Course:FRST370/Projects/The Citizens of Wellington County, Ontario, Canada vs Nestle Corporation and the Ministry of the Environment: A Long Fight for Groundwater

This case study explores the long-standing debates (2007-today) surrounding Nestlé’s extraction of groundwater from the Grand River Watershed in Southern Ontario. The citizens of various communities in Wellington County, Ontario have expressed concern over the water extraction permits given to Nestlé Waters Canada by the Ontario Ministry of the Environment (MEPC). The values of the local population represent a different set of interests from that of Nestlé, and satisfying both these stakeholders has been challenging for the Ministry. Locals have organized advocacy groups and protests in response to their lack of decision-making power, making a notable impact on the agreements. Yet, there are still many details straining this relationship that must be identified and addressed. Better consultation and harmonization of stakeholder values are fundamental to fully resolving these tensions. This case provides an example of the dangers of improper decision-making protocols and land use agreements.

Description & Background

Location and Site Information

Wellington County, Ontario, Canada

The conflict over water extraction and bottling is occurring in Wellington County, Ontario, Canada. The county is 2,657km², with a population of 90,932 as of 2016 CITE. Wellington County is comprised of various municipalities, the ones most actively involved in this case are the city of Guelph, Township of Puslinch (Administrative Centre of Aberfoyle), Township of Erin (including Hillsburgh village), Township of Centre Wellington (includes communities of Elora and Fergus).

Nestlé Waters Canada's active points of water extraction are wells in Aberfoyle and Hillsburgh, with a third, the Middlebrook well, being purchased recently for future operations. All the water bottling is accomplished at a bottling plant in Aberfoyle.

Regional Context

Eramosa River, a tributary of the Grand River

The county falls within the Golden Horseshoe Region, which falls under the provincial plan’s “Places to Grow” (experiencing pop growth higher than national avg) and the city of Guelph is expected to double in population in the next 2 decades (Ministry of Infrastructure, 2006). Wellington County is currently entirely dependent on local groundwater for all domestic, agricultural and industrial needs (Jaffee & Case 2018). Citizens have already rejected other means of supplying water, and the option of building a pipeline in Guelph’s 2006 Draft Water Supply Master Plan was vehemently opposed, and resulted in “Stop the Pipe!” campaign (Case 2016). In general, the groundwater supply is dependent on a balance between water extraction and aquifer replenishment (Case 2016). The Grand River Watershed (GRW), part of the Lake Erie and Lake Ontario watersheds, is the primary watershed used by the county. The GRW is 6800 km², the biggest in southern Ontario (Chilima et al 2017). It contains 19% tree cover and 79% of land is designated for agriculture (Chilima et al 2017). There are 5 major urban centres within the GRW, one being Guelph in Wellington County (Chilima et al 2017). The watershed is managed by the Grand River Conservation Authority (GRCA), but the land and water management plans are fragmented amongst authorities (Table 1), creating management gaps such as a lack of coordination, harmonization, and lasting connections (Chilima et al 2017).

Nestlé and Industry Context

Nestlé Logo

The worldwide bottled water market was estimated at $158 billion in 2014 and projected to double by 2020 (Jaffee & Case 2018). Nestlé is the global leader in the water bottling industry (Jaffee & Case 2018), with Nestlé Waters Canada being the Canadian branch of the water-taking sector of the company. They own 15 brands and 29 bottling plants between Canada and the US (Jaffee & Case 2018). Nestle takes from Mill Creek sub-watershed downstream from the subwatersheds used by Guelph and according to the City of Guelph's website, environmental effects haven’t extended to their water supply yet (City of Guelph 2017).

Of note, around 34% of plastic bottles in Ontario go to landfills (City of Guelph 2017) and, tap water is more regulated than bottled water and they are equally likely to contain contaminants in Canada and the US (Jaffee & Case 2018).

o   Nestlé enters the region and begins withdrawing water from a deep aquifer well in Hillsburgh, wellington in 2000 (Barlow 2013).

o  In 2015, nestle used about 2.1 of its 3.6 mil l/day allowance (City of Guelph 2017).

