THE STANDING SENATE COMMITTEE ON TRANSPORT AND COMMUNICATIONS
EVIDENCE
OTTAWA, Wednesday, December 11, 2024
The Standing Senate Committee on Transport and Communications met with videoconference this day at 6:45 p.m. [ET] to study matters relating to transport and communications generally.
Senator Leo Housakos (Chair) in the chair.
[English]
The Chair: Good evening, honourable senators. I’m Leo Housakos from the province of Quebec and chair of this committee. I would like my colleagues to briefly introduce themselves.
Senator Cuzner: Roger Cuzner, senator from Nova Scotia.
Senator Quinn: Jim Quinn, New Brunswick.
Senator Cardozo: Andrew Cardozo, Ontario.
[Translation]
Senator Miville-Dechêne: Julie Miville-Dechêne from Quebec.
Senator Youance: Suze Youance from Quebec.
[English]
The Chair: This evening, we are continuing our study of copper wire theft and its impact upon the telecommunications industry.
The committee welcomes Eric Smith, Senior Vice-President, Canadian Telecommunications Association; Michele Austin, Vice-President, Public Affairs, Bell Canada; Brian Lakey, Vice‑President, Reliability Centre of Excellence, TELUS; and Francis Bradley, President and Chief Executive Officer, Electricity Canada.
I welcome all our guests with us here this evening. We will have five-minute opening statements for each of our witnesses, after which I will turn it over to my colleagues for questions.
Mr. Smith, you have the floor, sir.
Eric Smith, Senior Vice-President, Canadian Telecommunications Association: Thank you and good evening.
The Canadian Telecommunications Association is dedicated to building a better future for Canadians through connectivity. Our members include service providers, equipment manufacturers and other organizations that invest in, build, maintain and operate Canada’s world-class telecommunications networks.
I appreciate the opportunity to appear before you today to discuss the issue of copper theft and its impact upon Canada’s critical communications infrastructure.
As members of this committee are aware, the telecommunications sector is an integral part of Canada’s economy and supports the operations of nearly every business and government department across Canada. Our networks are also the backbone that connects Canadians to one another, as well as to health care, education and emergency services.
While Parliament has been considering and passing laws to address the threat of foreign actors to telecommunications networks and other critical infrastructure, there’s a significant domestic threat growing within Canada. Driven by the rising value of copper, bad actors are targeting telecommunications infrastructure across the country to steal copper and sell it for financial gain. By some estimates, there was a 200% increase in theft and vandalism incidents between 2022 and the start of 2024, and the number of incidents continues to rise.
You’ll hear from other witnesses about their companies’ experiences with theft and vandalism, and how they have affected operations and impacted affected communities. These acts are not mere inconveniences to telecom companies; they affect individuals and communities; impact utilities, hospitals, airports and businesses; and, most important, they threaten public safety and human life.
The telecommunications sector is taking action to address this issue. Network operators are investing in additional security, including monitoring equipment and alarms. They are also making efforts to raise awareness among law enforcement about the seriousness of these crimes.
However, we can’t do it alone. In February 2023, a subcommittee of the Canadian Security Telecommunications Advisory Committee, or CSTAC, issued a report in which it recommended that the federal government create a new article of federal law that maximizes criminal penalties in the event of wilful or negligent damage to, violence toward or theft of critical network infrastructure.
Now, a year and a half since this recommendation was made, the need is even greater. While some might argue that the Criminal Code already contains the offences of theft and mischief, these provisions are inadequate for prosecuting those who target critical infrastructure.
In the case of copper theft, the value of stolen copper is often quite low, resulting in charges of theft under $5,000. This is the same charge levelled against someone caught stealing a bicycle, yet the consequences of copper theft are much greater.
We need new laws with greater penalties, and we don’t have to look far to find precedent. Earlier this year, Parliament recognized the importance of protecting the essential infrastructure by passing Bill C-70, which, among other things, modernized the criminal offence of sabotage to protect essential infrastructure from foreign interference.
We’re asking for similar protections from other equally harmful acts. In the U.S., at least 31 states have criminal laws addressing theft of and vandalism to critical infrastructure, including telecommunications facilities. To give one example, in July of this year, Florida created new criminal offences to protect critical infrastructure from theft and vandalism, including penalties of imprisonment for up to 15 years and fines of up to double the losses suffered. It also established civil liability for convicted individuals, making them liable for three times the amount of the actual damages.
One commentator noted the following:
Florida law previously lacked specific provisions addressing these types of offenses, relying instead on general criminal mischief and trespassing statutes. . . .
They continued, saying that this new law “. . . now fills this gap by providing a clear legal framework for prosecuting those who target critical infrastructure.”
We’re asking Parliament to fill the gap that exists in Canadian law. A new law with stiffer penalties would send a strong message to the public about the seriousness of these crimes and create a greater deterrence for would-be criminals.
We appreciate the committee’s recognition of the seriousness of copper theft and vandalism. I’m happy to answer your questions.
The Chair: Thank you, Mr. Smith. Now we turn it over to Ms. Austin.
Michele Austin, Vice-President, Public Affairs, Bell Canada: Before I begin, I believe the clerk circulated a document to the committee members that I’ll refer to in my comments.
I chair Bell Canada’s cross-functional committee on network‑impacting security incidents.
I am proud to acknowledge that I live and work on unceded Algonquin Anishinaabe territory.
At Bell, our purpose is to connect Canadians with each other and the world. It is becoming increasingly difficult to deliver on that purpose because of copper theft.
Network-impacting security incidents, including copper theft, are having a profoundly negative impact on Canadians and the economy. Businesses can’t process transactions. Airports must stop ticketing passengers and sometimes have to cancel flights. Emergency services cannot answer calls for help. Small businesses must stop work or close until they are back online. Families can’t check up on loved ones.
Bell’s network footprint starts at the border of Saskatchewan and Manitoba and runs east through Ontario, Quebec, New Brunswick, Prince Edward Island, Nova Scotia and Newfoundland and Labrador.
Since January 2022, there have been over 1,650 physical network-impacting security incidents across Bell’s footprint. I would note — having watched the testimony yesterday — that is a very different number than you heard. Copper theft is responsible for 88% of the physical security incidents that impact Bell’s network. The year-over-year increase of copper theft from November 2023 to November 2024 was 78%.
To support continued investment in Canada’s telecommunications networks, at the earliest opportunity, the Government of Canada must introduce amendments to the Criminal Code that create specific offences that target networks, telecommunications facilities and telecommunications services.
Chair, I have provided a presentation to the clerk that will help me illustrate the impact of copper theft, if committee members could please turn to page 2.
The first picture is the Lorne Bridge in Brantford. The bridge has been hit by copper thieves four times, impacting local businesses and the airport. You’re looking at the work of the repair team. You can see the graffiti under the bridge, and that is the repair work on the copper cables. Bell recently installed an innovative real-time cable theft network system under the bridge that dispatches police to the location immediately.
Copper theft in Brantford is a growing problem, and the city council has introduced bylaws to try to stop it. The second picture on the page is a major theft in Preston, Ontario, which is part of the city of Cambridge. That is a walk-in cabinet that contains feeder cables that support voice services over legacy telephone lines.
At this site, over 1,000 phone lines were cut, which were bundled in 11 large cables that were visibly damaged. Our customers were impacted for about 60 hours.
I would like to take this opportunity to invite committee members and their staff to one of our central offices, which is very close to here. If you are interested to see what these cables look like, we are happy to show you.
If you turn to page 3, the third picture is from Shubenacadie, Nova Scotia, on November 23 of this year. The picture is fuzzy because the weather was terrible. That incident impacted copper, fibre and wireless customers. The fibre on that line supports a nearby cell tower, but the thieves don’t discriminate between fibre and copper wires. They just cut.
The same spot had been hit a week earlier. The location of that pole required more equipment, which is why you see so many trucks in the photo. Please turn to page 4.
Ontario experiences the most copper theft with 61% of incidents in our footprint. From this slide you can see the theft occurs everywhere, but the hotspots are Kingston, Hamilton, London, Brantford and Cambridge.
On page 5 you can see that in New Brunswick, we have a big problem along the Trans-Canada Highway near Fredericton and Oromocto. That includes Canadian Forces Base Gagetown, which has also been hit. It is worth noting that on November 19 of this year — a month ago — in Miramichi, copper thefts knocked out both copper and fibre lines. The cost to Bell for repairs was $30,000. It took us 24 hours to repair the damage.
The internet at the Miramichi Airport was down all day. While planes could still land, the airport was unable to access weather or other data used to help pilots. Digital payment systems were also down.
Police estimated the amount of copper stolen in Miramichi would have been worth about $100 to the thieves.
The final page is a heat map of Quebec.
I want to thank members for the opportunity to discuss this incredibly important issue, and I look forward to your questions. Thank you.
The Chair: Thank you, Ms. Austin. Now I turn it over to Mr. Lakey.
Brian Lakey, Vice-President, Reliability Centre of Excellence, TELUS: Thank you to the Senate committee for inviting me here today.
I’m the Vice-President of the Reliability Centre of Excellence, the Co-Chair of the Canadian Telecom Resiliency Working Group and a member of the Canadian Security Telecommunications Advisory Committee, or CSTAC. Copper theft is a rapidly growing crisis, impacting Canadians and the communities we all serve. As we’ve seen over the last few years, Canada’s critical infrastructure, including communications, electricity, water, transportation and financial networks, remain vulnerable to acts of physical destruction. When thieves damage or steal our copper cables, essential telecommunications services like emergency, Amber Alerts and access to 9-1-1 are impacted. This is a matter of public safety.
