximately 38% of Canadian service stations dispense gasoline at rates which exceed 38 L/min, with rates as high as 52 L/min. It is expected that this situation increases the likelihood of spitback and refuelling emissions of benzene and other VOCs from these facilities, particularly from vehicles equipped with ORVR systems which began accounting for an increasing fraction of the in-use vehicle fleet in 1998. This being the case, the status quo option was judged to be inappropriate.

There were approximately 16,500 retail outlets dispensing fuel in Canada in 1995, with 45% of those facilities owned and operated by independent dealers (MJ Ervin & Associates, "Canadian Retail Petroleum Markets Study", September, 1997). While government policies can be effectively implemented using voluntary mechanisms in some cases, the high number of parties involved in the affected sector would make it very difficult to implement and enforce a viable voluntary program for the control of fuel dispensing flow rates.

During 1997 and 1998, the option of implementing provincial regulations to limit fuel dispensing flow rates was discussed with representatives of provincial environment ministries. The general consensus from these discussions was that a federal regulation is the most effective approach for addressing the issue of fuel dispensing flow rates since the issue is closely linked to the compatibility of emission control technology required to comply with national vehicle emission standards.

In 1995, the Canadian demand for gasoline was about 35 billion litres and it is estimated that approximately 44,000 tonnes of VOCs were emitted as gasoline vapours during the refuelling of on-road vehicles, including about 440 tonnes of benzene. As indicated earlier, Canada's motor vehicle emission regulations require that ORVR systems be phased-in on new light-duty vehicle and light-duty trucks beginning with the 1998 model year. ORVR systems are designed to route the vapours contained in a vehicle's fuel tank to the engine for combustion rather than venting the vapours to the atmosphere, with an emission reduction efficiency of about 95%.

Based on projections for future gasoline demand in Canada (Natural Resources Canada, "Canada's Energy Outlook, 1996-2020", April, 1997), it is estimated that ORVR systems will reduce vehicle refuelling vapour emissions by about 51,000 tonnes of VOCs per year, including about 310 tonnes of benzene, when the in-use fleet of light-duty vehicles and light-duty trucks is fully equipped with these systems (i.e. 2018-2020 time frame). While it is difficult to quantify the direct contribution of fuel dispensing flow rate controls to these reductions, the Regulations are inherent part of providing the proper operation of ORVR systems and will thereby ensure that the designed refuelling emission reductions of benzene and other VOCs will be achieved under in-use conditions.

The quantifiable benefits of the Regulations are primarily associated with reducing the amount of fuel spilled as a result of spitback during the vehicle refuelling process. Based on a methodology used by the U.S. EPA and the projections for future Canadian gasoline demand, it is estimated that the Regulations will eliminate the spillage of gasoline and gasoline blends by an average of nearly 2 million litres per year in the 2001-2020 period. This reduction in fuel spillage represents an annual decrease of about 1,500 tonnes of VOCs, including about 15 tonnes of benzene.

Because a fuel dispensing limit of 38 L/min is expected to result in the avoidance of fuel spillage, the Regulations will result in fuels savings for Canadian consumers and will also reduce the safety hazard associated with fires caused by spilled gasoline. Assuming an average gasoline price of 55 cents per litre, it is estimated that the fuel savings to Canadian consumers associated with reduced fuel spillage will be approximately $1 million per year.

The Regulations will ensure that ORVR systems will reduce refuelling emissions in a manner that is transparent to the consumer and will provide consistent and controlled refuelling. Canadian consumers will benefit by avoiding the inconvenience resulting from fuel spilling on clothing and the premature shut-off of the fuel dispensing nozzle during vehicle refuelling. Consequently, fuel dispenser operators and vehicle manufacturers will benefit from a reduced number of complaints from customers experiencing refuelling problems.

The Priority Substances List Assessment Report for benzene (1993) indicates that benzene has been demonstrated to cause cancer in animals and humans and that it is a substance for which there is believed to be some chance of adverse effects at any level of exposure. Furthermore, the report indicates that refuelling emissions were responsible for about 6% of the daily intake of benzene by adult Canadians (i.e. those non-smokers or not living in homes of smokers). As indicated above, the Regulations will reduce the exposure of Canadians to benzene emissions during vehicle refuelling and will thereby lessen the adverse health impacts associated with this common activity.

