Report on:

Economic Implications

of the Potential Effects of Piped Natural Gas on Environmentally Induced Illness/Chemical Sensitivity, Asthma and Allergies

for the Joint Environmental Assessment Review of the Proposed Sable Gas Project

Prepared by:
David Wimberly
and
Helen Lofgren
Co-Managers
Allergy and Environmental Health Association, Nova Scotia
Intervention Coalition on Proposed Sable Island Gas Pipeline Project

March 7, 1997

Executive Summary

The economic implications of the potential effects on persons in Nova Scotia and New Brunswick with environmentally-induced illness/chemical sensitivity, asthma and/or allergies caused or aggrivated by the distribution and use of natural gas is estimated to be significant. It is a serious and grevious deficiency of the Joint Environmental Impact Assessment of the proposed Sable Gas Project that the precise nature and extent of these costs have not been developed.

The essential point being made here is that the potential impacts are considerable but have not been addressed by this project. Therefore the assessment should pause here, fully evaluate these issues, and only then return to this assessment. The risks of not understanding these potential costs may well alter considerably any risk/benefit evaluation necessary to a satisfactory assessment of the proposed project.

We need a comprehensive benefit/risk evaluation. Input/output modeling should be done. It should identify both direct and indirect costs. Direct health care costs include, but are not limited to: physicians, nurses, private and public sector health care such as hospitals, clinics, offices, seminars, classes and medicines.

Indirect costs include, but are not limited to loss of productivity, lost time, disability, decreased effeciency in places such as schools - both as producer (staff) and learner (student), increased accidents, and even costs of loss of emotional control (such as acts of anger). Not all indirect costs will turn up as lost wages.

A significant number of persons in the Maritimes are potentially affected. This is no longer just a rare occurance of an unfortunate few. It is estimated that 20% of the Canadian population is unusually sensitive to allergins or chemicals (p.1, Indoor Air Quality, CMHC #6069, reprint 1991). US studies indicate that 25 to 35 million US residents suffer higher than normal risk of exposure to pollutants because of chronic respiratory disease and heart disease alone. The total of high risk groups because of existing health conditions is approximately 20% of the US population. Adding in factors of age, smoking habits and poor nutrition, this figure easily adds up to over one-third of the total US population (pp 11-12, Indoor Air Pollution and Housing Technology Summary Report, CMHC). These estimates do not factor in those whose health is compromised by environmentally-induced illness/chemical sensitivity, asthma and/or allergies.

The percentage of the population affected increases in the Maritimes; up to one-third of the Nova Scotian population has some level of problem arising from compromised immune systems. Most families will have someone affected, and most will have close friends affected. Even our hospitals have been unable to avoid widespread problems, as the "Sick Building Syndrome" at Camp Hill vividly illustrates.

Since the primary pollution causing these illnesses is indoors, and people are spending more time indoors than previously and the variety and quantity of chemical exposures is increasing, therefore it is likely that these problems are likely to continue to worsen for some time.

AEHA-NS had intended to comission a detailed consultant's report on the anticipated economic effects. However, funding was not granted sufficient to that considerable task. Given more time, it might have been possible for a graduate student to have undertaken this as a university project. Unfortunately, the time constraints of the assessment process precluded that as well. Therefore AEHA is simply describing the potential effects in a simple fashion and drawing few conclusions. It is impossible to determine the numerical value of economic effects, but we can state that they would certainly total to a substantial amount, even on the scale of such a massive project as this. We even speculate that these costs could more than off-set any financial gains to Nova Scotia or New Brunswick. Certainly some legal suits have resulted in huge cash awards in punative and compensatory damages. Combining that possibility with the certainty, in our opinion, of substantial direct and indirect costs gives a real urgency to a more precise calculation.

Nova Scotia makes very little if the proponents make very little profit. Nova Scotia and New Brunswick may have substantial medical and related costs with very little income to off-set this. That is not a risk that a prudent manager would undertake.

The proposed Project should not be approved by this environmental assessment not only due to serious deficiencies in the assessment process but also due to the lack of sufficient information to reliably assess the environmental and socio-economic effects.

Lists of Issues

These issues are listed here to bring them to the attention of the panel so that the panel can incorporate them all into a program of study that they require the proponents to complete before the next stage in this process.

Needing examination:

(a) direct economic effects;

(b) indirect economic effects;

(c) how various government and non-government organizations (NGOs) have approached the compensation issue for this type of project and related projects that cascade from it;

(d) consequences of end-uses of piped natural gas, especially to avoid unfunded liabilities due to unanticipated consequences and inadequacy of contingency funding bonded toward such public protection;

(e) economic valuation of the status quo; the value of the "do nothing" alternative;

(f) recommendations to the proponents and the NEB.

(g) A Fund should be created for further research and for treatment of persons suffering from environmentally-induced illness/chemical sensitivity, asthma and /or allergies resulting from, or aggravated by, the implementation of this project, should it be approved.

