Toronto Star: Elora takes on Nestle to safeguard future access to water

Donna McCaw and Jan Beveridge, shown by the Grand River in Elora, are members of Save Our Water, which is fighting Nestle Canada’s plan to draw 1.6 million litres of water a day from a nearby well. COLE BURSTON / FOR THE TORONTO STAR

The water supply in this small Ontario town faces ‘significant’ risk. So why is the province considering letting Nestle take even more?

By Robert Cribb and Stefanie Marotta Toronto Star

ELORA, Ont. — The artesian well that feeds Rob MacKay’s farm suddenly stopped bubbling.

A small silver pipe near the barn had always gushed water drawn from deep below his property in the Township of Centre Wellington, about 100 kilometres west of Toronto, known for its rushing, white-water gorge that helps supply the town’s needs.

But in July of last year, the water lay still for the first time.

MacKay knew the drought deserved some blame but he wondered about another possible culprit: Nestlé Waters Canada Inc., which has been drawing millions of litres of water from the Grand River watershed every day for the past 18 years and putting it in bottles that retail across Canada for as little as $1.

For MacKay and thousands of others in this agricultural region, warnings about future water sustainability have emerged as an existential threat.

New evidence suggests those concerns have merit.

A new independent impact study paid for by the environment ministry concludes the risks to the water supply in Centre Wellington — a region identified for major population and employment growth — are “significant,” the highest level of urgency.

“Centre Wellington’s current water supply system does not have the ability to meet future demands,” the report, authored by engineering firm Matrix Solutions Inc., reads. “Therefore, all consumptive water uses…within this area are considered significant drinking water quantity threats.”

Still, the province has not closed the door to expanding Ontario’s water bottling industry. Last month, it extended the moratorium by nine months — the second extension in two years — saying it will continue to review.

The betting money around Elora is on Premier Doug Ford’s government eventually allowing expansion. If that happens, this community could be forced to allow Nestlé, the world’s largest beverage company, to pump additionalmillions of litres a month at the Middlebrook well that the company owns just outside of town.

Provincial environment minister Jeff Yurek did not agree to an interview for this story. Instead, a written statement from ministry staff says the province is “taking time to complete our analysis of the water quantity review,” and that it will “continue to engage with the public, stakeholders and Indigenous communities for input on how we manage provincial water taking to ensure the safety of secure, reliable sources of water.”

In written statements, Nestlé denies any evidence of long-term water shortages in the region from further water taking.

“There is no verifiable scientific basis to make any such claim about current or future impacts,” reads the written response from Andreanne Simard, the company’s natural resources manager.

“Nestlé Waters Canada is committed unequivocally to the careful, controlled and transparent stewardship of watersheds in the communities where we operate…We have not, would not and will not ever seek to access any watershed – in this region — unless there is verifiable scientific evidence that the resource is healthy and sustainable.”

The new study’s “significant risk” warning for Centre Wellington is based on an “inability for the current municipal wells to meet future water demand,” says Martin Keller, source protection program manager with the Grand River Conservation Authority.

While the study concludes current water demands are being met, it cites data showing projected population growth that could exceed current capacity as early as 2031 during maximum daily use. By 2041, the township will not be able to meet average daily demands with the current infrastructure, the conservation authority concludes.

Water taking for domestic use, livestock or land development will have a “minimal” impact on the water supply, the study found. But large, new water taking permits — including those provided to water bottling p roducers such as Nestlé — may affect levels at municipal wells depending on the location of those new wells and how much water they take, says Keller.

“In some ways it’s a good news story that, yes, we still have enough water,” he said. “But I think it’s also a flag that if everybody was going ahead without management, and just digging wells all over the place we probably wouldn’t have enough water. And so there’s a need to manage the resource appropriately.”

The new study does not consider the impact of added water taking from Nestlé’s Middlebrook well.

But a separate study by engineering firm AECOM in April concludes water taking at Middlebrook would result in water level reductions in surrounding wells by 2.5 to 3.5 metres, lowering the maximum daily capacity by 560 cubic metres.

That reduction would be “unacceptable,” the study concludes, and “not considered a feasible option and therefore no further analysis was completed for this scenario.”

During a presentation to the Centre Wellington township council in June, Matthew Alexander, hydrogeology manager with engineering firm AECOM, said the deficit from new water taking from Middlebrook would mean “additional supply would be required to compensate for that reduction.”

Nestlé’s written statement says the AECOM report relied on assumptions “with no verifiable factual basis and almost no underlying scientific data” and that made the conclusions “speculative.”

Studies warning of future water “stress” in the region date back a decade.

A 2009 Grand River Watershed report by AquaResource identified a “moderate potential for hydrologic stress when considering future water demands in a drought scenario.”