In addition to the health benefits associated with the benzene emission reductions, the Regulations will also result in other benefits for Canadians. The Regulations will have a beneficial impact on air quality by reducing emissions of volatile organic compounds (VOCs) released during vehicle refuelling. Such releases are one of the precursors in the formation of ground-level ozone, a main ingredient of smog. Smog can have adverse effects on human health and can damage vegetation and is primarily a summertime problem in urban areas.

Finally, the Regulations combined with the application of ORVR systems to on-road vehicles will effectively eliminate the need for installing Stage II vapour recovery systems at Canadian service stations. In a letter to Environment Canada (Sept. 1998), the CPPI reported that the capital costs associated with retrofitting service stations with Stage II refuelling vapour controls can run up to $100,000 per service station. Consequently, controlling refuelling emissions through the combination of ORVR systems and the limitation of fuel dispensing flow rates to the prescribed level will result in considerable cost savings for service station operators in the long term.

The testing conducted by Measurement Canada suggests that approximately 62% of Canadian refuelling nozzles are already dispensing fuel at rates that do not exceed 38 L/min. Consequently, the Regulations should not result in any added costs for a considerable number of fuel dispensing facilities in Canada.

In the case of the facilities currently operating fuel dispensing units at flow rates above 38 L/min, compliance with the Regulations can be achieved without any technological challenge. Hardware is available in the Canadian marketplace that is designed specifically to comply with a 38 L/min flow rate requirement. This includes fuel dispensing nozzles which incorporate a flow-limiting device as well as separate flow-limiting devices to retrofit existing fuel dispenser systems. Different versions of flow-limiting devices are marketed by Canadian distributors of fuelling components, with list prices ranging from approximately $30 to $33 per unit. A Canadian distributor of flow-limiters has estimated that the installed cost of their device will be about $35 per unit while a Canadian petroleum company has estimated that, based on experience in the United States, the cost of installing flow-limiters to fuel dispensing nozzles could range between $50-$75 per unit. Environment Canada believes that an installed cost of $50 per flow limiter is a reasonable estimate of the compliance costs of the Regulations.

Based on the approximately 16,500 fuel dispensing retail outlets in Canada and assuming there is an average of 10 refuelling nozzles to dispense gasoline or gasoline blends per facility, about 165,000 fuel dispensing nozzles in the Canadian retail market will be subject to the Regulations. While the Measurement Canada survey suggests that 38% of fuel dispensing nozzles are currently operated at flow rates higher than 38 L/min, in order to provide a conservative estimate of the cost of compliance it is assumed that 50% of fuel-dispensing nozzles in Canada will have to be retrofitted with a flow-limiting device. On this basis, it is estimated that the resulting average cost of compliance per service station is $250 and total cost of compliance to the retail fuel dispensing industry is approximately $4 million.

Notwithstanding the above, many fuel dispensing nozzles will require replacement during the 12-month lead time period provided to comply with the Regulations as part of their natural turnover. These nozzles could be replaced with nozzles which incorporate appropriate flow-limiting devices at little or no additional cost compared to purchasing a new conventional nozzle. Therefore, the overall cost of compliance with the Regulations is expected to be lower than the estimate provided above.

Fuel dispensing facilities that are operated by wholesale purchaser-consumers of gasoline or gasoline blends will also have to comply with the Regulations. These sites consist primarily of central refuelling facilities run by vehicle fleet operators (i.e. couriers, taxis, rental cars, etc.). While there is little information on the number of these facilities that will be affected by the Regulations, it is expected that their contribution to the total cost will be minor because: (1) the number of central refuelling facilities is expected to be considerably lower than the retail sector; (2) the average number of fuel dispensing nozzles at central refuelling facilities is expected to be lower than at retail outlets; and (3) many central refuelling facilities are dedicated to dispensing diesel fuel and/or heavy-duty vehicles and would therefore not be affected by the Regulations. Consequently, it is expected that the total cost of the Regulations will be dominated by that borne by retail marketers of gasoline and gasoline blends.

