An environmental lobby group has formally begun legal action to force the federal government to abide by the Canadian Environmental Assessment Act in stimulus projects funded by Ottawa.

The case was initially begun last spring in response to the federal government's decision to no longer require environmental assessments for the big stimulus projects announced in last year's budget.

Ecojustice filed suit on Friday before the Federal Court in Ottawa on behalf of the Sierra Club of Canada. If it's successful, thousands of stimulus projects that were approved could be re-examined for their effects on the environment.

The changes to the Canadian Environmental Assessment Act were approved last spring by the federal cabinet behind closed doors. The change exempts federally funded stimulus projects — everything from highways to roads to sewers — from environmental assessments.

The federal government has argued this will do away with the need for time-consuming federal studies that are often done at the same time as provincial ones. Government documents filed in May 2009 say this will allow the government to kick-start an estimated $24 billion worth of infrastructure projects across the country and save it up to $ 400 million in assessment costs.

But the Sierra Club says the changes gut the Canadian Environmental Assessment Act, which requires public scrutiny on the environmental effects of big projects.

"We are asking the courts to declare the government's actions illegal," said John Bennett, executive director of the Sierra Club.

The new regulations allow projects to proceed without study, as long as they are 250 metres away from an environmentally sensitive area.

Bennett maintains these vague rules will lead to cumulative damage from big construction projects with no public say.

"We need these to be published so we can have an idea of what exactly is going on," he said.

The federal government has until April 5 to respond.

The Canadian Environmental Assessment Act is the second law that has been changed to accommodate the stimulus projects contained in last year's budget.

In April 2009, the House of Commons changed the 130-year-old Navigable Waters Protection Act, which required an environmental assessment for any projects near water deep enough to float a canoe.

Now projects on small rivers won't need a review at all, while decisions on bigger waterways are up the federal minister.