Tenure Arrangement

Tenure Status – Permit To Take Water (PTTW)

The aquifer and land are under provincial management by the MEPC and owned by Ontario (Ontario.ca, 2018). By law, you must have a permit if you plan to take 50,000+ litres of water in a day from the environment (Ontario.ca, 2018). The MECP issues all PTTWs and their guidelines are:

1. Environmental assessment
2. Prelim tests
3. Public comment/review
4. Send to MEPC
5. If approved, apply for PTTW
6. If accepted, report daily takings annually

Generally, the first water-taker has priority and subsequent takers cannot impede previously established takings (City of Guelph 2017). Some propose the PTTW be cut from a maximum duration of 10 years down to 1-5 years and require weekly extraction reports (Leslie 2016, Wellington Water Watchers). The tenures in this case have generally been 3-5 year permits with favourable renewal conditions (BAU continues until new permit issued). The PTTW is designed to ensure fair sharing, so for local municipalities to be given priority access would require the PTTW be rewritten (City of Guelph 2017).

Wellington's municipalities have their own PTTWs (Case, City of Guelph, Nestlé). The city of Guelph uses about 45 million litres per day, with 17 permits allowing a max of 122 million L/day (City of Guelph 2017).

There are 3 categories within the permit and Nestlé's PTTWs would be classified as Phase 1. “In Ontario, Nestlé Canada has two active Permits to Take Water (PTTW); one is for 3,600,000 litres/day in Aberfoyle and the other is for 1,113,000 litres/day in Erin, totalling 4.7 million litres/day" (Nestlé 2016). Nestlé owns its well/bottling infrastructures and is technically outside of the city of Guelph, therefore only subject to regulation from MECP, municipalities can only register comments/complaints (City of Guelph 2017). Nestlé's website states that the bottled water industry takes 0.6% of the Permits to take water (PTTWs) in the GRW and 0.2% total in Canada (Jaffee & Case 2018, Nestlé 2016) and additionally, “currently only 5% of all issued PTTWs in the province including bottled water companies, pay a permit fee for water drawn. The remaining 95% of water takers pay no fee while pumping over 99% of the water in Ontario.” (Nestlé 2016)

Administrative Arrangements

Acts & Bills

Acts and Bills pertaining to water bottling, well operation, water/shed management, public/private/government access and responsibility of resources (Ontario.ca):

Legislation	Purpose
Ontario Water Resources Act, R.S.O. 1990, c. O.40	Regulates well construction/operation and PTTW (taking >50000 million L/day)
Clean Water Act, 2006, S.O. 2006, c. 22	Safeguards wellhead protection areas (WHPAs) (City of Guelph 2017, Ontario.ca)
Safe Drinking Water Act, 2002, S.O. 2002, c. 32	Entitles the public to clean/safe drinking water
Water Opportunities Act, 2010, S.O. 2010, c. 19	Fosters innovation, development, and preservation of water
Conservation Authorities Act, R.S.O 1990, c. C.27	Conserves, restores, develops, manages watershed resources. Passed in 1946, “enabled municipalities to collaboratively manage land and water resources on a watershed basis” (Veale & Cooke 2017)
Environmental Protection Act, R.S.O 1990, c. E.19	Regulates pollutants/contaminants
Environmental Assessment Act, R.S.O 1990, c. E18	Establishes planning processes, assesses, and addresses the operation of water systems
Environmental Bill of Rights, 1993, S.O 1993, c. 28	Requires government to notify public and seek comment. Public holds right to comment on proposed legislation/regulation and request reviews of laws/regulations/policies/instruments
Planning Act, R.S.O 1990, c. P.13	Requires a ministry to consult with municipalities before authorizing any plans that would affect them

Institutions, Authorities & Reporting Systems

• GRCA
  • 1932: Ontario established first watershed agency in Canada, the Grand River Conservation Commission (GRCC) for surveying purposes (Veale & Cooke 2017)
    • Elora and Fergus, both in Wellington County, have been members since the 1930s (Veale & Cooke 2017)
  • 1948:  Grand Valley Conservation Authority (GVCA) (Veale & Cooke 2017)
  • 1966: GVCA and GRCC amalgamated to form Grand River Conservation Authority (GRCA), which is still the active authority (Veale & Cooke 2017)
  • 1990: Grand River accepted by Canadian Heritage Rivers Board on the basis of the watershed’s diverse cultural resources and recreation opportunities (Veale & Cooke 2017)
  • 2009-2010: Grand River Water Management Plan (WMP) established (Veale & Cooke 2017)
  • 2014: WMP finished and endorsed by 15 plan partners, includes 163 actions (Veale & Cooke 2017)
  • WMP was a voluntary undertaking by stakeholders seeking common goal (Veale & Cooke 2017)

