National Energy Board reforms make process more daunting.
A panel of experts charged with modernizing the National Energy Board has recommended sweeping changes to the way major pipelines are approved in Canada, including getting the federal cabinet to determine if a project is in the national interest before regulators follow up with a more technical review.
At the same time, the panel wants to expand the role of indigenous communities, move some leadership jobs to Ottawa from Calgary and establish an independent energy i nformation agency.
By recommending changes to so many aspects of Canada’s approval process and expanding the circle of people who have a say, the panel offers much to many.
But the recommendations are also a red- tape maker’s dream. The reforms are so vast and propose to fix so many unresolved issues they would make an already-onerous regulatory process even more daunting. Meanwhile, the upside is uncertain.
Most likely, those who are opposed to pipelines will continue to oppose them, regardless of how they are approved.
On Monday, after months of public input, the fivemember panel handed its 100-page report to Jim Carr, Canada’s minister of natural resources, suggesting ways to improve the structure, role and mandate of the Calgary-based NEB, with the goal of restoring “public trust,” and so that it performs as a regulator, not a policy-maker.
Its recommendations include replacing the NEB with a Canadian Energy Transmission Commission that would be governed by a board of directors based in Ottawa; requiring major projects to undergo a one- year review by the federal cabinet to ensure they are in the national interest before an additional two-year environmental and more technical review by the commission jointly with the Canadian Environmental Assessment Agency.
“Before going too far down the road of considering a new project, cabinet must decide if, at a high level, that project is in the national interest, ( followed by a detailed project review covering the full range of issues),” the panel says. “At this stage, “yes” means yes, subject to further regulatory approval after a detailed project review,” and “no” means “NO.”
So “yes” would still be a maybe, since the second review would also have the authority to approve or deny major projects.
The t wo- s t ep process means reviews would take three years instead of 15 months. In practice, reviews have taken a lot longer than 15 months, which raises questions about whether three years actually means a lot longer.
The panel recommends to “radically increase the scale and scope of its stakeholder engagement,” to improve the relationship with landowners, and to create a new, Ottawa-based Canadian Energy Information Agency.
It also recommends a much- expanded role for aboriginal people to ensure their treaty rights are taken into account.
“We see ourselves situated at the beginning of a new era in the industry and evolution of Canada, an era where Indigenous peoples will, at long last, assume their rightful place at the table of Confederation as leaders, knowledge keepers, and most importantly, as equals, bringing to bear distinct and valuable experiences and wisdom,” the panel says.
But that’s not all. The federal government would play a central role to coordinate a Canadian Energy Strategy, in partnership with aboriginal people, provinces and territories, so that “a proposed energy infrastructure project aligns with Canada’s big picture goals for economic, social and environmental progress.”
With the Canadian energy sector facing “increasingly difficult competitive headwinds” f rom the United States, where President Donald Trump is cutting red tape, re-imagining the regulatory process at the same time could mean even greater challenges, said Trevor McLeod, director of the Natural Resources Centre at the Canada West Foundation.
Still, McLeod said the report does a good job in many areas, including pushing political decisions upfront to improve regulatory certainty, increasing public engagement, and creating an independent energy information agency, which many believe is long overdue. It also comes up with better recommendations than a parallel report on reforms to the Canadian Environmental Assessment Agency, McLeod said. That report envisioned an expanded role for the agency on energy projects, which would threaten Canadian competitiveness even more, he said.
For its part, the West Coast Environmental Law Association said the panel completely missed the mark on how projects such as oil pipelines should be assessed.
Both panels envision a greater federal role in energy issues, which means a lesser role for provinces to determine the future of their economies. For Alberta and Calgary, the heart of the oil and gas sector, the transfer of jobs and decision- making to Ottawa means loss in stature.