THE BACKGROUND

The First Day. Gordon Kaiser^[1]

A little over ten years ago on a bright fall afternoon in Ottawa a thousand copies of a new publication called the Energy Regulation Quarterly came off the printing press. The next day they went out to the group of energy lawyers and energy regulators across Canada. This was an ambitious project. The new journal which became known as the ERQ was distributed free of charge in both French and English. The first editorial of the new journal laid out the framework of the new publication.

This is the first issue of the Energy Regulation Quarterly. Readers may wonder why we need another energy journal. The answer is, simply, that this country does not have one, at least not one dedicated to energy regulation.

Lots of things are regulated in Canada — the environment, broadcasting, securities, zoning, taxicabs, lawyers, telephones and railways. Over the years energy regulation has climbed to the top of the pile.

There are energy regulators in every province as well as at the federal level. That’s because the business of energy production, transportation and distribution is growing in importance, not just in Canada, but throughout the world. And it’s a sector that is increasingly challenged by technological innovation, which as it happens is a dominant theme in many of the decisions reviewed in this first issue.

ERQ takes a unique approach. Each issue will feature an article or articles by a leading commentator. In this first issue it is David J. Mullan, Emeritus Professor of Law at Queen’s University. David, who needs no introduction to the North American legal world, reviews 10 years of lectures he gave to energy regulators every summer at the CAMPUT energy regulation course hosted by his university.

Aside from bringing thought-provoking articles, each issue promises a series of case comments. Our goal here is to kick start a serious discussion on significant decisions energy regulators. That rarely happens now.

This issue offers important case comments by Dr. Michal Moore of the University of Calgary, Glenn Zacher of Stikeman Elliott in Toronto, and Jeff Christian of Lawson Lundell in Vancouver, as well as a commentary on the recent National Energy Board TransCanada Mainline decision by Gordon Kaiser, and one on the Maritime Link decision of the Nova Scotia Utility and Review Board by Rowland Harrison.

The TransCanada Mainline decision, like many of the case comments, highlights the challenges that new technology brings to energy regulators. The technology at the root of the issues in that case was the combination of hydraulic fracturing and horizontal drilling — which in less than a decade has managed to transform the gas supply market with economic recovery of massive reserves of gas from shale deposits across North America.

That new production has changed the picture on affordability of natural gas — and with it the industry and the regulatory landscape. TransCanada as the operator of the Mainline and many of its principal distribution company customers are facing significant challenges in adjusting to the new market environment. New regulatory solutions are required.

The other case comments noted above highlight some other areas where innovation in the use of technology is at issue — be it green energy technology, electric cars, or opportunities to bring natural gas into the transportation market. All provide serious challenges to regulators.

Technological innovation is not the only new development being faced by energy regulators. A sometimes related challenge is the changing energy geography of North America and the need for new transmission — for liquid gaseous and electric energy. Be it oil pipelines to western, eastern or southern (US) coasts to move to new markets, gas, LNG and pipelines in western, eastern and central regions to ensure the economic delivery of supply, or electric transmission between markets never before connected, the movement of energy is a more public concern than arguably at any time in our history.

This issue of ERQ examines some of these issues through the lens of the recent Nova Scotia decision on Maritime Link. The project is intended to provide a new link for Newfoundland to the North American electricity market and to give Nova Scotia access to electricity from Labrador. Through a series of transactions, the power from Muskrat Falls on the Churchill River will move to mainland Newfoundland by the Labrador-Island Link, and then through the Maritime Link to Nova Scotia and on to New England. Rowland Harrison’s comment offers interesting insights on the decision.

Case comments by authors are important. But so are comments by the readers. Each issue of ERQ going forward will devote a section to those comments. We invite you to participate in this dialogue.

We hope ERQ will not become a Canadian backwater publication. To address the non-Canadian side, we have conscripted Robert Fleishman, a well-known commentator from Washington, to an American Report in each issue. And in the second issue we will introduce the first of what we hope will be regular European commentaries.

We realize Canada is not an island in terms of energy regulation. Energy is an international product. Most energy companies operate worldwide. And Canadian regulatory procedures often borrow from those developed abroad.

In a way, ERQ is the third leg of a long crafted stool. Ten years ago, Canadian energy regulators together with utilities and the Energy Bar started two important educational initiatives. The first was the above-noted annual CAMPUT summer course. Each year for the past decade, regulators from across Canada have shown up for a weeklong session that has produced lively discussion and instruction. A number of those who lectured came year after year in a fine gesture of public service.

