Honourable senators, I’m pleased to participate in discussion on Bill C-69. This bill is well-known to you. Indeed, the context for impact assessments and regulation in the energy and natural resource sectors has changed over the last number of years. In my opinion, the ground has shifted. What do I mean by that? Climate change, technological change, market complexities, social and Indigenous issues have moved increasingly to the forefront of the discussions.

Nevertheless, this bill, as amended by the report of the Energy, Environment and Natural Resources Committee represents a good faith effort to respond to the countless representations senators have received to amend Bill C-69.

I want to compliment the special committee, not because I was a member, but for the work we did: Senator Tkachuk, Senator Patterson, Senator Carignan, and, I think, our good friend on the left here, as well, Senator Cordy, and, of course, the hard work of our facilitator, Senator Woo.

I don’t think we — I forgot about Senator Mitchell.

It happens.

I knew I had some explanation, and here it is. I apologize. Obviously, he was key to the discussions.

The amendments reflect the concerns associated with the proposed impact assessment process that touches on the environment, society and Indigenous rights and the risks associated with future energy infrastructure development.

I’m going to take a slightly different approach to my discussion because I think there will be lots of discussions about the specific amendments, and I enjoyed the speech yesterday from Senator Mitchell.

I’m going to talk about three things.

The first one is what I call policy mismatches. This not a class in public administration.

The second is the governance framework, or the architecture of the bill, briefly.

Then I will talk about alignment of stakeholder interests and objectives, all towards the rationale for why so many amendments were proposed with respect to the bill.

Let me begin with policy mismatches. I have had a lot of occasion to work with policy mismatches. They generally end up in poor implementation and with results that often don’t support the outcomes that are expected when legislation is passed. And in this case, I guess you get the sense of what I’m getting at. The bill, without amendment, I believe may seriously increase the risks associated with the pipeline and other infrastructure development.

For example, without increasing the role of existing life-cycle regulators during the early-planning phase of a project’s consideration, I would believe you could face a policy mismatch, which could end up in implications and decisions that may not be as purposeful or potentially available for litigation without having that kind of input and engagement.

The early planning process is significant as it creates a means to fully engage stakeholders in a transparent manner that allows for the agency to develop tailored impact assessment guidelines. That’s a good thing. Secondly, amendments were adopted by the committee involving the scoping of the 20 factors that many of you are familiar with that must be considered — not may — in an impact assessment. These amendments allow the agency to scope those factors most relevant to the project.

For me, relevant is about relevance, findings, weight, conclusions and opinions, and so you want a framework that accommodates the opportunity for that. I’ll talk about that in a minute.

The scoping of factors is to be done when preparing the tailored impact statement guidelines for project proponents. Amendments were made to the bill to emphasize that positive economic benefits of designated projects will be considered in impact assessments, and decision-making by adding specific references to the bill. Moreover, there was agreement that inserting a privative clause respecting certain decisions by the agency, the minister or the Governor-in-Council could reduce risk to some extent. It does not eliminate litigation risk, but it has some potential effect on reducing it.

Honourable senators, these are all mismatches that have been more or less addressed by the amendments, and that’s the point I’m trying to make.

Another possible mismatch I would like to bring to your attention is to reaffirm the role of life-cycle regulators in the impact assessment process. They always had a role, but the role has been enhanced.

For over 50 years, thousands of kilometres of pipelines have been built in Canada, and they have been developed under a virtual, independent and administrative tribunal authority. In my opinion, life-cycle regulators over many years have acquired considerable technical and policy implementation expertise, but they also provide stability in times of change.

To me, that’s very important because regulators are often able to overcome changes in government and policy direction and are able to support decisions in that context without necessarily being influenced by political or government policy changes.

That’s not entirely the case here, but we have moved amendments in a direction to at least enhance that capacity.

Basically, investors, in my opinion, are unlikely to sink a great deal of capital in projects without some constraint on political or ministerial discretion. CEAA 2012, which you are all familiar with and have heard enough about, made a significant change to the decision-making model. Cabinet makes the ultimate decision, and the panel makes the recommendations.

For lawyers, it’s a bit unusual because normally he who hears decides, rather than he who makes the recommendation. He who hears decides, and in this case he who hears makes the recommendation and does not decide. In this case, cabinet or the minister decides. That takes a little getting used to.

