THE STANDING SENATE COMMITTEE ON ENERGY, THE ENVIRONMENT AND NATURAL RESOURCES
EVIDENCE
OTTAWA, Tuesday, May 28, 2024
The Standing Senate Committee on Energy, the Environment and Natural Resources met with videoconference this day at 6:34 p.m. [ET] to examine the subject matter of those elements contained in Division 28 of Part 4 of Bill C-69, An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024.
Senator Paul J. Massicotte(Chair) in the chair.
[Translation]
The Chair: My name is Paul J. Massicotte. I am a senator from Quebec and the chair of the committee.
Today, we are conducting a meeting of the Standing Senate Committee on Energy, the Environment and Natural Resources.
Before we begin, I’d like to ask all senators and other in-person participants to consult the cards on the table for guidelines to prevent audio feedback incidents. Please take note of the following preventative measures in place to protect the health and safety of all participants, including the interpreters.
If possible, ensure that you are seated in a manner that increases the distance between microphones. Only use a black approved earpiece. The former grey earpieces must no longer be used. Keep your earpiece away from all microphones at all times. When you are not using your earpiece, place it face down, on the sticker placed on the table for this purpose.
Thank you all for your cooperation.
I will now ask my fellow committee members to introduce themselves, beginning on my right.
[English]
Senator Tannas: Scott Tannas from Alberta.
Senator Cotter: Brent Cotter, senator from Saskatchewan. Good evening.
Senator Miville-Dechêne: Julie Miville-Dechêne, Quebec.
Senator McBean: Marnie McBean, Ontario.
Senator Sorensen: Karen Sorensen, Alberta.
Senator Wells: David Wells, Newfoundland and Labrador.
Senator Gerba: Amina Gerba, Quebec.
[Translation]
The Chair: Thank you everyone.
[English]
We have some big hitters with us today. We should be proud.
[Translation]
Senator Wells would like our attention.
[English]
Senator Wells: Prior to addressing the subject in front of us with our guests, I wanted to move a motion for the consideration of the committee regarding Bill C-248, which is the bill for the Ojibway National Urban Park.
Just for background, from listening to our committee and the deliberations we had as well as to the presentation from MP Masse, I think the bill is good in principle. I don’t know that there will be any great wave against it if it is in its right form. But I don’t think — and I think my colleagues agree — it is quite in its right form.
Because of the private member’s bill process in the other place, if we vote for this bill now, it may not turn out well for the bill, and therefore, because of their lottery process and with an election likely next year, the bill might not see the light of day. I would like to see the bill pass in its correct form. At this point, it is not the Senate committee’s job to put it in its right form.
I have had discussions with MP Masse on that. He is in agreement with what I will now move. I have some emails that were back and forth, and I’ll read one line after I read my motion.
Colleagues, I move to defer further consideration of Bill C-248 to when we return later in the session. I have an agreement from MP Masse that this additional time, which will likely take us into the fall if the committee agrees — if steering agrees — will allow him to address the concerns our committee had during our initial deliberations at report stage.
The Chair: Are there any comments or questions?
[Translation]
Senator Miville-Dechêne: I agree with the motion. I have a great deal of respect for Brian Masse’s efforts. In my opinion, he has worked extremely hard on this bill, which is rather extraordinary, because he already has funding, which is quite unusual for a private member’s bill.
I think it’s a good idea to wait for those much-discussed and more exact coordinates to prevent private property from being affected. Is that what this is about? I think so, but I just wanted to clarify that we’re talking here about the geographic coordinates so that private property doesn’t mistakenly end up inside the park. Is that correct?
[English]
Senator Wells: That’s one of the elements that he heard that we had issue with. When he appeared before us, that was the key issue. Chief Duckworth also heard issues that he has to settle. It’s not for us to settle among the First Nations that are present in the area that we’re discussing. These are his issues that he knows must be addressed. It is not just the private property that we had particular concern with when he was at the table, but also the concerns of Chief Duckworth, which I think are both relevant and important.
Among a number of emails back and forth, he said that:
The delay will allow us to put all the concerns and fixes together. I appreciate your guidance. Much of this has come to fruition and the community stands by the position, and the committee process has been helpful to push everyone together.
I think that’s where he is now. He just needs time to do it. If we were to address this at clause-by-clause consideration next Thursday, which was our plan, there would be no good outcome for anyone.
The Chair: Any other comments or questions? I want to put on the record that I also spoke to Brian Masse. Basically, he confirmed the accuracy of your statements, Senator Wells. It was an agreement. I gather you want to delay the vote to next week.
Senator Wells: I want to delay further consideration of the bill until later in the session.
Senator Sorensen: Is the motion on the table?
The Chair: Yes. All in favour of the motion?
Hon. Senators: Agreed.
The Chair: Agreed.
Senator Wells: When I considered this, the first call I made was to you, chair, to seek your guidance on it. I appreciate the guidance that you gave me. My next call was to MP Masse to see if he was in agreement. I wasn’t seeking his permission because the committee has to make decisions based on our own objectives and needs, but I thought putting him in the loop was the right thing to do.
The Chair: Good success and good work, Senator Wells.
[Translation]
Today, the committee begins its examination of the subject matter of those elements contained in Division 28 of Part 4 of Bill C-69: An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024.
For our first panel, we welcome, by video conference, from the Government of Alberta, Mickey Amery, MLA and Minister of Justice, and from the Mining Association of Canada, Pierre Gratton, President and Chief Executive Officer, and Tara Shea, Vice President, Regulatory and Indigenous Affairs.
Welcome and thank you for being with us.
Five minutes are reserved for your opening remarks.
[English]
Mickey Amery, Minister of Justice, Government of Alberta: Thank you for inviting me to speak with you this evening. I will get right to the point.
In Alberta’s view, the proposed amendments to the Impact Assessment Act, or IAA, simply do not go far enough to address the act’s constitutional infirmities or sufficiently address the issues identified by the Supreme Court of Canada in the Reference re Impact Assessment Act case.
While modest improvements have been proposed to narrow the scope of the act, it remains the case that the act, as amended, would continue to allow the federal government to assess and ultimately prohibit entire projects on the basis of any potential “. . . adverse effects within federal jurisdiction . . .”
This is the case regardless of whether the project is primarily regulated by the province or otherwise requires any federal approvals outside of the IAA process. More generally, the proposed amendments represent a missed opportunity to address the wider concerns that have been expressed regarding the clarity of the act and a proponent’s ability to successfully navigate an unnecessarily complex process.
In Alberta’s view, more can be done to prove the efficiency, timeliness and certainty which are critical to attracting much-needed investment in this country. For example, we recommend this committee consider a true substitution process for federal impact assessment, allowing reasonable provincial impact assessment schemes to stand in place of the federal processes. This would achieve a number of goals. First, it would avoid needless duplication and leave the public interest decision in the hands of the constitutionally appropriate order of government. Furthermore, it would avoid what the current scheme achieves — that is, it restricts provinces and mirrors the federal model but the federal government still has the final decision within the current provincial scheme, which is not really a true substitution.
Alberta also remains concerned with the project list model utilized by the act. There is no basis for intra-provincial highways, gas-fired power stations and in situ oil sands projects, to name a few, to be prima facie subject to federal impact assessments.