(h) determine detailed information necessary to assess precisely which, if any, uses of natural gas and which, if any, configuration of a project will not cause harm to those with environmentally induced illness/chemical sensitivity, asthma and allergy.

(i) effect release by proponents of detailed information requested by AEHA.

(j) effect of the recognized and potential environmental health problems with natural gas, and with the knowledge that Nova Scotians and New Brunswickers are particulary susceptible to environmentally induced illness/chemical sensitivity, asthma and allergy due to preexisting environmental conditions,

-- and knowing that persons along the east coast of the U.S. where the gas is primarily destined may well have (in fact, are likely to have) similar sensitivities and susceptibilities because so many of the conditions that are known to contribute are similar there to here,

-- and knowing that those conditions include:

--climate - long rainy cool springs, damp summers

--acid rain and fog

--a climatic repeated freeze-thaw cycle which promotes mould growth, a very toxic and potent sensitizer

--homes, schools and workplaces increasingly sealed-off in the name of energy efficiency, but with frequently inadequate ventilation.

--a population exposed to ever increasing amounts of chemicals never demonstrated to be safe for humans, and exposed to the unintended and unknown synergetic effects from unplanned exposures to multiple chemicals; also, children born of parents with high chemical exposure as well as exposure to endocrine-disrupting chemicals for which the body has no defense.

--exposures of long duration which are now increasingly having had enough time to start to cause adverse reactions.

(k) overlap of economic issues with legal issues:

-- In case of health-related grievance, persons so affected should have the right to publicly-funded legal counsel since this pipeline project is a trial.

-- Compensation funding should be already in place in secured form.

-- The proponent has the responsibility to protect people from lost employment and therefore livelihood due to sensitization.

-- Arguments for extra liability since proponent has disclaimed responsibility and won't divulge the actual content of the natural gas which may include sulphur, heavy metals including lead, arsenic, mercury and the very highly toxic methylated mercury, radioactive materials including radon, and any of the decomposition products of the vegetation from which the natural gas was formed, many of which are highly carcinogenic.

(l) The proponents have not calculated the economic effects of sensitivity which is manifested in a wide range of ways, eg.: headache, loss of mental acuity, mental confusion, poor learning ability and poor productivity, behavioral problems, anxiety, depression, panic attacks, poor attention, increased accidents, aggression, family violence. The economic implications of all these effects have to be factored in and studied.

(m) costs of not fully assessing the economic effects of natural gas on health of people and finding out later that such costs were of a magnatude as to be crucial.

(n) Since (we maintain) it is a necessary component to actually assess the project in terms of sensitization, the project should be held until such time as these issues can be fully assessed. Therefore:

--list health effects.

--how many people? It is estimated that 10-15% of the population is affected by chemical sensitivity. In addition, the number of persons with classical allergy is increasing rapidly and dramatically, eg., the increase in asthma rates. When all forms of environmentally induced illness is included, the effected population rises to 20% nationally is estimated, and about 1/3 in Nova Scotia. This adds up, potentially, to some major economic and social impacts. The Environmental Health Clinic, Dalhousie Univ., currently has over 1100 persons on its waiting list, and the waiting time for an appointment for all but the most critical cases is about 4 years.

(o) People of Nova Scotia and New Brunswick are likely to have increased rates of chemical sensitivity due to the effects of acid rain and particularly of acid fog on respiratory mucosa.

(p) the economic costs of misdiagnosis, both in terms of the actual costs of improper assessment, and because of the costs to the individual whose proper diagnosis and treatment is delayed, as well as the consequent costs to society. --There is overlap with other recognized illness --eg.,asthma being treated symptomatically as opposed to seeking its root cause and preventing further sensitivities from developing.

(q) Costs:

--Medical treatment

--hospital time and usage

--physician and other staff and facility usage

--diagnosis

--cost of misdiagnosis

--general

--loss of productivity and efficiency

--accidents

--loss of enjoyment of life

--increased susceptibility to other conditions

--increased stress levels

--pain and suffering

--family break-up and other domestic difficulties

--increased violence

(r) Negative spin-off effects due to:

--direct health -productivity

--loss of livelihood; general impoverishment; loss of purchasing power which has a direct spin-off to the local economy.

--loss of discretionary spending (eg., travel, hobbies, restaurants, new clothes, entertainment), with a greater portion of limited resources being required for medications, special foods, adaptation of living space, etc rather than on other things including food, shelter, transportation, entertainment.

--possible net drain on the health-care system

--since it is avoidable, why cause it?

--expect negative spin-off effects to increase over time rather than decrease because based on current trends, in the future we will have more assaults on health by chemicals due to:

--living in more tightly sealed buildings;

--exposure is time-related. Over time more people are expected to show more effects.

--Economic effects of not taking care of legal effects before-hand.

--Liability suits especially now that proponents cannot make claims that they were not aware of potential health effects both standard and through sensitization effects.