An analysis in 2015 by the Grand River Conservation Authority found “a potential for hydrologic stress” in light of future demands.

In 2018, a Centre Wellington township water supply report predicted a water capacity deficit by 2026 that increases to more than 7,000 cubic metres of water a day by 2041.

Taken together, the body of evidence presented in the studies says, “at some point in the time, the current infrastructure….is not sufficient to meet the demands that they will have given the growth projections,” Keller said.

Nestlé already operates two wells in the region — one in Aberfoyle and a second smaller well in the town of Erin, 40 kilometres northeast of Guelph.

Those wells — approved to pump nearly five million litres a day — already account for nearly half of all Ontario water destined for plastic bottles, according to provincial data.

For that water, Nestlé and other water bottling companies pay Ontario $503.71 per one million liters — about five cents for 100 litres of water.

That rate doesn’t cover the cost of the provincial monitoring and management, according to the Council of Canadians.

“(The moratorium extension) is temporarily good,” said the organization’s chair Maude Barlow. “But we want the whole process — bottled water extraction — stopped in Ontario and across the country.”

That’s unlikely, Barlow acknowledges.

“I think they’re just looking for a way to justify to go ahead and allow companies to move ahead with it. In the meanwhile, (Nestlé) is still taking water from these wells…They’re still getting away with making a huge profit from our water.”

At a retail price ranging from $1 to $2.50 for a standard 500-millilitre bottle of water, the spread between the raw cost and retail price makes a compelling business case.

And the bottled water business is booming. In 2016, bottled water sales surpassed soft drinks in the U.S. for the first time to become the top selling beverage category, according to the International Bottled Water Association and the Beverage Marketing Corporation. Overall, sales hit 13.7 billion gallons in 2017, a seven-per-cent jump from the year before.

Nestlé identified Centre Wellington for expansion in 2016 and purchased the Middlebrook well, which has been sitting boarded up and untapped because of the moratorium.

The company argues in its written statement that the bottled water industry takes only .6 per cent of available groundwater in Ontario and that bottling water is a far more efficient use of the public resource compared to beer brewing and car manufacturing.

Nestlé Canada also says it is not taking the full amount of water it has been approved to bottle. The company consistently pumps less than 60 per cent of its annual allowance from the Aberfoyle well, according to its monitoring reports. At the Erin well, Nestlé typically takes less than 50 per cent of its allowance.

During low-water warnings, Nestlé is not required to reduce its water taking but said that it voluntarily decreased its rate during one of the area’s most severe droughts in 2016 and has maintained this reduction since. Even so, in 2016, Nestlé withdrew 783.5 million litres, its fourth highest annual amount of water in the 18 years that it has pumped water from Aberfoyle.

“In 2016, we pumped 40 per cent fewer litres than the total amount permitted annually by regulation, a threshold that is based on verifiable science,” the Nestlé statement reads. “That careful stewardship is an example of how we ensure the health and sustainability of water resources.”

Nestlé officials have said that the company is willing to share the Middlebrook well with the township but it needs that well as a backup in the event of an “unplanned shutdown” at Aberfoyle, allowing the company to “avoid ever having to halt operations and lay off employees,” the written statement reads.

The last “pump test” to determine the water volume that could be drawn from the Middlebrook well is 15 years old, dating back well before Nestle owned the property. It showed up to 1.6 million litres a day in potential water drawing. That level of production has never happened.

Nestlé’s written statement says it has no plans to bottle that much water from the well. While the company wants to conduct a fresh test, it has been unable due to the moratorium.

In the broad picture of protecting water resources, Nestlé is a relatively small threat, according to Rob de Loe, a water policy expert. He said that other industries, such as gravel excavators and pet-food manufacturers, use far more water.

“When it comes to the water bottlers, the thing that bugs me about the whole Nestlé controversy is that there are bigger fish to fry,” he said. “I have found, in my experience, that people seem to think that the problem begins and ends with Nestlé. And I don’t. I think an excessive focus on water bottling is limiting our ability to ask bigger and more important questions.”

Barlow of the Council of Canadians says that while other businesses take large volumes of water, there are unique impacts when water is removed entirely from the aquifer and shipped across the country in plastic.

“Plastic bottled water isn’t the only issue, but (water bottling operations) come in to a community and take that water until it’s gone. They’re like water miners. They may not impact the global total water taking per se, but it’s what they do to a local community.”

With water shortages growing globally — dozens of cities from Cape Town to Cairo to Istanbul and London have declared various states of “water stress” — bottled water giants are claiming private control of an increasingly vital public asset, says Barlow.

“We are a planet running out of clean, accessible water and those who gain access to it are going to be rich and powerful,” she said. “(Nestlé) can read the tea leaves as much or more than anybody. Even if they don’t need (the Middlebrook well) now, they want access to it in the future.”

