Christopher Ragan is an economist and director of McGill University’s Max Bell School of Public Policy. He is also chair of the Ecofiscal Commission.
Four years ago, the Mount Polley disaster reminded us that mining comes with risks. On Aug. 4, 2014, a tailings dam at Imperial Metals’ Mount Polley copper and gold mine ruptured, spilling 24 million cubic metres of water and tailings into several lakes and rivers in British Columbia’s Interior. It was the largest tailings-dam rupture in Canadian history.
The best way to minimize the hazards of mining isn’t simply to reject every mining project. The resource sector is an important part of the Canadian economy and mining firms already take risk management seriously. Events such as Mount Polley are the exception, not the rule.
But we can do more to manage risk to help ensure taxpayers don’t end up paying for disaster cleanups. For one thing, governments could put a price on the inherent dangers of mining.
There is currently no financial value placed on the risk of mining disasters in Canada. And there is no guarantee that a company responsible for a mining disaster will pay the associated cleanup costs. If a company goes bankrupt following an accident, Canadian taxpayers would get stuck with the bill.
Not only is this unfair, but it can actually make mining more of a threat to the environment. When a company knows it might not have to bear the cost of its environmental damage, it has less incentive to reduce the riskiness of its activities and processes, thus making disasters more likely.
For the rest of this column: https://www.theglobeandmail.com/business/commentary/article-its-time-to-put-a-price-on-the-risk-of-mining-disasters/