If someone cuts or steals copper wires in your neighbourhood, your phone, TV and internet will be compromised. When these services are down, you will not be able to call 9-1-1, receive emergency alerts or reach your friends and family.
For example, the Whalley Police Office in Surrey had all their telecom services disrupted after a copper theft incident. This impacted emergency dispatch response and operations for local police.
The situation can be even more dire in rural communities like Grande Cache, Alberta, where theft has led to community isolation more than four times in the last 18 months. Copper theft also costs the Canadian economy in lost productivity. When disconnected, businesses can’t process credit card transactions. Tarrabain Motors in Lac La Biche had to deal with this issue late last year after a copper theft. This can also make purchasing essential supplies like food or gas difficult for those who don’t carry cash.
Copper thieves are becoming increasingly sophisticated and organized. When thieves stole copper from a bridge in Cochrane, Alberta, their setup resembled a legitimate maintenance crew, complete with trucks and safety vests, all while stealing copper cables in broad daylight. The growth rate of copper theft is deeply alarming. Since 2021, copper theft has robbed over 170,000 TELUS customers more than 200 million minutes of essential telecom service. Mission, Abbotsford and Calgary are cities that have been hit multiple times this year alone.
TELUS is continuously investing in advanced security, floodlights, video cameras and specialized locking equipment. We are in the process of modernizing our equipment by transitioning to fibre cable. However, these deterrents are not enough.
In October, a copper theft impacted four cell sites and fibre cables, interrupting service for 23,000 wireless customers in Sardis, B.C., and the surrounding area. The situation required dense forest removal and resulted in a long restoration time.
While our technicians and teams worked tirelessly to restore service, the impact and recklessness of this criminal behaviour cannot be ignored. Tackling this growing issue requires effective collaboration across government, industry and police services.
We recommend a few legislative approaches to deter copper theft. First, amend the Criminal Code to classify any wilful damage to critical infrastructure as a serious crime. As other panellists have mentioned, copper theft is considered petty theft today. Stronger penalties would act as a deterrent to this growing crime.
Second, amend the Telecommunications Act to prohibit and impose fines on the sale of illegally obtained telecommunications material. This will disrupt the supply chain for stolen copper by eliminating viable paths to market. This will complement provincial regulations, creating a comprehensive framework to combat copper theft across all jurisdictions.
Third, we recommend all provinces renew and standardize their scrap metal dealer and recycler regulations, including closing loopholes that allow criminals to profit from stolen copper. For example, legislation should limit the sale of melted down copper because it’s no longer identifiable.
Additionally, Canada needs a dedicated metal task force, including coordinated investigations across law enforcement, and improved interjurisdictional information sharing. These measures have reduced copper thefts in other countries. Canada is lagging behind on this front.
Copper theft compromises essential services, public safety, health care access and the economy. Although we’re doing everything possible to prevent these crimes, real progress requires collaboration between industry, government and law enforcement.
The time to act is now. Every day of delay puts more communities and Canadians at risk. Thank you for your attention to this crucial matter.
[Translation]
Francis Bradley, President and Chief Executive Officer, Electricity Canada: Thank you, Madam Chair and members of the committee, for the opportunity to speak about copper theft, a problem that has plagued the electricity sector for many years.
My name is Francis Bradley and I am President and CEO of Electricity Canada, which is a national association and the voice of the electricity industry.
Our members are companies that generate, transmit and distribute electricity in every province and territory.
[English]
I commend the committee for addressing this important topic. I also thank our colleagues in the telecommunications sector for their advocacy. I also wish to acknowledge our members, whose insights helped shape these comments.
Copper theft is a persistent problem; it is dangerous, presenting huge safety risks, and a threat to reliability. Addressing it requires a collaborative approach involving operators, law enforcement and all orders of government.
In the electricity sector, copper theft occurs across various facilities, including substations, transmission and distribution lines and construction sites. As copper is an excellent conductor, it is also integral to our infrastructure. However, it also makes our facilities attractive to thieves. Our association has been tackling this issue for over a decade, facilitating collaboration among members, sharing best practices and advocating for government action.
Despite years of mitigation efforts, copper theft remains persistent, fuelled by high copper prices. Hundreds of incidents occur every year, resulting in millions in financial losses. Reports from our members make it clear: This is an ongoing and pressing issue.
Let’s talk about some of the risks and impacts of copper theft.
First, the safety risks are serious. Thieves who break into energized sites risk electrocution and severe injury. Tragically, media reports over the past 15 years document at least 10 deaths during attempted metal thefts. The danger further extends to first responders, utility workers and the public as vandalized sites can spark fires and create exposure to energized grid components.
Reliability is another major concern. Copper theft disrupts the power grid and can lead to outages that impact families, businesses and essential services that depend on uninterrupted service.
Where incidents don’t directly cause an outage, necessary repairs often require de-energizing equipment, further contributing to service interruptions.
What are we doing about it? The electricity sector has implemented numerous measures to mitigate copper theft. Among other tactics, companies have adopted advanced surveillance technologies, replaced high-value metals where feasible and strengthened collaboration with law enforcement. However, most of these efforts are industry driven with limited action from government. We believe the federal government should be taking a more active role in addressing this issue.
Here are a few of our recommendations.
First, remove the financial incentives for theft. Copper theft hinges on the ability of thieves to sell stolen metal. Provinces can address this by regulating the scrap metal industry, requiring records of transactions and mandating identification from sellers.
However, existing laws are inconsistent, poorly enforced or non-existent in many jurisdictions. The federal government should lead efforts to standardize legislation across all provinces and territories, creating a unified and effective approach.
Second, support law enforcement and prosecution. Allocate funding to train law enforcement and prosecutors on the economic and operational impacts of copper theft on critical infrastructure. Improved training will lead to better investigations and more successful prosecutions.
Third, strengthen the Criminal Code. Amend it to reflect the severe consequences of metal theft. This could include creating a specific offence for targeting critical infrastructure. It could also mean introducing a dual-procedure offence for theft or mischief involving critical infrastructure. Broader impacts on reliability could be treated as aggravating factors in sentencing.
Finally, penalties for metal theft should align with the severity of the harm that’s caused, moving beyond the current categorization of theft under $5,000.
[Translation]
Thank you again for the opportunity to speak today. Copper theft poses serious risks to the safety and reliability of the network, and coordinated action is needed to deal with it effectively.
I am at your disposal to answer your questions and continue the discussion.
Senator Julie Miville-Dechêne (Deputy Chair) in the chair.
The Deputy Chair: Thank you very much, Mr. Bradley. I think you paint a much more dramatic picture than the one we had at our last meeting.
[English]
Senator Cardozo: Thank you to you all for being here. Some of you might have seen the discussion we’ve had so far. You’ve taken it to the next level and I thank you for that.
I have to leave early. I wish to tell you that, for most senators, we love watching our committee videos. When we miss anything, we —
The Deputy Chair: What is your question?
Senator Cardozo: Sorry. It’s strict over here.
So, I look at Bill C-26, which we passed a few days ago. Mr. Bradley, you appeared in front of that committee. There is a section in there dealing with protecting a critical cybersystem.
Can we get at this issue? The phrase you’re using is “protecting critical infrastructure.” We’re talking about a cybersystem; we’re talking about telecommunications. Have we taken care of it in the law, and now it’s a matter of the implementation? Can any of you comment on that?
Mr. Bradley: I would be happy to provide some initial feedback on that.
No, I don’t think it is sufficient. I don’t think it addresses the issues because it speaks specifically to cyber.
Our concern is well beyond simply the impact on the telecommunications sector. Our concern is broader, around infrastructure more broadly. We’re talking about physical impacts, not simply cyberimpacts.
Senator Cardozo: What sectors is the copper that is being stolen used for? When we were discussing this a couple of days ago, we were told it’s mostly telecommunications. Let me put it this way: Who uses copper? Who uses other forms of wiring?
Mr. Bradley: I’m sure my colleagues from telecommunications can talk specifically about the rise in that space.
In our space, a great deal of equipment in the electricity system uses copper as a core conductor.
As we see greater electrification throughout the economy and the growth of electricity, we’re going to see a run-up in our sector, but everything that has to do with electronics requires more and more copper, so we’re seeing a huge increase in demand worldwide.
It is being driven up not just here but also internationally. As countries seek to move up in terms of their economic prosperity, we’re seeing significant growth there as well. It’s only growing.
Ms. Austin: We’re trying to get rid of it, just to be clear. We feel that copper is legacy technology, and we are very keen to move everybody to fibre. However, decommissioning takes a long time. Part of the problem, and I’m sure Mr. Lakey can comment on this as well, is regulatory. If you come to our central office, you will see that traffic signals are copper. They haven’t been changed in years, and we don’t expect them to be changed for years to come.
When you get into an elevator, you will probably notice there’s a panel; if you open it, there’s a phone. In multi-unit dwellings or apartment buildings, landlords will often upgrade the telecommunications services to fibre, but they won’t upgrade the elevator because it is extremely expensive. Who upgrades elevators? You upgrade the panelling; you don’t change the elevator. We suspect those copper connections will linger.
I’m sure Mr. Lakey has some comments.