Beneath MacKay Farms, water swirls toward nearby towns.

At 6,800 square kilometres, the Grand River watershed — which stretches across Southern Ontario from the Bruce Peninsula in the north and Niagara Falls in the south — is about the same size as Prince Edward Island. It provides water to a million people spread across 39 municipalities and two First Nations.

The area is one of the largest in Ontario to depend solely on groundwater and includes some of Canada’s fastest growing communities such as Kitchener, Waterloo and Guelph.

Rob MacKay and his brother Gord grew up in Guelph, riding and training horses with their father. Gord became a lawyer and Rob a theatre producer but they wanted to get back in the riding ring.

As they discussed retirement, they purchased MacKay Farms in 2009. Rob planted vegetables and grain to sell at the farmer’s market, while Gord moved two horses into the barn to train for shows. Their one well is the only source of water to feed the crops and animals.

During times drought or long periods without rain, MacKay has begun using a pump to force water out of the artesian well that once had more than enough pressure to flow without assistance.

“Annually now it seems to me that there’s always going to be a few weeks at minimum in the summer with insufficient rain,” he says. “The concern is a change in the flow rate of our well.”

Centre Wellington has been identified by the province as a key growth area with the population rising from approximately 19,000 in 2016 to more than 40,000 people by 2041. In the City of Guelph, the population is expected to grow by 54,000 with 21,500 new jobs requiring 24,000 households be built. Those homes and businesses will need water.

The city regularly issues water supply warnings. Weekly water condition reports show a steady string of “Level 1: Yellow” ratings advising residents to reduce lawn watering with fines up to $350 for those failing to comply.

On threat of fines, Centre Wellington residents are also restricted from using water at certain times of day and days of the week during low water warnings, unable to water their lawns or wash their cars.

“People are just letting their lawns die,” Elora resident Jan Beveridge says. “You can always tell when someone has just moved here from a big city because they’re out there drenching their lawns.”

Driving from his rural home to his part-time job as mayor of the postcard-perfect county of Centre Wellington, Kelly Linton’s black Dodge Durango hugs the fields where farmers say their well water is beginning to dry up.

Turning onto the streets of Elora, signs rising from manicured lawns of Victorian-era homes warn passersby to “Save Our Water.”

Linton, a soft-spoken husband and father of two who traded Toronto for the charm of his childhood home two decades ago, has been convinced Nestlé’s expansion would pose dire consequences to his community’s growth. And so, he finds himself in the bull’s eye of a high-stakes battle with one of the most powerful corporations on the planet.

This isn’t the job Linton signed up for when he decided to run for council in 2010 after a career running his own management consulting firm in the GTA. Water sustainability wasn’t a blip on the public radar. Centre Wellington is well known for the quality and quantity of its water, a place where wells bubble uncontrollably — an abundance that drew the earliest settlers generations ago and, more recently, Nestlé.

Linton, who was elected mayor of Centre Wellington in 2014, recognizes he and the council are very much the Davids facing Goliath.

With a market cap of $310 billion (US), Switzerland-based Nestlé S.A. is a behemoth on the global stage. With its Pure Life, Perrier, San Pellegrino, Acqua Panna and Montclair brands, it controls 30 per cent of the global bottled water market, according to Euromonitor International.

Linton’s tightrope walk balancing his town’s interests with the needs of a corporate giant might be tricky enough. It’s complicated by his position as warden of Wellington County — a job that requires him to serve the best interests of the area, including the towns of Aberfoyle and Erin, in adjoining Puslinch township.

“I have to know what hat I’m wearing,” he says. “As mayor of Centre Wellington, I do not want to see commercial bottled water facilities in Centre Wellington. But as warden of the county, I may need to talk to Nestlé about things.”

Dissent over Nestlé’s operations is far more muted in the other two towns, in large part thanks to economic benefits the company provides. Nestlé has 175 employees and is the largest taxpayer in the county at a little more than $1 million a year.

“To my understanding all [permits to take water] within Puslinch have had no effect on local water supply,” township mayor James Seeley said in an interview. “Nestlé [is a] great corporate citizen working within the legislation required from the Province of Ontario.”

At Nestlé’s second well in Erin, the company employs one part-time employee managing the well where trucks pull up to it daily to extract water and haul it to the Aberfoyle headquarters.

Since April 2017, Erin, through the Erin Community Benefit Fund, receives 50 cents from Nestlé for every 1,000 litres pumped, with a minimum payment of $25,000 per year. The more water it pumps, the more money the town gets for community amenities such as a skatepark and a playground. The offer was accepted by councillors despite opposition by residents asking that it be rejected.

“Nestlé hasn’t directly affected us. Nestlé has been working with the town of Erin. They’ve been able to provide us with reports and funding and that leads directly to providing our residents with additional programming,” Town of Erin spokesperson Jessica Spina said in an interview.

