Proceedings of the Standing Senate Committee on
Energy, the Environment and Natural Resources
Issue No. 55 - Evidence - February 21, 2019
OTTAWA, Thursday, February 21, 2019
The Standing Senate Committee on Energy, the Environment and Natural Resources, to which was referred Bill C-69, An Act to enact the Impact Assessment Act and the Canadian Energy Regulator Act, to amend the Navigation Protection Act and to make consequential amendments to other Acts, met this day at 8:01 a.m. to give consideration to the bill.
Senator Rosa Galvez (Chair) in the chair.
[English]
The Chair: Good morning and welcome to this meeting of the Standing Senate Committee on Energy, the Environment and Natural Resources. I apologize. I was lost somewhere and my car was not working. We will all get accustomed to this. We learn quickly.
My name is Rosa Galvez, and I’m a senator from Quebec. I am the chair of this committee. I will now ask senators around the table to introduce themselves.
Senator MacDonald: Michael MacDonald, Nova Scotia.
Senator Richards: David Richards, New Brunswick.
Senator Seidman: Judith Seidman, Montreal, Quebec.
Senator Neufeld: Richard Neufeld, British Columbia.
[Translation]
Senator Mockler: Percy Mockler from New Brunswick.
Senator Massicotte: Paul Massicotte from Quebec.
[English]
Senator D. Black: Doug Black, Alberta, sitting here as a guest.
Senator Simons: Paula Simons, Alberta, Treaty 6 territory.
[Translation]
Senator Pratte: Senator André Pratte from Quebec.
[English]
Senator LaBoucane-Benson: Patti LaBoucane-Benson, Treaty 6 territory, Alberta.
Senator McCallum: Mary Jane McCallum, Treaty 10, Manitoba region.
Senator Cordy: Jane Cordy. I’m a senator from Nova Scotia.
Senator Mitchell: Grant Mitchell, Alberta.
Senator Woo: Good morning. Yuen Pau Woo, British Columbia.
The Chair: I would like to also introduce, to my left, Maxime Fortin, the clerk of our committee; and to my right, Sam Banks, analyst from the Library of Parliament.
Colleagues, today we are continuing our study on Bill C-69, An Act to enact the Impact Assessment Act and the Canadian Energy Regulator Act, to amend the Navigation Protection Act and to make consequential amendments to other Acts.
Today we welcome, from the Canadian Electricity Association, Mr. Francis Bradley, Chief Operating Officer; and Mr. Terry Toner, Director, Environmental Services, Nova Scotia Power. From the Canadian Nuclear Association, we have John Barrett, President and Chief Executive Officer; Liam Mooney, Vice President, Cameco Corporation; and Frank Saunders, Vice President, Nuclear Oversight and Regulatory Affairs, Bruce Power.
Thank you for joining us. I invite each of you to proceed with your opening remarks, after which we will go to a question period. Who is speaking first?
[Translation]
Francis Bradley, Chief Operating Officer, Canadian Electricity Association: My name is Francis Bradley, Chief Operating Officer, Canadian Electricity Association. With me is Terry Toner, from Nova Scotia Power. We are going to present to you the views of the electricity industry on Bill C-69, with particular emphasis on the Impact Assessment Act.
The CEA is the voice of Canada’s electricity industry. Our members represent the entire value chain of electricity, including power producers, transmission and distribution companies everywhere in Canada, as well as equipment manufacturers and specialized technology companies.
[English]
The electricity sector is uniquely positioned to help Canada meet its climate change targets. More than 80 per cent of electricity in Canada is already non-emitting. Since 2005, our sector has reduced greenhouse gas emissions by 30 per cent, and we are on track to reduce by a further 30 per cent by 2050.
[Translation]
In order to build on this success, considerable investments must be made in the coming years. According to the Conference Board of Canada, our industry should be investing $350 billion between 2010 and 2030.
[English]
This is a huge opportunity for Canada to realize that though we need a clear and predictable regulatory framework, right now, Bill C-69 does not provide this.
As a committee, you have an opportunity to create balanced legislation. Let me turn it over to Terry, who will share the concerns and specific recommendations that we have.
Terry Toner, Director, Environmental Services, Nova Scotia Power, Canadian Electricity Association: Thank you. I have five main points that I want to make.
First, with respect to the minister’s discretion, good projects in the electricity sector require regulatory certainty. This is why we support the publication of the project list regulations before the finalization of this legislation and also why we are concerned with the minister’s unlimited ability to designate an unlisted project for review. Designation by ministerial discretion should be based on pre-defined, publicly available criteria and should be used in exceptional circumstances only.
Second, dealing with timelines, the government’s goal of process predictability is undermined by provisions in the act that permit limitless extensions and suspensions of the review processes. Currently, Bill C-69 gives the minister the ability to suspend or extend timelines up to 26 different times. The risk and uncertainty of such delays are unacceptable. Stop-the-clock provisions and the criteria for extension or suspension decisions must be clearly defined and publicly available so that proponents can assess risks before projects go for review. CEA supports a legislated 730-day limit for the total review process.
Third, dealing with certainty and predictability, proponents should receive the scope of information and process requirements at the outset of the impact assessment process. This should include the assessment criteria, scope and the agency’s expectations for consultations. This can be done through an alteration to clause 18 that outlines expectations in a notice of commencement.
Fourth, with regard to jurisdictional overlap, it is critical that the project list focuses on major, large-scale projects of national significance that may have adverse effects in areas of federal jurisdiction. The stipulation of assessing projects with potential for effects within the federal authority should be listed in clause 6.
Further, projects on the project list should not require an impact assessment if the effects are already appropriately regulated. This inclusion should be outlined in a revised clause 16(2).
Last, with respect to the consultation and accommodation of Indigenous communities, while the Canadian courts and the Prime Minister have stated that the duty to consult in the bill does not constitute a veto, it remains a vaguely defined concept. The bill’s preamble, which references the incorporation of the United Nations Declaration on the Rights of Indigenous Peoples, should be modified. Our industry has a strong track record of meaningful and effective Indigenous engagement and consultation, but while Indigenous interests must be considered seriously and in good faith, this should not amount to a veto on a project decision.
Mr. Bradley: Our sector is looking ahead to an unparallelled era of innovation and investment. Bill C-69 is intended to provide more certainty: one review, one decision. But as written, it adds project risk and uncertainty that will make these investments more challenging. This is not what the government intended. With the amendments that we’ve suggested, we believe that this legislation can be made more workable for our industry and better achieve what it is trying to do. Thank you.
John Barrett, President and Chief Executive Officer, Canadian Nuclear Association: Thank you. Before beginning my remarks, I would like to acknowledge that the land on which we gather is the traditional territory of the Algonquin people.
Thank you to the committee for the opportunity to appear before you. Given the time constraints on opening statements, I would like to go directly to the heart of the CNA submission and offer the following comments and amendments on Bill C-69 for your consideration.
Let me start by noting that the concept of cumulative impact is not only a key issue with respect to the environment but also with respect to investment in Canada. Large energy projects require large amounts of capital, and capital is fluid and investors do not like uncertainty. So any new legislation, no matter how well-intentioned, can create uncertainty. Furthermore, this uncertainty is magnified by the legislative regime being proposed because it is missing a key element, and that is the project list.
I would also note that the nuclear industry is one of the most well-regulated industries in the country. Its regulator, the Canadian Nuclear Safety Commission, or CNSC, is a quasi-judicial commission that is globally recognized and respected. Our members believe in and support a strong, open and transparent regulatory regime, and we believe that exists in the CNSC.
CNA members support the government’s goal of maintaining Canada’s superior regulatory standards while enabling “good projects to go ahead and resources to get to market.” We believe that this objective is achieved by the existing regulatory regime.
Let me now comment on three aspects of Bill C-69: single agency and joint panel reviews, the early planning phase and uranium mines and mills.
The bill proposes that a single government agency be responsible for impact assessment reviews. In the case of the nuclear industry, the bill provides only the option of an agency-led joint panel review. While joint panels are not new — we’ve had them in the past — the CNA does not believe that this will be an improvement over the current process.
Most of the potential impacts considered in relation to nuclear projects are related to radiation protection and international commitments on safeguards and non-proliferation, and that work must be overseen by an agency with significant and specialized scientific expertise. The CNSC is the only place in government with that expertise, and we believe that assessments should remain with the CNSC as the most efficient and effective way of conducting reviews.
As a full life cycle regulator, the CNSC licencing regime and regulatory framework already covers the entire life cycle of the project and is subject to the Nuclear Safety and Control Act and its regulations. This allows the CNSC to not only conduct the impact assessment in the planning phase of the project, but also to ensure that monitoring programs and follow-up conditions required by the IA, the impact assessment, are directly integrated into the licencing process throughout various stages of the project. Our industry is unique, and CNSC uniquely has the expertise and experience to manage the projects.
I’ll turn to the early planning phase. CNA members also have significant concerns over the early planning phase. We understand and appreciate the government’s intention with an early planning phase, but we are skeptical of its potential effectiveness. As the early planning phase occurs after the proponent has provided an initial project description, the proponent will already have undertaken stakeholder engagement to ensure the business case and to have some degree of confidence that issues are identified and can be mitigated. So the CNA believes that the current process already allows for important early input and engagement from local communities, Indigenous groups and public stakeholders.
CNA recognizes that not all proponents undertake as detailed, early engagement as necessary, but we do not believe that the default position should be a second early planning phase led by the impact assessment agency. This punishes good proponents and is not always necessary. In our view, the government’s objectives could be achieved by having the IAA, the agency, conduct a federal verification or confirmatory review of the proponents’ early engagement process. This could be further enhanced by the development and communication of best practice guidelines, which would ensure a consistent, positive approach to early engagement.