The Regulations could result in some consumers spending slightly more time refuelling their vehicles. As a worst-case scenario, a person who currently completely refuels a vehicle with a fuel tank capacity of 50 litres at a flow rate of 52 L/min (i.e. the highest found in the Measurement Canada tests) could spend up to 21 seconds more to perform a complete fill. However, this is mitigated by several factors that are expected to occur with the implementation of spitback and fuel dispensing flow rate controls which will tend to reduce refuelling times. First, the Measurement Canada survey indicates that some current fuel dispensing rates are considerably lower than 38 L/min which suggests that some retailers may be keeping flow rates unnecessarily low to avoid customer complaints of spitback and to ensure repeat customers. The combination of spitback controls and fuel dispensing limits will eliminate the uncertainty for facility operators and will encourage them to increase fuel dispensing rates to the full 38 L/min. Finally, as vehicle equipped with ORVR systems are likely to be more prone to premature pump shutoffs at dispensing rates exceeding 38 L/min, their owners would likely not realize the time savings that would normally be associated with high flow rates. Overall, the impact of the Regulations on fuel dispensing times is expected to be marginal.

It is estimated that carrying out inspection and compliance verification activities to enforce the Regulations will cost the government up to 5 person-years and $350,000 in operating and maintenance costs. However, the costs attributed to enforcing the Regulations will likely be reduced by integrating the enforcement activities with those of other regulations related to gasoline specifications (i.e. benzene and sulphur). Also, the costs of enforcing the Regulations are expected to decrease in future years as compliance rates increase.

In the Regulatory Impact Analysis Statement (RIAS) that accompanied the Regulations introducing Canada's new vehicle emission standards (SOR/97-376 28 July, 1997), Transport Canada raised the need to limit Canadian fuel dispensing flow rates. Subsequently, in 1997 and 1998, Environment Canada consulted with representatives of other federal departments and provincial environment ministries through a follow-up group of the CCME's Task Force on Cleaner Vehicles and Fuels. As indicated previously, discussions of that group indicated a general consensus that a federal regulation is the most effective approach for addressing the issue of fuel dispensing flow rates, due to the close link to the compatibility of emission control technology required to comply with national vehicle emission standards.

Based on the above, Environment Canada prepared a discussion document titled "A Preliminary Assessment - The Potential Impacts of Limiting Canadian Fuel Dispensing Rates to 38 Litres per Minute" (July, 1998). The document examined the relationship between refuelling emissions and fuel dispensing flow rates and the potential impacts of controlling in-use fuel dispensing rates to 38 litres per minute. On August 7, 1998, the document was sent for comment to a broad cross-section of stakeholders, including representatives from federal and provincial governments, the fuel production and distribution industries, distributors of fuel dispensing hardware, the vehicle manufacturing industry, environmental and public health groups and consumer groups.

In response, Environment Canada obtained input from the following parties: Association des Distributeurs Indépendants de Produits Pétroliers, Association of International Automobile Manufacturers of Canada, B.C. Ministry of Environment Land and Parks, Canadian Petroleum Products Institute, Canadian Vehicle Manufacturers Association, Federated Co-operatives Limited, Irving Oil Limited, Measurement Canada, Ministère de l'Environnement et de la Faune du Québec, Montreal Urban Community, Ontario Fuel Dealers Association, Shell Canada Limited, Ontario Technical Standards & Safety Authority.

The submissions received from stakeholders indicated that there was a general acceptance on the need to limit Canadian fuel dispensing flow rates of gasoline and gasoline blends to 38 litres per minute. Stakeholders offered a range of views on a number of regulatory issues. The following paragraphs provide a brief summary of the major issues raised by stakeholders during the preliminary consultation and the Department's analysis of the comments which guided the development of the Regulations.

The Department received comments suggesting that commercial cardlock and keylock facilities should be exempt from regulations due to the variety of commercial vehicle types and large skid tanks filled at these facilities. It was also suggested wholesale purchaser-consumers of fuels should be excluded on the basis of their small contribution to the desired benefits. Finally, one commenter suggested that given the relatively low cost of flow-limiting devices, their installation should be required on all fuel dispensing nozzles, including those used to refuel heavy-duty vehicles.