The levy rankles some residents.

“To me it’s almost a joke giving you $25,000,” said Marlene Kawalez, an Erin resident. “Here’s a pat on the back. This is going to help our community while they’re taking millions of dollars, on a consistent basis, out of our community.”

Centre Wellington township will receive few real economic perks if Nestlé begins pumping water, say local politicians like Linton.

He figures it might be one job at most and a pittance in taxation.

“It comes down to making decisions that are in the best interests of this town,” he says. “This is a fight worth fighting for Centre Wellington. There’s no jobs, there’s no development for us. There’s no other side. We know water is the most basic infrastructure we need. We know we need more of it. We know we need to drill more wells. Why would we want to encourage water taking?”

The notion of a future water shortage seems counterintuitive in a town that many Ontarians associate with the waterway that flows through it.

Not far from the MacKay farm, locals and visitors alike ride inflatable tubes the rushing Grand River along the towering cliffs of the Elora Gorge.

Above them, blue ribbons dot the landscape, tied around the tree trunks. They are placed there every spring by local activists to show their opposition to the Middlebrook well. Across the Township of Centre Wellington, hundreds of shiny blue ribbons dance in the breeze.

Nestlé’s presence in Elora has triggered a groundswell of opposition in a public information campaign that has engaged many of the town’s residents.

The “Save Our Water” slogan is not only on lawn signs. It shows up in the local paper, on telephone poles and local businesses. Inside one coffee shop on the main drag, a small sign reads “I Am A Water Protector.”

In a red-brick home at the corner of a residential block, a group of self-appointed hydrogeologists gathers.

Jan Beveridge spreads maps, water reports and council meeting agendas across her small, wooden dining table that she has surrounded with 12 chairs. Eleven coordinators take their seats, sifting through the paperwork, assessing their next move.

“We’re in a David-and-Goliath situation, and now our entire town has woken up,” said Beveridge. “This big company was allowed to buy one of our best sources of good-quality water.”

One report by the group lays out the stark choice: “The underlying question to our leaders is: Who gets preference to a limited water supply? Is it a municipality that has existed since 1832 and which has recently been mandated to double its urban population to 45,000 residents with an allocated target of 9,000 new jobs, or a newly arrived water bottler creating no new jobs and using outside labour to pump and truck local water out of the area?”

When Nestlé applied for a permit to evaluate the Middlebrook well in 2015, the Ontario Environmental Registry received more than 1,200 comments from residents, overwhelmingly asking the government to reject the company’s request.

“Please do NOT sell our water to corporate interests,” reads one of the submissions. “In the interest of our future and our RIGHTS as Canadians, do not allow this to happen.”

Another reads: “I am deeply disturbed that the Ministry of the Enviromnment would even consider the possibility of allowing a multi-national corporation not only to take possession of, but extract a commodity that is so crucial to the well being and survival of its citizenry.”

It was an “unbelievable number of comments,” said Guelph hydrogeologist Stan Denhoed. “Sometimes you get 10 comments, or one, and sometimes none, depending on the controversial nature of the permit.”

At a public town hall meeting hosted by Nestlé in April — to which the company invited residents — concern was tangible.

At one point, Mike Balkwill, campaign manager for the conservation advocacy group Wellington Water Watchers, sought clarification on a company response about Nestlé’s water taking in a small town in France.

Nestlé’s corporate affairs director Jennifer Kerr walked into the audience and stood in front of Balkwill, attempting to block his contact with the panel. She told him that he needed to take his seat.

“The only question here is, if it was discovered that you were reducing the aquifer, would you stop pumping?” Balkwill said, craning his neck to speak over Kerr.

“Sir, this isn’t a discussion this evening,” moderator Cheryl Holmes said. The panel wanted a “safe and respectful” forum, she added.

“It’s okay,” Andreanne Simard, Nestlé’s natural resources manager, said to the moderator. “I want to answer this…

“If we had a negative impact on the water resource due to our operation, we would advise and look to change our operation accordingly,” Simard said, adding that Nestlé’s water taking in Puslinch and Erin does not affect surrounding wells.

Back on the MacKay farm, Rob turns the faucet on the thin, black hose that leads from his well to his field of tomatoes. The soil around the tomato plants darkened as the water from the watershed fed his crop.

“When bottled water first came out, I don’t think people thought about the depletion of groundwater,” he says. “… [They think there] can’t be anything bad with this product, it’s government approved, or the government wouldn’t let them [pump water] if it was going to cause any trouble. There’s a lot of people that think that way, but I don’t think it’s accurate…I think that the governments don’t think about the long term-things.”

With files from Valerie Dittrich, Chelsey Gould and Lidia Abraha, Ryerson School of Journalism