Mr. Lakey: There are three areas where we use copper. If you look at the photos that Ms. Austin provided, you’ll see the legacy copper she speaks about, which is specifically for providing voice services. It is specific to our industry. It is not used elsewhere, so that’s where there has been some positive traction in regulations that specifically make it illegal, draw out these types of cables that are identifiable and put extra diligence around them. The second place we use copper is in ground wires, which is similar to what was spoken about here, and the third place is in lead-acid batteries in our mobile sites, which are used to provide temporary power when power is disrupted by vandals, theft or environmental factors.
Yes, we are investing billions to migrate away from copper. That takes a lot of time, and there are some unique situations that make it take longer, but we have hundreds of thousands of kilometres of copper to be replaced. We have about 150,000 kilometres of copper to protect and also replace. Bell probably has a much more substantial number.
Senator Cuzner: This has been very helpful. I have a couple of specific questions. Mr. Smith, you talked about the Florida experience and how they have increased their penalties and the whole realm of charges applicable in recent years. How is that panning out? Has it proven to be a deterrent, or is it too soon to measure?
Mr. Smith: It’s too soon. Florida’s law was passed in July. Georgia passed one, I think, the year prior. I’ve been talking to my peers in the U.S. who are very plugged into this on the legal side, and they said to expect more states to do more. There have been some laws that have been on the books for a while, but now they realize that those were inadequate, so in other states, they’re looking to update them even further.
Tying this into Senator Cardozo’s question, I think a better analogy is not Bill C-26 but Bill C-70, where they amended the sabotage law. It was to protect essential infrastructure, and that can be defined through regulation so that as things change, you don’t have to pass new laws. You can identify new infrastructure that’s considered essential. We’re talking about copper today, but it can be any form of vandalism or theft. It should be protecting essential infrastructure, including telecommunications, because our lives rely on it.
Senator Cuzner: Mr. Lakey, in your comments, you mentioned that Canada is lagging behind other nations. Who is getting it right? What countries are far more advanced than where we are here?
Mr. Lakey: I will give you a couple of examples. In the U.K., there was an estimate of £1 billion lost per year due to copper theft, so they actually kicked off Operation Tornado, a coordinated approach as we described, so law enforcement and tracing sellers of scrap metal to make it harder to pass it along and to trace it back. They saw 51% drop in copper theft.
In Australia in the state of Victoria, they implemented a copper metal theft prevention strategy that included mandatory record keeping that was available for everyone so that we or law enforcement could go look at the records. They saw a 40% reduction in metal-theft incidents, so that’s very good.
California recategorized this as a serious crime where any theft over 950 is considered a felony offence and can result in imprisonment. In July of this year, Los Angeles had a whole push on it. They had a crackdown that resulted in 82 arrests, 60 felony charges and the seizure of 2,000 pounds of stolen copper.
There are a lot of opportunities for us to learn from elsewhere and leverage that to change the rules here.
Senator Cuzner: I’ll skip over Ms. Austin for a moment. Mr. Bradley, you mentioned the provinces. You’ve dealt with the provinces, and some are more focused than others. Which provinces are showing progress on the issue?
Mr. Bradley: Well, with respect to what we’ve seen with metal recyclers, we’ve seen significant movement in jurisdictions like British Columbia and Alberta. Nova Scotia, where legislation has been passed but regulations were never introduced, was almost a success story. Even in Alberta, for example, where they do have the regulations in place, they aren’t being uniformly enforced. Even that brief picture that I gave you would suggest that in the vast majority of this country, we don’t have effective legislation or regulation at a provincial level.
[Translation]
Senator Gignac: Welcome to the witnesses. My first question is for Ms. Austin, from Bell Canada. Thank you for your beautiful graphs. There’s a big difference from one province to the next. It’s normal for Ontario to have a higher percentage, since it’s a more populous province. I notice that Quebec is lower than New Brunswick, as it accounts for 13% of theft incidents for your company. Are Quebecers more honest, or is the Sûreté du Québec doing something differently? I’m trying to understand the difference between Quebec, Ontario and New Brunswick. Do you have anything to teach us about good law enforcement practices or current technology in Quebec?
[English]
Ms. Austin: This was a big problem in Quebec a decade ago, and it was an organized crime problem. Yesterday, I think you heard this is a crime of opportunity. At the time, there was a really big push in Quebec to stop copper theft.
There’s still copper theft. The province is just in a different place, perhaps, than the other provinces. I don’t believe they actually have scrap metal laws in Quebec. There’s no obvious explanation as to why, except maybe it’s just a different wave, a different time or a different place. There is still definitely copper theft in Quebec, just not at the same rate as in Ontario and New Brunswick.
The Deputy Chair: A few municipalities have them in Quebec.
Ms. Austin: Yes, they have bylaws.
[Translation]
Senator Gignac: If we take into consideration the sensitivity of Canadians and law enforcement — because we ask a lot of them. On a scale of 0 to 5, law enforcement has to deal with crime, drugs, domestic violence and homelessness, and copper theft is low on the list of priorities. I don’t want to downplay the problem, which is important to our critical infrastructure.
I understand that the Criminal Code can be tightened up, but law enforcement still has to enforce it. For our next panel, we’ll be hearing from the Canadian Association of Recycling Industries; don’t you think that’s where the focus should be? Would there be a more immediate impact, if I refer to the experience of Australia and other American states? My question is for all the witnesses.
[English]
Ms. Austin: I can start.
Law enforcement across the country has been fantastic, incredibly cooperative and incredibly helpful with regard to this. As Mr. Lakey illustrated, it often has a big impact on law enforcement in terms of copper theft. It would be safe to say they are also frustrated with regard to the inability to act upon this. As the chair mentioned, many municipalities have bylaws, which the police have been very involved in.
From Bell’s perspective, scrapyards are too late. You’re going to have testimony from them. We’re a little concerned about scrapyards. The interesting thing for us is that when we decommission copper, we sell our scrap copper to the same scrapyards that accept copper obtained in criminal ways. It’s a little bit too late for us, so that’s why we have the focus on the Criminal Code.
Mr. Bradley: I would echo the frustration. We hear the same frustration ourselves in our sector from law enforcement. Among many people in law enforcement, we hear that what is required is greater deterrence. When they see repeat offenders who have simply been charged with theft under $5,000, they also recognize that we need to do something a little more significant when it comes to deterrence.
[Translation]
Senator Gignac: In terms of technology, can we pin our hopes on surveillance or technological changes? We’ve gone from copper to fibre optics…. Do you think things could improve in the next 10 years, if only because of technology?
[English]
Mr. Lakey: Yes, we are removing copper and replacing it with fibre. As I said, it takes a long time and a lot of money to make that happen. It is being done, and we do need to modernize. It is the sustainable approach.
The problem is that, in the transition period, as was mentioned, they cut everything; they don’t discriminate whether it’s copper or fibre. They have to get every last piece out. If you want to speak of Quebec, we had a recent incident in Quebec near Baie-Comeau where someone went in to steal copper wire. There was no copper wire, but in the process, they pulled down our fibre, cut it, realized it was fibre and then walked away. That impacted the community. That is the real risk.
I disagree with my colleagues on the supply side. Specifically, we had good success in 2010 and 2012 with the Alberta and B.C. governments implementing scrap metal dealers and tracing who is doing it. As I said, it is very specific for telco: It is only us as an industry using it. It is very easy for us to say whether something is a legitimate source from our industry to be recycled, which is the whole goal of the system set up there.
There is an opportunity to track and trace it and basically stop the financial reward that’s there by implementing those. I recently met with MLA Loewen in Alberta. He was part of that originally, and we started talking about it. He immediately said, “We need to revise our scrap metal laws. It needs to happen.”
[Translation]
Senator Quinn: Thank you for being here with us this evening. Your opening remarks were very clear and to the point, and I thank you for that.
[English]
I have a few questions to bring more precision to this. I appreciate the suggestion or observation that this is an interjurisdictional stakeholder type of thing that needs to have the same attention drawn to it as auto theft, as I think somebody raised last night with the auto industry.
Having had some experience dealing with recycling facilities in major ports, there need to be changes in the Criminal Code. There needs to be a line from the person who steals — I’ll say it this way — the fence, and the buyer, the scrapyard. Penalties should be all along that chain, including the scrapyard that buys. Shouldn’t there be changes to the Criminal Code that put the onus on the scrapyard in a more serious way, such that they look and consider if there is a clear, certifiable track, including regarding where melted-down copper comes from? If the seller can’t identify where that came from, then they shouldn’t buy it, thus leaving it in the hands of the thief. Then they might rethink their activities.
Shouldn’t there be that kind of an approach so it’s up and down that chain? The scrapyard, at the end of the day, is the buyer. If they’re buying things and aren’t clear what they are, then they should not buy it.
Would you agree with that? It should be a matter of the Criminal Code for those who participate in that activity.
I’m trying to get more clarity and precision regarding the Criminal Code and the chain. You all spoke about that, really.
Ms. Austin: We — TELUS and Bell — don’t disagree too much about having this provincially. Right now, we are great. We don’t disagree with regard to that, but that is traditionally provincial jurisdiction.
There are so many things that could be done. You ask for identification when someone comes in, so you have a database with regard to asking the scrap metal yard to store that identification for a month, maybe, after you’ve received that, so you could find out if there is a question along the way. There’s a database that should be searchable. There are many things you can do through legislation and regulation with regard to scrapyards.
You are correct: It’s my understanding with the recycling industry that it is quite an interesting chain. There are about three major recyclers, as I mentioned earlier, that receive copper criminally, to be frank, and also legally from us.
It’s an industry we’re very interested in making sure we do good —
The Deputy Chair: How many scrap buyers are there?
