Regulators: Disrupted by Change or Disruptors Bringing Change?[1]

The annual CAMPUT 2022 conference explored an essential issue facing regulators across the world — disruption.

When energy sector regulators, industry, and other stakeholders gather, conversations quickly turn to change. Energy sector regulation is rarely discussed without someone or several someones bringing up “massive disruption.” And as these conversations unfold, a key debate emerges: Are regulators predominantly disrupted by a rapidly changing environment? Or are regulators themselves the disruptors? There is rarely consensus. Some encourage regulators to be change-makers, noting that the urgency of addressing issues like climate change requires proactive attention. Others push back on this idea.

The 2022 conference of Canada’s Energy and Utility Regulators (CAMPUT), titled “Deep dive into disruption,” took place May 1–4 in Vancouver, British Columbia, and featured these types of conversations. Attended in person by close to 300 regulatory and industry leaders, along with almost 200 people attending virtually, the event explored decision-making, regulation, and regulators in the context of disruption. Sessions focused on rates and utilities in a decarbonizing world, the future of gas, relationships with Indigenous peoples, energy equity and affordability, the growing role of consumers and distributed energy resources, and digitalization. The role of the regulator underpinned most conference discussions.

Here, we aim to unpack the debate and propose an answer to the question.


Start with the context. There’s no question regulators are operating within a rapidly changing environment. Much of the urgent change is driven by global efforts to reduce the effects of climate change. Meeting Canada’s climate targets of reducing emissions 40 to 45 per cent from 2005 levels by 2030 — and becoming net zero by 2050 — requires Canada’s energy systems to change dramatically in a very short timeframe. Enormous costs lie ahead, and regulators will play an important role in climate change mitigation and adaptation. At the same time, technological change, innovation, and energy sector digitalization are occurring at a growing pace and scale, further disrupting the regulatory environment.

The emergence of new technologies and energy sources is impossible to predict. No one knows with certainty how long it will take for batteries, hydrogen, or small modular nuclear reactors to operate in the system at scale. But regulators will nonetheless be called upon to make decisions, many of which will shape the technological landscape and have significant impacts on the cost of energy. All the while, the use of distributed energy resources continues to grow, and shifting consumer expectations create the potential for “prosumers” to take on more prominence in the years ahead.

Alongside these environmental and technological disruptions, major social changes are transforming the regulatory landscape. In Canada, chief among them is reconciliation with Indigenous peoples. The need for reconciliation between Indigenous and non-Indigenous Canadians is fundamentally reshaping energy projects. Given the constitutional, legal, and historic context in the country, Indigenous consent for projects is crucial. Without it, project approvals can face lengthy — and often successful — court challenges. Many Indigenous communities have become willing partners with other proponents on energy projects (notably partners with equity stakes). This is fast becoming the path in Canada to Indigenous consent for projects. Regulators are increasingly working alongside Indigenous advisory committees that provide ongoing advice on regulatory issues that affect their communities. Regulators are also establishing joint monitoring programs through which Indigenous communities conduct safety and environmental monitoring activities on energy infrastructure like pipelines.

Regulators are also faced with the rise of affordability and social equity imperatives, including questions of equity and affordability in rate design, tensions between price signals and affordability in emissions reductions, and how to allocate capital costs of projects when governments don’t want to defray those costs using the tax base.

All of these issues amplify uncertainty, risk, and disruption for regulators and challenge their capacity to plan, make decisions, and create appropriate regulatory frameworks. A crucial question emerges — What is the role of the regulator? — and this question begs many more.


Should regulators be proactive and become disruptors? Or is their role about reacting to disruptive change? At the CAMPUT 2022 conference, some speakers advocated for regulators to “choose change” and drive it by creating regulations based on desired end states, whether those end states are emissions reductions, social equity, reconciliation, or all three. Other speakers encouraged regulators, as administrative tribunals, to “stick to their knitting” and operate within the purview of their legislative mandates. This debate has both legal and democratic dimensions. Regulatory decisions are subject to various forms of judicial review, and, at the end of the day, elected officials should be the ones deciding on broader matters of public policy.

Many of these discussions were framed, on the one hand, by the urgency of addressing climate change, and, on the other hand, by questions and concerns about how to allocate the enormous costs of decarbonization in ways that are fair and equitable. What is the precise role of regulators in this con text? Should regulators be the ones deciding who pays which costs for emissions reductions, when they pay them, and how they pay them? Or should regulators play a supporting role and provide evidence and data to governments to help inform policy choices on these questions?