The Department believed that requiring fuel dispensers that are dedicated exclusively to refuelling heavy-duty vehicles would result in unwarranted costs, due to the small impact of flow rates on the refuelling emissions of these vehicles. The available data for 1996 suggested that cardlock/keylock and non-retail facilities account for up to 7% of Canadian gasoline disposition. The types of vehicles that are fuelled at these facilities vary considerably but can include vehicles whose refuelling emissions are adversely affected by high dispensing flow rates. On this basis, the Department did not feel it was appropriate to provide a general exemption for all cardlock/keylock locations or for facilities operated by wholesale purchaser-consumers of fuel (i.e. other than those dedicated exclusively to heavy-duty vehicles).

The Department received comments suggesting that a lead-time of 18 to 36 months should be given to allow affected parties the opportunity to make the necessary modifications to fuel dispensers during routine scheduled maintenance in order to lower compliance costs. It was also suggested that the time necessary for manufacturers of flow-limiting devices to obtain the approval of the Underwriters Laboratory of Canada (ULC) needed to be considered in the process.

Environment Canada confirmed that a major Canadian distributor of refuelling hardware had already obtained ULC approval for two models of flow limiters that are designed specifically to limit fuel dispensing rates to 38 L/min. In determining an appropriate lead-time, the Department had to balance the cost-reducing nature of a longer lead-time with the fact that ORVR-equipped vehicles were already being sold in Canada which require the flow rate controls to operate efficiently. Given the relatively low costs of compliance and recognizing that a considerable portion of fuel dispensing facilities was already in compliance with the proposed limit, the Department believed that a lead-time of 12 months represented a reasonable balance of those considerations.

Several commenters indicated that Measurement Canada inspectors already audit fuel dispensing facilities to verify the accuracy of volume meters and suggested that enforcement of a fuel dispensing limit should be coordinated with Measurement Canada to minimize the potential burden on the fuel marketing industry and to reduce overall enforcement costs. It was also suggested that a regulation should mandate the use of flow-limiting devices on all fuel dispensing nozzles as a means of simplifying enforcement, on the basis that this would allow inspectors to perform a visual check rather than conducting a potentially complicated test.

The Department felt it was preferable to adopt a performance-based standard in order to provide fuel dispenser operators the flexibility of implementing the type of control strategy that is best-suited for their facility. A regulation requiring the use of flow limiters on every dispenser could result in unnecessary costs for many facility operators that already met the proposed limit. It was noted that the procedures for measuring the flow rate are simple and do not require any special equipment other than a stopwatch. Environment Canada agreed that reasonable measures should be taken to reduce enforcement costs and to minimize the potential burden on facility operators. Accordingly, the Department indicated that it would investigate the feasibility of coordinating inspection activities with Measurement Canada.

The proposed Gasoline and Gasoline Blend Dispensing Flow Rate Regulations were pre-published in the Canada Gazette, Part I, on June 5, 1999. The proposed Regulations were developed in full consideration of the comments provided during the preliminary consultation and were consistent with the Department's analysis of the comments, as summarized above. Stakeholders were requested to provide comments on the proposed Regulations within sixty days of their pre-publication. In order to facilitate the consultation process, the Department distributed copies of the Canada Gazette, Part I pre-publication to a wide range of stakeholders.

Following the pre-publication of the proposed Regulations, Environment Canada received written comments from six parties during the 60-day comment period. In their submissions, the Association of International Automobile Manufacturers of Canada, the British Columbia Ministry of Environment, Lands and Parks, the Canadian Vehicle Manufacturers' Association, and Saskatchewan Environment and Resource Management fully supported the proposed Regulations. The Canadian Petroleum Products Institute (CPPI) supported the intent of the proposed Regulations and suggested some minor changes aimed at "further improving the implementation and effectiveness of these proposed Regulations". Specifically, the CPPI recommended that the proposed procedure for determining compliance with the prescribed flow rate limit be based on the average result of three tests in order to overcome potential test variability and suggested that increasing the volume of dispensed fuel could also improve the accuracy of the procedure. The CPPI also recommended that the definition of "gasoline" be amended to be consistent with gasoline-related regulations recently promulgated under CEPA (i.e. sulphur and benzene). Finally, the submission received from the Ontario Fuel Dealers Association (OFDA) acknowledged the need for the proposed Regulations and indicated that limiting fuel dispensing flow rates to the proposed level was much preferred to Stage II vapour recovery systems. However, OFDA recommended that the Regulations require fuel dispensing nozzle manufacturers to supply only nozzles that will restrict the flow to below 38 L/min rather than placing the responsibility for compliance on fuel retailers.