Many of these concerns could have been avoided if, following Alberta’s successful challenge in the Supreme Court, the federal government had engaged in meaningful discussions with the provinces. This did not happen. Instead, the federal government chose not to inform Alberta that they were tabling these amendments in the House of Commons.
Even the original version of the act, which was largely determined to be unconstitutional, followed four years of consultation and feedback. Indeed, this committee invested significant time to hear from proponents and stakeholders prior to the act’s eventual enactment.
I will end my opening comments at this time and yield the floor to my friend.
Pierre Gratton, President and Chief Executive Officer, Mining Association of Canada: Thank you for the opportunity to be here today. I want to begin by acknowledging that we are gathered on unceded traditional Algonquin territory. I also want to acknowledge the hundreds of First Nations across Canada on whose traditional lands our industry operates and with whom we have strong partnerships.
In February 2019, the Mining Association of Canada, or MAC, appeared before this committee and expressed the view that the IAA would improve upon the Canadian Environmental Assessment Act, 2012, or CEAA 2012 if well implemented. Key aspects of the IAA that led to this conclusion were an improved time management system, getting rid of the stop-clock provisions of CEAA 2012 that rendered timelines meaningless; the tailoring of projects to focus on unique features and address common aspects through standard mitigation measures; enabling federal-provincial cooperation, which CEAA 2012 precluded except through substitution, and which only materialized in B.C.; and inclusion of federal permitting departments in the IAA process to enable faster post-environmental assessment — or EA — permitting, which CEAA 2012 did not allow for.
Unfortunately, implementation of the new act has fallen well short of our expectations. No new federal-provincial agreements have materialized and substitution continues to be possible only in British Columbia. No project has come out the other side of the IAA process, so there is currently no way of knowing if post‑IAA permitting has been accelerated. Further, there has been little to no evidence of project tailoring, which is the single most important promise of the IAA, which led us to believe that the act would improve upon CEAA 2012.
Let me now share with you a few examples of what I mean. A project in Val-d’Or was asked how it would impact marine life. A project was asked to assess the potential impact of a railway on bird mortality; there is no railway. Officials either are not reading the project descriptions or do not understand the sector they are assessing. They are imposing generic information requests that are inappropriate.
Worse, we are witnessing the opposite of tailoring — an extreme pursuit of information instead of focusing on key risks specific to projects. Proponents are being asked to complete multi-year studies that will ultimately have no bearing on decisions or outcomes.
Allow me to illustrate the point. Proponents are being asked for migratory bird data, which in and of itself is not unreasonable. However, we are hearing from practitioners that the level of field and analytical effort for baseline studies in response to federal guidance has expanded considerably. These studies add years and millions of dollars in costs to the preparation of an impact statement, without adding value to the impact assessment final decision or mitigation measures.
The scope for wetland studies and data related to compensation for wetlands has expanded considerably as well, despite strong provincial wetland policies and compensation processes. This is unnecessary duplication of effort.
Proponents are being asked for air quality studies for greenfield sites, which are mines that are in an untouched part of Canada. There are standard mitigation measures for dust control and particulate matter, and these are regulated by the province, not by the federal government.
Federal assessments ask about procedures for reclamation, something exclusively within the realm of the provinces.
Overall, there is a lot of information requested of proponents, much more than what is needed to assess mining impacts and determine appropriate mitigation measures in federal jurisdiction. We end up with massive impact statements, and it is extremely difficult for the public to determine what is relevant with respect to the project.
Impact statements must be accessible and comprehensible to be useful to rights holders and stakeholders. Hence, we approach the proposed amendments with skepticism and even cynicism. The amendments, in theory, will make it easier for the federal government to enter into cooperation agreements with provinces and Indigenous governments, but the law is an ass — as in donkey; I’m not using unparliamentary language.
We must see examples. The amendments requiring that decisions and conditions be based exclusively on matters that fall within federal jurisdiction should logically lead to an enhanced tailoring of assessments.
Unfortunately, as I said, we see negligible differences in practice when comparing projects begun before and after the Supreme Court opinion. While it may be true that the Supreme Court stated that the scope of what is studied is not limited and the federal assessments can study anything they want, it does not make sense to us that the government would impose studies on aspects that will have no bearing on eventual federal decisions or conditions.
Hence, in our brief, we state that the federal government should prioritize standard mitigation measures for effects in federal jurisdiction that are common for mining projects, with the objective of reducing costly, time-consuming, unnecessary studies and data collection. Assessments and studies should focus on unique project aspects that relate to federal jurisdiction. Studies unrelated to federal effects should be discouraged, if not prohibited.
In short, the government has the tools to administer an effective, efficient federal impact assessment to achieve its own timelines outlined in Budget 2024, but it must choose to use them. Until it does, federal assessment will remain onerous, inefficient and lengthy — and will fail to deliver on the government’s own clean growth goals. Thank you.
The Chair: Thank you. Ms. Shea, did you want to add something to the presentation?
Tara Shea, Vice President, Regulatory and Indigenous Affairs, Mining Association of Canada: No, Pierre has covered it. Thank you.
Senator Cotter: I am largely a visitor to this committee, and it is an honour to be here. Thank you both for your succinct presentations. Mr. Amery, we’re not used to people staying well within their time limits at these committees, so thank you very much.
While Mr. Gratton has raised a whole series of important policy questions about the effectiveness of the IAA and the amended version here, with no disrespect to him, I am mostly interested in a couple of questions for you, Mr. Amery, on your observations that this still doesn’t go far enough. I presume you meant it still has features of unconstitutionality about it.
My reading of the legislation is that the federal government has tried to rein in the reach of the IAA following at least what it says is its understanding and acceptance of the Supreme Court decision. I note that in a number of the provisions, particularly in the definitions of “adverse effects within federal jurisdiction,” it appears to have done that fairly extensively. Can you speak a bit more about the ways in which you see this as still inappropriately entrenching on provincial jurisdiction?
Mr. Amery: Certainly, and thank you for that opportunity.
In the IAA reference case, the Supreme Court majority found that the definition of “effects within federal jurisdiction” in the act go far beyond the federal government’s jurisdiction, noting that the definition captures any effect, positive or negative, trivial or non-trivial to the enumerated subjects. The result was, ultimately, a dilution of the decision makers’ focus at key decision-making junctures and impermissibly broad prohibitions on activities that Canada does not otherwise have the jurisdiction to regulate.
The changes that you refer to, senator, refer to a change in that the proposed change now speaks about “. . . adverse effects within federal jurisdiction . . .” which include “. . . non-negligible adverse changes . . .” to federal aspects.
The problem with this is that it continues to be very broad in its definition. The new definition includes a reference to “. . . non-negligible adverse changes . . .” to certain enumerated components of the environment, many of which remain from the prior definition of “effects within federal jurisdiction,” those being enumerated components like fish habitat, aquatic species, migratory birds and Indigenous traditional land use.
The addition of “. . . non-negligible adverse . . .” in front of the enumerated effects, in Alberta’s view, does not sufficiently constrain the definition of “adverse effects within federal jurisdiction” to address the issues identified by the Supreme Court in particular, given the central role that the definition plays in the overall designated project scheme of the act, including in relation to the decision-making under the section 7 prohibition.
