Happy Canada Day, Ontario.

Three years ago this holiday weekend, we weren’t so happy.

On July 1, 2010, consumers were ambushed by new eco-fees on thousands of mundane household products — ranging from inhalers to fire extinguishers — igniting a political firestorm. Mild-mannered Ontarians raged against the Liberal government for imposing those annoying taxes without warning.

Or rhyme or reason. Or consistency or transparency.

At Canadian Tire, different stores levied different fees on identical products. Eco-fees were an eco-disaster.

Launched on the same day as the hated HST, eco-fees added up to double jeopardy. Unlike the HST — which everyone saw coming — the new recycling fees seemed to come from out of nowhere, feeding into an opposition narrative of a stealthy tax grab.

Within weeks, eco-fees were trashed — but not forgotten. Tory Leader Tim Hudak campaigned relentlessly against “Dalton McGuinty’s sneaky eco-taxes.”

Now the Liberals have resolved to ditch eco-fees once and for all. Henceforth, instead of tacking on exasperating surcharges at the cash register, producers will bear the burden of diversion — and incorporate their recycling costs into their sticker prices.

Three years after the initial Canada Day uproar, the eco-fees story is a tale of two political environments. It’s also the story of how a recycled environment minister, Jim Bradley — who first held the portfolio nearly three decades ago — combines environmentalism with realism.

He is also lucky: After all that eco-chaos, and bitter divisions about waste diversions, the stars may finally be in alignment over landfills.

Bradley has buried the old model dominated by Stewardship Ontario — an ossified, arm’s length outfit run by the private sector. It wielded control over waste diversion without any political responsibility or accountability. Eco-fees were funnelled to little-known industry co-operatives that bankrolled recycling.

The government never saw the money from eco-fees. But it owned the political mess.

The new plan would require producers to include all environmental charges in the sticker price, recognizing them as a cost of doing business — just like wages, rent, overhead and electricity. Producers could no longer pass the buck — or fob off eco-fees — onto consumers at the cash register.

A new regulator will ensure that producers comply with government rules and meet diversion targets. The goal is to improve not just transparency but competitiveness:

Previously, with waste diversion hived off on industry-wide eco-fees, individual producers had little incentive to change their wasteful ways in manufacturing or packaging their goods. Now, if they can recycle more efficiently, and still meet government targets, they can sell at a lower price or boost profits.

But there is another competitiveness angle: The waste diversion industry has long complained that it couldn’t get good prices for increasingly valuable recycled materials, because there was only one centralized buyer via Stewardship Ontario. It was, as the waste industry argued, a wasted opportunity.

Bradley describes the old, discredited ‘stewardship’ model as a proxy for industry “cartels.” Stewardship Ontario and its offshoots had sole purchasing power for all recycled materials in each sector, yielding monopoly-like powers that subverted market forces. Depressed prices led to stagnation and a lack of innovation in the recycling processes.

Critics pointed out that the Liberals had failed dismally in their promise to increase waste diversion to 60 per cent from 22 per cent. The overall recycling rate has remained stagnant for two decades at less than 25 per cent.

Opposition reaction to Bradley’s reforms has been relatively restrained so far: “I haven’t had one question on it in the legislature,” Bradley notes dryly.

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But there will be questions when his proposals are debated in the legislature this fall. There are always political landmines over landfills.

And it will take time. No changes are expected before next year. But on the eve of Canada Day, the eco-disaster of 2010 has quietly receded from the headlines.