The Canadian federal government has spent the last 18 months considering environmental assessment (EA) reform. The Government has stated the goals of this reform as regaining public trust, protecting the environment, advancing reconciliation with Indigenous peoples and ensuring “good projects go ahead and resources get to market”.¹ To help achieve these goals, the Government has developed the “Environmental and Regulatory Reviews” discussion paper, which describes a proposed package of conceptual reforms that will significantly affect federal EAs.

Energy projects subject to the proposed regime will require, among other things, effective process implementation, especially since the assessments under the proposed regime are likely to be far more complex than under the current federal EA regime. This increased complexity underscores the importance of effective and efficient assessment process implementation. This article describes key implementation points related to the coordination of assessments, timelines and Indigenous peoples’ participation.

Background

To restore public trust in Canada’s EA regime, the federal Liberal Party’s 2015 election platform promised to review and reform this regime.² On August 15, 2016, Minister of Environment and Climate Change Catherine McKenna announced the appointment of an expert panel “to undertake the review of federal environmental assessment processes”.³ The panel received comments from more than 1,000 participants in-person (including almost 400 presentations) and more than 500 written submissions from Indigenous groups, individuals, academics, land claim organizations, non-governmental organizations, industry associations, companies, port authorities, provinces, territories and municipalities.⁴ Based on its work, the panel proposed a conceptual framework for a new and broader impact assessment (IA) regime.⁵

In developing its discussion paper, the Government considered the panel’s proposed framework, as well as the associated public comment and consultation, other engagement and “practical lessons learned [by the Government] over the past 18 months”. ⁶ Like much of the discussion around EA reform, the discussion paper describes the proposed package of IA reforms–at a conceptual level. While such concepts are, of course, important, if improperly implemented, many good energy projects may ultimately not proceed, despite their merits.

After assessing the feedback on the discussion paper, the Government has indicated it plans to bring forward a “comprehensive suite of changes this fall”.⁷

One Project, One Assessment

The discussion paper supports the “one project, one assessment” principle. Its underlying goal is to avoid multiple assessments for a project, resulting in unnecessary delay and duplication. However, the effective implementation of a single assessment can be complicated due to reviewers from multiple jurisdictions being involved. For example, an energy project may be subject to federal and provincial review, as well as a review under Indigenous laws. In reality, this creates the potential for multiple IAs for a single energy project.

To avoid this, the Government will need to proactively engage with the relevant jurisdictions for a project (either on a project-by-project basis or otherwise) and offer a harmonized IA process that is more attractive to such jurisdictions than proceeding with their own IAs independently.

In theory, once a project has received the necessary IA approval(s), the other environmental permitting processes are intended to ensure that how the project is implemented complies with the applicable requirements. However, in practice, some of these processes can effectively become IAs, because these processes essentially transform from considering how the project should proceed to whether the project should proceed. A far too common example of this arises—when a regulator uses its discretion to issue a necessary permit—to insist on a fundamental change to an energy project that was not contemplated in the IA process and threatens the viability of the project. When regulators effectively transform permitting processes that are intended to focus on how the project should proceed to whether it should proceed, such regulators are effectively subjecting the project to an additional IA.

Again, the solution requires the Government and other jurisdictions to ensure that the necessary considerations occur at the IA and the other permitting processes remain focused on how the project should proceed.

Timelines

The legislated timelines under the current federal EA regime often do not provide the timing certainty that energy project proponents and others require, because the legislated timelines or “EA clock” can be stopped. For example, the legislated timelines (i.e., the “EA clock”) can be stopped while the proponent responds to the regulator’s requests for further information or studies. Unfortunately, it is not uncommon for the “EA clock” to bear little resemblance to the actual time period from commencing the EA and receiving the EA approval.

In support of the Government’s objective of “seeking to attract and grow investment”, the discussion paper indicates the Government is considering, “Maintaining legislated project assessment timelines to provide clarity and predictability” [italics in the original].⁸ The discussion paper also suggests project-specific timelines may be used. To attract investment, legislated timelines must be reasonable and respected. For “project-specific” timelines to work in practice, they must be backstopped with legislated timelines that are reasonable and respected.

If implemented well, the Government’s proposed “early engagement and planning” phase prior to the IA should greatly reduce or eliminate the need for requests for further information and studies (after this phase). Early engagement and planning is intended “to support better-designed project proposals and more effective assessments and to seek consensus on the project assessment process” [boldface in the original]. ⁹ Thus, the legitimate need for further information and studies beyond what is undertaken based on the early engagement and planning phase should be minimal, if any. Regardless, the practice of “stopping the EA clock” should be eliminated, since it undermines the credibility of the EA system (especially given most investors and proponents assess timeliness based on the commencement and completion of the EA process and not the EA clock).

Respecting timelines goes beyond the practice of “stopping the EA clock”. Respecting timelines includes coordinating and managing the IA with other jurisdictions, as well as minimizing extensions for ministers or Cabinet to make decisions (such extensions should be rare exceptions due to principled reasons for a short delay to achieve a better-quality decision).