More simply put, this minor change in the proposed amendments put forward to the act’s definitions means that the practical and legal effect of the prohibition in section 7 of the act remains largely unchanged.
I’ll give you an example of what I mean by that. Instead of being prohibited under section 7 from causing any effect, for example, to Indigenous land use, a proponent would now be prohibited under the proposed changes from causing any “non‑negligible adverse effect” to traditional land use. That’s to say that the proposed change to this definition or changing the definition from any effect to “non-negligible effect,” for those enumerated components, for example, means, again, that the practical and legal effects of the prohibition remain unchanged.
In the context of more major projects, the practical outcome is the same. That is to say that any adverse versus any non-negligible adverse impacts, in our view, is first, overly broad, and second, relatively the same with the practical and legal effect and would continue to allow Canada to regulate activities under the act which it simply does not have the jurisdiction to regulate.
Senator Cotter: Thank you very much, minister. That’s really helpful.
What I understand and you would acknowledge, though, is that that there are potential federal impacts to initiatives that are normally thought to be in the context of provincial jurisdiction. Would the approaches that you described about substitution be the way in which that would be addressed — and, hopefully, to the satisfaction of the government’s legitimate interest in the environment that would be affected?
Mr. Amery: If we’re referring to the substitution components that I spoke about earlier, the ability of provinces to make significant decisions in areas of their own jurisdiction or their own order would be appropriate in the ultimate submission of the finalized proposed changes going forward. Right now, as it stands, that doesn’t seem to be the case.
Currently, while the provinces are entitled to mirror the feds in the way that the process takes shape, the ultimate decision making still lies with the federal government. That, essentially, does not give us the ability as provinces to make decisions about our own proposed potential provincial impact assessment scheme in our province. That may work better within this province or within other provinces, but the act and the proposed changes do not currently allow for that to happen.
I think you spoke earlier about whether the definition was narrow enough. It’s our view that it is still not narrow enough. That is the real problem here. It continues to highlight some of the concerns that the Supreme Court raised in the initial challenge in the IAA impact assessment case. In our view, simply adding the word “non-negligible” to that does not bring any further clarity or a narrowing of the definition to make this a workable act.
Senator Cotter: Mr. Amery, does the Government of Alberta have suggested language with respect to the Impact Assessment Act amendments that would bring the comfort you have described needing?
Mr. Amery: We certainly wanted the opportunity to engage in consultation with the federal government in order to help achieve some of that. We did not get that opportunity. We are certainly prepared to submit that, but that was never given or afforded to us in the period between the decision of the Supreme Court and where we are today.
Senator Tannas: Thank you. My understanding is that there isn’t a definition of “negligible” in the act as it would stand right now. Is that correct? Is there a definition to work from on what is negligible and what is not?
Mr. Amery: Not to my knowledge, senator, no.
Senator Tannas: Right. So is it your feeling that — to put it in non-lawyer terms, because I’m not one — this is a new set of words that would give the government additional cover while retaining the freedom to determine what is not negligible and put everybody back in court again? Is that essentially your position?
Mr. Amery: To make this as simple as I can — and I know this is challenging; it is for me as well, senator — moving away from the definition of “effects within federal jurisdiction” to “non-negligible adverse changes” doesn’t provide any additional clarity to Alberta. It certainly doesn’t provide additional clarity or address the concerns the Supreme Court raised about the definition being overly broad.
Non-negligible impacts and effects within federal jurisdiction, in my view, are practically the same thing. If you don’t have any effect, you have nothing at all. If you have a non-negligible adverse change, that is different from a negligible adverse change or a negligible change.
What I’m trying to get at here is that although the wording is difficult to comprehend, in my view, they are essentially one and the same.
If you don’t have an effect, for example, you have nothing at all, and if you don’t have a non-negligible adverse change, then you ultimately either have a negligible change, which is essentially nothing at all, or a non-negligible change, which is something. This is where we come to a problem.
I see you nodding, senator, so I think understand the challenges we’re facing here as well.
Senator Tannas: Thank you.
Maybe you can respond to this, then; I would like to hear from both of you. Our committee has allocated two days to study this. We have not been successful in having the minister come here to talk to us. A study has not yet started in the House of Commons. We’re way ahead of our skis here.
But is there enough here in this situation for us to consider carving this out and spending the time to review the comments from an industry point of view that you have raised, Mr. Gratton? Also, is there a potential solution that we could work toward on the legal side to try to make this better? I would be interested to know what your thoughts are on that.
The Chair: Have you addressed that question to the minister or Mr. Gratton?
Senator Tannas: To both, if it’s possible. Quick answers, please.
Mr. Gratton: I didn’t raise it in my opening remarks, but in our brief, we do touch upon the question of “negligible” and “non-negligible.” Our members are confused. It’s introducing new terminology that is not well-defined and adding more uncertainty to an already uncertain process, so there is definitely concern with the introduction of that terminology.
We did not have the time nor the resources to study this from a legal perspective, which is why you got the presentation you did from me, so we don’t have anything at this point to propose to try to address that uncertainty or other aspects that might better focus the bill on matters of federal jurisdiction.
Historically, as an association, our members have always focused on how to make this work. We have dealt with five different versions of federal environmental impact assessment legislation over the years. They have all had challenges, and we have always felt that so much of what matters is how it is implemented by officials. However, this is adding more uncertainty through that terminology that officials will have to interpret. How they will interpret it consistently will be another sort of trial by doing. To your point, it might be something that gets settled in the courts.
The Chair: Minister Amery, do you have anything to add to that question?
Mr. Amery: Certainly. Once again, thank you for the opportunity.
The Supreme Court gives us a little help here. It says:
Effects must be linked clearly to federal matters under the constitution, including only those transboundary effects where federal jurisdiction has been established. Appropriate thresholds must apply to ensure prohibitions do not apply to trivial effects or positive changes.
We contrast that with some of the wording that is being proposed right now, which is, again, “non-negligible.” We don’t know what that means; I don’t think anybody truly knows. The concern here is that we’re moving away from what was already generally broad to something that is similarly broad. The Supreme Court has said that is part and parcel the reason why portions of the impact assessment case went the way that they did.
So, I don’t think we’re achieving anything here by moving forward with the proposed changes, because they simply do not create the clarity or narrow the scope of the act in any way that would help bring us to where we need to be to avoid another constitutional challenge.
The Chair: If I could join in, when I read the proposed amendments, I thought the Supreme Court’s position was very clear. Not only that, they gave you a mechanical set of how to deal with the uncertainty from then on, because they basically strongly suggest that resolution is through this mechanism. I thought you would surely come to an agreement, because it’s pretty detailed, but what you’re saying in spite of that is that it’s not good enough. Is it because people are not dealing fairly or open to reaching a fair deal? Is it time to exaggerate, given the political situation? Help me out here. Why is it that we’re so far off when the Supreme Court was very clear in many respects?
Mr. Amery: Thank you.
We’re so far off because we still do not know what the term “non-negligible” actually means. We think that it remains overly broad. We believe it does not capture the essence of what the Supreme Court has indicated in its decision. “Non-negligible” is not, in our view, significant enough to meet the requirements of the court’s decision.