• Wellington Water Watchers
• Council of Canadians

Stakeholders

Affected Stakeholders

Actor	Objective	Influence
The People of Wellington County	Secure water supply, increase control over "local" water	low power, high interest
Nestlé Employees	Maintain jobs, families, social	low power, very high interest
Wellington Water Watchers	Step 1: deny Nestlé all 3 PTTWs Step 2: phase out bottled water in 10 years Step 3: respect duty to consult First Nations Step 4: "ensure public ownerships and control of water"	Local NGO moderate power, very high interest
Municipal Councils	Secure control over "local" water as a right and a commodity	moderate power, high interest

Interested Stakeholders

Actor	Objective	Influence
Nestlé Waters Canada Corporation	Financial profit, future investments, maintain industry and public favour	high power, high interest
Ministry of Environment, Conservation, and Parks (MEPC)	Maintaining profits from Nestlé and public favour The Environmental Director hold signatory power for most plans	high power, low-moderate interest
Province of Ontario	Maintaining profits from Nestlé and public favour The Prime Minister at the time was Kathleen Wynne of the Liberal Party	high power, low-moderate interest
Canadian Bottled Water Association (CBWA)	Maintain industry, product demand, profits, public favour	moderate power, high interest
Council of Canadians (CoC)	Representation of Canadian public's values and interests	low-moderate power, low-moderate interest
Ecojustice	Providing legal representation for WWW and CoC when fighting Nestlé's 2012 appeal (Barlow 2013) Representing "the people" and public interests	moderate power, low interest

Discussion

Timeline of Conflict

• 2000-2001: Nestle Waters Canada bought the Aberfoyle Springs bottled water brand and its facilities (Aberfoyle and Hillsburgh) and began pumping (Jaffee & Case 2018)
• After 2005: Nestle permits allowed to extract max 3.6 million liters/day from Aberfoyle plus 1.1 million liters/day from Hillsburgh (Jaffee & Case 2018)
• April 2, 2007: Nestle Canada files application for 5yr, 3.6 million-litre PTTW from aquifers adjacent to those supplying Guelph (Province of Ontario Environmental Registry, 2008) (Case 2016).
• 2007: opposition to Nestlé’s renewal application emerges (Case & Zeglen 2018, Jaffee & Case 2018).
• May 2007: WWW organized campaign resulting in >7000-8000 Guelphites sending letters to MECP, but MECP granted permit (Case & Zeglen 2018, Jaffee & Case 2018).
• 2007: WWW becomes registered local NGO (Case & Zeglen 2018, Jaffee & Case 2018).
• Summer 2012: “Worst drought in more than a decade seriously impacted farmers, livestock producers, and residents” (Jaffee & Case 2018, Barlow 2013).
• In September 2012, Ontario ministry of the environment (MECP) renewed Nestlé’s lease for 5 more years, added a restriction limiting water withdrawal by 20% during “times of moderate drought” (Barlow 2013).
• Fall 2012: citizens of Erin Township held public demonstration against Nestle’s permit renewal, facilitated by WWW and Friends of Hillsburgh Water (FHW) (Case & Zeglen 2018, Jaffee & Case 2018).
• 2012-2013: Nestle appealed to Environmental Review Tribunal for removal of restriction (Barlow 2013). The ministry agreed to settle and with Nestle are asking the tribunal to approve new agreement (Barlow 2013).
• October 2013: Nestle withdrew appeal (Case & Zeglen 2018, Jaffee & Case 2018).
• Nestlé’s 2015 Annual Monitoring Report: (City of Guelph 2017, Nestlé.ca)
  • Water levels in the Amabel Aquifer, the water source of Nestlé’s Aberfoyle-based well, are stable
  • Nestlé’s water-taking has not caused a decline or drop in water levels year after year
  • There are no negative impacts to the aquifer
  • Water taking at the current rate is sustainable at this point in time
• 2015: Nestlé used about 2.1 of its 3.6 mil l/day allowance (City of Guelph 2017).
• 2015: nestle expanded operations to Elora and purchased the Middlebrook Well intending to supply the Aberfoyle plant (Jaffee & Case 2018)
  • Initially, Nestle stipulated it be allowed to conduct test pumping before committing (Jaffee & Case 2018)
  • If the permit is approved, the well would extract 1.6 million liters/day (total extraction in the county would = 6.3 million liters/day) (Jaffee & Case 2018)
• By 2016: opposition was “organized” and “vocal enough” to draw involvement from top provincial officials (Jaffee & Case 2018)
• July 2016: Nestlé’s Aberfoyle PTTW expires (Nestlé Waters, The Canadian Press)
• August 2016: activists “organized” and “vocal enough” to draw involvement from top provincial officials. Premier (leader of province) Kathleen Wynne admitted permit-to-take-water system was out-dated (Jaffee & Case 2018)
• November 30, 2016: Guelph filed submission in support of 2 year moratorium, also recommended changes and considerations (City of Guelph 2017).
• December 2016: provincial government imposes 2-year moratorium on new and expanded water-taking-for-bottling permits in order to reassess the regulatory processes (Jaffee & Case 2018)
• Before 2017: Nestlé was paying $3.71 per million litres (Leslie 2016, Barlow 2013 AND) plus $750 permit fee (Ontario.ca, Leslie 2016, The Canadian Press 2017).
• August 2017: water price change from $3.71 to $503.71 now in effect (Jaffee & Case 2018, The Canadian Press 2017)
• August 2017: Hillsburgh (Erin) Well permit expires
• January 2019: Moratorium that stops Nestle from proceeding with Middlebrook Well is over (Jaffee & Case 2018)

