Ottawa’s new energy rules viewed as vague with open-ended timelines
OTTAWA Last week, the federal government rolled out its long-awaited environmental assessment reforms, which could dramatically alter how projects like pipelines, power lines, hydro dams and mines are reviewed.
The bill is 350 pages, and experts are still digesting the full scope of the proposed changes. Many of the detailed regulations still need to be written, and it would take years before they are fully enforced.
Initial reviews of Bill C-69 were mixed, but several academics, project proponents and opposition politicians have complained that it remains too vague to properly assess. Here are four aspects of the legislation that have observers scratching their heads.
EARLY PLANNING PHASE FOR PROJECTS
The proposed legislation would add an early planning phase in which proponents will be required to submit an initial project outline to the body overseeing the review. The regulator overseeing the proposal, now the Impact Assessment Agency of Canada (IAAC), will eventually determine whether a review is required, and the proponent will then have 180 days to fulfil a list of detailed requirements provided by the IAAC.
Early consultations with local communities are designed to raise any potential red flags about a project — a provision that experts agree is wise. But some argue the updated legislation does not clarify what specific criteria are required for proponents to meet under early engagement, potentially delaying reviews.
“What it looks like now is they ’ve really just shoehorned a couple of extra steps into what was already part of the previous regime,” said Martin Olszynski, an associate professor at the University of Calgary.
SHORTER LEGISLATED TIME LINES FOR REVIEW
Ottawa has long promised that while it would subject major projects to more environmental scrutiny, they would do so on shorter timelines in an attempt to provide certainty to investors and proponents.
The latest legislation did set out specific deadlines for reviews, with a final recommendation from the IAAC to come in 300 days, down from 365 days. For more complicated projects subject to a joint review, a final recommendation is expected in 600 days, down from 720.
However, industry is still unclear over whether, and based on what criteria, the agency will be allowed to delay its final recommendation. Project reviews have been delayed in the past due to court appeals or a lack of information supplied by the proponent, for example. Still, based on an initial read of the legislation, Olszynski said the current legislation could actually restrict the number of levers regulatory agencies can use to postpone final recommendations.
OVERLAP OF REGULATORY BODIES
Ottawa’s legislation will essentially put the IAAC in control of all project reviews — a role that used to be fulfilled by various regulators like the National Energy Board, Canadian Environmental Assessment Agency or the Canadian Nuclear Safety Commission. The IAAC will work together with other existing regulators before making its recommendation to cabinet.
What remains unclear is how the IAAC and newly-formed Canadian Energy Regulator (CER) will blend their respective assessments.
“The literature provided by the federal government on the proposed legislation is somewhat vague as to exactly how responsibilities will be broken down between the CER and the IAAC, and contain a good deal of what we would characterize as attempts at universal inclusiveness and political correctness,” analysts at GMP FirstEnergy wrote in a note to clients, which slammed the regulations for their “increased complexity, subjectivity and open-ended timelines.”
“Moreover, it is not directly stated, but the new policy appears to put the environment first and the economy second, and the wants of a small number ahead of what is best for Canada’s economy as a whole,” the analysts said. “We see nothing in these proposed changes that will attract incremental energy investment to Canada.”
STRATEGIC OR REGIONAL ASSESSMENTS
The proposed legislation also appears to recognize the need to assess the so-called “cumulative impacts” of projects, rather than on the prescribed, or project-byproject, basis that is currently followed. This broader consideration of factors is something experts, and even many project proponents, had been recommending for years.
“What we’re seeing here in this law is a recognition that those regional assessments are a good idea,” said Robert Gibson, a professor at the University of Waterloo. He said that the new legislation appears to suggest that government will begin to carry out studies on regional and strategic impacts, a move he says “is not useless by any means, but it falls far short of addressing what the government will do about any of that.”
As it stands, the legislation is unclear as to whether regional and strategic assessments will become mandatory, or whether proponents will continue to be judged based on their individual proposal.