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True North: Adapting Infrastructure to Climate Change in Northern Canada

4.0 The Role of Governments in Climate Change Adaptation

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Governments, businesses, communities and individuals all have a role to play in adapting to climate change. Our focus here is on the roles for governments. Governments are stewards of public assets, lands, and natural capital, and are responsible for making related management decisions that are in the public interest, including taking action to minimize risks posed by a changing climate. In doing so, the government needs to systematically assess climate risks in the context of desired goals or outcomes; take action to address risks; monitor, evaluate, and report on the actions taken; and adjust actions according to experience. This essentially describes a cycle of adaptive management, an approach useful when dealing with uncertain, long-term, and complex issues. It captures government?s role as an adaptor. Second, governments can signal and support "climate-wise" decisions by providing information; shaping existing institutions, such as regulations, fiscal measures, and markets; and removing barriers to adaptation. This describes government?s role as a facilitator of adaptation across society.

This chapter discusses the broad roles of Canadian governments in climate change adaptation. It includes analysis commissioned by the NRTEE, information collected during the NRTEE program activities, and information from publicly available sources. It briefly discusses how the roles of governments might differ in Canada?s North in comparison to other regions of the country, in the context of the changes taking place in northern governance regimes. The chapter ends with a summary of mechanisms that governments can use to promote mainstreaming of adaptation thinking in infrastructure decisions.

4.1 Perspectives on Government Roles

In 2005, representatives from Canada?s federal, provincial, and territorial governments completed a National Climate Change Adaptation Framework, which outlined government roles in adaptation and potential areas for inter-jurisdictional collaboration on the issue. Although the document was not adopted within federal policy, the process and its contents have influenced subsequent provincial and territorial plans and strategies. The generic roles for governments that the framework suggests remain valid and useful, falling into two broad categories: government as adaptor and government as facilitator.[52]

Table 13 builds on these roles, and illustrates a range of levers governments have at their disposal to move forward on adaptation. It highlights the importance of collaboration in advancing adaptation. Adaptation is a horizontal issue, of direct and indirect relevance to several areas of sustainable development, requiring information of different types, from a range of sources and disciplines, and for a variety of needs. For a given issue, say infrastructure adaptation, one level of government can both be an adaptor and facilitator of adaptation, the role depending on mandates and obligations of departments or ministries.

In areas of shared interest and jurisdiction, nurturing engagement and collaboration from the highest political levels to the local level is key. Examples of collaborative approaches for adaptation include; the community adaptation planning process taking place in Nunavut; a partnership between BC Hydro and the Government of British Columbia focused on augmenting hydrological data and trends; multi-stakeholder research consortia such as Ouranos; the federal government?s Regional Adaptation Collaboratives, [53] and its partnership with the Government of Yukon to develop a regional capacity in climate change scenarios. Collaboration across geopolitical boundaries is important for sharing knowledge, addressing equity concerns, and promoting the resilience of integrated systems, including ecosystems and integrated economic sectors.

Table 13: Government?s roles in adaptation

Desired behaviour
and state:

Effective management of
climate change-related
risks, by, for example?

? accepting impacts and
bearing losses
? sharing losses
? preventing negative
? increasing understanding
(risks and responses)
? exploiting opportunities

Leads to human and natural systems that are more resilient to a changing climate

Government as adaptor
Stewardship ? Land
? Natural capital
? Physical infrastructure
? Transboundary issues
Policy development
and implementation
/ provision of public
goods and services

Social, economic, environmental, cultural well-being ?
Examples of policy areas: coastal and flood defence; disaster management; health; safety; natural resources,
ecosystem, environmental management; cultural preservation
and heritage; innovation; trade; economic development; international development

Examples of public goods and services: long-term environmental
observations and monitoring (e.g., hydrology, weather, permafrost); climate science and modelling;
natural and social science; inventories of human built
assets and natural capital