Bill C-69 more or less continues the model contained in CEAA 2012, something which I have called the layering function. You layer one bill on another bill and you expect that the layering will result in a more likely outcome of predictability and clarity. Unfortunately, it doesn’t always work that way because when you layer it, you introduce other factors. You create more uncertainty and then you’re once again uncertain about what that outcome will deliver.

Many representations focused on the increased political risk as a result of the Governor-in-Council decision-making. The bill, as amended, recognizes this and includes efforts to shift more responsibility to the agency or the review panel; that is, away from the minister or cabinet.

After all, the review panel must hear the evidence, as I said, analyze and weigh the evidence, make findings and prepare a comprehensive report that is to be submitted to cabinet.

Roland Harrison is a well-known professor and now a consultant, I believe, in Calgary. He used to be a member of the National Energy Board for many years and was a professor of mine at Dalhousie University who taught me constitutional law; unfortunately, I was older than him when he taught me that. I have to go back and think about whether I learned anything. I don’t know what mark I got, Senator Sinclair. I have to think about that.

Roland Harrison described this in a paper he has written in which he thinks about or has talked about how the value of the contribution to the ultimate decision on a particular project will be determined by the independence, integrity and rigour of its process.

What he is talking about there is actually the National Energy Board. He is not talking about a Cabinet decision, because CEAA 2012 created the recommendation versus decision-making model.

Mr. Harrison goes on to say something I think is important because of the framework in which this is going to occur:

An independent agency can come to its conclusion as to the proper balance between the fundamental considerations of economic development, protection of the environment and impacts on society, but is it the proper forum in which a final decision should be made on society’s behalf?

In this case, Mr. Harrison thinks that it is the proper forum, that is, for cabinet to make these broad societal decisions. Nevertheless he is emphasizing that, in the context of reviewing major resource development projects, independence should not be defined by the finality of an agency’s decision, but by the integrity of the process that culminates in a recommendation.

Now, for lawyers, that may be kind of neat and an interesting distinction, but actually, it’s pretty powerful. What it’s really saying and what this bill is attempting to do is realign more authority in the agency so that its recommendation has a great deal more integrity and influence on the potential public interest determination that is made by cabinet.

I think that’s a very important consideration, and it’s one of the considerations that I think led to a number of the amendments that we are now examining on Bill C-69.

Greater independence for the proposed President of the Impact Assessment Agency has been considered as well as his or her role and the clarity of the appointment process. The IAA will also have the authority to appoint members of a review panel from a roster created by the minister.

My final comment on this point would be more of an observation. The Governor-in-Council makes a public interest determination. That is broad, but they are doing it on the basis of factors that are recognized in the legislation. Public interest determination is still open to some ambiguity and uncertainty in their application, but we’re accustomed to them and they are used a great deal. They do so on a determination under clause 63 of the bill based upon the factors that will be discussed in the report delivered to cabinet by the agency.

It’s my expectation — and I think this is important — that the review panel will also form an opinion as to the public interest in its report to the agency. But that is not clear. I make this observation because I think it’s critical. If the review panel goes through the entire process and the 600 days and files a report with the government, the agency should have the capacity to make a recommendation in the public interest, which, by the way, is the decision that cabinet has to make.

I think that is important because the reason is under this model the public interest determination, while not determinative, would be, in my opinion, impactful, particularly when the Governor-in-Council has to give its reasons publicly.

I would like to move on briefly to this issue of the governance challenge. There are some who would say, “What are you talking about here?” At the end of this, I hope I know what I’m talking about here.

I wanted to step back and ask myself this question: There have been so many representations as to why it is, particularly for pipelines, that this bill does not work and will not be effective in being able to construct pipelines in Canada. We have heard many of those representations and many of us have been lobbied to that effect.

I had the benefit of being involved in pipelines when I was working in a number of agencies, so I kind of understand the experience you have to go through to certify a particular pipeline, but not under an impact statement or an impact environment.

When I was thinking about this issue, I asked myself this question: Is the governance framework — I’m not talking about board governance here — associated with the impact assessment proposed in Bill C-69 a framework that would allow the achievement of the objectives based upon how the bill is designed and the architecture of the bill? In other words, the inputs are the policy initiatives. The outputs and outcomes have to be what? The infrastructure that potentially flows from it.

The impact assessment is to do what? It’s an impact assessment of an infrastructure project — a terminal, a marine, a dam or a hydroelectric mine. Therefore, the governance challenge is to assess whether this framework is one that will actually work.