Third, I will turn briefly to uranium mines and mills. CNA is deeply concerned by the treatment of uranium mines and mills under this legislation. The CNA is requesting simple amendments to clause 43 and related provisions of the impact assessment act to ensure uranium mines and mills are treated consistently with other mines and mills in Canada.
Currently, the draft bill automatically imposes a review panel process on designated uranium mining and milling projects, whereas designated projects of similar complexity for other mines and mills — for example, coal, gold and silver — are not automatically subject to a review panel process. This arbitrary referral is dissimilar to all prior versions of federal environmental assessment legislation.
Moreover, it is not supported by any science or evidence. In fact, the uranium mining industry is a top performer in Canada with respect to social, environmental, safety and health issues, including regulatory compliance. Furthermore, it is the only mining and milling sector in Canada already subject to continuous dedicated oversight by a federal life cycle regulator, the Canadian Nuclear Safety Commission.
For the impact assessment act to be workable for Canadian uranium producers, uranium mines and mills must be treated like other metal mines and mills. Our specific recommendations are included in our written submission.
In conclusion, I recognize that our written comments have arrived to you but with short notice. I hope you have had an opportunity to review them because there we go into our concerns in much greater detail than I have in these opening remarks.
Again, thank you for the opportunity to appear before the committee, and we look forward to your questions and comments.
The Chair: Thank you. We will start questions with the deputy chair.
Senator Cordy: Thank you very much for being here this morning. It’s all helpful to us as we’re trying to work through a pretty lengthy bill, with varying industries coming before us.
I have to tell you the electrical people sent somebody to my office who had been a student where I used to teach, so it was a bit jarring for me to realize that the students are now coming before me. He said, “Mrs. Cordy, you used to teach at Colby Village Elementary,” and I said, “Yes.” He certainly looked a bit different than when he was 10 years old.
I’m wondering about the duty to consult, which you raised and are quite concerned about. I’m not quite sure I understand the concern because the courts have clearly come down on the side of the duty to consult. You seem to be afraid that it’s a veto, yet it’s been proven in the courts time and again that it’s absolutely necessary. While the old bill — Well, it wasn’t a bill on its own. It was part of a large bill, so there was no consultation. The old system was driven by the duty to consult, but this system is early and inclusive engagement starting at the beginning. My recollection of what the courts had suggested is that very thing, that it’s got to be early consultation. So I’m a bit — not troubled, but I’m just wondering why you would feel this is a concern when the courts have come down on the side of consultation.
Mr. Toner: I think we are not specifically concerned about the ultimate veto. I think what we have experienced in even projects that don’t arise to the level of a federal EA is that it takes more time than is built into this process to have that proper relationship.
In our company, if we have a project we have even thought about and we already exist in the territory, we hope to have developed that relationship and spent time even before the project is brought in. But it’s not a certainty. There would be various proponents that might spend less time on the front end. One hundred and eighty days, for example, for early planning sounds like a long time, but a lot of things have to happen in that section.
I think our concern is just that there should be more acknowledgment and encouragement of proponents to have properly prepared for the project they are going to bring in, with a fair amount of engagement in our case, maybe even have reached some agreement on things that were important issues. Once you get into the process, 180 days is a long period of time. I have been sitting on the multi-interest advisory committee for two and a half years, so we have had a lot of discussion about this. Those are all good things about early planning, but it’s a lot to get that done.
I think we are looking for some means to get some certainty as we bring a project forward, but at the end of the day, we might be able to then move it through a process in a timely enough fashion that we get a successful project.
Senator Cordy: Early planning is actually part of this new bill, and there was never before an early planning stage in 2012. Do you think that the new early planning stage is a positive step so that people actually are aware of bumps they may incur along the way and they can iron them out before they get into spending huge amounts of money?
Mr. Toner: It can be a very good process, but there are a lot of steps. There is a draft project description, then discussion and consultation, feedback to the proponents, a final project description and a preparation of perhaps up to five different reports, which we think will be important, none of which are actually mentioned specifically in the bill. They are in the consultation paper on time lines. We’d like to see some of those things more affirmed, because those could be very useful if done as described by the agency.
But the bill doesn’t yet have, in our opinion — and with public enough regulation — the certainty that we would get out of that 180 days what it intends to deliver.
Senator Cordy: The regulations never come before the bill is passed, no matter who is in government or what’s happening. Thank you for coming today.
Senator MacDonald: Good morning, panel.
Mr. Bradley, you mentioned that 80 per cent of Canada’s electricity is generated from non-emitting sources. As a Nova Scotian, that’s certainly not true in Nova Scotia. Over half of our power is still produced by coal. On the other hand, Nova Scotia, in relative terms, is fairly clean. We have a fairly good record in terms of our emissions.
Mr. Toner, I’ll ask you, in terms of Nova Scotia Power, what are the medium- and long-term impacts of this on the ability of Nova Scotia Power to continue to keep its present approach of producing power in Nova Scotia? And how would these proposed changes affect its ability to manage its infrastructure and feed it?
Mr. Toner: A lot of the work we are doing with regard to coal is actually happening not in this bill but in the work under the pan-Canadian framework, the two regulations, the cap and trade system that’s being brought in, the Clean Fuel Standard. Those all are onerous and, combined together, will create some stress on us.
We understand that, over time, we need to transition, and we already have reduced our coal by over 30 per cent and are headed for 30 per cent more. The replacement energy, though, will come from projects that then might be assessed under this bill. And that’s why we are looking for a bill that has enough certainty so hydro or other clean energy projects that come forward can be well considered and well engaged with all, including the rights holders, First Nations and Indigenous people. But we hope to have a process that makes sense so we can move it through in a timely enough fashion for us to be able to effect the transition over the next 15 years that we need to do.
Senator MacDonald: We are all familiar with the Utility and Review Board in Nova Scotia. Consumers in Nova Scotia certainly are. We have seen our power become increasingly more expensive. It is an issue for people, an issue for businesses, an issue for consumers and an issue for people on fixed incomes. What do you see, in terms of the cost of power in Nova Scotia, in the next 10 or 15 years, if these types of regulations and if this new approach was implemented?
Mr. Toner: We certainly did see an increase in the earlier part of the century. While we are starting to make conversion projects and so on, we are in a rate stabilization period right now. We are looking to try to have an additional rate stabilization period. Depending on how we are able to address other legislation and carry out projects under this legislation, it could place a pressure on the rates that we have. One of the reasons we are here and appearing today is to ensure that laws that get finalized, like this bill may well be, will be fair and efficient and will meet all of the requirements but actually allow us to do it in a way that does reduce the likelihood of additional big costs.
There is uncertainty associated with some aspects of this bill. It’s for that reason we are looking for additional adjustments. We are not against the bill per se; I think we see a lot of good in it. But we are looking for a few areas to improve conditions for business.
Mr. Bradley: If I may add to what Mr. Toner was saying, my colleague from the nuclear association earlier mentioned the cumulative impacts of different regulatory regimes and structures. That’s something that we are becoming increasingly concerned about. At the federal level, provincial level and local level, all of these additional cumulative regulatory impacts ultimately result in additional costs, and those additional costs are borne by the customer.
Senator MacDonald: Thank you.
The Chair: Because we are on that subject, I would like to jump in and ask a couple of questions. When talking with the officials about the reasoning behind that “one project, one agency and one process,” to have the umbrella agency of environmental assessment looking into the whole thing, I remember this issue, especially with the nuclear. I understand that it’s a clean energy, but there are a couple of issues that are still remaining to be further developed, and I would like you to explain to me where we are at.
The first one is the issue with the waste, the residues. What are we doing with the residues? Second is the fact that most of these nuclear plants are very close to water bodies, particularly to oceans, and with climate change particularly in that area, erosion is very hard on the coast. I think that there is this need for an umbrella organization looking into these global things, because I understand that you have the technology and you have the expertise, and I don’t dispute that, but there are some global issues that need to be looked at. Could you please elaborate on these two points?
Frank Saunders, Vice President, Nuclear Oversight and Regulatory Affairs, Bruce Power, Canadian Nuclear Association: In our view, we already have a global agency that looks after us, and they aren’t a pushover. We are regulated from cradle to grave, which includes waste. Our waste is all accounted for and stored, and it’s a relatively small amount of waste.
The Chair: Stored where?
Mr. Saunders: Stored on the sites where the power plants are at. The storage facilities are licensed by CNSC. We are required under the act to provide the funds in trust to take care of that waste in the long term. So we are cradle to grave in that regard, and that waste is always looked after.
Sometimes people hear rhetoric on the volume of the waste. But as an example, on the Bruce site, which has eight reactors and has been operating for about 40 years now, the total volume of waste on our site is actually about equivalent to what one day’s worth of waste would be in Toronto at the public dump.
The Chair: Are you comparing it to solid waste, municipal waste?
Mr. Saunders: Yes, municipal waste, volume. People tend to talk about weight. Uranium is heavy, but it’s not very big. And it’s relatively easily manageable and, technically, we know how to store it. We are going through a process, through the Nuclear Waste Management Organization, to provide long-term permanent storage there. That is a process that is moving along with lots of public consultation and other things. But technically, that solution is very doable. It’s not really an issue. Of course, it is a thing people want to have a say on, so it will take a couple of years to work our way through it.
However, that waste is well controlled. The volume is not very big. We know exactly where it is. We measure it; we monitor it; we track it. If you haven’t seen any of that waste, I would invite you to come and see how it’s stored. I think you will be impressed with what it looks like compared to how other hazardous waste is stored around the country. You can go to any landfill these days and see how they store the hazardous waste in buckets and drums. Then eventually they take it away. You can’t track it from its owner to its end. In our case, you can do all of that.
Is waste something we should be concerned about? Absolutely. Is it something all industries should be concerned about? Absolutely. Is it something we as people should be concerned about individually in our lives? Absolutely, it is. But it’s a fact of life. By living, we generate waste. The trick is not that you generate the waste but how you manage it and what you do with it on the other side.