The concept, for example, of Indigenous rights and the federal government’s related jurisdiction remains extremely broad, resulting in a broad definition of “adverse effects within federal jurisdiction” that have not yet been clearly defined. It is our view — as noted by the Supreme Court of Canada also — that they are far from obvious. One example is that despite the decision that migratory birds are within federal jurisdiction, they remain within the enumerated components of the proposed change.
These are some of many examples we would like to present to the committee to suggest to you that the purpose and direction from the Supreme Court was that the overly broad component of the definitions was deemed to be unconstitutional, and we haven’t remedied that with these proposed changes by simply inserting the word “non-negligible.” That doesn’t do anything to tell us here in this province what that actually means.
The Chair: Thank you. Before we go on to the next panel — because we are a bit ahead of ourselves — are there any other questions from our committee members about things which you would like clarity on?
Senator Cotter: Mr. Gratton, maybe you can speak a bit about what you see, particularly from your organization and other people who are looking to pursue development opportunities, regarding how to integrate federal and provincial impact assessment initiatives. Is there a way of thinking about it — aside from the issues that you have identified about what I will call bureaucracy — to make this as effective but also as efficient as possible for proponents?
Mr. Gratton: There are a couple of mechanisms. One is substitution. For the mining sector, the main area of federal jurisdiction — what used to be a trigger — that affects our industry is the Fisheries Act, because most mines will affect water and fish-bearing waters in some way. It can be minor, but nevertheless, that’s the biggest permit we will need. That has historically been the reason that, as a provincially regulated sector, we have fallen under federal assessment legislation.
Ideally, through substitution — and I take the point of the minister from Alberta that there is still a federal decision if the project is assessed — the carrying out of the assessment is done by the province, as is the case in British Columbia.
Arguably, the decision now, from what the court has said, should be based solely on those federal aspects that have been part of the assessment. At issue is — and I think this is where the sore point is — if, because of one particular aspect, the federal government were able to say no to something that the province had agreed was acceptable. How do you reconcile that? It is hard to know what the answer is because it’s also going to be on a case-by-case basis to a certain degree.
What if the impact on fish were extraordinarily large? That might be a real problem. But presumably, the province would also recognize that. So, that would also get reconciled by our provincial government.
There was a period in time — we call it the golden years of 2010 to 2012 — during which environmental assessments were actually at their most efficient. That was a period when there were existing agreements between federal and provincial governments on assessments. Although they weren’t a formal substitution and there wasn’t equivalency, there was a lot of cooperation, and they agreed to “stick to their knitting.” They did their respective jobs reasonably well. We got projects through more quickly than we have seen since or that we saw before then. If there were a way to go back to that era, we would welcome it.
Senator Cotter: I think your observation, particularly in constitutional terms — and I expect Minister Amery would agree — is that from time to time the Constitution does feel like an ass. Some judges have said the law might be an ass, but it’s not a bloody ass. Our goal here is to try to find ways to make a sometimes cumbersome constitutional framework work for provinces, the federal government and proponents who want to make use of it, and in ways that are respectful of the environment. There ought to be a way to square that circle. I don’t think we’re there yet.
The Chair: Minister, do you have any closing comments that would help explain your position?
Mr. Amery: Thank you once again. I appreciate the opportunity to speak before this committee and provide our position when it comes to the Impact Assessment Act and the proposed changes.
It is our view that this really goes to the core — all of my submissions go to the core — of the Supreme Court’s concerns with the act and the proposed amendments, and I will close by saying that in Alberta, we believe that it does not go far enough to correct the issue.
The Impact Assessment Act and the proposed changes that have been put forward continue to be unconstitutional despite the proposed amendments. The federal environment minister, for example, can still interfere with projects that remain within provincial jurisdiction. This includes projects like oil sands development, major highways within provincial borders and provincial power plants.
There was a brief comment earlier about whether the political landscape has anything to do with this. I would submit to you that these major projects, which are happening in every single province — major oil sands development, major highways within provincial borders, provincial power plants and other types of major projects — impact a large swath of Canadians, and the appropriate thing for us to do here is ensure that Alberta remains committed to making sure that the proposed act helps address the concerns that we have raised.
We urge and encourage the committee to consider recommending more aggressive changes to the act to provide both regulatory and constitutional certainty, so we can begin to restore investor confidence in this country and attract those individuals and companies that wish to invest in Canada. We do so for the benefit of Canadians, not because of political motivations. Thank you to all of the committee members for hearing me out.
The Chair: Thank you to all of you.
Senator Cotter: May I ask a small question? In whatever form this legislation takes when finalized, would it be helpful from your perspective that the matter be referred to the Supreme Court in another reference? Does that delay things? Can you offer your thoughts on that?
Mr. Amery: It’s difficult to speculate on whether that would be appropriate at this point, before we know what the final version of that might be. But in its current form, all of our indications and opinions suggest that we haven’t moved the needle far enough to avoid another constitutional challenge and Supreme Court of Canada intervention. The goal here is to make that the ultimate proposal and encourage the committee to make those appropriate changes to ensure that some of the issues that we have identified here — and I’m certain that others may identify in the future — are addressed before it becomes more difficult to do so.
The goal here would be to say that we are in a period in which potential changes can still be made and recommendations can still be put forward. We would like to have the opportunity to be part of that. We would also like for this committee to make those changes absent that consultation phase, and we will make those determinations once we see what that final version looks like.
As it stands today, it is likely that this would not pass the same muster that the Supreme Court of Canada forgave to the initial act and that we would be taking the same position we did in our initial challenge.
Senator Cotter: I wanted to say thank you. Thanks also for what looks like the picture of your law school graduating class behind you.
Mr. Amery: Thank you very much.
[Translation]
Senator Miville-Dechêne: Unlike my colleague, I’m neither a lawyer nor a constitutional expert. As I listen to you speak, I wonder whether the federal government’s stubbornness or desire to remain involved in decision-making can’t be explained by the environmental threats facing our country.
You gave the example of the oil sands. We know that natural resources fall under provincial jurisdiction, but the effects of a deposit are felt well outside the province.
Isn’t that a reason for the federal government to examine these issues? We know that the Supreme Court has ruled on certain aspects of the law. However, given the threats posed to the environment, isn’t it normal for there to be a national perspective on these issues?
[English]
Mr. Amery: I don’t disagree with both levels of government legislating in areas of their constitutional jurisdiction. The problem that arose in the challenge to the Impact Assessment Act and ultimately the decision of the Supreme Court of Canada was that the Impact Assessment Act, as it was originally proposed, went far beyond the jurisdictional lane, if you will, of the federal government. It was ultimately deemed to be largely unconstitutional for a number of reasons.
The first reason is that overly broad definition. The second reason is the screening decisions that were found under section 16, for example, where the court found there existed potential for adverse federal effects in the wide swath of screening that took place, which encompassed federal jurisdiction as well as provincial jurisdiction.
I will not dispute the position that you mentioned with respect to environmental protections. We also value that very much. What we’re saying, however, is that the impact assessment model, in both its current and original forms, goes far beyond that and far beyond what the Constitution allows the federal government to make decisions on. The Supreme Court of Canada made that decision and made that determination a short time ago, and I think rightfully so.