Ms. Austin: Thousands.
The Deputy Chair: When you said three —
Ms. Austin: It goes up a chain.
The Deputy Chair: But at the bottom?
Ms. Austin: There are thousands of scrapyards.
The Deputy Chair: Okay.
Senator Quinn: But they come under three major umbrellas.
Ms. Austin: As the international supply chain goes, there are three major Canadian scrapyards that we deal with. It goes to action, and they bid on our scrap metal. We are looking at how we can ensure they’re not buying copper illegally.
Mr. Lakey: I think having that traceability is a great idea, because ultimately as a society we want recycling to occur. This allows that to happen but applies an onus of traceability and transparency, as discussed, so we ultimately get what we need.
Mr. Bradley: I would point out that in the electricity sector, we’re trying to address it on our end as well. This is not all coming to government and asking them to please fix our problem; we’re doing what we can on our end to fix the problem. We’re looking at identifying copper; we’re stamping it and coating it so it can be clearly identified when it can be identified. But there are some challenges to that. There are challenges because, in some cases, there is a lack of regulation at a provincial level to be able to do something about that.
The other piece is in new facilities and new material that is being put out — it is our legacy equipment and our legacy facilities. Unfortunately, unlike the telecommunications industry, we don’t have fibre. We do have other materials we can use instead of copper, but we have a system that’s been built up over a century that is filled with copper.
Senator Quinn: To go a little bit further on the scrapyard, should there be a requirement for the scrapyard that rejects seller X to share the name and details of that person with other scrapyards so they just don’t go down the street or to another town? Shouldn’t that be another deterrent — that it be incumbent upon them to do that — with the Criminal Code punch behind it?
Mr. Bradley: I think in the scenario you’re describing, if it were our sector and somebody brought to a scrapyard something that was stolen and clearly marked as coming from an electric utility facility, I hope their call wouldn’t be to another scrapyard but to law enforcement.
Senator Quinn: Right. I am talking about an extra step because they may sometimes forget the number of the police.
Thank you.
[Translation]
Senator Miville-Dechêne: I have a few quick questions. First, thank you for the images; they’re very useful for us senators.
You talked about Bill C-70, but the way you did it…. When you talk about critical infrastructure and sabotage, do you think that this bill could be applied to your problem? Did I understand correctly?
[English]
Mr. Smith: I don’t think so. When Bill C-70 was being considered, we were advocating for broadening the definitions. But that provision, based on the way it’s drafted, is to deal with crimes against the national interest.
Senator Miville-Dechêne: And not scrapyards.
Mr. Smith: Yes. While it is in the national interest to protect communications and other essential infrastructure, it would be difficult. There has to be that intent. It has to be shown that someone was trying to harm the national interest.
[Translation]
Senator Miville-Dechêne: You say that you try to install something on the copper to ensure its tracing, but this copper that is resold is then remelted. Does its traceability disappear at that stage? I’m trying to figure out how it can be traced when thieves put it in a vat and make the trace disappear.
[English]
Ms. Austin: I can start.
Because we’re trying to decommission copper, we won’t be going backwards. We’re trying to get copper out of our system. We prefer fibre. We are not going to spend the money to go back to all of our tiny wires and imprint them with a marking.
But, yes, copper can be melted down. It is very difficult to trace.
Mr. Lakey: It’s the first step as it enters recycling, to have that traceability before it gets deconstructed.
First, we’ve said clearly there are specific cables used in telecom. They should only be coming from the telecom companies in Canada who are providing them, to have that first step of traceability. After that, they can be granulated, melted down or whatever and turned into the recycled product. Having that traceability as it gets processed is important.
We are doing some of the labelling, if you will, regarding traceability. However, yes, we’re going to shift to fibre. It’s the transition period.
[Translation]
Senator Miville-Dechêne: Tell me about your responsibility as an industry to strengthen security. You say that this problem has existed for years, but what are you doing about it? What investments have you made, at Bell and Telus? Have you installed cameras, for example? Have those measures reduced the number of crimes?
[English]
Ms. Austin: Bell spends $1 million annually on security. What does security look like? The security enhancement includes things you would expect: hiring extra security guards, improving lighting and increasing fencing. Also, we have team members who care so deeply about this issue that they’ll change their route home because they know one area has been hit recently.
We have team members who bring their GoPros or trail cameras because they’re concerned a local gang has hit a spot before. They’ll put those up. They take this seriously.
We have begun installing aerial alarms. We’re exploring new GPS alarm systems we can use. With an aerial alarm, it’s like a loop. We know if the loop is broken, then something’s wrong. We can connect those to law enforcement, which is what we used under the bridge on Lorne Street.
Mr. Lakey: Yes. We do many of the same things as well.
Senator Miville-Dechêne: Does it have an impact?
Mr. Lakey: It does. We have had some success, where we get law enforcement engaged quickly because we have the alarms or repeats. We have surveillance and that sort of thing as well. It is helping, but it’s not enough.
As I said, we have only 150,000 kilometres to protect. Bell probably has three times that, I would guess. It’s very difficult to protect that. It’s a mix of aerial and buried. You’ve seen some of the pictures where it gets concentrated.
We weld things shut. We put concrete blocks on manholes. We are doing all sorts of crazy things and trying to improve things every day. However, we are fighting an uphill battle.
Senator Miville-Dechêne: I have one last thought. Most of what you’re asking for is in provincial jurisdiction. We’re a Senate committee. We can speak about those things, butthe Criminal Code is probably the only thing in our reality. This is a study. Some of it is not exactly in our —
Mr. Lakey: Specifically, I was recommending federal Criminal Code changes regarding telecommunications.
Senator Miville-Dechêne: Yes, I got that. It’s the scrapyards.
Mr. Lakey: Yes, the scrap metal. There’s a coordination component for sure.
Senator Miville-Dechêne: Thank you.
Mr. Bradley: Thank you.
[Translation]
Senator Youance: I’m trying to understand the copper market. Is it reserved solely for telecommunications companies without being accessible to the general public, which would ensure that the thefts continue?
The theft chain was discussed earlier. You also said that a thief can steal $100 worth of copper. At the very end of the chain, when it gets to the final buyer, what does that $100 turn into? I’m trying to understand the thieves’ interest.
[English]
Ms. Austin: I can talk about the value. The motivation is different.
In New Brunswick, if you steal $400 worth of copper, that could feed your family for a month. In Kingston, we know there’s a very active drug gang who, when their supply is low, steal copper in order to get some money until their supply comes back.
You talked about how they steal them. We have these things called pedestals, which only have one metre of copper. But thieves don’t know that. It’s not worth a lot to them. They think it’s going to be something entirely different.
Copper is extremely valuable. It’s at record-high prices globally. The energy and electricity sector are only going to use more of it, even while we try to get rid of it.
Mr. Lakey: Yes. It’s not only the telecoms. We use it quite a bit. We have a very specialized use for it. But it is then melted down and consumed in other sectors.
The electrical grid, EVs, charging stations — all of these sectors are driving up the price of copper. Computers, electronics, all of these require copper because it’s a great conductor. It gets repurposed and pushed into those other sectors.
There are thefts of cables for EV chargers. You can see that they’ll cut the charging cable off, take that cable and recycle it.
It’s across the industry. The reuse is across industry.
[Translation]
Senator Youance: When you remove old systems made of copper and convert them to fibre optics, what do you do with the used copper? Do you put it back on the market or do you reuse it?
[English]
Ms. Austin: We recycle it.
Mr. Lakey: We recycle it as well.
Ms. Austin: Yes. It’s not fast. It’s slow. Switching from copper to fibre is a very slow process, but we have recycling programs. Often, we’re in the same vendor chain as the scrapyards who are not acquiring this copper legally.
Mr. Lakey: That comes back to traceability. We will go to these recyclers and explain we are the valid owners, that we own this and would like to recycle it.
Mr. Bradley: I would point out that it isn’t just telecommunications and electricity. You will find copper in hundreds or thousands of applications. Go to your local Home Depot and walk through the plumbing section, and you will see equipment that may have been made from recycled copper from the telecommunications companies or from some of our member companies. It is used extensively throughout everything that we manufacture.
The Chair: I have a couple of questions. I assume the telecommunications industry has insurance when it comes to these highway robberies, so I assume the insurance companies who are insuring you are also victims, correct? So the victims are the telecom companies, the insurance companies that insure the telecom companies and, obviously, the consumers.
Ms. Austin: That’s correct.
The Chair: So, the two entities profiting from this are the thieves themselves, who are conducting this, and the scrapyards.
I’ve been acquainting myself with this problem, and it seems to me that there’s an urgent need to put the onus on the scrapyards when they’re collecting the stolen material, before they rush to transform it, melt it down and profit from it. At some point, they have to bear some responsibility for receiving this and must have the onus put on them to confirm and validate where this property is coming from. Would you agree with that?
Mr. Smith: I would agree with that. Obviously, because we’re talking to the Senate, my focus is on the Criminal Code, but definitely, what you will hear — and I’ve heard it from some representatives of the scrapyard industry — is that the onus shouldn’t be on them and that their job isn’t to be law enforcement. We’re not asking them to be law enforcement, but we are asking them — like other industries who have to follow regulations — to follow simple steps, many of which were mentioned, such as requiring ID, not allowing cash transactions and, in some cases, holding on to scrap metal for a period so that the police can actually get in touch with them to conduct an investigation. All those are simple steps that can help the situation and, as you said, put the onus on them to ensure they’re not engaging in or helping to facilitate illegal activities.