That’s my answer on the waste side. I thought you had another question in there?
The Chair: Yes, the location, because all these are —
Mr. Saunders: Ah, yes. We are located near water, because we use it for cooling. Most of the cooling is on the conventional side of the plant. It’s for the steam turbine. It’s not about producing the power part, so it wouldn’t matter whether it is nuclear, coal or any other kind of generation plant that uses steam. The water is there to condense the steam to produce the power.
Yes, we do have to monitor that, but under the CNSC regulations, we have an environmental assessment program that we have to repeat every five years. Every five years, we do a review, and we check things like water levels and flood levels, and we look for potential for major catastrophes such as seismic events or any kind of catastrophe you can imagine. We have it all in our plan, which is called the probabilistic safety analysis. It’s part of our licence requirement. We are more prepared for any kind of emergency than any industry or any municipality you would like to compare us to.
Would erosion be a potential problem? It could be. It could go the other way, too. It could be that water levels in places like the Great Lakes will decrease. The scientists can’t tell us. We have had an R&D program up in the Bruce County for 10 or 12 years now that is studying the Great Lakes — the fish, the habitats and the effects of global warming, potentially, on that body of water. We want to understand it well enough to make sure we see the impact.
We are a “long” industry; we look long into the future and work hard to make sure we know and understand the environmental impacts of our operations. This is all transparent. All this R&D is in the public domain. It’s all peer research. Nothing is hidden here. We are pretty open, in our view.
Senator Neufeld: Thank you for being here.
I’ll ask both of you this first question. It’s about public participation and your viewpoint on that. The old legislation said that only those that were in proximity and were actually affected would be consulted and that the proponent would have to do the work with those individuals, communities or whoever they would affect. But now, this bill opens it up to anyone from anywhere. I’d like to know whether you think this will lengthen the process, whether it will make it more difficult — as we know, I don’t care where you go, people are going to be against something, and there are some well-heeled organizations worldwide. I come from British Columbia, and I think we house most of them. It’s difficult. I’ve had to deal with that lots. So I’d like to know how you folks think about public participation and what it actually should be.
Mr. Saunders: To be honest, we like public participation because we think we have a good story. Generally, that participation works out to be favourable, in our view.
There is an issue, though, and it’s where you get into the problem of people coming from far and wide and about whether you are talking about the project or about government policy. There are a lot of people who come to argue that we shouldn’t have nuclear power or we shouldn’t have something that is already an agreed position in Canada. That really does lengthen a process when you get into a whole debate about that, when, in fact, the commission hearing the project really has no authority to rule on government policy. They are ruling on whether you meet the requirements of the project.
I think there is a need for some criteria around participants. I don’t care how far away they come from as long as they are actually talking about the project and what the project means versus debating some esoteric view on nuclear energy. I speak for nuclear, because that’s what we are, but I think that’s true of all projects in all industry. Whether you’re talking to the forestry, mining or any other industry, there are some people who believe you shouldn’t be doing that, and they want to come and argue. They have a right to argue it, but that’s not the forum.
Senator Neufeld: In response to that, who would make the decision that a particular group can’t come and participate because they are talking about policy? Who makes that decision, then, and how is that decision made? That’s the difficulty I see. I know we need public consultation; heaven forbid, I have been involved long enough to know that. I believe it should be those affected directly and not the world being welcome to come and share their viewpoints. But the difficulty is this: Who makes that decision, if you agree with it?
Mr. Saunders: In our case, it’s really the CNSC who is running the hearing that makes the decision. I really can’t speak too much for them, because I’m not them. But from what I’ve seen at our hearings — which are frequent —, in the nuclear industry, we have hearings all the time. It’s not a hearing once every 20 years but every three or five years — maybe more — depending. But their view appears to be that anybody can make a written submission. If you have a point of view and want to write something on a project, you provide it. But they look at it for relevance, so if it is strictly a policy thing, they will consider it but may not invite you for oral presentation.
How they make that decision, I’m not clear, as I’m on the proponent side of those discussions, but I think those are necessary decisions, as you say. They are not necessary to rule some people out; they’re necessary to make sure that those people who are most impacted have the opportunity to participate. As you know, if the volume gets too big, then your time and your opportunity gets shortened and you don’t get a chance to have a say. Those who are most impacted should have the most opportunity.
Senator Neufeld: Thank you. I appreciate that.
Mr. Bradley —
The Chair: Sorry, senator —
Senator Neufeld: I’d like him to have a chance to respond.
Mr. Toner: It is an important element of any public process like assessment. Of course, we always are concerned about how to keep it within the scope. There could be tools in this, depending on what happens in regulation as well, to use the various means so that people who are closer to a project and who are more impacted more might get a more direct opportunity. The use of the Internet has proven to be useful, even in moving this bill forward in the early stages.
If there are proper time frames, and the agency or panel is about to make a decision, they have the opportunity to use a multi-layered approach. The question is: How will that happen? The trick is in making the actual cake, not just putting the ingredients there.
Senator Seidman: Thank you for your presentations.
Mr. Bradley, in your presentation you talked about issues that were important to you. One was certainty and predictability. I’m sure you’re aware and you’re feeling that many stakeholders are not confident that clause 22 sets out an explicit list of factors to consider in impact assessment. Quite the contrary, they argue that policy considerations are inserted in every review, and these result in a move away from a technical and science-based approach. A technical and science-based approach is predictable and transparent and would include definitions and hard measures for those criteria so proponents would feel reassured that the factors to be considered are not moving targets.
I’d like to refer specifically to perhaps one of the most unclear elements of the Impact Assessment Act, and that’s the cumulative effects provision in clause 22, where it says that the agency must consider:
(ii) any cumulative effects that are likely to result from the designated project in combination with other physical activities that have been or will be carried out, and
(iii) the result of any interaction between those effects;
As the provision is currently written, what would be considered “cumulative effects,” and do you believe this provision will be straightforward to apply?
Mr. Toner: The first thing we would say is that it’s important but embryonic in its stage of knowledge and technique. There is lots of literature that has been tried, but it is an area that has appeared in many bills. It’s probably been mentioned in the past in bills.
There is a list of factors. That’s one of the factors. How will the collection of all those factors be considered? I think if you are in an area where there is already a lot of industry or a lot of projects, the next project’s cumulative effect is probably a legitimate question and concern that would feature more prominently. In an area that is less impacted by other things and for which there is a fairly clean project coming forward, I would think and hope that there would be less emphasis.
I think there is a lot of actual work still needed to better define this. We hope to see, either through regulation or, probably more likely, initially through policy and guidance material from the agency, that start to unfold. It is an area that could easily be used against the process in general, but it cannot be ignored. It’s an important component. We see that in the environment today.
Senator Seidman: I guess I should ask if Mr. Barrett or Mr. Saunders has something to say.
Mr. Saunders: The issue with cumulative effects, as it’s in the act, along with other provisions, is they’re not clear. You don’t know what they actually mean and therefore you don’t know how to address them when you start. We already look at cumulative effects in our industry, but what is not clear in the act is how far back and how far forward you go. You can extend that forever, if you want, to under the definition, but your ability to do actually do that accurately is limited at some point.
I would think that one of biggest comments would be, both here and in other aspects, to be clear about what success looks like so you know what you are aiming for, or if you are starting a project that you think will not meet those objectives, you can stop before you spend a lot of money doing something that won’t be successful. Mostly, that’s industry’s position. Government sets these rules. That’s okay, and we’ll follow the rules, but we want to be able to make a decision that makes financial sense. If it’s not a project that will go, let’s figure that out right out the door and go on to something else.
Senator Woo: Thank you for your testimony. I have two questions, one of each of our witnesses.
The first one is on clause 18, which is the end of the planning phase leading to the commencement notice. You have asked for more clarification on the start of the project, the end of the commencement and the end of the planning phase and wanting more details of what should be done. I’m reading the legislation, and it seems to me that everything you’ve asked for is already in there. In 18.1(a), it says a notice of the commencement of the impact assessment that sets out the information or studies that the agency considers necessary. Second, any documents prescribed, including tailored guidelines — tailored guidelines sounds to me like a specific description of what is required — regarding the information of studies, blah blah blah, and when it goes down, it talks about the specific factors within clause 22, the long list of clause 22 factors. It requires the agency to tell you which ones of those factors you need to consider. So the question really is: Why do you think there isn’t already enough clarity in clause 18 with respect to the commencement notice?
The second question, more particularly for our friends from the nuclear industry, is on the early planning phase. What I’m hearing is that you believe good proponents in your industry already do early planning and that you don’t want to penalize them by having them having to do a second early planning phase. That’s what your testimony says. To me, that doesn’t make sense because if they are already doing the early planning phase, start the clock earlier. Tell the government that we’re starting our early planning phase and use the time you will already be spending anyway as part of the official early planning. If you take out the early planning, what you are then doing, in effect, is excluding proponents from having to do early planning, which you have already described as a good practice. You talk about how good proponents do early planning and you worry that they have to do a second early planning. The solution, to me, is not to get rid of early planning; it is to incorporate what you already do into the early planning phase and encourage others to also do the same.
Mr. Toner: Well quoted from the bill, and there is a fair amount of instruction there. I think we are alluding to the fact that in one of the consultation papers, which would presage a regulation, we think, on timelines and information requirements, there is a lot more specificity as to the types, and that’s perhaps the place for it. But absent seeing the regulation, even in a draft form or at the next stage of a consultation paper where we see the five products in particular that are described coming out of the early planning phase, I think what we are saying is we would like to see more wording that made it more difficult to avoid having those as explicit products coming out of there.
Senator Woo: Surely any tailored guidelines have to be tailored to the project. It cannot be described generically. The regulator has to see and the Impact Assessment Agency has to know what the project is in order to tell you what the tailored guidelines are.