CEAA 2012 created a unique framework for infrastructure assessments for pipelines. The National Energy Board had the full responsibility for the assessment and the licensing conditions.

Dr. John Colton from Acadia University has noted that these changes produced a public perception that certain environmental protections and environmental review processes have been diminished to make way for expedited approvals of energy infrastructure.

Bill C-69 responds to this public perception challenge by reforming the governance framework associated with impact assessments concerning pipelines. However, concerns have been expressed that the framework of Bill C-69 may further enhance the governance weaknesses identified in CEAA 2012.

Senator, I regret to inform you that your time is up.

Would you like five more minutes, senator?

Thank you, Your Honour. I didn’t realize I was taking so much liberty with the time. I was certain this was 15 minutes. I have to follow Senator Gold’s example here.

Bill C-69 responds to the public perception challenge by reforming the governance framework associated with impact assessments concerning pipelines. However, these concerns expressed that the framework may further enhance the governance weakness. Many amendments are being proposed because the bill’s architecture will not likely achieve the performance and implementation goals associated with interprovincial pipelines. There are many ways of saying that, and I will go into it briefly.

The governance challenges are heightened by the efforts to transition to a low-carbon emission economy which may require a dramatic transformation in the way we produce and consume energy. So project proponents are confronted by this harsh reality and the challenge associated with reconciling energy, social, environmental, Indigenous and other policy issues in a project context — not a policy context, a project context.

One company CEO indicated and asked the following question: “Are pipelines the new tobacco?” I found that interesting. This raises the important question of how energy policy relates to broader political problems concerning economic management, environmental quality, regulation, federal-provincial relations, et cetera. It is all there.

So designated pipeline projects are unique. They pose particular issues and challenges that may not be associated with other designated projects.

Let’s take, for example, TMX — delayed. Line 3 is now delayed by the Court of Appeal in Minnesota. Keystone is delayed in the U.S. Three major projects are all delayed. The TMX decision is coming soon, but all the projects are delayed. Is that unique to pipelines? Maybe not. But it certainly does affect pipelines.

Despite the legislative timelines, there are invariably delays to the completion of pipeline projects. This leads to investment uncertainty and potential capital risk. Investors are not passive actors but must respond to the business climate that supports long-term investment decisions in infrastructure.

The experience with delays, along with the new impact assessment framework, has raised important concerns associated with sinking capital into highly risky multi-billion dollar projects.

Honourable senators, the easiest way to minimize risk is to avoid it, but that would not be for the public good or the long-term interests of Canada.

Risk cannot be avoided but risk can be minimized. The amendments proposed assist in recognizing the uniqueness of energy infrastructure and pipelines and the need to develop an effective governance framework and an effective architecture to support the implementation of these types of projects.

Given my five minutes, I will skip to my conclusion.

A minute and 26 seconds.

In closing, honourable senators, what I was going to talk about, in a nutshell, was the alignment of stakeholder interests and stakeholder objectives.

It is important that we continue to think about all of the stakeholders and their interests and think about an alignment — not hard trade-offs. If we start thinking of hard trade-offs, we start thinking about winners and losers. That is not going to accomplish the goals we need to achieve to build important interprovincial projects. That also has the opportunity to reduce litigation risk. It also has the opportunity to increase clarity. A good example of that is the early planning system, which I think everybody supports.

So alignment of interests, not hard trade-offs, not winners and losers. If that’s the case, we can get the kinds of projects built in this country that will impact social goods, involve Indigenous reconciliation, create opportunities in economic growth and maybe restore the $100 billion of GDP to this country that Alberta has contributed to in the last number of years.

Final comment, if I may: We all recognize the context in which energy and infrastructure, including pipelines are required. A pipeline is not just a pipe in the ground. It represents important interests that affect our environment, economy, Indigenous rights and our society generally. I encourage the Senate to pass Bill C-69 as amended. Thank you.

Esteemed colleagues, I rise to speak at third reading of 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.

The Standing Committee on Energy, the Environment and Natural Resources, ENEV, studied this bill very thoroughly. We heard from 275 witnesses and visited nine Canadian cities from coast to coast to coast. I am quite sure that Bill C-69 is one of the most heavily scrutinized bills in the history of Canadian legislation. Canadians paid for this extensive consultation, and they expect modern, coherent and effective legislation. The committee made 188 amendments to the bill. Today I will describe issues relating to the study of this bill and the adoption of the amendments, and I will encourage you to vote in favour of Bill C-69 as amended.