The Chair: That is being done right now in certain jurisdictions in the U.S., if I’m not mistaken.
Mr. Smith: It is. There are some provincial requirements as well, and in Canada, there are a few cities that have bylaws, but again, the question is how well they’re being followed or enforced.
The Chair: Thank you.
Senator Cuzner: I’ll be quick with one question. I respect Senator Miville-Dechêne’s comments, that much of this — especially around the scrapyards — is provincial in nature, but what I’m hearing from the panel is that it is also the Criminal Code and a leadership role that you feel should be played by the federal government.
Mr. Lakey: The federal government regulates the telecommunications industry and the mandated 9-1-1 emergency services that are so critical for Canadian safety.
Senator Cuzner: We appreciate the fact that you’re coming with solutions and not just problems. That has been helpful for the panel.
The thefts have certainly become more complex. It’s not just a bunch of guys with a little bit of intel going down and ripping down a couple of lines with the hope that there’s copper there. It’s more a focus of organized crime. Are the thefts more —
Ms. Austin: Recently in Flamborough, which is just outside Hamilton, for four days in a row, we had a team of thieves dressed in reflective vests who rented a truck with a flashing yellow light and put cones out and redirected traffic. It wasn’t until a Bell employee drove by and said, “Wait a second, what’s going on here?” that we figured out they were thieves. They are growing more sophisticated as far as we’re concerned.
Mr. Bradley: From an electricity sector perspective, I would say that there’s a spectrum: It goes from less sophisticated to very sophisticated. We’re seeing things across the spectrum. I would point out our concern is that yes, there are cost impacts, but, as I said earlier, our principal concern is with respect to reliability and public safety. As I noted earlier, in the past 15 years, there have been 10 fatalities. We’re not quite so concerned about what the costs would be, although they are not insignificant. Then wind up getting passed on to customers — to ordinary Canadians — but our principal concern is public safety and the reliability of the system.
Senator Cuzner: I have one last thing. Having worked in Fort McMurray for a number of years in the early days, I know that Great Canadian Oil Sands Ltd., Suncor, Syncrude and competitors started working together when the crisis around greenhouse gas emissions and environmental emissions came about. Although they compete, I know the Canadian Association of Petroleum Producers have come together on best practices, because they have a common foe and a common issue that they have to solve.
Is it the same situation with you? You seem to be fairly compatible tonight.
Ms. Austin: Brian and I have worked together on this.
Senator Cuzner: Is there sharing of best practices?
Ms. Austin: Absolutely. Do you want to talk about CSTAC and your work there?
Mr. Lakey: When the Canadian Telecommunications Network Resiliency Working Group was formed, part of my presentation was to identify this as the number one cause of avoidable outages to telecom networks. That’s something we’ve been collaborating on with the other carriers, on a regular basis, on copper theft and best practices beyond copper theft as well. But, yes, that collaboration is ongoing and continues to grow, but this is also why we’re here. We need further collaboration with the help of the Senate and legislative bodies.
The Chair: On behalf of the committee, I would like to thank our panellists for being here with us and sharing their views and knowledge on this issue.
For our second panel this evening, the committee welcomes Brian Shine, Board Chair of the Canadian Association of Recycling Industries and Chief Executive Officer of the Manitoba Corporation; Ross Johnson, President of Bridgehead Security Consulting Inc.; and, joining by video conference, Linda Annis, Executive Director of Metro Vancouver Crime Stoppers and City Councillor for the City of Surrey.
Welcome and thank you for joining us. We will first have opening remarks of five minutes each, starting with Mr. Shine, followed by Ms. Annis and then Mr. Johnson. Then we will proceed to a period of Q & A.
I turn the floor over to Mr. Brian Shine. You have five minutes, sir.
Brian K. Shine, Chief Executive Officer, Manitoba Corporation and CARI Board Chair, Canadian Association of Recycling Industries: Good evening, and thank you for the opportunity to provide feedback this evening. I look forward to the discussion and welcome the interaction.
I’m currently serving as a two-year Chairman of the Board of Directors for the Canadian Association of Recycling Industries, or CARI. It is a 78-year-old trade association representing the for-profit recycling industry. We currently have over 200 members, primarily involved with metals recycling but also representing paper, plastic and electronics recycling. Previously, I served as Chairman of the Board of Directors from 2018 to 2020 for the Recycled Materials Association, known as ReMA. It’s a recycling trade association based in Washington, D.C., and is composed of nearly 1,700 companies.
I’m based in the Buffalo, New York, area and lead a company called Manitoba Corporation involved with copper recycling throughout North America. The free trade of recyclables between Canada and the U.S. is critical for the economy of both countries, as well as my company, which has been in business for 108 years. It was started by my great-grandfather in 1916. We buy approximately 30% of our incoming copper from Canadian companies and sell approximately 20% of our finished copper products for consumption by Canadian manufacturing companies.
Both CARI and ReMA work collaboratively on a wide range of issues that impact our respective members with one of the most prominent being metals theft. As you may be aware, ReMA developed a website called ScrapTheftAlert, which can be found at scraptheftalert.com. CARI continues to promote the use of the site by encouraging Canadian companies to post about thefts, ensuring CARI members are aware of stolen materials and reporting stolen materials they encounter to law enforcement. These efforts demonstrate that the recycling industry is working to be part of the solution to materials theft.
The ScrapTheftAlert site helps law enforcement, in addition to alerting the recycling industry of significant thefts of materials in the United States and Canada. Upon validation and review, alerts can be broadcast and emailed to all subscribed users within a 100-mile radius of where the incident occurred.
Here are some recent figures from the site: There have been over 24,000 alerts published, there are over 35,000 active users and approximately US$3.5 million of property between the U.S. and Canada has been recovered as a result.
Unfortunately, Canadian adoption of this tool has been slow. Since unveiling the site in 2014, Canadian law enforcement has only grown from 89 initial users to 117 users in 2024. The overall Canadian user count is 689. There’s certainly a lot of work to be done and opportunity to grow their valuable network. CARI is committed to doing so and could certainly use your assistance in helping to spread the word.
The key focus of discussions between the recycling industry, governmental agencies and law enforcement should be centred on collaboration and consultation. Crafting legislation that works to stop criminals and working in concert with recyclers can go a long way toward reducing this illegal activity, which has significant implications for infrastructure, public safety and international trade.
Again, thank you for the opportunity to speak with you this evening, and I look forward to exploring solutions on behalf of our industry and in support of the committee’s focus on this critical issue. Thank you.
The Chair: Thank you, sir. Ms. Linda Annis, you have the floor.
Linda Annis, Executive Director, Metro Vancouver Crime Stoppers and City Councillor, City of Surrey: Thank you for this opportunity. I’m sorry I’m not joining you in person this evening.
I’m Executive Director of Metro Vancouver Crime Stoppers. Our organization is more than 40 years old. We grew out of the idea that our police department can’t be everywhere but we, as ordinary citizens, have extra eyes and ears.
Every year, Metro Vancouver Crime Stoppers receives more than 4,400 anonymous tips. Over the past 40 years, we’ve turned these into almost 8,500 arrests, and we’ve recovered more than half a billion dollars of drugs and property. The key to our success is the fact that anyone can call us and remain anonymous. Data anonymity is protected by the Supreme Court of Canada, and in our region, we take tips in more than 100 languages.
I’m also a city councillor here in the City of Surrey, British Columbia. In just four short years, our city will be the largest city in British Columbia, growing past Vancouver.
When I talk to you today, I’m wearing both hats.
Copper wire theft, as you know, is dangerous, disruptive and costly. The theft of copper puts technology across our country in a precarious position. It can interrupt first responders’ services, disrupt electronic business transactions and damage infrastructure systems and networks, as well as essential health and safety services. The fact is that though the value of the copper stolen and resold may well be under the $5,000 threshold in terms of the Criminal Code, the damage caused the by the theft is much, much greater. I’m hard-pressed to think of any other theft which is as small in relative terms that has the capability to do so much damage to Canada and Canadians. Frankly, the penalties should be much more for thefts currently valued at under $5,000.
At the same time, scrap metal dealers and recyclers need more education and more inspections that can be standardized across all of our jurisdictions. To say the current world of scrap metal dealers and recyclers has the feel of the Wild West when it comes to regulations and inspections isn’t an exaggeration. It means changes to the Criminal Code, but it also means working with the provinces and municipalities so there’s a combined effort rather than a patchwork approach to this very serious crime.
Stealing and selling copper amounts to shutting down the technology-based economy and the everyday lives of Canadians. We need increased penalties, serious and regular inspections of scrap metal and recycling operations, and to make the process so strict with such tough penalties that together we can take the profit and ease out of stealing and reselling.
The changes you’re looking at, such as limiting the resale of copper wire theft to local communities so it’s easier for police to track, are all things I can support as head of Crime Stoppers and as a local politician. Anything you can do to make it tougher to resell will also make stealing copper wire less profitable and attractive.
However, whatever you do, I would ask that in addition to recommending any changes to rules and regulations, you include a strong public information campaign that calls upon people to be encouraged to call the police or Crime Stoppers if they know something.
Crime Stoppers organizations like ours exist across Canada. The fact is that when it comes to copper wire theft, people know things, and we can take their tips anonymously. It is not just the thieves who know about what they have done; people close to them — family, friends and others in their criminal circle — all know something. Anyone who calls Crime Stoppers will always remain anonymous. That also goes for ordinary citizens who see something unusual or odd in their neighbourhoods. For instance, TELUS told me about a group of thieves who were dressed, looked and acted like they were TELUS repair people, and when people saw them, they thought nothing of it. However, a quick call to Crime Stoppers or police could have avoided the theft of that wire.