Again, the proposed changes simply do not address the findings of the Supreme Court, and what we’re here to encourage the committee to do is simply to propose changes or amendments to the current form of the act, if you will, that address and encompass those findings of the Supreme Court and ensure that both the constitutionality and the jurisdictions of the provinces and the federal government are respected.
The Chair: Thank you very much. Thank you to the witnesses. I think we had a substantial discussion. Thank you for your availability and time, including our own senators.
[Translation]
For our second panel, we welcome, from the Canadian Chamber of Commerce, Bryan N. Detchou, Senior Director, Natural Resources, Environment and Sustainability. We also welcome, from Electricity Canada, Francis Bradley, President and CEO and Channa Perera, Vice President, Regulatory and Indigenous Affairs. Finally, we welcome, by video conference, from the Independent Contractors and Businesses Association, Jock Finlayson, Chief Economist.
Welcome and thank you for being with us. Five minutes are reserved for your opening remarks. The floor is yours Mr. Detchou, followed by Mr. Bradley and Mr. Finlayson.
Bryan N. Detchou, Senior Director, Natural Resources, Environment and Sustainability, Canadian Chamber of Commerce: Honourable senators, on behalf of the Canadian Chamber of Commerce, I want to thank you for giving me the opportunity to take part in today’s discussion to examine the proposed amendments to the Impact Assessment Act and the implications for Canadian businesses and investments.
[English]
Senators, allow me to begin my remarks by stating the obvious: No country is better positioned than Canada to lead the global energy transition. With its vast natural resources, skilled workforce, strong regulations, commitment to environmental, social and governance — or ESG — and focus on reconciliation with Indigenous communities, Canada stands out as a responsible and reliable global supplier of natural resources.
Canada has grand ambitions and the talent and natural resources to see them fulfilled. However, we also have a record of getting in our own way.
Canada will not meet its net-zero goals, let alone become a reliable global supplier of responsibly sourced natural resources, if we cannot get major projects built. Project approvals cannot continue to take 10 or more years, whether what is proposed is a major carbon capture utilization and storage project that would continue to reduce emissions or a transportation gateway that would help ensure Canadian businesses can get goods to market reliably and efficiently. Regulatory certainty is essential to generate the investment and growth our nation requires, which cannot be achieved without private sector partners committed to long-term projects.
Though governments have made several commitments in recent years to improve regulatory efficiencies, streamline permitting for major projects and clear backlog, the status quo remains. This multi-jurisdictional process certainly has many actors involved, but the federal government has a unique role to play to ensure Canada rids itself of its reputation as a place where major projects can’t get built.
Consider the electric vehicle, or EV, battery industry. The federal government aims to make Canada a major player in the global EV supply chain by investing heavily in EV production. Alongside Quebec and Ontario, they have committed tens of billions of dollars to attract major automakers. Critical minerals like lithium, cobalt, nickel and graphite are essential for EV batteries, but since 2005, only four new critical mineral mines have opened in Canada. Government data shows that to support domestic EV battery production, Canada must open 20 new mines by 2035, five times faster than the current rate. This is challenging, as a typical mine takes 10 to 15 years to pass regulatory approvals and community consultations. Canada’s EV transition is hindered by these regulatory and logistical challenges in utilizing our mineral resources.
Last October, when the Supreme Court of Canada released its judgment finding parts of the IAA unconstitutional, it simply underscored the ongoing challenges that businesses in Canada face due to regulatory uncertainty. In a world where capital is highly mobile, countries that can offer regulatory clarity and efficiency will attract more investment. To remain competitive, Canada must demonstrate that it can deliver major products in a timely and predictable manner.
In response to the court’s judgment, the Government of Canada pledged surgical amendments. However, the efficacy of this surgical intervention remains uncertain. As this committee conducts its study, certain key questions demand attention. First, will the amendments provide the certainty and predictability desired by project proponents? Second, have the amendments sufficiently addressed the pivotal concerns outlined by the court? Third, what are the consequences if the amendments are insufficient?
To answer the first question — the proposed amendments to the IAA show that the government’s main priority after the Supreme Court’s ruling was to ensure the IAA’s constitutionality rather than improve clarity on its applicability, timelines and decision-making authority. As a result, a key opportunity to create a regulatory environment that boosts business confidence and minimizes risk has been missed.
To address the second and third questions directly — our primary concern is that if the amended act is finalized in its current state, it may again face constitutional challenges from provinces. Meanwhile, as companies and investors once again await clarity, many will either keep their funds on the sidelines or invest them in other countries, hindering Canada’s economic prosperity and energy transition.
[Translation]
Rhetoric and ambition alone will not get major projects built in Canada. Achieving our economic and environmental goals requires true collaboration between the private and public sectors. It’s imperative to recognize that the success of these projects is closely tied to our country’s economic growth and productivity. While Canada is ready to lead the global energy transition, that position is not guaranteed nor should it be presumed.
[English]
Getting the amendments to the IAA right is essential. The Canadian Chamber of Commerce believes that an amended IAA developed through collaborative efforts can create a more predictable, transparent and efficient regulatory framework. We are eager to support the government in its aim to establish a modern and efficient regulatory system that responds to the needs of industry and respects the jurisdictions of all levels of government. Thank you, senators.
The Chair: Thank you.
[Translation]
Francis Bradley, President and Chief Executive Officer, Electricity Canada: Thank you very much, Mr. Chair. I am the president and chief executive officer at Electricity Canada. We were formerly known as the Canadian Electricity Association.
[English]
On behalf of Electricity Canada, we would like to thank the committee for inviting us to appear to speak on the Impact Assessment Act provisions included in Bill C-69.
Electricity Canada is the national association of the electricity industry. Our members generate, transmit and distribute electricity, and are responsible for building the major projects that power our homes, our institutions and businesses across the country. Our members have a long track record of delivering electricity that is clean, reliable and affordable. Whether it is Site C in British Columbia, the Keeyask Generating Station in Manitoba or investments in small modular reactor technology in Ontario, we are at the forefront of building major infrastructure in each province and territory.
The biggest challenge we face is building more electricity at a pace not seen since the 1960s. Canada is experiencing a rapid increase in electricity demand. This is driven by several factors, including population growth, the electrification of transportation, buildings and industrial processes, as well as efforts to achieve a net-zero economy by 2050. For this to happen, we will need to at least double the size of the electricity grid, making more electricity over the next 26 years than in the last century. Hydro-Québec alone, for example, has forecast that it will need to invest $185 billion to decarbonize its grid by 2035.
We must also ensure that this new generation is clean. To do this, we will need to build — and we will need to build much faster. However, current permitting and approval timelines at the federal level do not reflect the urgency required to achieve net zero by 2050. While environmental stewardship and our duty to consult must be preserved, more work needs to be done to reduce jurisdictional duplication and improve focus.
The proposed amendments are a good start. Since the court’s ruling in October 2023, Electricity Canada has consistently advocated for the federal government to concentrate the IAA on the prevention and mitigation of significant adverse impacts related to federal jurisdiction. We’re pleased to see some of our suggestions have been accounted for in the proposed amendments. This change underscores the government’s commitment to addressing the most critical adverse impacts of projects.
