The expansion of the Trans Mountain oil pipeline in Acheson, Alberta in December, 2019.Candace Elliott/Reuters
Alberta business leaders are calling for a sweeping overhaul of approvals for projects such as pipelines, saying current regulatory and environmental burdens will keep Canada from meeting its investment goals.
They say regulatory processes for all large developments should be streamlined, not just those that Prime Minister Mark Carney’s government deems to be in the national interest.
In a report released on Monday, the Business Council of Alberta said cumbersome federal regulatory requirements and political interference are keeping prospective investors from risking capital on big Canadian industrial projects.
The council made a series of recommendations it says will allow more big-ticket developments to be built faster, helping to meet Mr. Carney’s target of $1-trillion in investments over the next five years.
A big problem with the current system is that the ultimate decision on whether a project can proceed is in the hands of the federal cabinet, which makes the process inherently political after proponents have spent heavily through the regulatory and environmental approval process, said Alex Pourbaix, chair of Cenovus Energy Inc. and incoming chair of the council.
“One of the very important things this report does is it suggests there’s a two-stage process. There’s a quick stage upfront where the proponent will understand if the government is supportive of this project. It’s the, ‘Should the project go ahead?,’” Mr. Pourbaix told reporters.
“And there’s the much longer process that goes through all of the environmental issues, the Indigenous issues. But it puts a political decision at the front before proponents have had to invest billions of dollars.”
The simpler process should send the message that Canada is a secure place to spend capital, he said.
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The council comprises more than 130 chief executive officers and entrepreneurs of Alberta-based companies. It quoted a World Bank assessment of the business environment for private-sector development, showing Canada’s regulatory framework ranks 33rd out of roughly 100 countries.
It also cited a recent Business Council of Canada survey in which 47 per cent of members said regulatory risk was mostly likely to affect their investment plans.
The Alberta council is urging governments to adopt a one-stop regulatory approach for all major projects with provinces leading reviews within their borders. In addition, the group wants political debate completed before review processes begin, as well as all reviews for pipelines assigned to the Canada Energy Regulator, ensuring a single authority.
Major developments should have a two-year time limit for regulatory reviews, it said.
The council called for a number of pieces of federal environmental legislation to be scrapped, including the moratorium on oil tanker loadings on the northern British Columbia coast, clean electricity regulations and the plastics registry reporting, which tracks plastics from manufacture to end-of-life.
Since being elected last year, Mr. Carney has sought to foster a construction boom across the country. His government’s Building Canada Act, for instance, is aimed at expanding natural resource development and exports across the country.
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The Major Projects Office, led by Alberta business veteran Dawn Farrell, was created under that legislation to streamline approvals for developments the government decides are of national importance. Several have been referred to that agency since last September.
Meanwhile, under a memorandum of understanding signed by Mr. Carney and Alberta Premier Danielle Smith last November, the two sides have agreed to give Alberta regulatory jurisdiction over large projects within the province. That MOU, which includes dozens of other provisions, is aimed at paving the way for a new oil pipeline to British Columbia’s Pacific coast from Alberta.
These policies are positive, but should be carried over to all proposals, said Mike Holden, vice-president, policy, for the Business Council of Alberta. The legislation amounts to a “workaround to the existing system,” he said.
“It doesn’t go far enough. It doesn’t address the systemic changes that we think need to be made. And it also kind of carves out a different path of a separate set of projects,” Mr. Holden said.
“What we’re trying to do is fix that major project review and permitting system in a broad sense.”
Some of the system-wide reforms the council recommends include using digital and artificial intelligence tools to streamline compliance and set measurable targets. It wants better cost-benefit analysis of rules before they are imposed and a system to regularly review and update obsolete rules.