Our police can’t be everywhere, so the extra sets of eyes and ears of ordinary citizens are helpful to local law enforcement. Thank you.
The Chair: Thank you. Mr. Johnson, you have the floor.
Ross Johnson, President, Bridgehead Security Consulting Inc.: Thank you for this opportunity. I own a security management consulting company based in British Columbia. Although I have clients in several sectors, most of my work is in the electricity sector in Canada and the United States. My career includes 24 years in the Canadian Armed Forces as an infantry and intelligence officer. I left the military in 2001. After, I worked first in aviation security and then for the safety department of an offshore oil-drilling company based in Houston, Texas.
I have worked in the electricity sector since 2006 when I joined EPCOR Utilities in Edmonton. I am also currently the Chair of the Physical Security Advisory Group, a team of industry security professionals who advise the Electricity Information Sharing and Analysis Center, which exists to support the security of the North American interconnected grid.
As security director at EPCOR, my greatest concern was substation intruders. An incident in 2008 at Namao Substation in northern Edmonton illustrates why. A copper thief entered the site in the middle of the night, and his actions created a fault in high-voltage equipment and an outage that affected several thousand customers.
An electrical engineer involved in investigating the incident later described to me what happened to the intruder. He told me that he had been trying to pull a copper grounding strap off the inside of a fence and braced himself by putting one foot back against a piece of equipment called a reactor. He told me that the intruder would have seen a bright purple flash of a plasma cloud. The plasma cloud would have contained about 9,000 amps of electricity and been considerably hotter than the surface of the sun.
The electricity went around the intruder, not through him, which was why he survived, as only one tenth of an amp is required to kill a human. Instead of killing him, it set him on fire from the waist up. There was a fire station literally right next to the substation, and firefighters were on the scene in less than one minute. They saw the intruder inside the substation, screaming and with his clothing on fire. They could not turn a fire hose on him because the station was still energized, so they yelled at him to roll on the gravel to put out the flames.
Several minutes later, a substation worker arrived on the scene to de-energize the site so that firefighters and EMS could enter and help the intruder. He was still alive but bleeding badly. The intruder was hospitalized with extensive third-degree burns to the upper half of his body.
Copper thieves often get away with the crime without injury, but, occasionally, the consequences are grave. In this case, the most immediate were the terrible injuries to the intruder. The second injury was to the substation worker who entered the site to de-energize it so the first responders could enter. He ended up with post-traumatic stress disorder, which kept him off work for several weeks.
In other incidents within our sector, utility workers have been injured by high-voltage equipment when they failed to realize that the copper grounding straps had been stolen, rendering it unstable and dangerous. Intruders have also cut holes in fences, which can then be used by children to enter the site.
Most people’s experience with electricity lies in what comes out of the wall sockets at home and at work. They don’t understand that the levels found in substations are vastly more dangerous. That is why we view substation security as a public safety issue, and our efforts are directed at keeping intruders out.
Copper theft is the most common reason for substation intrusions. Copper is easily converted to cash by metal recyclers, and thieves see copper grounds in substations as low-hanging fruit. In North America, two thirds of all theft from substations involves copper.
Preventing substation intrusions for any reason, including copper theft, requires a combination of measures. The ones within the jurisdiction of the electricity sector, such as improved substation security, substituting less valuable alternatives to copper and public awareness of the hazards are the responsibility of the asset owners and operators, and we do not shrink from it.
We need help, though, in changing the perception by thieves that substation intrusion has a low risk of consequence. There is a belief, even within our industry, that copper theft goes unpunished by the legal system.
Electricity is the medium through which we create and share prosperity. It is the critical infrastructure sector that all sectors rely upon. Substation intrusions put the reliability of the grid at risk, and our increasing dependence upon electricity means we have less tolerance for outages.
The substation attacks in Moore County, North Carolina, two years ago created an outage that left 150,000 people without power for almost five days. One person died of suffocation when their oxygen generator failed, and when the intruders are caught, they will face life imprisonment.
Canada’s reliance upon and demand for electricity is increasing, but the laws protecting the supply of electricity have not kept pace with the changes.
Thank you. I’d be happy to take your questions.
The Chair: Thank you, sir. I will turn it over to senators for questions.
Senator Simons: Mr. Johnson, since I’m from Edmonton, I will start with you. I wasn’t here yesterday but I read all the testimony, and as I understand it, one of the main problems here is that the penalties for stealing copper are relatively low because the value of the copper falls under the $5,000 mark.
Based upon your experiences in security, would you think it would be possible or preferable to have a Criminal Code offence that is more akin to sabotage, both for electricity substations and for telecommunications?
I wrestle with this, because the people who are mostly doing this are not, for the most part, political actors or trying to create incidents of terrorism. However, this is the sabotage of essential infrastructure, nonetheless.
Mr. Johnson: Thank you. The example of a law that I look to is one the U.S. has. It is Title 18 U.S. Code Section 1366, destruction of an energy facility. It covers the oil and gas sector and the electricity sector. What it provides for is that if somebody does $5,000 of damage or more in an electrical or oil and gas facility, or if their plan, if successful, would have led to $5,000 or more, then they are eligible for five years in prison. At $100,000, it’s vastly different. If their plan, if successful, would have cost $100,000 in damages, they are eligible for 20 years in prison.
That law is quite successful, in my opinion. I work across North America, including a lot in the United States. We’ve had a problem in the Pacific Northwest for the last few years with multiple substation attacks — several in the same evening by the same people.
The FBI in Seattle have been successful in stopping these. They are using the Title 18 law to charge the intruders. What we’ve seen is that there has been a reduction in incidents in the Pacific Northwest.
There was a series of substation attacks being planned in Baltimore, Maryland, last year by Atomwaffen Division, a neo‑Nazi group —
Senator Simons: But those are terrorist attacks. That is different.
Mr. Johnson: True, but they used this law. They were only planning this attack, and the law was used. One of the perpetrators was sentenced to prison for 18 years.
My point is that the law they have regarding the destruction of an energy facility will apply to any destruction, from somebody coming in and damaging the copper grounds all the way up to terrorism.
The important thing is that it gives prosecutors a tremendous ability to get the perpetrators to, frankly, turn each other in. If they can say to someone, “You are facing 20 years in prison,” that person will turn in his confederates very quickly. That is how they successfully solved Tacoma Christmas attacks from two years ago.
My point of view is that copper theft is the number one reason that people intrude into substations. People can intrude into substations for all sorts of reasons, all the way from terrorism down to copper theft. I would like to see a law that deals with protecting critical infrastructure and gives the Crown great scope when it comes to dealing with the perpetrators.
I’m not trying to throw people in jail for 20 years. I just want them to go away and leave us alone.
Senator Simons: Mr. Shine, yesterday, the committee heard from Ben Stickle, a professor from Tennessee, who testified that many of the copper thefts, in his analysis, are being carried out by people within the recycling and scrap metal industry themselves. What do you say in response to that? Is that something that you have observed — that the calls are coming from inside the house, as it were?
Mr. Shine: I have been in the industry for 40 years, and I have never once heard of a recycler committing an act of — Are you suggesting they are going into telecom companies and actually taking the wire? Is that what you are suggesting?
Senator Simons: They are facilitating the sale. I think that was his point.
Mr. Shine: Meaning buying stolen goods?
Senator Simons: Knowingly buying stolen goods and conspiring, not just turning a blind eye.
Mr. Shine: Now I understand. The second part of that, in terms of buying, in my 40 years in the industry, the people that I’ve interacted with at both CARI as well as ReMA, the U.S. equivalent, I have not come across anybody I would have said was complicit in partaking. I’m not suggesting that all scrap dealers are honest and ethical. I don’t mean to say that, because I’m sure they’re not. Just like all used car salesman, every industry has bad actors.
I have truly never encountered a scenario where I felt as if I was interacting with or in the presence of somebody who was knowingly participating in a ring of buying stolen goods.
Again, I’m not saying it hasn’t happened, but it has never come across by radar in my 40 years in the industry.
I’m not condoning it or suggesting that it’s not the case; I just don’t know of it.
Senator Quinn: Thank you, witnesses, for being here this evening.
Mr. Shine, I understood that you said you operate scrapyards.
Mr. Shine: I have two yards, one in the Buffalo, New York, area and one in St. Louis, Missouri. What is a little different, when you say “scrapyards,” is that my company doesn’t buy from the public. There are companies set up to buy from the public, and it is called retail trade. That is where this initially happens, when retail scrapyards are buying from the public, looking at the goods as they come in the door and unsure of whether they are authentic or not.
Typically, I have been in presence of many of them because I buy from the people that collect goods, accumulate full truckloads, 40,000 pounds, and then I buy from either scrap dealers or industrial plants throughout North America. So, yes, I operate two yards, to answer your question.
Senator Quinn: What do you require of those folks that you buy from so that there is a clear demonstration that the materials that they are selling to you come from legitimate sources — in other words, that they are not stolen?
Mr. Shine: At the level that I buy, because I’m buying in full truckload quantities, there is no requirement or way to actually know that for sure. But the people I work with are vetted, qualified suppliers I have successfully done business with over many years and have reputations for not wanting to be party to any stolen transaction up through the chain. We’re the final stop before things get remelted.