--If future generations sue government for fraudulently robbing of their future through:

a) squandering their resources;

b) causing foreseeable health effects;

c) dramatically increasing pollution levels; especially aggravated by the fact that it is public and common knowledge now that the resources are finite and irreplaceable and have only one-time use. Sources of fossil fuel energy other than gas are scarce or otherwise contraindicated, and it is known that coal would likely be seriously limited in potential to to be used due to global environmental concerns.

(s) Fifteen out of twenty-two pipeline failures in Canada have been with natural gas pipelines. The first was in 1976, and the rate is accelerating. (National Energy Board, Canada, Report of the Inquiry, Stress Corrosion Cracking on Canadian Oil and Gas Pipelines, Nov., 1996) Pipelines require regular inspection and maintenance which is only accomplished by digging up. This means regular disruption of the environment, and regular disturbance of pipeline coatings whose possible failure is a major reason for the need for regular inspection. The pipelines may be made of pvc piping, much of which contains endocrine-disrupting plasticizers. (WWF, Washington). The various coatings, adhesives or tapes used to protect the pipe may contain endocrine-disrupting chemicals as well. There can be permanent and irreversible environmental damage from endocrine-disrupting chemicals of pvc pipe materials and any coatings, adhesives and tapes. The economic effects of these environmental effects seem to have been ignored.

(t) The pipe is to be left in the ground once the project finishes. The economic effects of this seem to have been underestimated, especially since there will likely be a uranium and radioactive lead coating deposited on the pipe. If the pipe is to be disposed of properly, then those economic and social costs need to be considered. We would prefer the pipe to be taken up and disposed of rather than to be left in the ground, as a potential health and safety problem.

(u) A potential increase in the number of Nova Scotians whose access to public places may be severely restricted because of their levels of allergies or related sensitivities. Aren't all people entitled to full and free access to public places? If that access is taken away is that not a form of infringement of their freedom of association or freedom of movement ?

(v) need for legally-guaranteed access to in-depth research on the topic of sensitivities that may result from the transmission or consumption of natural gas.

(w) A fund should be created for research and treatment of those afflicted with allergies or other sensitivity-related illnesses as a result of the approval of this project. Whether the funds are raised by way of surcharge on the product, whether by way of a "carbon tax", whether by way of a share of the profits realized by the proponent or by way of contribution by the provincial government of a percentage of its share of earnings - a fund should be created.

(x) We need legally-guaranteed access to appropriate, comprehensive, fully funded healthcare specific to chemical sensitivity for anyone becoming sensitized or suffering adverse health effects.

Study Proposals

We have tried several routes to get a full and through evaluation of the socio-economic effects as well as more detailed information about the environmental health effects of natural gas. A large part of this effort was to determine precisely which utilizations of natural gas might be of benefit and which would not be of benefit specifically to those with and/or susceptable to natural gas sensitization. We have been consitantly frustrated in our attempts. We asked the Panel and the proponents at the Scoping Session of 3 December 1996. We asked the Intervenor funding office. Nothing so far has been adequate.

We had numerous discussions with the Maritimes and Northease Pipeline about this need. We submitted a proposal, in writing, to them. They have acknowledged receipt of that proposal, but have failed to act on it. Now all deadlines for receipt of new evidence are up. We feel led on.

The best response was from the Intervenor Funding Program, which gave us a small grant. However, that grant was less the one twentieth of the amount we requsested. And the amount we requested was the bare minimum we felt even a frugal volunteer organization such as the AEHA would need for a bare bones approach.

Now we are in the position of only being able to identifying the deficiencies. We know with considerable certainty that natural gas is an imminent health threat to our members and many others. We know enough to know that natural gas can and does cause real harm. We do not know enough to be confident of ways, if any, of adequately mitigating that risk of harm. Therefore we must requst the precautionary approach and ask for rejection of this gas project. If the proponents had cooperated in providing information and in participating with us in studies, then we may well have found ways to be confident in using gas. But since the proponents have chosen not to cooperate, they only have themselves to blame for our need to ask for no pipeline at all.

In Conclusion

The AEHA concludes at this time, based on the information before us that:

a. The economic costs of the Sable Island Gas Project have not been adequately assessed since the costs due to health factors has not been investigated and reported.

b. This is a serious deficiency as there are expected to be quite large direct and indirect costs due to increased health care.

c. The Panel should direct the proponents to immediately commence a comprehensive assessment of health care effects and costs, before this assessment can go ahead.

d. Such a study should be undertaken in complete cooperation with local and regional stakeholder representatives of those wirh environmentally induced illness/chemical sensitivity, asthma, and allergy.

e. This issue is of serious socio-economic concern to the government and taxpayers of this Province because of its potential impact on the costs of health care, loss of productivity, loss of quality of life and human suffering;

f. A fund should be created for further research and for treatment of persons suffering from environmentally-induced illness/chemical sensitivity, asthma and /or allergies resulting from, or aggravated by, the implementation of this project.

g. The proposed Project should not be approved by this environmental assessment due to serious deficiencies in the assessment process and due to the lack of sufficient information to reliably assess the environmental and socio-economic effects.