Areas of Conflict

A main area of tension is the designation of restrictions and fees (The Canadian Press, 2017). This includes changes to existing restrictions and fees, protocol for expired permits, and the water-bottling moratorium. Many public interest groups have expressed support for increasing regulation and extending the moratorium, while Nestle has argued for the continuation of existing permits. The Canadian Bottled Water Association (CBWA) claims that increasing the cost of bottling water will be passed directly onto consumers. According to CBWA spokesperson Elizabeth Griswold, “the industry cannot absorb additional costs… Increasing cost for Ontario companies would also serve to open the market for imported bottled water, and many Ontario jobs would be lost.” (Leslie 2016).

The environmental and social impacts of removal of water from the watershed are also a point of conflict (Jaffee & Case 2018). Currently, well water levels are consistent and not in decline according to the City of Guelph (2017). However public interest groups expressed concerns that increasing water-taking could change this.

The environmental impact of the plastic bottling process is also a highly contentious aspect of the issue (Jaffee & Case 2018).

At the heart of this issue is the debate over the commodification of water. The water bottling industry, in this case Nestle, is dependent on water commodification in order to maintain profits, however many feel that this is contrary to the idea that water is a human right that should be equitably managed and freely accessible to all. This has raised larger concerns of self-determination and social equity and criticisms around Nestle’s water-taking operations and business model. According to to Barlow (2013), “the [????] appeal is inconsistent with the public trust and must be rejected. The public trust doctrine holds that important common resources - such as water and air - are held by government on behalf of the public, and must be managed for the benefit of current and future generations. If successful, this case could set a crucial precedent for recognizing water as a public trust and granting communities priority rights to control their water and how it is used.” (Paragraph 2, Barlow 2013).

There are also other factors at play in this scenario that paint a much less black-and-white picture. According to Jaffee & Case (2018), “The scarcity narratives deployed by local residents, activists, public officials, and bottling industry representatives illustrate the use of several forms of figurative conflation involving geographic and temporal scales of water scarcity, and economic and volumetric forms of scarcity. We argue that this conflation illuminates deeper issues of economic and social justice at the heart of the conflict, which transcend reductionist hydrological assessments of scarcity or abundance.”