That is one point that the committee was making earlier about remelted materials. That happens after leaving the recycling trade, by and large. Metal recyclers are not melting the material, and they’re not buying melted material. People aren’t melting and then coming to the scrapyard.
I don’t know if that answers your question.
Senator Quinn: It’s helpful. I will stick with the theme, though.
I’ve had some experience in scrapyard operations in a port environment, and there were issues with respect to explosions and things — regarding crushed cars, as an example. The company would lower the price for those that they could identify and, in fact, maybe stop buying from them. They were trying to their best to prevent things from happening.
What would you think if, through this, one of our recommendations was to put greater onus on companies that buy scrap, either from other dealers or the public, in order to ensure there is a certification — a trail, if you will — so that when you buy, you know that none of it has been obtained illegally? What would you think if that kind of recommendation came forward and, in fact, became a requirement?
Mr. Shine: I think it’s totally appropriate for recyclers to have a seat at the table, and I appreciate the opportunity to speak tonight and participate in that process because we welcome that, honestly.
There are things that we can do because we are the first stop along the way after the theft, after the crime. We have a role to play, a responsibility. Again, the legitimate recycling trade embraces that and understands the impact to our communities, the companies, the emergency services and so on. So we welcome that.
What we don’t want to do, though, is create a scenario where we can’t operate as a business, because we play an important role in keeping the recycling trade moving. As long as we have a seat at the table and can openly and professionally discuss those criteria, that’s fine. In fact, it would be welcome, especially if it’s uniform. What we’re seeing now is discrepancy between the provinces, and that creates a lot of challenges.
Senator Quinn: You’ve heard the other witnesses this evening. I assume that you were listening in.
Mr. Shine: Yes.
Senator Quinn: They talked about, in Canada, how maybe there needs to be greater emphasis in the Criminal Code not only on the perpetrator of the theft but also those who need to be aware and may buy from those who have illegally obtained that which they are selling, and put an onus on them by having fines and/or heavier penalties for owners of scrapyards. What is your reaction to that?
Mr. Shine: I think it’s totally appropriate for recyclers to have responsibility, to ensure they are not buying stolen goods. Regarding what that looks like, exactly, the best methodology, there are some examples in the U.S. that work well.
Our industry as a whole, both the U.S. and Canada, have embraced and are definitely participating in — again, in Canada, province by province or local jurisdiction — requirements to take identification to report purchases. I was told by my board of directors last week that Alberta has the best system in place, that it is the cleanest and most straightforward. Everybody understands it. It is functioning well. But even in Alberta, the transmission of the data isn’t necessarily well received. Law enforcement doesn’t want to have to leaf through purchases and cull out who the bad actors are. But in Alberta, they have a “no buy” list. A “no buy” list should absolutely be communicated throughout the recycling trade, and anybody buying off a “no buy” list should absolutely face fines, penalties or whatever the right criteria are.
Senator Quinn: Ms. Annis, have you had incidents with respect to the public eyes offering extra help watching over things that are happening? Have any of the public ever been at risk or threatened because they come across a scene? Have there ever been any bad vibes in that regard when the public gets involved?
Ms. Annis: Thank you for the question. When people call Crime Stoppers, they remain anonymous, so we don’t have any people dealing with us getting bad vibes.
However, people don’t think of it as being a serious crime. They don’t think about that person who can’t make the 9-1-1 call because their telephone isn’t working and may perhaps lose a loved one.
It’s very important that the message be sent out to the public about how serious this crime is. I don’t think that people take it as seriously as it needs to be taken.
The Chair: Don’t say the chair is not benevolent.
Senator Cuzner: Ms. Annis, I’ll continue from Senator Quinn’s last question. I’m sure you have conversations with other Crime Stoppers organizations across the province and the region. Have you noticed a surge in the number of tips that you’re getting regarding metal and copper theft? Is there any kind of a trend that you can detect as to how these crimes are being committed that could maybe better inform us regarding a path forward on prevention?
Ms. Annis: Absolutely. Bottom line, as the price of copper goes up, the more thefts there are and the more tips we get. I have spoken to both the RCMP and the Vancouver Police Department, or VPD, and the new Surrey Police Service about this, and, again, they are indicating that it’s been very under‑reported, but we are hearing about a lot of situations.
Reporting to the police or to Crime Stoppers seems to be a very significant issue. Having said that, we do get several hundred tips each year about it.
Senator Cuzner: You’ve seen that increase over the last number of years?
Ms. Annis: It ebbs and flows depending on what the price of copper is.
Senator Cuzner: You had mentioned in your presentation the recycling sector and referred to it as the Wild West, if you could maybe expand on that. Mr. Shine, I’ll give you an opportunity to weigh in on that as well. But could you elaborate on seeing the sector as the Wild West?
Ms. Annis: I absolutely will. We in British Columbia are finding that a lot of the recyclers are accepting product that has been stolen. A prime example is catalytic converters, though obviously that is not the topic of discussion tonight.
When the City of Surrey passed legislation around only accepting catalytic converters that had been engraved, suddenly, catalytic converter theft went way down. We hear this over and over again. I don’t think the local dealers are being inspected in the way that they should to ensure that they’re getting good, clean product.
Senator Cuzner: Mr. Shine, do you want to respond to that?
Mr. Shine: Sure. Thank you for the opportunity to do so. Obviously, I’m in the industry and come from a long line of family members that have been in the industry. I certainly take exception with the Wild West analogy, but I understand the point.
The recycling industry has changed a lot in my time, during my career. First, there is a lot of public money in the recycling trade now. It’s been a subject of roll-ups.
One of the previous presenters talked about the three large companies within Canada. One is private and the others are publicly traded. There’s a lot of scrutiny that comes, of course, with public entities. The reality is that the degree of professionalism has stepped forward. You have many college‑educated people running these businesses today, myself included. It’s just a different world than it was.
We are highly regulated, both in the U.S. and Canada. We have inspections for water, air and noise. We’re inspected regularly and significantly.
Regarding the issue of theft of catalytic converters, there are rings of people who are bad actors that send to unscrupulous dealers for sure. But those people are by and large not representing the recycling industry. They are fly-by-nights. Your point about identification of the catalytic converters and the reduction of theft, that is a great thing. We welcome that as a trade.
We want to be looked at as part of the solution and an important part of the recycling trail so that we can reduce virgin materials and create a good carbon footprint.
Senator Cuzner: Do you see your organization really playing a significant role in trying to deal with the issue?
Mr. Shine: I really do. The other point I want to make quickly is that I don’t want to see the Senate, if the copper price is high, put regulations in place and then if the price goes down take them away. It needs to be consistent because you don’t want to wake up one day and the market is high and higher thefts would be expected. We should have it consistent so that recyclers know the rules and can enforce those in all market conditions.
There is no question the sentiment is right. As the market goes up, it is amazing how attuned thieves are to market pricing. The reality is, I don’t want to see it be temporary, put in when markets are high and then not when they are low. It should be consistent so we all know the rules.
Senator Dasko: Thank you to the witnesses. My first question is for Mr. Johnson. You have described the situation around substations and the security or lack of security with regard to them. You’re calling for a change in the Criminal Code as a way to deal with it.
My question is really about prevention when you have substations. You described one incident and what happened to the perpetrator and so on. It seems to me that substations have a certain built-in security mechanism because they are dangerous places.
Why isn’t prevention 100% of the way to solve this — or just about 100% — when it comes to substations? Why isn’t there more security at the substations or whatever it may be?
Why isn’t every substation just a place where a perpetrator would never think to go?
Mr. Johnson: Thank you. That is a very good question.
In North America, we have at least 55,000 substations greater than 100 kV. I don’t know what the number is in Canada, but there are many thousands of substations. The problem is that many of the substations are remote, and they are almost all unmanned.
If we’re having an intrusion, the issue is that we have to detect the intruder, assess whether they are trying to get into the substation and then delay them until law enforcement can get there.
I did a lot of my work in Alberta and was involved with the provincial government and the legislation with the recycling industry. One of the big issues we had in Alberta is that so many of the substations are remote. You could have an intrusion that would start, you would see it, and it would still take you an hour and a half to get law enforcement there.
The problem is that in these sorts of cases, you cannot delay somebody for an hour and a half. Because of that, we adopt multiple approaches to this. First, we put in security. The best security goes to the most critical stations, the 500 kV stations where you could have huge, widespread outages if they are attacked. The smaller, lower-voltage substations will get less security.
The problem, as well, is that our infrastructure was built for a world that doesn’t exist anymore. We have had huge changes in society and threats and problems that we didn’t have 20 or 30 years ago. A lot of our equipment is, as we say, legacy. A lot of the stuff has been there for decades.
In order to protect it, we need to do a number of things. We are doing what we can in the sector. For example, Nova Scotia Power has created engineering specifications for using alternatives to copper in substations. They have it set up so that all new substations that Nova Scotia Power builds will not use accessible copper. There will be no copper above ground that anybody could get to. That is terrific. That is exactly where we need to go.
The issue, though, is the old legacy sites. In order for a theft to occur, you need a motive, opportunity and rationalization.
The motive is clear: People need money.
The opportunity is that substations are often remote, they’re unmanned, and the amount of time it would take law enforcement to get there is far more than the amount of time it would take to go in, steal something and get out.
The last part is rationalization, and that is concluding, “Nobody cares, the laws are really weak and they never charge us, anyway, so it’s not a big deal.” That’s one of the pieces that we need to attack.