Similarly, should regulators be making decisions about the role of gas in future energy systems? Or should regulators instead provide evidence to inform choices by governments and consumers? Speakers and attendees at the CAMPUT conference often said regulators should be proactive change-makers because of the urgency of reducing emissions: There are costs to society if regulators wait for governments to reform regulators’ enabling legislation. But there may also be costs to society if regulators “lean out over their skis” and make mistakes or make decisions for which there is no democratic foundation.

At their heart, many of these discussions hinge on whether a regulator’s stance on environmental, economic, or social imperatives represents a failure of legislative frameworks and mandates, or whether it’s instead a failure of imagination on the part of regulators. Our view is that this bifurcated way of framing the issues misses the mark.


There is a more constructive approach to discussing these important topics. Instead of pointing fingers at legislation or at regulators, why not ask whether regulators can work within the broader decision systems of which they are a part to effectively navigate and respond to disruption?

Regulators are one part of a broader decision-making system for energy that includes, importantly, policymakers and legislatures. Responding effectively to climate change, technological change, social equity imperatives, and Indigenous reconciliation requires a system-level approach. First, regulators should innovate within their existing mandates. This could include working with utilities and other market participants to find innovative solutions for emissions reductions planning (or other imperatives) in an uncertain environment.

The British Columbia Utilities Commission, for example, has required regulated companies BC Hydro, the largest supplier of electricity in British Columbia, and Fortis Energy, the largest supplier of natural gas, to exchange their energy forecasts for electricity and gas. This enables each of the utilities to provide their own forecast in response to the other’s and helps to foster alignment on future resource plans. Regulators could also develop scenarios for emissions reductions or electrification to inform government decision-making. There are multiple scenarios published by a variety of sources, with greater or lesser levels of rigour and credibility. With their deep expertise and access to data, regulators could play a crucial role on this front.

But to take this third route in the disruption discussion depends on policymakers trusting regulators to “do the right thing.” Effectively navigating and responding to disruption requires a whole of system approach in which everyone is open to taking on new roles. Governments will have to decide how much authority they want to give regulators to be part of the solution for issues like decarbonization, Indigenous reconciliation, and social equity. They will then need to provide the necessary authority, resources, and personnel for them to take on new roles.

For urgent issues, such as reaching ambitious decarbonization targets, increasing the speed of change while minimizing mistakes requires improved dialogue among all actors in decision-making systems. It also requires mutual learning in meaningful and thoughtful ways in order to help foster alignment on problems and solutions, and in particular how problems can be addressed by policy, regulation, industry, and civil society. Effectively responding to climate change will also involve integrated system planning and clear communication of pathways and options. Integrated planning across sectors can help to optimize existing systems and assets for emissions reductions and, crucially, for affordability, resilience, and reliability. Regulators can play pivotal roles in all of these changes, but there needs to be shared understanding among energy sector decision-makers of their roles and responsibilities to avoid conflict, overlap, and working at cross-purposes.

Finding ways of moving faster will also require rethinking the risk tolerance of regulators and paying careful attention to the costs of failure. A culture change towards better acceptance of failure may be needed within regulatory agencies and among politicians and policymakers. Learning from mistakes — rather than punishing them — would be a good place to start.

The questions threaded through CAMPUT’s 2022 conference will emerge ever more frequently in the years ahead. Regulators will need to think through their answers rapidly, thoughtfully, and proactively. So will policymakers. None of this will be easy. But it is essential for energy decision systems to navigate and respond effectively to disruption.


  1. The following article is a reprint with permission of the original that appeared in the ICER Chronicle, Edition 12 (Summer 2022), online (pdf): <>.

* Dr. Monica Gattinger is Founding Chair of Positive Energy, Director of the Institute for Science, Society and Policy, and Full Professor in the School of Political Studies at the University of Ottawa.

David Morton was first appointed as a commissioner at the British Columbia Utilities Commission in Vancouver, Canada, in 2010 and was later appointed as the chair and CEO in December 2015. As chair and CEO, David is responsible for delivering on the vision of the BCUC — to be a trusted and respected regulator who contributes to the well-being and long-term interests of British Columbians. David is also vice chair of ICER, an executive member of CAMPUT and chair of its International Relations Committee, and co-vice chair of the NARUC Committee on International Relations.


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