In consideration of the stakeholder comments, a few changes have been made to the Regulations. In order to improve the accuracy of the measurement procedure, the dispensed volume of fuel which serves as the basis for the calculation of the dispensing flow rate has been increased by 25%, from 8.0 litres to 10.0 litres. In addition, a provision has been incorporated to the procedure which requires that 2.0 litres of fuel be dispensed prior to initiating the timed portion of the test. This provision will ensure that the dispenser's flow rate is stabilized when the measurement begins and will provide the person conducting the test with sufficient time to prepare to make the initial measurement. Finally, the definition of gasoline has been made to be consistent with that contained in the Sulphur in Gasoline Regulations and the Benzene in Gasoline Regulations.

With respect to the suggestion of basing the compliance determination on the average of three tests, the Department feels that this would have been unnecessarily burdensome for both inspectors and facility operators verifying the flow rate of fuel dispensers. Further, the Department believes that the Regulations represent the most favorable approach to limiting fuel dispensing flow rates to 38 L/min as it provides fuel dispenser operators the flexibility of implementing the type of control strategy that is best-suited for their facility and avoids unwarranted costs for the many facility operators whose systems already meet the requirements of the Regulations.

The Regulations will require inspections of affected fuel dispensing facilities by designated Environment Canada officials, or by other officials acting on behalf of Environment Canada (e.g. possibly Measurement Canada). Typically, inspections will be carried out during normal business hours and in a manner that minimizes interference with a facility's normal operation. Using a stopwatch and the dispenser's volume meter, an inspector will measure the time it takes to dispense 10.0 litres of fuel into a vehicle's fuel tank or into another appropriate container. Based on the measurements and the formula set out in the Regulations, and taking into account a reasonable test tolerance, the inspector will determine if the flow rate from the nozzle exceeds the requirements of the Regulations. If so, the inspector may perform a second test to confirm the flow rate measurement depending on the magnitude of the exceedance.

In verifying compliance with the Regulations, CEPA inspectors will abide by CEPA's Enforcement and Compliance Policy. This policy sets out a range of possible responses to offenses, including: warnings, inspector's directions, ticketing, ministerial orders, injunctions, prosecution, and civil suits by the Crown for the recovery of costs in specified circumstances. If a CEPA inspector confirmed that an offense had been committed, the inspector would select the appropriate response, based on the following criteria:

• Nature of the offense: This includes consideration of the damage, the intent of the alleged offender, whether it was a repeat offense, and whether an attempt was made to subvert the objectives and requirements of the Act.

• Effectiveness in achieving the desired result with the offender: The desired result would be compliance within the shortest possible time and with no further repetition of the offense. Factors to be considered would include the offender's history of compliance with the Act, willingness to cooperate with enforcement officials, and evidence of corrective action already taken.

• Consistency: Inspectors would consider how similar situations have been handled in determining the measures to be taken to enforce the Act.

Environment Canada believes that promotion of compliance through information and education is an effective tool in securing conformity with the law. Accordingly, the Department will undertake to make appropriate information available to affected parties.

Ross White
Transportation Systems Branch
Air Pollution Prevention Directorate
Environmental Protection Service
Department of the Environment
Ottawa, Ontario
K1A 0H3
Tel.: (819) 953-1120
FAX: (819) 953-7815

Arthur Sheffield
Regulatory and Economic Analysis Branch
Economic and Regulatory Affairs Directorate
Policy and Communications
Department of the Environment
Ottawa, Ontario
K1A 0H3
Tel.: (819) 953-1172
FAX: (819) 997-2769