Mr. Toner: On the tailored guidelines provision, in particular, I think I agree with you, but there are four other products we think we would obtain from that early planning phase. There would be a public participation plan and a consultation or engagement plan and requirement. There would be an overlap with jurisdictions plan and there would be a permit expectation plan. I think with that level of precision, we believe, if it’s done properly, we will get that, but I think we are looking to make sure it does, in fact, occur and we’re looking for small tweaks in the bill.
The Chair: As time is passing, please, shorter preambles and shorter answers, if we want to give the floor to everybody.
Senator Massicotte: Mr. Saunders, if, relative to the standing issue, in responding to Senator Neufeld, you said as it is currently organized whereby anybody can submit a written submission, they don’t necessarily get a personal hearing. If that was continued, if that was the practice they meant, then that’s acceptable to you. Am I correct in saying that?
Mr. Saunders: Yes, I think so. It’s not as efficient as I would like at times.
Senator Massicotte: It seems to work.
Mr. Saunders: Yes. I don’t think you can’t exclude people from expressing their interest. Otherwise, it doesn’t work.
Senator Massicotte: Good summary.
Mr. Toner, let’s talk about the right to consultation. You are referring to the right of consent, and you are concerned that right to consent could lead to a veto. You know the government position. First of all, that reference to Bill C-262 is in the preamble and therefore not part of the legal document. Also, the government will make reference to the fact that when the United Nations wrote that declaration, the rapporteur made it clear in his comments, in all discussions made it clear, this is not to lead to a veto. We also had the minister in the Senate chamber making it clear this is not a veto. But I gather all those assurances are not satisfactory to you. Can you explain why?
Mr. Toner: I think that until we see where the final negotiation ends up between the federal government and Indigenous nations and we understand how powers and other things might be redistributed, we remain nervous. I think that’s the best word. Particularly, our experience in projects has been that in order to do appropriate engagement from our point of view, or consultation from the government’s point of view, it takes time, and I’m concerned that that will not be easily rectified with the timelines in there.
Senator Massicotte: The declaration has not amended the obligation for meaningful consultation, and the Supreme Court has increasingly specified when that means. I think we are getting to a point where, hopefully, we are close to understanding what that really means, and the current process of Trans Mountain will help that, but I appreciate there is yet another document called the declaration and it refers to right of consent. I appreciate your concern with the definition, but from what we are getting, it looks like it’s not as clear as we would like but reasonably clear and probably not a problem. Would you agree with that?
Mr. Toner: I would say that things are progressing in a positive way and we remain to see the final product.
Senator Massicotte: I agree. Thank you.
Senator Simons: I have some questions for the electricity folks, primarily. In speaking to people back in Alberta who are in the electricity industry, some have expressed concerns about clause 7(9) of the navigable waters section of the bill, which deals with maintaining the water level or water flow necessary for navigable waters. The concern they have raised is that that may require them to maintain the flow even if the reduction in flow has nothing to do with their infrastructure project. I notice that you have not referenced that section in your list of amendments. I’m wondering if you share the concern raised by ATCO and even by CAPP about 7(9)(a) of the navigable waters section and what it could mean for hydro projects?
Mr. Toner: We had to pick some of the biggest concerns we had and focus on those today in our five-minute presentation. We have studied the navigable waters provisions in the bill. There is some concern. We’re hopeful that some of the requirements might be slightly adjusted to allow for a better definition of routine works and routine activity so that, if we did obtain a permit under navigable waters for a particular structure, it would include some of the provisions that would naturally come with the operation of that particular facility. We think the remedy is perhaps more in line with that and with better regulations on minor works and routine works and a better definition of that.
Senator Simons: A single project, like a dam or a wind farm, that is one thing, but presumably your members also deal with linear projects like power lines, which can be more controversial and cover much more territory. How concerned are you about the potential impact of this bill on the ability to increase our grid capacity?
Mr. Bradley: I think it comes back to one of the issues that we started with, and that is our desire to see what the project list is to begin with and as to whether or not those types of projects will even be captured. They not be captured in the scope, and if that’s the case, then we wouldn’t be concerned. If they are on the project list, yes, indeed we would be. Absolutely.
Senator Simons: What about more green technologies like a large wind farm that might be in a migratory bird path or an offshore wind farm? My concern is that a lot of debate has focused on pipelines and oil, but it seems there are a lot of hurdles in this bill that could prevent us from greening our power supply because they would make it more difficult to do the kind of large wind infrastructure that we would need to add more green power to the grid.
Mr. Toner: I think we have built several wind projects in the last few years, and consideration for birds or other things are very important. It does us no good to put a project in a place where we end up killing birds or bats or having other impacts.
We have a cautious optimism about that type of project, but longer, linear projects present a difficulty. They become a land use and land rights issue that I think that goes beyond the extent of this bill.
Senator Simons: You could ask —
The Chair: Thank you, senator.
Senator Patterson: To the Canadian Nuclear Association first about uranium mines: We heard from the Canadian Nuclear Safety Commission current head and also the views of the previous eminently respected head, Dr. Michael Binder, that harmonization with the provinces and licensing of uranium mines has been beneficial and efficient in avoiding duplication. Despite these expert opinions, both of which felt that harmonization with provinces has worked well, including in Saskatchewan, Bill C-69 imperiously prohibits substitution of all projects regulated under the Nuclear Safety and Control Act, as well as uranium mills and mines. Is there any rationale for requiring review panel assessments of uranium mines and mills, and would you recommend an amendment to allow for substitution in these cases?
Liam Mooney, Vice President, Cameco Corporation, Canadian Nuclear Association: Thanks for the question. We would agree with the views expressed by President Velshi and previous President Binder that there is good integration between the provincial assessment process and the assessment process that is led by the CNSC currently. There are changes in our amendments that we suggest should be made that would allow for substitution. Our main thrust is to treat uranium mines and mills the same as other mines and mills throughout Canada. We feel that there is good evidence for doing so, having regard for our strong safety performance and our environmental performance over the many years we have mined in northern Saskatchewan in particular. In that space, I think there is also a recognition that the CNSC provides federal oversight in addition to the provincial oversight that exists. We’re regulated more than any other mine and mill, and we think that has to be recognized when you are setting up what is essentially assessment regulation before you have licensing.
Senator Patterson: To the Canadian Electricity Association: This is a great story of the $350 million invested over the last 20 years, and I think you’ve told me when we met that there are plans for a future $1.5 trillion to be invested in making Canada even cleaner than it is now.
Canadian companies, I believe, are concerned about litigation risk after Bill C-69 passes. Even a senior lawyer at the Department of Justice told this committee that the additional factors for consideration and the new scheme does indeed present potential litigants with more opportunities to challenge a decision made under the act. What is the potential for re-litigation of matters of fact under Bill C-69, and do you have an amendment that you’d recommend to reduce the litigation risk?
Mr. Bradley: Yes, thank you for that. That was one of the issues that we raised last year when we appeared before the house committee. You’ll find in the details of our submission that we’ve included material on that as well in terms of recommendations, and we look at including a prohibitive clause in the legislation.
Senator Mitchell: My first question is to Mr. Toner, and it’s with respect to his concern that there is not enough specification about the pre-planning process outcomes. Senator Woo, in his preamble, listed one of the five, and Mr. Toner went on to say there is still the other four. I want to read in 18(1)(b) where it says that:
. . . including tailored guidelines regarding the information or studies referred to in paragraph (a) and plans for co-operation with other jurisdictions, for engagement and partnership with the Indigenous peoples of Canada, for public participation and for the issuance of permits.
Every one of those was a concern on Mr. Toner’s part that they weren’t included. Can you confirm for me, Mr. Toner, that you are aware they are in there and that they are not obligations on the proponent but obligations on the government? Why would the government put something in legislation that they didn’t intend to fulfill, and how much better is it that they have an obligation to you that they don’t now have?
Mr. Toner: Thank you for the comment, senator. You are quite correct. Words are in there about each of those and, from our point of view, it’s the details we are looking to see and the concerns that we still have before we see where the regulation is going to provide much more detail. From our point of view, that’s an area of focus or us. A lot of times, the details are in the regulation.
Senator Mitchell: It would be very difficult to specify the engagement and partnership with Indigenous peoples for a given project when we don’t even know what the given project would be.
There has been some discussion about public participation and how we triage that or how we make that decision. A question was asked that really alluded to the standing provisions. The standing provisions only apply right now under the NEB, and over 60 per cent of the assessments done now don’t apply under the NEB. They apply to your kinds of industries. It’s not as if everybody loves your industries. It’s not like there aren’t people lined up to make points about those. But somehow, effectively and efficiently, even without the amendment in the bill that says you have to finish within timelines, even without that, you are able in your industries to manage that process efficiently, effectively and meet time lines. How is it that not having a specific, outlined, detailed standing test can’t be applied everywhere if it’s applied by you? Can you tell you how efficiently you have done that?
Mr. Saunders: To start the answer, I think we do believe it is the job of the agency that’s holding the hearings to limit that discussion. There is a view, though, by many in the public that there should be no limit ever on any of that discussion and that that discussion should go on forever and a day. Our view is not so much the how but that there is a recognition that there has to be some limit on how many and for long. Our experience has been that governments are not generally very good at limiting those discussions.
Senator Mitchell: Are you aware that the —
The Chair: I’m sorry. We only have six minutes left and several questioners.
[Translation]
Senator Carignan: I am going to do this quickly, in three minutes. I read the briefs, I hear the comments of all the groups involved, those in the industry, consultants, environmental groups or indigenous groups. I see one main theme, the absolute power of the minister. It is almost discretionary and means that the environmental assessment process in Canada will change with the government, or even with the minister. Basically, what is going to happen is that it will cost you more in lobbyists than in biologists. Am I mistaken?