Government as facilitator
Data and information Reliable, high-quality information on climate change impacts; climate design values for engineering codes and standards; regional / sectoral vulnerability; social and economic trends Tools to support risk assessment, planning, and decision making
Institutions Examples: liability rules, regulations, permits, codes and standards, guidelines, land-use planning processes, markets, taxes
Financial incentives Examples: subsidies for private sector research and development, micro-financing
by example

Demonstration of processes, techniques

Procurement (to stimulate market creation)

Provision of
?safety nets?
Targeted attention to vulnerable populations. Examples: broaden access to risk-spreading mechanisms;
reinforce informal networks
Sources: Intergovernmental Climate Change Impacts and Adaptation Working Group ( 2005), Stern (2006), Conference Board of Canada
(2007), IPCC (2001) (after Burton 1996).

4.2 Government Roles in Canada?s North

Adapting to the impacts of a changing climate will involve cooperation across all levels of government in Canada?s North ? local, Aboriginal, territorial, and federal. However, delineating roles and responsibilities may be challenging.[54] As discussed in Chapter 2, governance systems are in different stages of development across the region. Intergovernmental issues, including lines of responsibility, accountability, representation, and financial and human capacity remain unclear in some cases. Capacity issues alone may make the success of any new rules and processes in Canada?s North dependant on the formal and informal relationships between and among the various levels of governments.

As already emphasized, an effective approach to adaptation is to consider climate risks in existing planning and decision-making processes. This assumes that effective planning and decision-making processes are already in place, and that implicated stakeholders are clear on roles, responsibilities, and property rights. Although this is not necessarily the case in Canada?s North, all orders of government have an interest in developing and enhancing institutions, clarifying the regulatory environment, and building inter-jurisdictional relationships for the advancement of local, regional, and national goals. While this process is likely to require significant financial and human resources, it also presents an opportunity to consider the implications of a changing climate in the negotiation and implementation of agreements, and as new institutions, working relationships, and partnerships develop. In some cases, however, Aboriginal peoples may deem some climate change adaptation strategies, such as community relocation or abandonment of traditional wildlife harvesting activities, as unacceptable cultural changes.

Northern governments and regulatory bodies operating in Canada?s North are likely to perform, and are already performing in some cases, many of the generic roles set out in Table 13. However, capacity constraints and competing priorities may present barriers to undertake strategic review of policies and plans, to develop and deploy measures to make infrastructure ?climate wise,? to disseminate adaptation- relevant information, to provide incentives, and to set and enforce regulations geared toward managing climate risks. Coordination and collaboration among governments is essential for efficient and effective governance, to reduce overlap and duplication, to achieve the best program and service delivery for all residents, and to ensure that lines of accountability are clear.

The regulatory framework for oil and gas development in the Northwest Territories, Nunavut, and Eastern Arctic offshore is an example of ongoing inter-jurisdictional collaboration, which now also needs to consider adaptation. The National Energy Board (NEB) has regulatory responsibilities for oil and gas exploration and activities in much of Canada?s territorial north. Project authorizations and approvals for oil and gas exploration and production are subject to environmental assessments, the process dependent on the location of the project. Environmental assessment processes are overseen by a range of regulatory agencies, including the Mackenzie Valley Land and Water Board, the Gwich?in Land and Water Board, the Sahtu Land and Water Board, and the Wek?eezhii Land and Water Board in the Northwest Territories, and the Nunavut Impact Review Board for Nunavut. Environmental assessments generally require proponents to consider the impacts of climate change to the project. Despite a recognition of and concern about the rapid rates of environmental change taking place in the region, coping with adaptation needs presents challenges to the NEB, territorial, and Aboriginal governments.

Box 5 illustrates stakeholder perceptions in Canada?s North on possible government roles and responsibilities in promoting adaptation in the region, based on qualitative research conducted by the NRTEE.

BOX 5: Northern stakeholders have a range of views on government roles and responsibilities in promoting adaptation in Canada?s North
During the course of the program on Climate Change Adaptation Policy, the NRTEE commissioned research on the role of government in adaptation, specifically in Canada?s North. As part of this work, the research team conducted telephone interviews with northern stakeholders in April 2007. The interview format consisted of open-ended questions relating to the roles of various orders of government. The following boxes present the aggregate results of interviews. Results are not statistically representative of northern populations. They provide an indication of northerners? perceptions on the issue at the time of the interviews.

