A new report from the environmental commissioner of Ontario documents startling shortcomings in the way the province protects water, one of its most valuable resources.

"Our report notes that most water users still pay nothing for water, including agriculture, municipalities, the sand and gravel industry, golf courses, and so on," Ellen Schwartzel told reporters Tuesday.

Large corporations and industries are pulling trillions of litres of fresh water from Ontario's watersheds for free in some cases, or at prices that fall well below what it costs the province to monitor their activities..

Some industries such as bottled water companies, beverage manufacturers, canning or pickling facilities, concrete manufacturers and pesticide and fertilizer manufacturers are charged $3.71 per million litres they take from Ontario's aquifers and rivers. Other users pay nothing.

Tuesday's report notes the Ontario government began charging for water in 2009. The province spends about $16.2 million annually managing water taking, but collects only about a million dollars in water fees. In other words, the charges recover only 1.2 per cent of actual water quantity program costs.

Just last week, CBC News reported on a situation in Elora, Ont., where many residents are fighting a proposal by Nestlé Waters Canada to draw up to 1.6 million litres of fresh water every day from the Grand River watershed.

Ontario's Ministry of Environment is currently reviewing the application.

Ecosystems stressed

Schwartzel noted Tuesday that "ecosystems in some parts of the Grand River watershed are periodically stressed by low water levels" and accused the Liberal government of mismanaging water issues despite two separate reports that called for better cost recovery as well as better protection for watersheds.

Any company in Ontario that draws more than 50,000 litres of water a day needs a provincial permit. The report shows there are currently 6,000 water-taking permits in Ontario, and collectively up to 500 trillion litres of fresh water are taken from the province's aquifers, rivers and lakes every year.

Schwartzel said Ontario should "increase the water-taking charge and expand its scope to apply to other water users, with a goal of recovering the full cost of the ministry's water management responsibilities."

She also said some of Ontario's water sources are already stressed due to growing population, increased demand, development and climate change.

On Tuesday at Queen's Park, Environment Minister Glen Murray noted there's a distinction between industries that use water, then treat it and return it to the eco-system, and other water users.

"If you're taking water and putting it in plastic bottles and selling it back at almost the price of gasoline, that water is not coming back, so the ministry is looking very carefully at whether the water is returned to the environment, or whether the water is permanently removed," Murray said.