Assessment

Assessment of Power:

Given that wellington county has no direct power over Nestlé’s operations, which are ratified by the province, the main form of power they hold is socio-political influence. On the other hand, Nestlé holds a substantial amount of power through economic influence. Ultimately, the province holds final say on all proceedings and has the legislative power to influence both Nestle and wellington county

Assessment of Social Engagement:

The level of social engagement on this issue varies by stakeholder and can be classified according to Fig 5. Majority of the citizens in and around wellington county can be considered as “observing” and/or “following” the issue. Members of both local and national activist groups can be considered “enforcing” and/or “contributing” to social engagement on this issue. The Nestlé employees can be considered “following” the issue as they are closely monitoring the situation as it relates to their jobs, but feel they have little influence over the results.

Assessment of Social Licence:

A significant factor in this case has been the use of social license as a means of accumulating public power. The existence of social license is often "described as a PR tool to legitimize resource extraction yet it can also be wielded to the opposite effect, wherein withholding social license becomes a tool to delegitimize operations" (Gunster & Neubauer 2018a).

Media plays a large role in defining and framing what social license means for the various stakeholders (Gunster & Neubauer 2018b). In this case, the local and national media has consistently been a key means of communicating stakeholder narratives and views. Without the use of media, the public interest groups and concerned citizens would have limited influence and ability to garner broader support. This has been a main method for reducing Nestle’s social licence to operate.

Assessment of Responsibility:

This case, like many others, is complex because of the number of affected and interested stakeholders and governmental groups with responsibilities within the watershed. Groups with watershed responsibilities include 15 federal departments/ agencies/ corporations, 5 provincial ministries, 1 regional council, Six Nations of the Grand River, 2 watershed groups, and various municipalities’ public works divisions (Table 1).

Institutions with watershed responsibilities in the GRW (Chilima et al 2017)

Federal level	Provincial level	Municipal/ First Nations level	Watershed level
Agriculture and Agri-Food Canada	Ontario Ministry of the Environment (MOE) including its sub-agencies such as: Ontario Clean Water Agency (OCWA)	Public Works division of various municipalities and cities such as: Guelph, Kitchener, Paris, Cambridge and Brandford	Grand River Conservation Authority (GRCA)
Canada Mortgage and Housing Corporation
			Lake Erie Region Source Water Protection
		Certified water operators of Six Nations of the Grand River
Canadian Environmental Assessment Agency	Ontario Ministry of Municipal Affairs and Housing (MAH)
Environment Canada		Waterloo Regional Council
	Ontario Ministry of Natural Resources (MNR)
Fisheries and Oceans Canada
	Ontario Ministry of Agriculture, Food, and Rural Affairs (OMAFRA)
Foreign Affairs Canada
Health Canada
	Ontario Ministry of Public Infrastructure and Renewal (OMPIR)
Indian and Northern Affairs Canada (Now Aboriginal Affairs and Northern Development Canada)
Industry Canada
Infrastructure Canada
International Trade Canada
Natural Resources Canada
Parks Canada
Public Works and GovernmentServices Canada
Transport Canada

Recommendations

The continued issues in this area over the years stress the lack of adequate watershed management in the GRW as well as poor stakeholder engagement processes. Existing financial, human, political, and information challenges should be minimized. Funding and implementation should also be improved. Additionally, expanding consultation according to a model of Free, Prior, Informed Consent (FPIC) is of critical importance. (Shrubsole et al 2017)

Effort should be taken to create an integrated water resource management (IWRM) plan.  Shrubsole et al (2017) define IWRM as “an ecosystem approach in which at least

1. The catchment or river basin rather than an administrative or political unit is the management unit;
2. Attention is directed to upstream–downstream, surface–groundwater and water quantity–quality interactions;
3. Interconnections of water with other natural resources and the environment are considered;
4. Environmental, economic and social aspects receive attention; and
5. Stakeholders are actively engaged in planning, management and implementation to achieve an explicit vision, objectives and outcomes.”

Chilima et al’s (2017) suggested approach to GRW management is another useful tool. It involves the use of 3 main pillars of (1) a combined law-policy approach (2) a strong coordinating mandate, and (3) tiered planning and assessment.