Responses to the question ?What should be the main roles and responsibilities of the federal government in promoting climate change adaptation in the North?? included the following:

  • demonstrate leadership
  • provide funding
  • fund training and capacity building through partnerships
  • assist Aboriginal governments in developing the capacity and human resources to adapt
  • transfer information to territories to help them educate the public
  • undertake (climate) research and modelling
  • make sure climate information is available, accessible, and up to date
  • develop best practices
  • set the regulatory agenda
  • convene, coordinate, co-operate, talk with us
  • take an arm?s length role and empower us

Responses to the question ?What should be the main roles and responsibilities of the territorial governments in promoting climate change adaptation in the North?? included the following:

  • develop internal capacity and then educate the northern public
  • demonstrate commitment to action by: increasing personnel and budgets to address adaptation; revising climate change strategies
  • facilitate community action ? for example, develop adaptation templates for the communities
  • get more involved in ongoing initiatives (e.g., Arctic Council?s adaptation projects)
  • develop partnerships with other governments

Responses to the question ?What should be the main roles and responsibilities of Aboriginal governments in promoting climate change adaptation in the North?? included the following:

  • get land claims agreements implemented properly
  • find out what it all means
  • raise awareness of climate change as a new and growing threat
  • work with others to develop capacity to adapt to climate change
  • press for partnerships with the territorial and federal governments
  • use science and traditional knowledge to make decisions
  • move forward with community plans that address adaptation

When asked ?What should be the main roles and responsibilities of municipal governments in promoting climate change adaptation in the North?? respondents highlighted specific gaps in capacity instead of providing direct answers to the question, as in the previous three cases. The gaps and needs that respondents related to community readiness and technical support and included the following:

  • communities are not ready to adapt
  • communities are already struggling with change
  • communities require technical support before anything else is possible (e.g., technical support for energy planning, integrated community planning, and vulnerability assessments)

Responses to the question "How can governments in the North work together to deal with climate change adaptation?" included the following:

  • by pursuing meaningful partnerships ? an example of a successful partnership model that arose was the Northern Contaminants Program
  • by taking northern issues to national fora and meetings of federal/provincial and territorial ministers (environment, energy, resources)
  • by recognizing that there is no ?silver bullet? on adaptation and that this is why we must work together
  • governments can work together, but there is no substitute for federal leadership

There is particular relevance in considering the federal government?s role in climate change adaptation in Canada?s North. By virtue of the mandate of Indian and Northern Affairs Canada, the federal government has a ?direct role in the political and economic development of the territories, and significant responsibilities for resource, land and environmental management.?[55] The federal government?s international obligations are equally paramount, as climate change has significant circumpolar ramifications. Coupled with responsibilities for forecasting weather and sea ice, performing scientific assessments, and maintaining the knowledge base of Canada?s landmass, and regulatory responsibilities in northern oil and gas development, the federal government plays a vital role in shaping an integrated climate change adaptation strategy for Canada?s North.

4.3 Instruments for Infrastructure Adaptation and Current Initiatives

Governments have a range of levers at their disposal to promote adaptation. They can rely on voluntary measures, such as information provision, or command and control measures, such as regulations. They can also use markets, financial incentives, liability rules, and fiscal or tax measures to dissuade or encourage citizen or business activity or behaviour. Within the context of what governments perceive to be politically acceptable at the time, they base the selection of instruments on criteria such as economic efficiency and likely effectiveness in achieving the stated goal, which can encompass multiple objectives. For reasons such as resource constraints or perceived lack of salience, governments can also choose to do nothing.