Since 1995, the Impact Assessment Act has served as a decision-making tool to help assess how a given project will affect the environment and communities. Projects might include pipelines, mines, ports, highways, nuclear reactors, dams or hydroelectric facilities. This is a tool that can lend legitimacy to decisions. In practice, impact assessment should enhance the effectiveness of the approval, construction, operation and completion of projects with minimal negative impacts on the environment and maximum social and economic returns.

Bill C-69 is a very important piece of legislation and has therefore been the subject of serious lobbying. Its success depends on striking the right balance between socio-economic pressures and the need to protect the environment, which is a source of natural resources and ecological services that are essential to human survival.

Bill C-69 is justified for multiple reasons: to regain public trust, modernize the impact assessment process, solve issues with regulatory agencies, offer certainty to investors and proponents. It strengthens the role of science during impact assessments, as well as the consideration of cumulative effects and the need to consider climate change. It extends public participation, it better coordinates with provincial governments, implements more meaningful consultation of Indigenous peoples, and goes further to meet international commitments. These reasons are also embedded in the 20 new factors that Bill C-69’s impact assessment must consider.

Bill C-69 is also justified by the fact that the status quo is not acceptable by any stakeholder. Prior to 2012, environmental assessments were conducted by the Canadian Environmental Assessment Agency, CEAA, with technical inputs from energy regulators. Invoking economic arguments, major changes were brought to CEAA by the government at the time in an omnibus budget bill, Bill C-38, which resulted in CEAA 2012. At the time, numerous groups raised warnings against proposed changes, including the Canadian Environmental Law Association, who conveyed strong objections to the unprecedented and unjustified demolition of the federal environmental legislative framework. CEAA 2012 repealed and amended 11 acts that collectively entrenched environmental protections, ensured governmental accountability and facilitated public participation in environmental decision-making at the federal level.

At first glance, CEAA 2012 appeared to be a good system for industry as it accelerated the authorization and permitting process. This was particularly evident for the oil and gas sector around which the changes were centred. Yet, since 2012, no new major pipeline has been constructed. The NEB has had 51 court challenges since 2012. High profile projects such as Northern Gateway, Energy East and Trans Mountain expansion experienced significant obstacles.

Under CEAA 2012, thousands of projects, which should have been previously subjected to federal environmental assessment requirements due to their potentially significant adverse environmental effects were not reviewed.

Pierre Gratton, the president and CEO of the Mining Association of Canada said:

Under CEAA 2012, however, despite great promise of further improvements, federal and provincial coordination broke down. As well, mining became nearly the only sector subject to the act.

A CBC News poll in 2016 revealed that most Canadians had little or no confidence in the NEB. The main reasons for this distrust? Highly contentious pipeline hearings, political interference and repeated changes to how it operates.

In 2017, the C.D. Howe Institute published a report entitled, How to Restore Public Trust and Credibility at the National Energy Board. Several of their recommendations are now included in Bill C-69, which repeals the NEB and creates the Canadian energy regulator.

Under CEAA 2012, only 70 projects were completed. Of these projects, 6 per cent were oil and gas projects, 45 per cent were mining, and 9 per cent were transport and pipeline projects. Despite the seemingly low proportion of oil and gas sector projects, great importance was placed on understanding the needs and requests made by this sector. Therefore, during ENEV hearings, we heard 61 witnesses from this sector. Of the amendments passed by the committee, more than 90 were put forward by CAPP and CEPA.

But the interests of any sector must be balanced with the interests of communities and Indigenous peoples. Also, they must be balanced with environmental protection and the needs of future generations. The process must be fair across sectors. The government must not pick and choose sectors for special exemptions or protections. Standards must be high.

Tim McMillan, CEO of CAPP, agrees with this:

When we look at the vision we think it is possible that Canada can and should have a regulatory system that upholds our high environmental and regulatory standard and does it in a clear, efficient and transparent way.

Shannon Joseph, Vice President of Government Relations at CAPP, said:

Our companies are committed to following the rules. They want to have high standards. They want to work with the communities where they operate, but it needs to be clear.

Thus, a balance must be struck between relieving economic pressures, providing certainty to industry, addressing environmental problems and providing for environmental protection.

