Pumpjacks draw out oil and gas from wells near Calgary. Energy Minister Tim Hodgson said the legislation coming forward in the fall will raise 'the competence' of the federal government by increasing its ability to speed up project approvals.Jeff McIntosh/The Canadian Press
The federal government is moving to reduce duplication in the approval process for several types of large energy projects, a plan that will be expanded this fall with sweeping new legislation.
An initial step came Wednesday in the form of regulations related to such projects as oil sands extraction, some pipelines and transmission lines.
The new rules mean that some projects that had been subject to reviews under both the Impact Assessment Act (IAA) and the Canadian Energy Regulator Act (CERA) would no longer be subject to the IAA.
The changes are part of the government’s pledge to bring in a “one-project, one-decision” approval model.
Heather Exner-Pirot, a senior fellow and director of natural resources, energy and environment at the Macdonald-Laurier Institute, said Wednesday’s regulation change is welcome.
“It’s extremely impactful. This has been a top request of industry associations,” she said, in reference to the move to reduce duplication in the approval process.
Prime Minister Mark Carney and several of his ministers will welcome CEOs and major global investors to an investor summit in Toronto next week. They are also in Alberta this week for a cabinet retreat.
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Ms. Exner-Pirot said the timing of the regulatory change and promises of new legislation this fall appear to be aimed at persuading those investors that changes are taking place in Canada.
“This is a big full-court press,” she said. “They are letting investors know that there’s some action and not just talk.”
Lisa Baiton, president and CEO of the Canadian Association of Petroleum Producers, said in an e-mail that her organization supports the federal government’s efforts to streamline approvals and reduce regulatory duplication.
“Countries are now looking for new energy trading partners, and they want Canada to be one of their stable and reliable suppliers of energy for the decades ahead,” she said, adding that Canada needs to act quickly to build a competitive investment environment.
The IAA was created through a law passed in 2019 by the Liberal government called Bill C-69, which has faced heavy criticism from Canada’s energy sector, the Alberta government and the Conservative Party. They all say that it has hindered new oil and gas development and hurt economic growth.
The regulatory changes announced Wednesday in the Canada Gazette remove some project types from being subject to review under the IAA.
Projects affected include international and provincial pipelines and electrical transmission lines, offshore renewable-energy projects that are regulated under CERA, oil and gas pipelines and facilities in national parks and protected areas that are regulated under CERA, some oil sands extraction facilities and fossil fuel-fired generating facilities.
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In addition to the new regulations, the government also released a report summarizing feedback that it heard during consultations on a broad package of legislative changes planned for the fall.
The government had released a discussion paper in May entitled Getting Major Projects Built in Canada.
That report sought feedback on several proposals aimed at fast-tracking federal approvals for large projects.
Wednesday’s report acknowledges that some Indigenous leaders expressed strong concerns about the government’s efforts to streamline regulatory approvals.
“Indigenous participants noted that consolidating federal decision-making under a single project authority could reduce cabinet oversight in the decision-making process, and result in expedited approvals without environmental assessments and Indigenous participation,” the report said.
Energy Minister Tim Hodgson said in an interview Wednesday that the legislation coming forward in the fall will be about “raising the competence” of the federal government by increasing its ability to speed up project approvals.
“We’re in a trade war. The world is in a rupture. Canadians expect us to build Canada strong and to do that, we need to move faster,” he said.
“But we’ve been very clear: we will do that by raising the competence of government, not by cutting corners.”
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Asked how the legislation will address concerns raised by Indigenous leaders, Mr. Hodgson said the new rules would create a single consultation process “so that First Nations don’t need to put themselves through multiple consultations on the same project just because ministries don’t have their proverbial co-ordinating act together.”
The government has also brought in the Building Canada Act, which was approved in June of last year. That legislation allows Ottawa to list specific projects as being of national significance, which then exempts the project from some aspects of the IAA.
In a C.D. Howe Institute report released this week, George Vegh and Kate Koplovich wrote that while the Building Canada Act and the proposals in the discussion paper are welcome, they don’t go far enough.
“None of these mechanisms address the fundamental sources of uncertainty in Canada’s regulatory system: political decision-making over individual projects and open-ended criteria that require regulators to consider broad public policy objectives,” they wrote. “What Canada needs is a depoliticized and simplified system of regulatory approvals that applies to all projects.”
Earlier this summer, Mr. Carney and Alberta Premier Danielle Smith jointly announced that a proposed oil pipeline to the West Coast would be designated as a project of national interest under the Building Canada Act.
That designation triggered a consultation period through to Sept. 18.
At an event in Edmonton on Wednesday, François-Philippe Champagne was asked if the government will soon be updating that pipeline plan.
“We get it that we need to bring our resources to market. We get it that we need to expand,” he said, without directly addressing the project’s status.
With a report from Emma Graney in Calgary