Indigenous Participation

One of the most discussed aspects of IA reform is the mechanisms for increased involvement of Indigenous peoples. The Government’s actual plan for increased involvement is general and potentially far reaching. For example, the discussion paper quotes Prime Minister Justin Trudeau indicating, “The Government is committed to a renewed relationship with Indigenous peoples, nation-to-nation, Inuit to Crown, government-to-government. This renewed relationship is based on the recognition of rights, respect, co-operation, and partnership”.¹⁰ The discussion paper also notes, “Reconciliation must guide partnerships with Indigenous peoples, recognizing and respecting their rights and interests, their deep connection to their lands, territories and resources and their desire to participate as partners in the economic development of their territories”.¹¹

Unfortunately, the discussion paper does not describe in detail what the Government is considering in this regard nor how any related mechanism might work. Similarly, the discussion paper indicates the Government is considering early and regular engagement and participation with Indigenous peoples, “seeking to achieve free, prior and informed consent through processes based on mutual respect and dialogue”.¹² More recently, the Government has reiterated its commitment to many of these concepts in its “Principles respecting the Government of Canada’s relationship with Indigenous peoples”.¹³

For many energy projects subject to the proposed federal IA regime, a key implementation issue will be how to effectively and efficiently facilitate Indigenous people’s participation in the applicable capacities for a particular project. Regardless of how Indigenous peoples are participating (e.g., as a proponent, as a reviewer, as a participant in the free, prior and informed consent process and the duty to consult process or as a participant in the IA process or some combination of these), effective and efficient facilitation will likely be required to meet the energy project’s timelines.

Such facilitation has no one-size-fits-all approach and is expected to require considerable tailoring and constructive dialogue to suit each scenario. However, helpful precedents and guidance already exist regarding such implementation. For example, the development and operation of the Peter Sutherland Sr. Generating Station is a partnership between Taykwa Tagamou Nation and Ontario Power Generation Inc. This project, which was subject to Ontario’s EA regime, was completed ahead of schedule and on budget earlier this year.¹⁴ Likewise, practical guidance on seeking free, prior and informed consent is already available.¹⁵ Similarly, considerable experience has been developed on effectively and efficiently facilitating the duty to consult. As a result, the Government’s approach to increased involvement of Indigenous peoples—whatever it turns out to be—may require significant change regarding how Indigenous peoples participation is implemented for energy projects, but helpful guideposts exist for proponents.

Conclusion

Effective, efficient implementation of IAs is essential for the proposed regime to ensure that good energy projects receive the go ahead and resources get to market. Among other things, such implementation will likely require the following elements:

• conducting only one IA per project;
• respecting reasonable timelines; and
• facilitating the full participation of Indigenous peoples and governments in each relevant capacity on a project-by-project basis.

Without sufficient consideration and resources provided to effectively and efficiently implement the regime on a project-by-project basis, the proposed IA regime is unlikely to be successful.

*Michael Fortier is a partner at Torys LLP. His practice includes advising proponents and other clients regarding environmental assessment and Indigenous law issues relating to energy, infrastructure and mining projects.

1. Canada, “Environmental and Regulatory Reviews”, Discussion paper (Ottawa: June 2017), at 3, online: <https://www.canada.ca/content/dam/themes/environment/conservation/environmental-reviews/share-your-views/proposed-approach/discussion-paper-june-2017-eng.pdf>.
2. Liberal Party of Canada, “A New Plan for a Strong Middle Class” (24 July 2017), at 41-42 online: <https://www.liberal.ca/wp-content/uploads/2015/10/New-plan-for-a-strong-middle-class.pdf>.
3. Catherine McKenna, “Government of Canada Moving Forward with Environmental Assessment Review” CISION (15 August 2016) online: <http://www.newswire.ca/news-releases/government-of-canada-moving-forward-with-environmental-assessment-review-590224291.html>.
4. Johanne Gelhas et al, “Building Common Ground – A New Vision for Impact Assessment in Canada” (Ottawa: 2017) at 87, online: <https://www.canada.ca/content/dam/themes/environment/conservation/environmental-reviews/building-common-ground/building-common-ground.pdf>.
5. Ibid, at 48-85.
6. Supra, note 2 at 6. The discussion paper also proposes changes (not covered in this article) to the National Energy Board Act, the Navigation Protection Act and the Fisheries Act.
7. Ibid.
8. Ibid, at 10.
9. Ibid, at 10.
10. Ibid, at 15.
11. Ibid.
12. Ibid.
13. Canada, Department of Justice, “Principles respecting the Government of Canada’s relationship with Indigenous peoples” (19 July 2017) online: <http://www.justice.gc.ca/eng/csj-sjc/principles-principes.html>.
14. Ontario Power Generation Inc, “Peter Sutherland Sr. Generating Station” (21 July 2017) online: <http://www.opg.com/generating-power/hydro/projects/new-post-creek/Pages/new-post-creek.aspx>.
15. See, for example, The Honorable Frank Iacobucci et al, “Free, Prior and Informed Consent in Canada: Towards a New Relationship with Indigenous Peoples” Torys LLP (12 July 2016) online:  <http://www.torys.com/insights/publications/2016/07/free-prior-and-informed-consent-in-canada-towards-a-new-relationship-with-aboriginal-peoples>, especially Part IV <http:/www.torys.com/insights/publications/2016/07/part-iv-towards-a-new-relationship-to-facilitate-reconciliation>.