Another important change is the adjusted focus on non‑negligible federal effects. This will provide the opportunity for the agency to designate and limit assessments to projects with non‑negligible adverse effects within federal jurisdiction. We also welcome additional provisions that will enable greater coordination with provincial counterparts, foster meaningful reconciliation with Indigenous peoples and designate projects based on adverse impacts. On the latter issue, we look forward to working with the Impact Assessment Agency through their expected review of the designated project list later this year.
Overall, the targeted changes to the IAA are a positive step. Swift action by the Impact Assessment Agency to operationalize the legislative amendments, including the development of well-aligned regulations and administrative measures, will be key to achieving long-term success.
While we are pleased with some of the amendments, we continue to call for greater urgency across the whole of government if we are to be successful in building enough electricity to power a net-zero economy by 2050. The government should move forward as quickly as possible with its major project-related commitments in Budget 2023 and Budget 2024, including setting timelines for project approvals and permitting.
Thank you for your time. My colleague and I are pleased to take whatever questions you have.
[Translation]
The Chair: Mr. Finlayson, chief economist, you have the floor.
[English]
Jock Finlayson, Chief Economist, Independent Contractors and Businesses Association: Thank you, Mr. Chair. We appreciate the opportunity to appear from wet and dreary Vancouver this afternoon and make remarks before your committee.
The Independent Contractors and Business Association is the largest construction industry association in Western Canada. We have 4,000 members and clients. We also have a thriving employee health and benefits business that underpins the association. We currently provide support and non-wage benefits to 170,000 Canadians.
Construction, we believe, has an important role to play in moving Canada forward in a rapidly changing and increasingly competitive world. We are the fifth-largest industry in the country, accounting for 8% of employment, with 1.6 million employees last year. Construction spending across the country added up to about one tenth of Canada’s GDP last year. During the pandemic, a lot of policy-makers, consumers and business decision makers had an opportunity to reflect on the importance of the construction sector as we grappled with supply chain bottlenecks, infrastructure deficits and shortages of essential goods and materials.
The foundation for our country’s prosperity has traditionally rested on hard work, resilience, entrepreneurship, fairness and strong public policy in institutions. In the decades since the Second World War, Canada leveraged these important assets to build one of the world’s most successful countries and a very prosperous economy.
However, in recent years, the stresses on our economy have been raising mounting concern, certainly in the business community, about our country’s ability to compete and generate long-term prosperity. As documented by many think tanks, including the OECD, Canada has been losing ground relative to peer jurisdictions on some key metrics of economic success, including investment per employee, the growth in GDP per person, business start-ups and entrepreneurial wealth creation.
We have also earned a reputation as a pretty difficult place to do business, especially for companies in industries seeking to advance large-scale projects in industries like transportation, energy, mining, and public and private sector infrastructure. We believe Canada can do better, and we must do better at a time when our population is growing, the global geopolitical environment is deteriorating, energy costs have become a top-of-mind concern, and our policy-makers at all levels are striving to reduce carbon emissions while also expanding the electricity sector and kick-starting the development of a so-called critical minerals industry.
Your committee is examining proposed changes to the IAA. Like many business groups in Western Canada, we had grave reservations about the IAA as adopted in 2019. We intervened in the Supreme Court of Canada’s review of the IAA in support of the position taken by the Province of Alberta and some other provinces. The court found, as you already know, certain parts of the IAA unconstitutional because it embodied an overreach of federal jurisdiction.
The federal government’s response to this is contained before you today in a package of amendments to the Impact Assessment Act included in the 653-page omnibus budget bill. We consulted four of Canada’s leading law firms to hear their commentaries on the changes proposed. All four of the law firms agreed that the changes, while in some cases welcome, are minor — one firm described them as cosmetic — and will not, in all likelihood, leave the IAA invulnerable to future constitutional challenges.
The law firms that we consulted also raised concern about some of the new terminology in the bill before you and the uncertainty that may well be created for proponents as a result of that. We are not opposed to the very limited changes in the IAA proposed in the 2024 omnibus budget bill, and we offer no specific comments on those before you today. Instead, we would like to emphasize the importance of looking for a more significant overhaul of project assessment and environmental permitting in Canada. We believe this will be essential if the country is to achieve the goals set by policy-makers around net zero, around dealing with infrastructure deficits and ensuring prosperity for the future.
It’s no secret that today’s project assessment regimes, not just the federal one but a number of those operating at the provincial level as well, inhibits private sector investment, hinders industrial and infrastructure development and will slow efforts to build a lower-carbon economy. I have included in my remarks a quote from a recent C.D. Howe Institute analysis that confirms that this is, in fact, the case.
The Government of Canada, in introducing the IAA, as mentioned by Mr. Gratton in the earlier panel, promised that the updated system for reviewing projects would be more efficient and foster greater certainty. The evidence so far indicates that those goals have not been met, and I would refer you here to a detailed report done by the Canada West Foundation in 2023 that documented the performance of the new IAA system and how it fell short of the goals set by federal policy-makers. The government itself has kind of implicitly acknowledged this, particularly in statements by the Minister of Energy and Natural Resources, who has complained in public and private that it shouldn’t take 12 to 15 years to develop a new mine in Canada.
The government is acting slowly to try to make some changes that will improve the business environment for major project investment. However, the fact is, Mr. Chair, that private sector interests in investing in large industrial and infrastructure projects in this country has dwindled since the mid-2010s, and this can be seen by consulting the data reported by Natural Resources Canada on projects. They count major projects across the country. These have been dropping appreciably since 2015, and this is not limited to the oil and gas sector. It extends to other infrastructure and natural resource industries as well.
The number of projects completed in Canada, according to the same source of data, dropped by 36% between 2015 and 2023. There are various reasons for that. Public policy and the regulatory system are not the only explanation, but they have clearly contributed to building a business environment where it is getting very difficult to advance projects. We do not believe the changes unveiled in Budget 2024 will make much of a difference to that. They may help a little bit at the margin, but we really believe that the country needs to step back and look at more far-reaching changes in modernization of our regulatory and project review processes, including the environmental permitting system. Thank you.
The Chair: Thank you very much, Mr. Finlayson. First question, Senator Wells.
Senator Wells: Thank you, panel, for your presentations. Mr. Detchou, you said in your presentation that the government chose to improve the constitutionality of it or fix that aspect of it rather than — and I’m paraphrasing this part — make the process better. What could they have done or should they do, or what should we do through a possible amendment, to make the process better versus specifically addressing the constitutionality aspect?
Mr. Detchou: Thank you very much for your question, senator, and we’re happy to provide written remarks or a written brief to the committee as it conducts its study. We’re still gathering a lot of comments and feedback from our membership. As you can imagine, a lot of these developments are rather new, so we have been evaluating the different amendments.
The main focus of the remarks were around stating that most of the significant changes to the IAA — or those the government may consider significant — were pieces to make the bill pass the constitutionality test. One of the things that the chamber and a number of other associations have been quite vocal on, going through the IAA process for the last six or so years and even prior to that — because the chamber was actually before this very Senate committee in April of 2018 discussing the IAA — were a lot of things that unfortunately were in my remarks today. So the general comment was that the main focus was ensuring that the bill passes the constitutionality test and not fixing some of the major concerns that industry has raised around applicability, timelines and predictability. It seems as though the government may have missed the mark, both in passing the constitutionality test and making the process better for the project proponents.