[English]
The Chair: Short answer.
Mr. Bradley: Sure. From our perspective, we would agree with your contention. I think we noted earlier that we count 26 times in the legislation when either the minister or the Governor-in-Council can hit pause. We would absolutely share that concern in terms of the ability for the minister to step in on the process.
Senator Richards: Thank you for being here. Most of the questions I was going to ask have been answered.
On the stringent review panel for uranium, is that why it’s stringent, because it’s uranium? What’s the life expectancy of places like Point Lepreau in New Brunswick, which was fairly successful? What’s the life expectancy of a nuclear power plant like Point Lepreau? Could you answer that, please?
Mr. Mooney: On your first question with respect to uranium mines, we are essentially swept up in the process because we share a regulator with the nuclear power reactors. So in that space, uranium mines and mills are treated as nuclear projects. It’s a product of our overarching life cycle regulator in the Nuclear Safety and Control Act that brings in uranium mines and mills. That’s why, with the provisions of the bill talking about joint review panels, we are treated more like a nuclear reactor than we are like another mine or mill.
Mr. Saunders: As to life expectancy and nuclear reactors, I’m not as knowledgeable about Point Lepreau. I’m more knowledgeable about the Bruce Power site. We would expect, with the current refurbishment work that we’re doing, that those reactors will operate at least until the mid-2060s.
The truth is, like any other mechanical device, physically they can operate as long as you are willing to spend the money to upgrade and maintain the equipment, so they’re really no different than any other plant in that regard. However, people should understand that the licences do not cover that full span. A current licence is 10 years, so every 10 years you re-licence, and that re-licencing process requires you to demonstrate that the plant is still fully fit and capable of operating.
Lifetime can be — like I say, at some point, it will become uneconomical, much like your car. At some point, it gets more expensive to repair than to buy a new car. Plants are the same way. You would expect most nuclear plants to run at least 60 to 80 years, but the licencing process in Canada is much shorter. Canada is unique in that we do not have a lifetime licence for plants. We licence them currently every 10 years.
[Translation]
Senator Mockler: I will be quick too.
[English]
There is a lot of confusion across the country. I want to talk a bit about Atlantic Canada. When I look at what is being proposed, it results in duplication and extended approvals. You have answered some of the questions earlier with respect to timelines leading to increased investor uncertainty for initiatives with economic and environmental benefits for New Brunswick and across Canada. I have one question for nuclear. What impact would that have on small modular reactors going forward? We are leaders in that area.
The other question is for electricity. I think the objectives when we do an assessment of a project should involve environmental protection, economic growth and consultation with First Nations and Canadians. With that said, if we do not or we avoid the complete environmental protection and also economic growth, what is Bill C-69 all about?
Mr. Barrett: Thank you very much, senator. Before I hand it over to Frank Saunders to answer your question, I think this dovetails with the question we were unable to answer from Senator Woo on the early planning phase, because the impact is on investor confidence, which is the key point here.
Mr. Saunders: To put it simply, there is no doubt in our minds that this process will significantly extend the approval process. It will duplicate numbers, pieces of it. The process as proposed would not have CNSC granting a licence at the end of it. We’d still have to do the CNSC process afterwards. I know people say that’s not true, but in my experience, when I look at the technical information involved, this will extend that process to the extent that for small modular reactors, which are much lower income to start with, if you add a lot of time and energy at the front end, it will very much affect the economic viability of that kind of reactor.
Senator Mockler: Thank you. For electricity, can you give your opinion on the environmental protection economic growth? What do you see happening with Bill C-69?
Mr. Bradley: Getting back to the beginning of our presentation, our fundamental concerns with respect to the legislation are about timelines, and we see that potentially as extending a process that then makes the economics of some of these projects more challenging.
Senator McCallum: Thank you for your presentations. I’m coming from the perspective of Indigenous peoples. I look at this impact assessment as very important so that we are not left with just the burden once the companies leave. It’s a balance among environment, equity and economy, social, the lives of First Nations on the lands and future generations.
I look at the impact of what the dams do — I’m from Manitoba — and look at the river flows, water quality, fish passage and protection, watershed protection, threatened and endangered species, cultural resource protection and recreation, and there are now eight proposed new dams for Manitoba and one of them will be going underground with this Minnesota development. How do you deal with the cumulative effects of development? Going project by project, there is no significant damage, but there is cumulative catastrophic damage. By dealing with it project by project, will we ever come to a time when enough is enough?
Mr. Toner: Perhaps I could quickly respond. I’m very interested in those concerns. I think there is something not spoken of, but there is an ability for regional and strategic assessment at a policy level, which is earlier in the process, and that’s the type of topic that might well be a good candidate for that type of thing.
The other thing is, as we develop — and I can’t speak for all of our utilities, but we certainly try. As we move forward with the new reality that we think there is, developing projects without being in some way partnered with Indigenous communities seems extremely challenging and perhaps unwise. So I think we look for ways to actually work together to identify projects that are successful.
Senator McCallum: When we look at the area of consent and consultation, if it’s not done before the project, would you agree that the litigation risk will increase?
Mr. Toner: We can’t conceive of doing a project without trying to identify those. We would try to identify big issues before we even entered the process formally.
Senator McCallum: That’s why I’m just saying consent is important, and so is consultation.
The Chair: Thank you very much for your testimony, and thank you, colleagues, for your questions.
Senator McCoy: Can I raise a point of order or an observation? Many of us are really counting on the industries that these gentlemen are representing in order to transition to a low-carbon future because we want to increase our capacity for electrification on a number of fronts.
Could I make the observation that some senators are members of the committee? I am not, but I have a right to be here. Generally, if time permitted, I would have some interesting questions. At least, I would have some questions, and I would find them interesting. We are running out of time, but even members of the committee have more questions than you are allowing.
The Chair: Could you direct your questions and I will ask them to write back?
Senator McCoy: My observation is to the steering committee. When you’re scheduling these things, we were talking about a bill that calls for meaningful public participation. I’m finding that the Senate of Canada is restricting public participation from people who are directly affected and upon whom we will rely to take us through to the next generation of energy infrastructure. In scheduling things, could you please allow more time so we have a proper investigation of this bill?
The Chair: We will try. Thank you very much.
We continue our study on Bill C-69.
[Translation]
We now welcome David MacLean, Vice President, Alberta, from the Canadian Manufacturers and Exporters, and Tristan Goodman, President, from Explorers and Producers Association of Canada.
Thank you for joining us. I invite you to make your opening statements, after which we will move to a time for questions.
[English]
David MacLean, Vice President, Alberta, Canadian Manufacturers and Exporters: Good morning. Thank you for having us here today. I’m here to talk about this bill on behalf of Canadian Manufacturers and Exporters and our association’s 2,500 direct members.
Manufacturing represents the largest business sector in the country. It directly accounts for 11 per cent of Canada’s GDP, two thirds of Canada’s exports and 1.7 million employees in high-wage and high-skill jobs in nearly every community in the country.
While we count a significant number of resource developers, particularly energy producers, among our membership, by and large, the Canadian resource sector, including mining and energy, are our valued customers and partners. Together, manufacturers and resource developers are the cornerstone of the Canadian economy. Manufacturers in every region of the country see this legislation as a potential threat to future resource development and the well-being of their essential suppliers and customers.
Canada’s manufacturers and exporters support the development of Canadian energy and understand the intent of Bill C-69 but recommend modifications identified to support a process that enables good projects to proceed quickly, amicably and predictably. In its current form, the legislation fails to do that. The bill will make it more difficult and, in some cases, impossible to proceed with nationally significant national resource development projects. In our view, the bill should be amended. After extensive consultations with members and partners across Canada, we have some general recommendations for potential amendments.
Bill C-69 would create a system seemingly designed to find flaws and ignore positive economic benefits. Clause 63 describes the five factors the minister must consider in making a decision, which include sustainability, potential adverse effects, implementation of the mitigation measures and others. The act should be amended to include national, regional and community economic interests.
Despite the stellar health and safety record of Canada’s pipeline and nuclear industries, this bill would move the approval and condition-setting function for pipelines and nuclear facilities from the NEB, the Canadian Nuclear Safety Commission, Nova Scotia and Newfoundland offshore petroleum boards to Environment and Climate Change Canada. Life cycle regulators must be not be removed from the project approval process.
In order to have a clear debate, the proposed project list should be made public. In situ oil sands operations should be excluded from the project list as they are currently subject to stringent Alberta regulations that manage environmental and socioeconomic impacts.
Duty to consult indigenous groups is enshrined in section 35 of the Constitution and is included in this legislation. It has been repeatedly tested in the courts and, through trial and error, the expectations of government and project proponents have been clarified. Introducing, as it does in the preamble, the United Nations Declaration on the Rights of Indigenous People could introduce some unnecessary uncertainty into the process.
This bill and the impact assessment act place the discretion for determination of public interest of a particular project in the hands of the Minister of Environment. We believe that that should be shifted to a tripartite model to avoid overly politicizing the process.
Any new legislation must not undermine the jurisprudence that has been established over the years around project approvals. In the past five years, court challenges in the Federal Court of Appeal and the Supreme Court of Canada have added layers of judicial certainty regarding the NEB’s regulatory process. Replacing the NEB now with a new process would welcome a new round of court challenges, setting Canada back further.
The act should implement reasonable time frames during which challenges can be made. This would increase certainty around clock stoppages and clear rules for timeline extensions.
The mandatory requirement for review of offshore oil and gas activities is an unnecessary overreach. Not all projects justify this level of oversight, and mandatory panel reviews could make new offshore exploration economically unviable.
Thank you for your time today.
The Chair: Thank you.
Please keep your preambles short so we have more time for questions.