Several instruments of relevance to climate change adaptation exist. The OECD recently reviewed some of them, focusing on insurance and market mechanisms, private-public partnerships, microfinance schemes, regulations, and incentives for research and development (R&D). Minimizing problems related to moral hazard and negative externalities are two important considerations. Moral hazard is the case where people or businesses take greater risks with the expectation of government bailout due to political pressure. An example of a negative externality is the effect of a household decision to reinforce their sea front, exacerbating erosion on the sea front of a neighbouring household. Table 14 is a summary of some possible adaptation options and instruments applicable to physical infrastructure, which includes the three instruments evaluated in the next chapter.

Table 14: Potential use of well-known policy instruments to promote adaptation
Climate impact Adaptation option Potential instrument
Flood and storm damage to coastal infrastructure through sea surges and enhanced coastal erosion

Prevent the loss through:

  • structural options: coastal defence, such as beach armouring ; design and build structures to be ?flood proof?
  • on-site operations: beach nourishment, sediment management
  • institutional options: land-use planning, emergency planning, clarifying accountabilities

Change location using set-backs, relocation strategies

  • Regulatory nature: zone planning, all-hazards requirement for disaster/emergency management
  • Markets: differentiated insurance premiums
  • Financial incentives: publicprivate- partnerships (PPPs) or financing for shoreline defence
  • Liability rules: changes to legal liability to internalize risks and costs of adapting coastal infrastructure

Flooding after severe rainfall and snowmelt events

Change in volume, timing, and quality of water flows

More frequent and severe water shortages

Prevent the loss through:

  • structural / technological options: increase reservoir capacity, dredging, increase water drainage infrastructure
  • institutional options: water reallocation, risk management to address rainfall variability
  • market-based options: water permits, water pricing

Changing activity through diversification (e.g., less reliance on hydroelectric generation) and conservation

  • Financial incentives: adjustments to terms of PPPs (e.g., water efficiency requirements), subsidies for technology deployment
  • Markets: water pricing, trade in water permits
  • Information and leadership by example: awareness campaigns and demand-side management programs

Reduced infrastructure performance due to changes in average climate conditions and extremes

Reduced space heating demand, but increased cooling linked to warmer temperatures

Prevent the loss through:

  • Structural options: designing and building ?climate-wise? housing stock and other infrastructure
  • Institutional options: changing maintenance requirements; reviewing safety and energy efficiency standards
  • Share the loss through marketbased options: such as insurance
  • Change location using zone planning and siting decisions

Increase understanding through monitoring impacts / responses

  • Regulatory nature: building codes & standards, zone planning, adjustments to project approval process (e.g., environmental impacts assessment process), adjustments to licences (e.g., condition licence to adaptation)
  • Markets: adaptation-dependent insurance premiums; insurance schemes
  • Financial incentives: adjustments to terms of PPPs, R&D incentives targeting innovative technologies for adaptation
  • Information or leadership by example: monitoring protocols, technology demonstration pilots, training and skills development of infrastructure practitioners
Greater frequency and severity of extreme weather events, and related damage to infrastructure Disruption of economic activity, and indirect health effects (e.g., food spoilage, water contamination)

Share the loss through risk-spreading options beyond the insurance industry Prevent the loss through:

  • institutional or administrative options: early warning systems, enhanced disaster/emergency management
  • structural options: flood barriers, flood proof infrastructure, lightning protection, installation of internal sprinklers

Change location using zone planning and siting decisions

  • Regulatory nature: building codes & standards, zone planning, adjustments to project approval process (e.g., environmental impacts assessment process), adjustments to licences (e.g., condition licence to adaptation)
  • Markets: adaptation-dependent insurance premiums; insurance schemes
  • Financial incentives: mobilize private finance or PPPs for defence structures
Source: Adapted from OECD (2008), includes information gathered during stakeholder consultations of the NRTEE program.