The opportunity part I can handle as a security professional in this sector. I can improve security. We can remove copper from substations and do all sorts of things, but it’s the rationalization piece that we also need to put pressure on, and that’s the part where the perpetrators think that this is a victimless crime, nobody cares and nothing is going to happen to them anyway.
Senator Dasko: Within those substations, are you saying there’s really no rationale for setting up greater security in those situations, even loud noises or whatever it is, or cameras where you can actually see, even when the law enforcement is an hour away? You’d still be on camera, and that would be a bit of a disincentive, I think.
Mr. Johnson: We do all of that, but there is a fixed amount of money available for doing this.
What we do is the greatest amount of security goes to the largest substations, the ones that handle transmission-level power. Then the smaller substations will have less money allocated to them.
If there is an area that is getting hit hard all the time, then we will beef up the security in those particular sites. In many cases, we treat the problem where we find it. But to actually just go out and try to beef up security to the extent necessary on all of them, it would be unaffordable and, ultimately, wouldn’t work, because the response time, in many cases, is too great.
Senator Dasko: Yesterday, we had a witness here from the government, from Innovation, Science and Economic Development Canada, who described to us a public awareness campaign that was run on this very topic.
Now, Mr. Shine, I think you’re in the U.S., so you may not have had access to such a campaign, but is anybody aware of this campaign? Did you see it? Did you see any elements of it? Do you recall any of it?
Mr. Johnson: I don’t recall seeing it.
Senator Dasko: You don’t recall.
Ms. Annis, do you recall such a public awareness campaign or anything about it?
Ms. Annis: I don’t recall ever seeing it, no.
Senator Dasko: Thank you.
Senator Clement: Thank you for being here.
That is an issue, though — the awareness. Going to your point, Mr. Johnson, about nobody caring: if nobody knows, then nobody cares.
I want to come back to the Criminal Code. I sit with Senator Simons on the Senate Standing Committee on Legal and Constitutional Affairs. When people make changes to the Criminal Code, they come before that committee. We have been changing that Criminal Code piecemeal, little bits here and there, and I have to tell you, the Criminal Code has not actually been reviewed in 50 years. Right now, it’s kind of a big, jumbled mess. I’m a little sensitive to this idea that we need to make changes, again, to the Criminal Code when theft is already covered in it. I’m saying all this, and I’m going to want your reaction to that.
I heard in the previous panel — I missed some of it, though — about municipal bylaws. Would those be a better way, or do they have to be part of a whole process around this?
With municipal bylaws, you are making it harder to sell the stuff, where you can’t pay cash, must use traceable ways to pay and that sort of thing.
All of you can comment.
Mr. Johnson: In my experience, Calgary had a very good municipal bylaw, and that was to a large extent, I believe, the way we patterned the laws for the province of Alberta.
The problem, though, is that you’re just pushing the problem to the next jurisdiction. If you’ve got really strong municipal laws in one community, then the thieves will take the copper and go to the next community that doesn’t have those laws, so it’s kind of a game of Whac-A-Mole with them.
Regarding the Criminal Code, I understand your concerns. It’s not really the theft law that concerns me, though. The law says $5,000 worth of copper. You have to go a long way to get $5,000 worth of copper wire. That’s not the problem. The problem is the tremendous damage done to the substation, to the fencing and to the high-voltage equipment. That can cost many thousands of dollars. That’s not covered under the theft law, to my understanding.
I believe that is covered under the mischief law, but under the mischief law, you can bring in all these others. In Alberta, we would have Crown prosecutors calling us up and saying, “We want to know all the costs, not just the cost of the copper.” Essentially, if it’s over $5,000, they want to know about it.
The problem with that, though, to be honest with you, is that then you’re coming under the mischief law, and mischief is a term that, frankly, reminds people of Dennis the Menace. People don’t take it seriously.
When I first heard that, I was in a conversation with an RCMP officer, and I said, “What are you going to do in this case?”
He said, “Oh, I’ll charge him with mischief.”
And I said, “Mischief? That sounds like Dennis the Menace.”
He got really angry at me, so I went and looked up mischief laws, and I discovered that the mischief laws are actually quite robust and will allow up to life imprisonment.
It is a really serious law, but the problem is, frankly, the name of it. People don’t take it seriously. It’s an outmoded term.
Senator Clement: Thank you.
Does anyone else have a reaction?
Ms. Annis: I would like to add that I agree 100%. We have enacted bylaws here in Surrey, again, around catalytic converters. That certainly reduced catalytic converters being sold illegally in Surrey, but it pushed it over to our neighbouring communities.
I do think that it’s something that we should be looking at globally, for all municipalities and, perhaps, coming up with some sort of legislation that is controlling it in the province as well.
Senator Clement: Thank you.
Mr. Shine: Just to chime in, I agree with the remarks that have been said. It’s very difficult when it’s a patchwork, first, because people push to the easiest spot, for sure. Second, in some cases, we are managing multiple yards across multiple provinces or municipalities, and that creates discrepancies in terms of how you train the staff and the procedures and protocols that are in place.
It would be much easier if it were uniform, which I understand may be a big ask. If it were uniform or, at least, relatively the same criteria required to purchase, report, et cetera, then it would be easier to communicate and to understand.
Senator Miville-Dechêne: I’d like to address my question to Mr. Shine, because I want you to clarify your role.
You said you were based in the U.S., but I see you here as the spokesman of the Canadian Association of Recycling Industries. Is that the case?
Mr. Shine: Yes.
Senator Miville-Dechêne: You said you have about 200 companies in this particular association. I’d like to know how representative this association is of the whole.
We were told during the last panel that there were thousands of scrapyards. Are you just a very small part of it, and what is the difference between a recycling company and a scrapyard?
Mr. Shine: First, yes, I’m based in the U.S. and I am chairing the board of this Canadian trade association. That’s not unprecedented. There have been other U.S. representatives chairing the board, so I’m not the first.
Senator Miville-Dechêne: I just wanted to clarify, because it seemed to me contradictory, but maybe it’s not.
Mr. Shine: Totally get it. The name of my company, Manitoba Corporation, isn’t because we have physical assets in Manitoba. We’re on Manitoba Street in the city of Buffalo; that’s actually how we got our name. But because we do a lot of business in Canada, they think we’re okay.
Anyway, the 200 members versus thousands of recyclers question, I’ve not actually seen statistics about how many recyclers there are; that could be the case. Not every company chooses to become a member of a trade association. Some do and some do not, either because they’re too small — mom-and-pop kind of operations, two, three, four people — or they just don’t want to pay dues into a national trade association. Those types of people let others do the work, both in terms of through the trade association but also paying for it. They don’t want to pay dues and they don’t want to go to a national meeting. So there’s no question that we don’t have 100% of the market.
I would say, though, the 200-plus members represent a large swath of the industry. It’s probably something like 70%. That’s a guess; I don’t know that for certain. But I would say that the 200 member companies probably cover 70% of the metal recycling that takes place. Because anybody who is serious and significant — and again, professional — understands the role of the trade association, and the power to collaborate, to work with the government to ensure that we’re a viable industry going forward, and providing all the important things that we do.
Regarding your last question about scrap versus recyclables, that is a transition we’re undergoing as an industry. It used to be the junk industry. Then we jumped up a level to the scrap industry. Now the reality is we’re becoming the recycling industry. And really, it’s an acknowledgment of the important role that we play in feeding manufacturing the goods needed to make new products. Because the reality is, without recyclables, new products, hospitals and schools won’t be built, because recyclables are in-feed to all of those activities, including the telecom industry and all the rest of it. So we play a role in helping to facilitate the manufacture of goods. So we’re trying to elevate, again, junk, scrap and recyclables. So it’s an industry that’s in transition, as reflected in the terminology.
Senator Miville-Dechêne: Since you’re the head of this association, have you seen methods among your members to control who’s buying or to get the identity of the people selling? Do you have some examples of things that work?
Mr. Shine: In the U.S., which I’m more familiar with, being larger, I led a trade association that represents 1,700 member companies, as I mentioned in my remarks.
Senator Miville-Dechêne: You lead two trade associations?
Mr. Shine: From 2018 to 2020, I was the chairman of ReMA, the Recycled Material Association. I have a day job too. So I’m more familiar with the U.S. approach to this, but the U.S. and ReMA and CARI are extremely collaborative. We help each other because Canada is ahead in certain areas, like environmental and certain other regulations, and the U.S. is ahead in certain areas, like materials theft.
I had the board meeting last week, and I told them that I was going to be making this presentation and have the opportunity to interact with you. And so I took a canvas of what laws they are under, because we represent all the provinces on our board, and it was a patchwork. It was everything from very little, to taking identification, to uploading the data of daily purchases, to limiting the cash that can be paid out — all different kinds of rules, province by province, or even in some cases by municipalities. So it’s a patchwork and needs work, for sure, for us to be able to effectively carry that out.
You don’t want to, to the earlier presenter’s point, just shift it. If somebody has a tough regulation, all that does it push the thief to the next municipality or province. You don’t want that scenario, ideally, because you want it to be uniform. That gives the recyclers a fighting chance.
The legitimate recyclers want to and must abide by the law. The illegitimate recyclers, and there are some for sure — I can’t pretend there are not. I wish they weren’t because they give us all a bad name. But, in any case, it would be easier if it were uniform, for sure.
The Chair: Colleagues, that brings us up to 8:45, which is the end of the second panel. I want to thank our panellists for being here and sharing their experiences and views. It’s been very helpful. Colleagues, that concludes the meeting, and I call this meeting adjourned.
(The committee adjourned.)