Tristan Goodman, President, Explorers and Producers Association of Canada: I will be quick, as I look forward to the questions. It is a great honour to be here among such distinguished individuals. There is quite the background before me, so thank you very much.
My name is Tristan Goodman, and I am the president of EPAC, Explorers and Producers Association of Canada, which operates across four different provinces, and my members number about 150. They are oil and gas explorers and producers. They are all Canadian based. They all are Canadian based entrepreneurs, many of which have invested their own personal money through mortgaging their houses and other methods to develop businesses. Some of these businesses have turned into some of the most successful companies in Canada throughout our history. Some are small. Some are much larger.
We spend billions every year. When things are going very well, we spend many billions. Right now, investment is more challenging. We also purchase a tremendous amount of manufactured goods, from steel to vehicles and everything in between.
We also produce about 25 per cent of natural gas and conventional oil production. Most of this, if not all of this, is through wells. I don’t represent the oil sands mining group, so it’s a bit of a differentiation.
We have seen a significant drop in investment, and it’s a concern. I think Bill C-69 will cause additional concerns related to this. We are very proud of the fact that we operate in some of the most stringent environmental requirements., and I believe the track record we have is strong. But, of course, there are opportunities for improvement as we move along.
There are three points I’d like to make.
First, I’d like to say that we support the detailed analysis and contributions of the Government of Alberta, the Government of Saskatchewan, Canadian Association of Petroleum Producers and the Canadian Energy Pipeline Association. We work collaboratively with those groups. Instead of myself providing a laundry list of those, I’d like to focus on three specific areas.
There is a lack of balance in the purpose statement under clause 6 for both agencies. I’d welcome any questions on that, and I have some ideas on how to quickly rectify that. The extensive nature of ministerial discretion is a concern. The very broad engagement process, I believe, actually dilutes the participation of those who have recognized rights as well as those who are directly and adversely affected.
I would like to close my comments with a personal perspective. In my career over the last 20 years, I have worked for several different regulators personally. I have been involved in regulation and I have helped draft legislation. I was the executive that led the creation of the Alberta energy regulator. I have a PhD in natural resource management. I’m a qualified lawyer in the United Kingdom, and I also have a legal background here in Canada. So I believe I can help you as you move through this process, and I certainly hope there is an ability to aid the Senate in their deliberations. Thank you.
The Chair: Thank you very much.
Senator MacDonald: Thank you both for being here this morning.
Mr. Goodman, I’ll direct my question to you. I’ll ask you to elaborate on clause 6 and the lack of balance therein. Could you address that?
Mr. Goodman: I will start with how all regulators work. Regulators have a long history. They have developed since in the 1850s but really took off in the 1950s. That’s when we saw an increase in agency boards and commissions across many different jurisdictions, from the U.K. to United States and Canada.
One of the key things about all regulators — and there are over 2,000 in Canada, and some estimates put it as high as 3,000 agencies, board and commissions. It’s a major piece of government. The point of a regulator by most definitions is to reduce harm. They are there to try to create trade-off discussions, to try and create balance. They will be provided an oversight over a piece that the democracy provides them, usually in the administrative component.
It’s very critical that they can look at the trade-off debate. When you read the two sections, clause 6 in both the new agencies, that trade-off doesn’t come through fully. The purpose statements are critical and fundamental when you are a regulator. It’s very important from a practice standpoint, and it’s very important from a stakeholder standpoint. It’s one of the first things the courts will always read when they are examining these things.
Adding in an aspect of economic within the purpose statements will provide that balance. I know many of you work in different jurisdictions. There are examples in Ontario and Quebec, in British Columbia with the BC Oil and Gas Commission, and in Alberta with the current Alberta energy regulator and the Natural Resources Conservation Board. They all have this purpose statement in that manner. I think that, right now, is lacking within the bill.
Senator MacDonald: I have a supplementary for both of you. The numbers show that foreign investment in Canada has dropped by almost half. It’s a huge loss of foreign investment in this country.
Under this new proposed regime, the total area for extension or suspension of time limits is 26 different times when the minister can arbitrarily use discretion, not just to pause projects but to put unlimited amount of time in the pauses of these projects. Under the previous regime, it was nine.
It would seem to me that this is a prescription for predetermined failure for so many projects. People with investment just will not come to the table to invest. As people who are involved in your sectors, I’m curious about your response to these seemingly numerous opportunities for a minister to shut a project down.
Mr. Goodman: I can appreciate and understand why ministerial discretion occurs within certain pieces of legislation. Ministers are democratically elected representatives of the Canadian people, and there is no question that, in certain limited cases, usually at a higher policy level, there could be situations where that occurs. I have to agree that right now the ministerial discretion within the bill creates a lack of predictability for investors as they move forward. I think there is an opportunity to reexamine some of the key aspects, particularly where they are more administrative. There is certainly an argument that — and I have heard the argument — we don’t want civil servants making decisions. I think we have to recognize how our system has been set up. There is a time and place where civil servants are making outstanding decisions every day. Just look at the clerk trying to get this organized. This is a feat of genius. Congratulations on that. But the reality is that discretion is something that needs to be tightened within this bill. Right now, you are going to continue to lose investment if that level of discretion were to be left in this bill.
Mr. MacLean: Time frames for regulatory approval are a competitive issue, and we talk a lot about competitiveness. Even with the status quo, we already lag behind competing jurisdictions for investment in terms of how quickly we can get projects approved. As we move forward, we need to be cognizant of time lines and how that affects economic viability of projects.
Senator Cordy: Thank you for your comment, Mr. Goodman, that it is ultimately the responsibility of the elected official, the minister, to make those decisions. I agree with you. In fact, the ministerial discretion for decision-making related to this was brought in the budget bill of 2012, and my understanding is that there is less discretion in this bill than there was in the budget bill of 2012.
My question is for you, Mr. McLean. It is related to jurisprudence, which you mentioned. We have brought this up before, particularly when we had the government officials before us. Their response to it was that of course the jurisprudence would stand on issues that are in this bill, unless it is something brand new. Did you think all jurisprudence would be thrown out, or what is your concern specifically?
Mr. MacLean: The jurisprudence is important. Anything done to endanger that or get us back to square one would be a mistake. Members, particularly in the energy sector, expressed concern to us about the potential for that to happen once the bill becomes law. What we found in Alberta was that when there were significant reforms to regulators, that the jurisprudence remains, so the risk didn’t come to fruition there, but it’s still a concern going forward.
Senator Cordy: The same thing would hold through with this bill, to my understanding of answers that were given to a number of senators.
To your concern about duty to consult, we’ve had a fair bit of litigation already and the courts have ruled on duty to consult. In the previous bill, the old system was a duty to consult, and the courts found that that was not carried out to the extent that it should have been. That was why there was so much litigation. This bill actually proposes a new, early engagement with Indigenous people so that there is truly a duty to consult and it is true consultation. I don’t share your concern that there will be more litigation. I believe, with the early and more inclusive engagement, that there would be less litigation.
Mr. MacLean: That’s good to hear. CME is part of a coalition of business associations looking at this issue, and a universal theme throughout every submission is around the wording of the legislation around duty to consult. It seems to be a common concern and, if an amendment can be made to address that concern, that will probably be looked at favourably by our members.
Senator Simons: I should say, in the nature of full disclosure, that Mr. MacLean and I have a long history as amiable sparring partners on political issues in Alberta.
David, I know you grew up in Fort McMurray and you know what the boom and bust cycles are like. Could you speak to my colleagues who are not from Alberta about what the situation is right now with the difference in pricing and with the lack of market access? What has the situation been for manufacturers in Alberta in this period and what are you worried about if Bill C-69 goes ahead?
Mr. MacLean: We estimate that 80 per cent of Alberta manufacturers are in some way energy facing. What we found during the downturn in the energy markets — part of that is the differential and part is the global price of oil and gas, and the differential is caused by a lack of pipeline capacity. Manufacturing in Alberta lost 45,000 jobs. Some of that has come back over time because we still have a very strong energy sector. But the manufacturing sector has been decimated by the downturn in oil and gas. Those impacts have been across the country, not just in Alberta. The impacts have been extreme, and there is a lot of frustration around the lack of market access for Alberta energy.
Senator Simons: Mr. Goodman, you have had a lot regulatory experience, obviously. Are you concerned about the way life cycle regulators are treated in the context it of Bill C-69?
Mr. Goodman: There isn’t necessarily a right or wrong to approach this, but generally industries are more comfortable when they have a life cycle regulator. Whether that is an energy or a nuclear regulator, it’s more efficient and has other benefits. It effectively can look at the detail. The reason you have agency boards or commissions and the reason the courts in general would defer to them is that they are technical. It’s very challenging for an agency to look at a very technical subject outside of the specifics. Many of us would have trouble. I noticed the gentlemen from the uranium business. That’s a pretty challenging area compared to where others are in the energy space. In general, businesses always prefer a one-stop shop, and that one-stop shop tends to be sector-specific.
Senator Simons: Is it possible to have a one-stop shop that would work with a combined panel that includes representatives from life cycle regulators, as the impact assessment act suggests?
Mr. Goodman: I think there are existing processes. We have to remember we have a pretty decent National Energy Board right now. I think there is a lot to be said about that regulator. It’s world class and well recognized. Yes, there are opportunities for improvement, but I think in general you will have to consider different factors within that. Right now, I would argue that you have an existing process that is considering that through joint panels and other components related to that. It is certainly possible.
The Chair: Can I ask a question exactly on that? In the news, we have heard a lot about the NMB and the fact that the CEOs and the people in high levels came from the industry they are regulating, so that caused a lot of apprehension of conflict of interest. I understand the expertise is with the life cycle regulator, but if the authority there is going to be in direct relationship or indirect relationship with the people they want to regulate, is that not something that could cause friction?