Northern stakeholders are increasingly concerned with the manifest impacts of climate change and those likely to come. Since the launch of the NRTEE program in 2006, the profile of and investment in northern adaptation has increased. Climate change adaptation is a theme in the Northern Vision of the three territories, which outlines activities to build on and opportunities for collaboration to advance adaptation. Territorial climate change plans or strategies include adaptation objectives and initiatives, mainly focused on getting a better understanding of expected impacts, community and sectoral vulnerability, and viable adaptation responses. Through a partnered approach, some northern communities are starting to develop and implement adaptation strategies. The Government of Canada has two adaptation programs specifically targeting Canada?s North, and delivered by Indian and Northern Affairs Canada and Health Canada. Box 6 highlights some adaptation initiatives of governments, communities, and industry in Canada?s North and of relevance to infrastructure adaptation.

BOX 6: Canadian governments, communities, and industry are already taking action on infrastructure adaptation
Federal funding programs, territorial legislation, and provisions in Aboriginal self-governance agreements require proponents of major infrastructure projects to study and disclose the anticipated environmental and social impacts of the project. Specifically, new infrastructure projects, such as a new mining operation or a major oil and gas pipeline, require an environmental assessment. Processes and regulatory requirements differ among jurisdictions. Federal processes, for example, require proponents to consider the impacts of climate change to the project, with guidelines on how to do this available through the Canadian Environmental Assessment Agency. Stakeholders in the private sector have suggested that information gaps such as projections of climate change and changes in other environmental conditions pose challenges to meeting this legal requirement. Territorial boards are also grappling with how to address adaptation. The Yukon Environmental and Socio-economic Assessment Board, for example, is already allocating considerable financial and human resources to the task.
The Northern Vision of the three territorial governments outlines priority adaptation activities relevant to infrastructure, including assessing the vulnerability of community infrastructure and studying ways to adjust engineering practices and codes and standards to incorporate climate change impacts.
Two out of four goals in Yukon?s 2009 Climate Change Plan address climate change adaptation, including activities focused on infrastructure.
The Government of Northwest Territories is undertaking a series of activities to enhance the resilience of buildings under changing climate conditions. For example, Public Works is integrating the implications of higher snow loads in building design, and disseminating this information in a brochure. This department is also working in partnership with the Public Infrastructure Engineering Vulnerability Committee of Engineers Canada on guidelines for the use of thermosyphons.
Nunavut?s Department of Environment, Natural Resources Canada, and the Canadian Institute of Planners are working with communities to identify vulnerabilities to climate change, undertake scientific assessments, and develop adaptation strategies. About ten communities have engaged in this process to date, including Clyde River, Hall Beach, and Iqaluit.
The three territorial governments, Manitoba, Quebec, and the federal government are funding the development of a best practices guide for the construction, maintenance, and rehabilitation of transportation facilities in permafrost regions.
Indian and Northern Affairs Canada manages a $14 million northern adaptation program. Among others, it funds and supports community risk and vulnerability assessments and the development of tools to support decisions on adaptation.
Health Canada manages a $7 million program for climate change and health adaptation in northern and Inuit communities. Activities include supporting community-based research of climate change impacts on health and viable adaptive responses, producing and disseminating research results in culturally appropriate formats.
The Canadian Standards Association is developing national guidelines for managers of northern community infrastructure focusing on permafrost and climate change.
Changing permafrost patterns and related ground instability has led to the use of innovative building material to support structures.
In response to soil erosion from permafrost thaw, communities are reinforcing shorelines and moving buildings inland.
Several major infrastructure projects have taken measures to address permafrost warming and minimize ground settlement, such as the installation of thermosyphons.

At the same time, infrastructure development and renewal has emerged as a policy priority, presenting an incredible opportunity to phase in climate change adaptation as infrastructure planning and investments unfold. Statements and investments by federal and territorial governments in the past few years link infrastructure to the advancement of regional and national policy goals, and trends covered in previous sections of this report suggest a likely boom in infrastructure development in the region.[56] Infrastructure development and renewal presents a window of opportunity to adjust processes guiding infrastructure funding, design, construction, and lifecycle management to account for a changing climate. Doing so would be adaptation mainstreaming in action.