Some feasible solutions suggested by the City of Guelph include (City of Guelph, 2017):

• “Reducing the maximum term to five years for a permit-to-take-water”
• “Additional consultation for applicants renewing permits to take water”
• “More transparent information sharing online, including weekly water monitoring data for public reference”
• “A stronger science-based process to evaluate proposed water taking impacts that include source water protection technical models, which prioritize future municipal growth and the associated water demands”

Finally, according to Case, “While water is the focus, much of this activism is driven by three broad social priorities that reflect ideas of community resilience and which suggest entry points for social work participation in community-based environmental initiatives: self-reliance and sustainability, localization and direct citizen participation, and community.” Findings P 2 (Case 2016)

References

Barlow, M. 2013. Why Wellington County is standing up to Nestlé. Alternatives Journal. Vol 39, Issue: 4, p 10. Retrieved from http://ezproxy.library.ubc.ca/login?url=https://search.proquest.com/docview/1419387537?accountid=14656 Case, R. 2016. Eco-social work and community resilience: Insights from water activism in Canada. Case Journal of Social Work. Vol 17, Issue: 4, pp. 391 – 412. https://doi.org/10.1177/1468017316644695

Case, R., & Zeglen, L. 2018. Exploring the ebbs and flows of community engagement: The pyramid of engagement and water activism in two Canadian Communities, Journal of Community Practice, Vol. 26. Issue:2, pp. 184-203, DOI: 10.1080/10705422.2018.1449044

Chilima, J. S., Blakely, J.A.E., Noble, B. F., & Patrick, R.J. 2017. Institutional arrangements for assessing and managing cumulative effects on watersheds: Lessons from the Grand River watershed, Ontario, Canada, Canadian Water Resources Journal / Revue canadienne des ressources hydriques. Vol. 42, Issue:3, pp. 223-236, DOI: 10.1080/07011784.2017.1292151

City of Guelph. 2017, May 29. Questions and answers about Nestlé, Guelph's water restrictions and conservation. Retrieved from https://guelph.ca/living/environment/water/nestle/

Gunster, S. & Neubauer, R.J. 2018. (De)legitimating extractivism: the shifting politics of social licence. Journal of Environmental Politics. DOI: 10.1080/09644016.2018.1507290

Gunster, S., & Neubauer, B. 2018. From public relations to mob rule: Media framing of social licence in Canada. Canadian Journal of Communication, Vol. 43, Issue: 1. DOI: 10.22230/cjc.2018v43n1a3342

Jaffee, D. & Case, R. 2018. Draining us dry: Scarcity discourses in contention over bottled water extraction, Journal of Local Environment. Vol 23, Issue: 4, pp. 485-501. DOI: 10.1080/13549839.2018.1431616

Leslie, K. 2016, December 21. Premier Wynne wants 'bigger look' at future of bottled-water industry. Retrieved from https://www.thestar.com/business/2016/12/21/premier-wynne-wants-bigger-look-at-future-of-bottled-water-industry.html

Nestle Waters. (2016, September). Nestle in Canada: Proud to manufacture in Ontario. Retrieved from https://www.nestle-waters.ca/en/aboutus/documents/nestle in canada - fact sheet (sept. 2016).pdf

Shrubsole, D., Walters, D., Veale, B., & Mitchell, B. 2017. Integrated water resources management in Canada: the experience of watershed agencies. International Journal of Water Resources Development, Vol. 33, Issue: 3, pp. 349-359, DOI: 10.1080/07900627.2016.1244048

The Canadian Press. 2017, December 26. Ontario allowing bottled water companies to take 7.6M litres a day on expired permits | CBC News. Retrieved from https://www.cbc.ca/news/canada/toronto/ontario-water-bottling-1.4420158

Veale, B., & Cooke, S. 2017. Implementing integrated water management: illustrations from the Grand River watershed. International Journal of Water Resources Development, Vol. 33, Issue: 3, 375-392, DOI: 10.1080/07900627.2016.1217503

Wellington Water Watchers. (n.d.). About us. Retrieved from http://wellingtonwaterwatchers.ca/about-us/

Wellington Water Watchers. (n.d.). Nestlé and the Middlebrook well. Retrieved October 11, 2018, from http://wellingtonwaterwatchers.ca/campaigns/nestle-and-the-middlebrook-well/

Wellington Water Watchers. (n.d.). Say no to Nestlé. Retrieved from https://www.saynotonestle.ca/ 

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