Mr. Goodman: I actually don’t think it will, so long as you have a balanced approach. If you look at regulators, particularly in the energy space right now — and you can look at Alberta Energy Regulator as an example — you have industry experts that sit within the board and groups that come from the Anglo community and Indigenous nations.
The Chair: Thank you.
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Senator Carignan: My question deals with areas of jurisdiction. Technically, your companies would be more local or provincial in nature. In this bill, do you sense that the federal government wants to go even further into a provincial area of jurisdiction to begin, or even increase, control over companies that are normally in provincial jurisdiction in terms of environmental assessments? Mr. Goodman?
[English]
Mr. Goodman: Having fully read the bill several different times and looked at some of the comments that are coming out of the House of Commons, there is some concern here that could occur around provincial jurisdiction versus federal jurisdiction. The details on this could be debated, but I do think right now, at least within the energy space, and to a large extent under CEAA and other things within the environmental space, there has been delineation. Although it is not strictly jurisprudence, there has been a practical convention built up over many decades of use, and I think there are some concerns that bring to bear around how this could impact the ability of some provinces to develop their natural resources.
The Chair: Thank you.
Senator Neufeld: Thank you, gentlemen, for being here. I will just start with a quick question. The Minister of Environment and Climate Change said that Bill C-69 will, “make the Canadian energy and resource sectors more competitive.” Could you tell me whether you agree with that? Do the people you represent actually agree with that statement?
Mr. MacLean: None of our members have expressed the sentiment that the legislation, as is currently proposed, would increase competitiveness of Canadian businesses. It’s the opposite. There is a lot of heartburn out there around potential unintended consequences of legislation that will slow down approvals and slow down investment in resource projects across the country and also economic infrastructure. This bill doesn’t apply to just resources. It also applies to economic infrastructure like ports and airports, which are critical to manufacturing competitiveness.
Mr. Goodman: I would have to echo those concerns. My members are generally concerned with Bill C-69, that it would have a chilling effect on the investment into our country or the investment that moves within our country into my members’ businesses.
Senator Neufeld: I want to ask you about participation. The previous act more or less focused on those that would be affected and those that are close to a project that would have to go through the assessment. Bill C-69 opens that up to the world. I know I asked this question of the other two groups. I know public participation is important, so don’t get me wrong there. I have been around long enough to know that, and I have done a lot of it. Tell me what you think of opening it up to the world. I don’t care what you do, people will be adamantly opposed to oil and gas, nuclear energy or electricity generation. Once the world has an opportunity, what do you think will happen? As a regulator and developer of regulations, how do you think that can be curtailed a bit in the bill we have before us now?
Mr. Goodman: I can appreciate why people would want to hear from many different sources. Provided that it’s helping the regulatory decision, there is value in that. However, you do have a practicality of a limitation of time. No matter how long you go for, you could do something for 20 years and you would still not hear from everybody who may wish to come in.
I think it is absolutely critical for those with recognized rights and those who are living, working and recreating near these areas that could potentially be impacted by any development, whether that is a dam or other natural resource project, a solar or wind area. I think those are the people who are most important. I believe this bill, by trying to accommodate broad public participation, actually has an ability to dilute those voices just from a practical regulatory standpoint.
Mr. MacLean: We have to be mindful of time frame. Public participation is a critical part of the process. We need to encourage that, of course, but it needs to be managed so we don’t damage the competitiveness of projects.
Senator Woo: Let me pick up on the participation issue with Mr. Goodman. Your members are currently subject to the current Canadian Environmental Assessment Agency, which does not have a standing test. We have heard from them that it works well. They are able to sift through the witnesses in a way that calibrates their relative importance, including taking written submissions. Do you disagree with their assessment?
Mr. Goodman: No, I think right now, the way the system is working, there are opportunities to improve it, but I do think I have to give credit to that agency.
Senator Woo: Thank you for that. Can you also clarify that it’s not possible for consultation to take place within 20 years, as you suggest, under Bill C-69? Bill C-69 sets the limit for consultations with the public, and this idea of things that go over 20 years is absolutely not a possibility under Bill C-69.
Mr. Goodman: No, I will not clarify that. I’m sorry, sir.
Senator Woo: Okay, I can clarify that the bill in fact does not provide for the opportunity for consultations to go on indefinitely.
Let me talk about balance and get some views from both Mr. MacLean and Mr. Goodman. Mr. MacLean, you make a pretty extraordinary statement about how Bill C-69 is a system designed to find flaws and to ignore positive economic benefits. I would like you to perhaps defend that claim a bit more. That’s not my reading of the bill. What we heard from the agencies is that, in fact, the current regime is designed to only find adverse impacts, whereas this bill allows for finding positive economic benefits.
This brings up the issue of balance, which is so important to Mr. Goodman’s testimony and a very important point as to how we create a balance. Clause 63 on the ministerial and cabinet discretion on the public interest test, in my reading, is in fact a way for the minister or cabinet to override the adverse impacts that they find if they find that the project overall is in the public interest. Is that not a way in which this balance is created in a system that would otherwise be very problematic if an agency only found adverse impacts and the government did not have the ability to say, “We can live with these adverse impacts precisely because we have a provision in the bill that says we need to look at economic benefits for communities as a whole?”
Mr. MacLean: Well, clause 63 describes the five conditions, and economic development isn’t one of them.
Senator Woo: Have you looked at the definition of sustainability in the bill?
Mr. MacLean: Not recently, no. Then maybe make it explicit and bring it right forward into the legislation. It should be emphasized that economic benefit is a critical piece of this, and it should be written in.
Mr. Goodman: I would have to agree. I do understand your point. In the argument you are making, I understand what you are moving to. I just think there is additional clarity. If that’s the actual purpose of that section, then I think you would put that up front with greater clarity, too. That is a normal practice across provincial and federal jurisdictions.
Senator LaBoucane-Benson: Thank you for your words today. Mr. Goodman, I was struck by what you were talking about: the purpose statement is fundamental, and the purpose statement in two of the acts you thought was not strong enough. I believe you said the economic factors must be mentioned or the economy must be mentioned in the purpose statement. I looked at the purpose statement, and I see economic conditions in there and taking into effect positive and adverse, but I do understand, I think, where you’re coming from. How would you amend that to have the economy or economic factors come forward in a more purposeful way?
Mr. Goodman: I appreciate the question. I think the easiest amendment is to simply add a line. It’s very important to list out the factors the regulator has to consider, and that is done well within the bill. By simply adding in a line that one of the other factors is the economic benefits from a public interest standpoint, something that simple creates the natural dynamic that a regulator has to face between preventing something potentially negative from happening but allowing that positive to continue. Thank you.
Senator LaBoucane-Benson: Mr. MacLean, with regard to the duty to consult, you might have heard Senator Massicotte’s question to the previous panel, so I won’t repeat it, but one of the things I wonder is, how does adding a statement about UNDRIP to the preamble only, when in no place in the rest of the bill does it mention UNDRIP, create unnecessary uncertainty?
Mr. MacLean: Hopefully it doesn’t. Frankly, I’m not a constitutional lawyer. But if words matter and if preambles don’t matter, then let’s agree they don’t matter. But if they do matter, legally, or to set the tone of legislation as we go forward, then I think we should be precise at this point and clear on what adds clarity and what does not.
Senator LaBoucane-Benson: I would say that Mr. Saganash, who brought this forward, and other people would say the UNDRIP is really clear and that the wording of UNDRIP is all around self-determination. I guess when we’re talking about added uncertainty, some of it seems to be fearmongering and some of it seems to be that there really is a problem here. I haven’t been able to get a clear understanding of how talking about Indigenous people’s rights to self-determination equates to a level of uncertainty that nobody would want to invest in Canada. I’m still trying to figure that piece out.
The Chair: Thank you.
Senator Massicotte: Thank you very much for being with us this morning. I have two quick questions. I share your concern at the fact that, in the project list, the rules are not yet established. But if the project list was the same as that currently in place, would that satisfy both of you?
Mr. Goodman: Well, I guess the answer is it depends on the actual legislation in its final conclusion. I think, right now, in its current form, the answer would be no because the project list is not an independent piece. It’s read within the context of the rest of the legislation, and there are concerns with the legislation.
Mr. MacLean: We have specific concerns in Alberta around in situ oil sands operations.
Senator Massicotte: But if the current list as it currently applies was confirmed to be applicable to the future, in situ is excluded and is provincial, in that case, would that not satisfy?
Mr. MacLean: It would partially satisfy. There is also a concern around power generation. We should have a project list and it should be discussed publicly.
Senator Massicotte: In your written submission, Mr. MacLean, you make reference to Canada West as submitting a good report. Canada West basically suggests that the maximum time limits should include any time required by the proponent, in other words, with the ability to pause. Would you agree with that? In other words, the time frames should include delays by everybody and not only caused by the government?
Mr. MacLean: Yes. As well as we can create some certainty around time frames, yes, it should include proponent time frames as well.
The Chair: Just as an example, for in situ projects, what is the lifetime of an in situ project?
Mr. MacLean: Twenty to fifty years.
The Chair: We are saying with this bill that the maximum time for approval is three years. Can we talk in relative terms? We are taking three years for a project that is going to be there for 20 years, in the case of in situ. If I take a project of a dam, we are talking about 50 or 60 years. So what does it look like to take one year or two years with respect to the whole life cycle of the project? Is this really significant?
Mr. Goodman: If you don’t mind, I’ll answer that. The answer is yes, it’s very significant. The way investment flows work within Canada, at least in the oil and gas sector — and I can’t speak to the other sectors — time really is money, and the time value of money is calculated in various ways. Whether it’s three years or a year-and-a-half or one year, it makes a dramatic difference on whether that investment would actually occur within our country or if those funds would flow to, quite frankly, another country.
The Chair: In the list of the projects that are under the present rules, most of the projects were withdrawn by the proponent, so the lack of the time in the approval process lies more on the responsibility of the proponent who is deciding to take away his project at a given time.