Yet, governments appear to be failing to fully exploit this opportunity. The 2008 infrastructure framework agreements between the Government of Canada and the Governments of Yukon, Northwest Territories, and Nunavut require that territories develop a long-term vision and approach to the management of public infrastructure. Among other provisions, these infrastructure plans must include a description of the infrastructure stock?s current state, and highlight challenges and pressures foreseen over the next 10 to 15 years. However, they are not specifically required to identify or address climate change impacts and adaptation issues. Instead of a strategic and coordinated approach to adaptation of infrastructure, the integration of climate change considerations as a risk factor in infrastructure management will likely be at the discretion of the many decision makers involved, according to their capacities, needs, and interests.

The economic evidence to rationalize investments in proactive adaptation is scant, but this is a growing area of interest to many stakeholders in Canada?s North and elsewhere. Compared to climate change mitigation, which has been the object of economic and quantitative policy analysis for over two decades, efforts to understand the potential magnitude of adaptation required and the phasing of investments based on economic efficiency have only begun in the past few years.

A factor influencing progress to date on infrastructure adaptation to climate change is cost. Examples of studies pertaining to infrastructure that are relevant to Canada?s North suggest that adaptation will likely be expensive. At the same time, they indicate long-term benefits to adapting proactively, in the form of reduced costs from climate change damage:

  • A study by Larsen et al. (2007) on the economic costs of expected climate change impacts on public infrastructure in Alaska illustrates the high sectoral costs expected in the region. Under conservative assumptions of impacts and costs, the authors estimated that a changing climate added 10 to 20 per cent to an infrastructure operating budget of $56 billion through 2080. Integrating climate change adaptation into infrastructure planning could reduce costs by up to 13 per cent between now and 2030, and by as much as 45 per cent between now and 2080. The infrastructure types expected to result in the most costly impacts were roads and airport runways, which represented about half of the costs.

  • A study conducted by Zhou et al. (2007) at Natural Resources Canada focused on residential and commercial buildings in the Northwest Territories. They estimated potential savings from undertaking timely adaptive measures on building foundations, taking into account a range of projections of permafrost conditions. Their results indicated that, in light of potential permafrost degradation from now until 2069, proactive adaptation could imply savings of up to 70 per cent compared to non-adaptation scenarios. They also found that adapting all vulnerable buildings across the Northwest Territories could cost about $230 million. These estimates are likely conservative, as one community alone (Inuvik) is facing costs of approximately $140 million to repair buildings affected by permafrost degradation.[57]

Scientific assessments conclude that a degree of climate change is likely unavoidable due to the buildup of atmospheric GHG emissions from human activities now and into the future, making adaptation a critical response over the next few decades. However, there may be limits to our ability or willingness to undertake adaptation ? as it either becomes prohibitively expensive (e.g., relocation of several settlements) or exceeds human capacity (e.g., scarce resources lead to confrontation instead of collaboration). Global efforts to stabilize GHG emissions can reduce the need for adaptation in the long term, which is particularly important to lessen the impact and enhance the resilience of long-lived assets and the underlying services they provide to society.

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52 Policy Research Initiative (2009) - Prioritizing Climate risks and Actions on Adaptation. http://www.policyresearch.gc.ca/ page.asp?pagenm=2009-0007_03 Accessed July 2, 2009.

53 Natural Resources Canada delivers the Regional Adaptation Collaboratives program. Program information appears at: http://adaptation.nrcan.gc.ca/collab/index_e.php

54 This section draws primarily from Northern Canada Consulting (2007), a report commissioned by the NRTEE program.

55 For further information on the mandate, roles, and responsibilities of Indian and Northern Affairs Canada, see http://www.ainc-inac.gc.ca/ai/arp/mrr-eng.asp accessed July 2, 2009.

56 See Appendix 7.4 for federal policy drivers and commitments linked to northern infrastructure since 2006. These commitments would amount to about $1.4 billion in federal investments toward infrastructure development in Canada?s territorial north over the next seven years. Expanding northern infrastructure systems is also a priority under the Northern Vision of the three territorial governments.

57 Angus and Mitchell (2009). Standing Senate Committee on Energy, the Environment, and Natural Resources.