Senator Wells: Thank you for that. You will likely know that in our consideration of this part of the bill, time is of the essence. If you had anything specific that the committee could consider for an amendment, I would encourage you to send that in quickly. Thank you.
Mr. Detchou: Thank you, senator.
[Translation]
Senator Miville-Dechêne: I’m going to continue along the same lines as Senator Wells, because that’s the exact same question I wanted to ask. That’s all right. This time, we’re going to do it in French, which will make you practise another language.
I’m going to build on that, because it’s all well and good to say that they were concerned about the constitutionality of the law, but not about the things that are really important to us as business people.
What are the problems with timelines and predictability? What can you tell us today? You must be aware of what’s hindering the implementation of this project; we’ve been talking about it for years.
Mr. Detchou: Thank you very much for your question, senator.
First of all, I’d like to say that even in the government’s current bill, we expected some answers to the questions you’re asking.
The government has said in recent years that it wants to reduce the time it takes to acquire certain permits. It has indicated different targets, ranging from three to five years. However, in the current bill, there are no rules that are clear enough to tell us how the government is going to respect those targets and what will happen if the government fails to meet these three-year or five-year targets.
For companies, this means significantly higher costs and many more projects that won’t make it to the final stage.
Senator Miville-Dechêne: I guess it depends a bit on the sector, but on average how long does it take to get a permit for a given project? What were we aiming for? If we were aiming for three to five years, what is the current average wait time?
Mr. Detchou: I know the government has said it would like to reduce the target to five years. As you said, currently, it depends on the sector. One of the examples we talk about a lot is the mining sector, because we know it’s critical in order to achieve all the objectives. In this sector, just for the permits alone, we’re talking about 8 to 12 years. It’s often a little longer, because some projects are more complex than others.
As you can imagine, we can’t always meet our objectives. In my opening remarks, I gave some statistics from the Government of Canada. We have certain objectives we’d like to reach by 2035 or 2050, but we’re not even able to open mines in the country. For the mining sector, we’re talking about 8 to 10 years. We’d like to reduce that, and these are conversations we want to have with the government.
I can tell you that, between the Supreme Court decision and today, we weren’t consulted by the Government of Canada. We know that other associations were, but not ours. The premier of Alberta told us that her government was apparently not consulted either. This gives us cause for concern.
Senator Miville-Dechêne: Thank you, Mr. Detchou.
[English]
Senator Sorensen: Thanks. Honestly, I was going to ask the same question, but I’m going to alter it a bit. I’m going to open it up to others as well.
There are concerns that the amendments aren’t sufficient. I think we have all asked the same thing. If you have suggestions, feel free to provide them to us, but I would like the other two witnesses to comment.
To all three of you — and to the previous panel as well — do you think more extensive amendments would have been better made as a stand-alone bill as opposed to trying to work within this framework? Maybe I’ll start with Mr. Bradley.
Mr. Bradley: With respect to whether it should be a stand-alone bill or part of another bill, we don’t have an opinion, but we do feel this is something that needs to be moved on as quickly as possible.
Senator Sorensen: Another bill would take longer.
Mr. Bradley: Perhaps, yes. With respect to specifics, my colleague Mr. Perera can give some details in terms of what additionally we would like to have seen.
Channa Perera, Vice President, Regulatory and Indigenous Affairs, Electricity Canada: In terms of the timelines, which we had a discussion on, we could have asked for further clarity on that. At the same time, we want to be pragmatic in terms of what can be done in the short term.
We did talk about timelines with the Impact Assessment Agency. We would prefer to see shorter timelines, obviously — a net zero by 2035 target. We have 12 years or less to build infrastructure. The demand is going to double or triple by 2050. With that in mind, and with some of the large hydro projects taking as long as 10 to 15 years, we would like to see legislated timelines in this legislation, if possible. The act has included time limit extensions in various places, but there is no specific clause where they have indicated that projects should be done within five to seven years, for example.
The European Union has looked at doing some of these assessments within three years. We need to consider specific timelines. Then again, as I said, we want to be pragmatic. It may not be possible in this round. What we do like about the act is the move to significant adverse effects and the focus on non‑negligible federal effect. That will most probably improve the act in terms of the number of projects captured by it, and that is important. We don’t want projects with trivial impact being captured under the Impact Assessment Act.
We do commend the government for including the change in language in terms of non‑negligible impacts and also essentially focusing in on areas of federal jurisdiction, not looking at overly broad provisions to capture those projects that are in the provincial jurisdiction.
Senator Sorensen: Thank you.
Mr. Finlayson, anything to add?
Mr. Finlayson: I would note that the promise with the IAA was upfront — and we were involved in some of the deliberations with government at the time — in that it was going to actually speed things up. There are four phases, as you know, laid out for project assessments in the IAA.
The first phase, for example, had a notional 180-day time limit. This is the planning phase. Last year, the Canada West Foundation went through all the projects that were in the queue through the IAA process and came up with the number of 323 days, on average, for that planning phase. So there has been a lot of slippage.
The agency itself will often stop the clock in order to consult with project proponents and ask for more information, so it just hasn’t delivered. I don’t know how realistic it is to crunch that down into a vastly shorter timeline. But, my goodness, if the previous speaker is right and the European Union is able to bring forward significant projects and approve them within three years — and that’s a federation of 27 independent nation states — surely to goodness, in Canada, we should at least be able to match that.
[Translation]
Senator Oudar: My question is for all the witnesses. When Bill C-69 was tabled, the budget was simultaneously announced as one of the various measures being considered. Earlier, you quite rightly identified the time required to obtain regulatory approvals. That’s what the Minister of Finance was targeting when she tabled her budget.
She talked about several measures that I’m sure you’ve read about and that I’d like to hear about from you. In particular, she identified the following measures: the five-year target for regulatory approval; the three-year target for nuclear projects; a desire to better consult First Nations; the publication of a dashboard to ensure a degree of predictability; and the creation of a Clean Growth Office. The latter already exists within the Privy Council Office, but the minister wants to create a specialized position to reduce timelines and drive culture change.
These are measures that go with the bill and fulfill the objectives you share, and which are also shared by the government. What worried me was that the minister announced the creation of a ministerial working group in the budget, and I understand that none of the organizations here tonight are members of the government’s group to drive culture change. It would be important to send a signal. I’d like to hear from you about the measures published in the budget that are aligned with the objectives you put forward this evening to our committee. The question is for all three organizations.
[English]
Mr. Detchou: Thank you very much for your question, senator. If you will allow me, I will answer in English.
Certainly, there are a number of provisions in the most recent budget that we believe are very positive. I would say that, number one, the key is implementation. Previous speakers from the Mining Association of Canada said exactly that — implementation is key. We need to move past rhetoric and go to proper implementation. That is number one.
The Clean Growth Office and new money being allocated to Natural Resources Canada are all positive; however, these are also promises or reiterations of promises that we have heard in the past, and time is of the essence. That’s one thing I would stress.