Here are some of the pressing problems. The Alberta Energy Regulator, AER, said that in a standard year, they receive 40,000 applications concerning a variety of oil and gas projects. Mark Taylor, Executive Vice President of the AER, said that fewer than 10 projects require public hearings and that 95 per cent of all applications are accepted with most approved by computer software in less than five minutes. However, when questions about costs and timelines for closure of orphan wells or remediation of tailing ponds were raised, witnesses were unable to provide answers. In November of last year, a multimedia inquiry quoted Rob Wadsworth, AER’s Vice President of Closure and Liability, as saying that the cleanup of the oil patch could cost an estimated $260 billion. AER said this number was based on the worst-case scenario and the validated figure is $59 billion. Yet, using numbers from the Orphan Well Association, liabilities only for orphan wells could be as high as $107 billion.

Keeping non-producing wells in a state of inactivity with no economic benefit, while maintaining the risk of becoming a hazardous threat to public safety, is an irresponsible practice. A bigger threat is posed by 97 square miles of tailing ponds. These contain 340 billion gallons of water contaminated by heavy metals and toxic hydrocarbons that might take thousands of years to clean up. This is a massive financial burden to Alberta’s citizens and to future generations.

During committee hearings on Bill C-69, we also heard the moving testimony of Ms. Greyeyes, a victim of sexual abuse at the work camp. She and other Indigenous witnesses shared personal accounts of violence and abuse associated with the work camps of energy development projects. Two disturbing reports from Amnesty International explain that while transient work pays well, high wages also raise the cost of living in local communities, putting pressure on local health services, and causing imbalances in the social fabric. Ultimately, this negatively affects Indigenous women and children. These potential impacts will be considered through gender-based analysis in Bill C-69.

During her testimony, Professor Reed from the University of Saskatchewan said that responsible corporations are already conducting and benefitting from GBA best practices.

More and in line with this, the report of the National Inquiry into Missing and Murdered Indigenous Women and Girls published yesterday made five calls for the extractive and development industry to consider the safety and security of Indigenous women and girls through the life cycle of projects.

Colleagues, recent international scientific reports made clear the urgent need for action to address the climate crisis.

Climate change is a financial vulnerability for Canada. Stephen Poloz, Governor of the Bank of Canada said:

The focus is on the risks that climate change poses to both the economy and the financial system. These include physical risks from disruptive weather events and transition risks from adapting to a lower-carbon global economy.

Just last week, at Canada’s Global Defence and Security Trade Show Lieutenant-General Wynnyk said:

As climate change alters our weather patterns, climate scientists predict that we will get risk of more extreme weather events such as heat waves, heavy rainfalls, flooding, droughts, and, of course, forest fires. Climate change is a reality of our operating environment and it’s something that we, in the Canadian Armed Forces, have to consider more and more in how we plan.

Some amendments to Bill C-69 might have the undesired effect of undermining climate change as a “factor to be considered” during the project’s impact assessment. However, this will benefit neither proponents nor communities as the climate crisis affects us all. The government must take a closer look at this issue.

Bill C-69 will promote and support sustainable development. As such, it will attract investment and projects as we transition to a low-carbon economy. Natural gas, hydro, nuclear and other renewable energy projects are growing as the cost of producing each kilowatt is becoming cheaper, even without the assistance of subsidies. The application of renewable energy in mass transport, the transport of goods, and in mining are increasing. Presently, the green bond market is valued at $521 billion. The international Climate Bonds Initiative is mobilizing $100 trillion U.S. dollars as capital for large-scale climate and infrastructure projects seeking increased capital market investments to meet emission reduction goals.

Colleagues, Canada must get its act together, assume leadership and become the change we want to see in the world. Stopping or delaying modernization renders all our industries, which already lag as they rely on old technology and old criteria, less competitive.

Bill C-69, as described by my colleague Senator Wetston, is a highly technical bill. It’s part of direct and indirect connections. Some amendments may have direct desired outputs, but unintentional indirect effects. We must allow the government to do the “fine tuning.”

The International Association for Impact Assessment is clear on what “best practices” in impact assessment should be.

Senator Galvez, would you like five more minutes?

Five minutes.

Yes. Thank you. Impact assessment must be purposeful, rigorous, practical, relevant, cost-effective, efficient, focused, adaptive, participative, interdisciplinary, credible, integrated, transparent and systematic. All these features are found in the impact assessment regime laid out in Bill C-69 as amended.

Dear colleagues, vote with me to send Bill C-69 as amended to the other place. Thank you very much.