Canada will introduce new review rules for major projects such as pipelines, after pledging it wanted to give investors firm, predictable timelines.
Prime Minister Justin Trudeau’s government will unveil its overhaul of “environmental and regulatory reviews related to major projects” on Thursday -- as a provincial trade war brews over a Kinder Morgan Inc. pipeline project that has already been approved. The announcement is scheduled for noon Ottawa time, with ministers set to fan out across the country to sell the new regime.
Natural Resources Minister Jim Carr has said he wants timelines to be predictable and reasonable on Canadian energy projects that historically have faced lengthy delays and legal challenges. One major example is Kinder’s Trans Mountain pipeline expansion, which was approved in November 2016, only to see British Columbia toy with new shipping restrictions that could starve it out. The oil-producing province of Alberta responded by banning British Columbia wine imports and halting talks to buy more power.
Trudeau’s government has given notice to parliament that it will create “impact assessments” and an agency called the Canadian Energy Regulator, the expected successor to the National Energy Board. A Carr spokesman declined to say whether all the changes will be detailed on Thursday.
The development will be watched closely by the energy sector and other observers. “We need a credible process, and all projects -- regardless of the industry, regardless of the sector -- benefit from having a process that is evidence-based,” said Nichole Dusyk, a postdoctoral fellow at the Pembina Institute, an environmental think tank.
Dusyk said the government should create a “more robust, transparent and inclusive process” and to more closely align energy and climate policies, to avoid approving projects that would lead Canada to fall further behind on its emissions-reduction targets.
The announcement comes at a conspicuous time. Alberta, the Canadian Chamber of Commerce and others have this week called on Trudeau to step in and stop the trade spat over the Trans Mountain pipeline, a project that won’t be affected by the new rules but that’s reflective of the uncertainty that exists in the process now.
“We’ve been very clear that the decision has been made on Trans Mountain,” Environment Minister Catherine McKenna said Wednesday in Ottawa. “I’m all about no drama, no surprises and it’s in that context that I’m very excited that very shortly, we will be announcing the new process for environmental assessments.”
Canada’s overhaul of environmental rules looked at assessments, the NEB, marine navigation and fish habitat. New rules on fish habitat were unveiled Tuesday, prompting a warning from the Canadian Electricity Association that the measures could unduly delay or discourage investments in clean energy projects.
Asked about the provincial dispute over wine, electricity and oil, Trudeau said Wednesday he would “continue to engage with the premiers on a regular basis” while “making sure that we come to the right place that’s in the national interest for Canada.” Trudeau regularly says the Trans Mountain pipeline expansion is in the national interest.
British Columbia Premier John Horgan said in a press conference on Wednesday his province won’t retaliate against any Alberta products and he hopes cooler heads prevail. “I want to resolve this but I’m not going to be distracted or deterred,” Horgan said.
An expert panel previously recommended environmental assessments be replaced with “impact assessments,” measuring “all impacts likely to result from a project.” It recommended the involvement of indigenous groups and an assessment to both the established indigenous treaty rights and asserted treaty rights.
“Our recommended approach seeks to build public confidence in the assessment process,” the panel wrote in its report. “We believe that public trust can lead to more efficient and timely reviews. It may also support getting resources to market.”
A separate panel on NEB changes recommended that the federal cabinet determine “alignment with national interest” of all major projects before any detailed project review, followed by a two-year, full environmental assessment. It also called for the creation of an independent Canadian Energy Information Agency to provide data and information to decision-makers.