Mr. Goodman: I appreciate your question. The proponents will make decisions as they enter processes, just like we would all personally make decisions as we enter various processes. As the proponent learns more, they are constantly re-evaluating their commitment to that initiative. To be honest, a lot of it is based on the math within a discount cash flow or whatever analysis they are undertaking. They may be pulling out simply because of concerns over the lack of predictability as to where that investment may go.
There are some dramatic cases associated with this, but you can start to see it as of earlier this week with Devon Canada starting to think about pulling out of this country. That’s an example of where people are becoming very nervous about concerns with predictability on how to move through these processes.
The Chair: Yes, which is under the present regime.
Mr. Goodman: It is. I would argue you may not want to move away from that present regime but, rather, change the present regime. That’s certainly up to the officials.
Senator Mockler: I’m from Atlantic Canada, New Brunswick. In Atlantic Canada, we know and we have the experience, since Confederation, how difficult it is to encourage investors to come home to invest in major projects. Government plays an important role. We are concerned, and I have had the opportunity to meet elected officials municipally, regionally, provincially and even federally, and they see in Bill C-69 that the bill is also inconsistent with the joint management principle of the Atlantic Accord acts. It also introduces considerable discretion in a decision-making process that should be predictable and science-based. I believe in that. Do you have any additional comments?
Mr. Goodman: I have not recently looked at the joint accords so I have to be a little careful here, but I do understand and I have had several discussions with colleagues in Atlantic Canada and those issues are being raised. I think it goes back to an original question around the division of powers, really, between the federal and the provincial governments in the management of natural resources. The joint accord is meant to preserve some ability, and that has been a fairly effective process.
Senator MacDonald: That’s right.
Mr. Goodman: So I would ask this chamber to consider what the implications are around that, given the positive history that has been developed there. That would be my only comment.
Senator McCallum: I want to go back to the ministerial discretion. You said you didn’t want civil servants making the decisions. I have to agree with that, because I have had to work in the health field with civil servants going into standards of care and into areas they shouldn’t. There is no sanctioning for them. When you look at the 26 timelines in this new act, what would be acceptable for you? I don’t understand this timeline. You can see where it’s going to be stopped. I’m looking at that, because I know there is one agreement between the boreal forest and Indigenous chiefs. They withdrew their consent midway because of concerns they had, which didn’t come out until midway. They still continued, despite this retraction. So that’s where I’m coming from. What is a happy medium for you?
Mr. Goodman: I can answer both questions. First, on ministerial discretion, just to clarify: I do believe there is too much ministerial discretion within this bill to make this practical and workable and to give certainty within it. My comments were that I can appreciate where there are aspects where ministerial discretion is perfectly valid. We live in a democracy. I think that’s more than reasonable.
I would ask the Senate to undertake two things related to ministerial discretion. The first is to examine where democracy genuinely needs to be involved around ministerial discretion. When that occurs, there needs to be some additional framework put around that. You need to understand, as an investor, stakeholder, an Indigenous nation — whoever is participating and has interests — how will the minister make that? I recognize there is some of that within the bill. You pointed that out, senator. But some of it is quite subjective. It would help if you could get more objective standards within that. That’s where I would go on the first point.
The second point is this: What is reasonable? I’m not sure my view is going to help you here, but I’d go to the macro global issue that we have. We live as a relatively small country by population within a macro global economy, and we need to compete for capital within that to make sure we can fund the services that Canadian value so much, such as universal health care, public education and protection of the rights that are there. We have to remember that a lot of those are being funded by the development of our natural resources.
So, to answer your question, you need to look to whom you compete against. If you look to one of our main competitors, the United States, they can get pipelines, for example, built very quickly. That is a factor you need to be aware of, yes, I agree. Good point.
Senator McCallum: Thank you.
Senator Richards: Thank you for coming. I have two quick questions, one for Mr. Goodman and one for Mr. MacLean.
Mr. Goodman, because of ministerial discretion, do you think this bill is worse for business than the 2012 bill?
Mr. MacLean, how will Bill C-262 affect consultation, and will it or could it lead to expanded time frames or more litigation? Bill C-262 is the United Nations bill.
Mr. MacLean: The concern among our membership is that the UNDRIP mention in the legislation changes the game in terms of duty to consult. I’m not sure exactly how it does that, but if we have jurisprudence, court decisions and if we have worked out the details around duty to consult over the past five years, as we certainly have in Alberta with oil sands development, then the status quo ought to be sufficient, assuming we have had some success under the current system.
Mr. Goodman: I believe the current bill, as currently written, is not as positive as the current situation, with recognition of all the flaws of the current situation. That is why I am here: to hopefully provide you with the ability and opportunities to update them, along with other stakeholders you are listening to.
Senator Mitchell: Thank you. I should point out the UNDRIP provision in the preamble was an amendment that was passed unanimously in the House of Commons, including by any Conservative MPs from Alberta who were there to vote.
My question, though, is for Mr. Goodman, who has made a lot about the importance of putting economics first. It’s a follow-up on Senator LaBoucane-Benson’s comments and questions. The first three elements of the purposes reference economics explicitly. It’s referenced through sustainability, which includes economics, and through effects, which includes economics, specifying positive and negative. There are 130 times it is referenced in definitions, and 31 times it’s referenced explicitly. On the other hand, the Responsible Energy Development Act, which set up the AER, which you have pointed out you were instrumental in establishing, doesn’t reflect economics once. How do you square that circle?
Mr. Goodman: Certainly. First, it’s not correct that it doesn’t reflect economics; the word “orderly development” there means economic. It’s by convention that people understand that, and courts have accepted that within the jurisprudence that has been built up.
Senator Mitchell: So that would happen here, too?
Mr. Goodman: Hopefully, that would occur. I don’t believe that is the case, personally. I think there is opportunity for this chamber to consider the ability to insert and clarify that. There is a long history in the piece of legislation you referenced. This is starting, to some extent, with new language, in a different way. The PC reference actually goes back to 1938, so there is a long built-up understanding by convention, which is very common within our system. So I would again encourage you to consider the opportunity to provide clarity on that, if that is the intention of the government.
Senator Mitchell: Clarity, yes, but clearly it is the intention of the government or they wouldn’t have referenced it 161 times.
My second question references timelines. You made the point, Mr. Goodman, that you couldn’t confirm that public participation would be done within timelines. You are a lawyer. I refer you to amendments to clauses 16, 27, 51 and 99, all of which specify it has to be done within timelines.
But in the latest in-situ plant reviewed by the AER, set up under your direction or participation, it took six or seven years to review the Aspen project in-situ, the Imperial project. What could we learn from the problems with the AER process that we could apply here? It seems odd we would be hearing criticism of timelines here, every one of which has been shortened, by over 50 per cent some of them. A major one goes from 720 to 300; another goes from 450 to 300. You will say “planning process.” You have one; you just don’t specify it. My point is that there are six or seven years under the process you set up, and you’re worried about timelines here.
Mr. Goodman: I am worried about timelines. There are certainly opportunities within the Alberta energy regulatory process to improve. There’s no question about that. The Aspen project is a great example of where I think that is an unreasonable timeline.
I’m suggesting there are some things to learn, some positive, some negative, within that process and others. The starting and stopping ability of a clock is difficult. I fail to see why we can’t look around the world in which we have to compete in where there are set timelines. That is true even within our own courts. Within criminal cases, timelines have been set — no exceptions. And we see this regularly implied. I don’t know why we can’t put that into our administrative tribunals.
The Chair: We have time for one more question, Senator McCoy, with a short preamble.
Senator McCoy: A very short preamble.
We are all guessing what’s going to happen under this legislation. Some senators with no experience with processes like this are saying it says one thing. People who have been working with legislation or processes of this nature are saying another. I wish we had some kind of objective benchmark against which we could assess regulatory process in this very important area.
I want to address regulatory excellence, because I presume you were involved in that in Alberta, and the public or the regulatory excellence project coming from the University of Pennsylvania. Could you give us a thumbnail sketch of that? I have recommended that a leader of that process be here as a witness. Let’s talk about what are the four main characteristics of regulatory excellence, and perhaps we can get a panel that talks to that, which will give us some help to gauge whether this bill meets those standards.
Mr. Goodman: Certainly. There was a significant piece of work. It was run out of the University of Pennsylvania. This occurred over about a year time frame, and it involved academics from across the globe, from Australia to the U.K., Canada and elsewhere. There is actually a book that’s been published with edited components within that. I think there are a lot of positive aspects that can be looked to.
Generally, regulators really need three critical things to be effective. You can look to regulatory failure when this does not happen. There are many examples of that that I won’t mention here.
The first is they need technical competence. They need people who actually know what they are talking about when they are regulating. What you don’t want is a group of lawyers regulating the energy business, to be frank. You really want technical excellence.
The other one you need is you need to ensure your processes are fair. Some people call these the rules of natural justice being applied. But the key is there is a perception by all stakeholders that there is fairness within that process.
The final one — and this is more modern and it is continuing to evolve — is you need to have people genuinely engaged. There is different language around this, but you actually have to listen to the people that could be impacted by the development. They are not talking about the broad policy components. Policy components, big issues, belong with democratically elected officials. The administrative side belongs at the regulatory level to make those decisions. But that does not mean you don’t listen to those people. I live in rural Alberta. I am on a water well. I live in a sour gas zone. I am very interested, with my family, to make sure that they are protected and safe. I have confidence in that system because I was engaged in that process, not as a regulator but as someone walking up to my front door, banging on it and saying, “We’re thinking of doing this and, before we get too far along, we would like to have a conversation with you.” Brilliant. That is exactly what should happen. That is continuing to evolve.
The Chair: Thank you very much for this very interesting conversation.
(The committee adjourned.)