There is another thing I would mention when we talk about uncertainty and predictability. Today, our discussion is focused on the IAA, but it applies to a number of different provisions. The government has made a number of different commitments. I’ll mention one: investment tax credits, or ITCs. There is a suite of investment tax credits that the government has introduced that industry is generally in favour of. Of course, there can always be improvements, but industry has generally been very much in favour of those investment tax credits. However, very few of them are actually law, and a number of them were promised or announced several years ago. The only thing better than the promise of an ITC is an implemented ITC. That applies to a number of different things.
Certainly, the government has been saying the right things for quite some time. What we are looking for is proper implementation.
I hope that answers your question, senator.
Mr. Bradley: Thank you. It is an interesting question, and I would agree entirely with everything my colleague from the chamber has said. The commitments that have been made are certainly ones that we would look very favourably upon. Our concern — very much like the ones my colleague expressed — is the time it is taking to actually get to those; indeed, some of these are commitments that have been made previously.
One that I would point to was in Budget 2023: the commitment for a “one project, one assessment” approach to this. I believe that was repeated in Budget 2024. That would be an example of a commitment that we think would be an important one and very helpful if it were brought forward. We would like to actually see that commitment move forward. The investment tax credits continue to be a concern for a number of my members as well.
The final point I would make is that this is, of course, part of a broader challenge that we face with respect to getting projects built and actually getting to a “yes” on projects so they can move forward. The Impact Assessment Act and the Impact Assessment Agency of Canada are very important pieces of this, but they are only one of many gates that one must go through. There are 90 federal laws and regulations that impact the electricity sector, which is primarily a provincial responsibility. So all of the various pieces of federal legislation and regulation that we need to conform to and move through to be able to get projects moving forward are part and parcel of that challenge. We would like to see all of them addressed.
The Chair: Mr. Finlayson, do you want to add something to the presentation?
Mr. Finlayson: Yes. I think the senator asked a great question. It allows me to clarify that the IAA doesn’t deal with permitting but whether a project should be built. It’s the Impact Assessment Act. Once a project has been approved through that process — or through companion processes that operate at the provincial level — the proponent then has to arrange to get the permits to actually go ahead. As Mr. Bradley has indicated, that can involve abiding by a number of different laws and regulatory processes and dealing with different levels of government and different departments within the same government.
Therefore, the post-approval permitting issue is actually a very important one and not really addressed by the changes the Government of Canada is proposing to the IAA but very important in terms of the lived experience of people who are trying to advance projects. I have been involved in some files where it has taken years after a project has been approved through, for example, a provincial environmental assessment regime here in British Columbia to get all the permits lined up and to go ahead. Often, the permits are time limited, so you may have to renew them. It’s a tremendously complicated legal and administrative challenge for project proponents that does not end on the day they actually get a certificate saying the project is approved.
Senator McBean: During the two panels, we have heard a lot about how the amendments to the Impact Assessment Act do not go far enough and miss an opportunity. But, Mr. Bradley and Mr. Finlayson, I heard you both say it and I’m going to hold you to it: There were things in there that you liked. I’m wondering if you can be specific about some of the amendments in there that are going to make your lives easier.
Then I have a follow-up for you, Mr. Perera.
Mr. Bradley: Certainly. Actually, I will pass to my colleague Mr. Perera.
Mr. Perera: As Mr. Bradley indicated, we do like the fact that the government is focusing on significant adverse impacts. That is crucial. We need to try to move away from the project list approach that we have had over the last many years. The project list is designed to capture projects by size. If you take hydro as an example, the current threshold for hydro is 200 megawatts. What difference would it make if it were 195 or 205 in terms of impact? The threshold wouldn’t make any difference whatsoever, right? Therefore, we need to start looking at the adverse impact and then constrain that to federal jurisdiction. In our view, that is exactly what the government has done.
I know the changes are more surgical. We would like to see broad-based changes, but we just don’t have the time for that. We don’t want years of delay until we come up with a new act. The act that we have in place is only about seven years old; we haven’t even tested it yet. But that doesn’t mean we cannot further improve, especially in terms of timelines.
As one of the other witnesses said earlier, it’s not just the Impact Assessment Act. There are other acts like the Fisheries Act, Species at Risk Act and Migratory Birds Convention Act. All of those require some level of permitting. On the fisheries side and again looking at hydro, some of the facilities don’t even have Fisheries Act authorization.
Therefore, when we talk about 5, 12 or 15 years, what we’re talking about is a combination of impact assessment timelines, which if you add up all of the days, months and years comes to about 6 years, but then getting the permitting from various line departments requires another 6 years.
There are provisions in the act that would enable the life cycle departments like Fisheries and Oceans Canada, or DFO, and others to be part of the impact assessment. As far as I know, the agency is working hard to bring all of them together. If you look at review panel assessments, you already have those life cycle agencies participating in integrated review panels.
There are many things in the act, but the challenge is operationalizing the act and providing the resources to the Impact Assessment Agency to undertake these reviews without applying for time extensions or the minister asking for more time to review. We should be able to complete those quickly. When we talk about timelines, we must be careful in terms of what those timeline barriers are.
We do like the fact that there are now provisions being introduced to further collaborate with the provinces. This is very crucial given the electricity sector is primarily regulated at the provincial level. We do want to see substitution where feasible and let the provinces do their job. Many of the electricity projects are already captured provincially, and the more collaboration we have, the better.
One point about reconciliation and Indigenous involvement — early planning is crucial. We cannot build new projects without Indigenous participation. In our industry, we have been working with Indigenous communities and developing equitable partnerships and other ownership structures to work with them and achieve our net-zero target.
I’ll stop there before taking up too much time.
Senator McBean: You sound incredibly positive. You sound very collaborative to me, because it sounds as if you’re saying there is project tailoring when we heard from other people that there isn’t. You seem to be finding spaces where others don’t see them.
Do I have enough time for Mr. Finlayson to answer?
The Chair: Will the answer be short and sweet?
Senator McBean: That’s up to him.
Mr. Finlayson: It will be very short. I’m an economist, not a lawyer, but I would say the main change here that we think holds some promise is the narrowed application of the IAA. The amendments that have been tabled would repeal the definitions in the existing act of “. . . direct or incidental effects and effects . . .” and “. . . effects within federal jurisdiction . . .” and replace them with a new, narrower definition of “adverse effects within federal jurisdiction” that have to be non‑negligible.
That’s a bunch of language that I guess the courts and lawyers will sort out.
Senator McBean: Sorry for interrupting. Do you like that language, “non‑negligible”?
Mr. Finlayson: I’d have to ask our lawyer on it. It’s not the kind of language I would use, that’s for sure. But in developing a statute, our lawyers seem to think this could lead to a narrowed application of the IAA and address the kinds of concerns that we and the Government of Alberta had about an overly broad definition of “. . . effects within federal jurisdiction . . .” in the existing act.
To me, this is a fairly minor shift, but you asked me to identify something that we supported. That’s one thing we think holds some promise.
The Chair: Thank you to our guests for sharing their knowledge with us. It was very useful. We appreciate it a lot. I also want to thank all my colleagues, the senators who contributed to this process. We are continuing to get some serious results in a timely manner. Thank you very much to all of you.
From this aspect, we still have additional witnesses regarding Division 28, Part 4 of Bill C-69, on Thursday, May 30. That’s our last session dealing with the act. It’s pretty complicated; that’s why we need to do a bit of preparation.
(The committee adjourned.)