At the same time, the Energy Law Forum was created. It meets every May at locations across Canada. So far it has stopped at Kelowna BC, Lake Louise Alberta, St. Andrews by-the-Sea New Brunswick, Val David Quebec, Salt Spring Island BC, La Malbaie Quebec and Toronto, Ontario.

In both of those initiatives, speakers often delivered first-class papers. There was always a concern that none were published. With Professor Mullan’s piece here we demonstrate how the ERQ can provide a forum to remedy that shortcoming.

But ERQ’s real purpose is to provide timely public discussion on important regulatory decisions. And to that end, we have assembled a roster of contributors — leading practitioners, academics and other experts who will author the case comments and other articles. We appreciate their commitment. Some have contributed to this first issue, others have their names listed on the masthead and we look forward to their comments in subsequent issues.

The very first edition of the publication highlighted an interesting group of characters. The first article by David Mullan of Queen’s University was called Regulators and the Courts: A Ten Year Perspective^[2]. As David pointed out in the article, his article reflected his experience at the new course for energy regulators at Queen’s University where he was the lead speaker for the entire decade. As it turns, out David has followed that tradition and continued it to this very day. In fact, this issue of the ERQ contains another article bearing the same title. As in the past it will be the first article in this issue of the ERQ.

David was not the only regulator regular contributor. Robert Fleishman a senior partner at the law firm of Kirkland & Ellis in Washington DC contributed an essay called The Washington Report.^[3] It was the last article in that issue of the ERQ and continue to be in the first issue of every year. There were other regular contributors of note. One was another American called Scott Hempling. One of his articles called From Streetcars to Solar Panels: Stranded Costs Policy in the United States^[4] turned out to be the most read article in ERQ history. Equally popular were other five articles he contributed over the decade.

Another article often quoted was from the only Court of Appeal judge that wrote for the ERQ. That was the article called The Joy of Decision Writing^[5] by Mr. Justice David Brown of the Ontario Court of Appeal. One energy regulator chair also contributed. The late Willie Grieve sent us a gem called One Hundred Years of Public Utility Regulation in Alberta.

THE REGULATORS

In marking the 10^th anniversary of the ERQ, we thought it best to touch base with the people that the ERQ was designed to inform. The goal from the beginning, as stated in the first editorial set out above, was to see if we could improve the state of energy regulation in Canada with a better analysis of the court and regulatory decisions in Canada. We asked the leaders of the three energy regulators across Canada who contributed the most to the ERQ over the years. Starting with the Pacific Ocean and ending with the Atlantic Ocean, these were David Morton, the Chair of the British Columbia Utility Commission, Bob Heggie, the Chief Executive Officer of the Alberta Utilities Commission, and Peter Graham, the Chair of the Nova Scotia Utilities and Review Board. Their comments follow.

British Columbia: David Morton^[6]

On behalf of the BCUC — and indeed the entire regulatory community — congratulations to ERQ on its 10^th anniversary.

I was a relatively newly minted Commissioner when I read the inaugural issue in 2013. The first editorial opened with the statement “Readers may wonder why we need another energy journal. The answer is, simply, that this country does not have one, at least not one dedicated to energy regulation.” My curiosity was piqued.

I remember turning the pages with growing interest as I realized the quality of the writing, the depth of analysis and the scope of the material. Of course, it helped that a recent BCUC decision on Natural Gas for Transportation was featured. So, this new publication was also both timely and relevant to me.

Over the intervening ten years, the ERQ has not disappointed. Filled with thoughtful analysis, it informs and supports the regulatory community, bringing us together in spite of the challenges of geography and differences of jurisdiction.

This is a time of unprecedented change in the energy and utility industry in Canada and around the world. It has never been more important to have access to the very best of the work of our peers. When I look at recent articles in the ERQ I see titles like:

I am very pleased to see the ERQ moving with the times — deftly and effectively. The content remains as fresh as it was that first day. That first editorial stated: “ERQ’s real purpose is to provide timely public discussion on important regulatory decisions.” Mission accomplished. Keep up the good work ERQ!

Alberta: Bob Heggie ^[11]

I am honored to write this foreword in recognition of the significant achievement of the tenth anniversary of the Energy Regulation Quarterly. The journal remains a singular and unique publication in Canada with its unique perspective of fostering discussion of energy regulation and the decisions of energy regulators, both in Canada and the United States.

ERQ was launched in 2013, thanks to the visionary minds of Gordon Kaiser, Mike Cleland and Rowland Harrison. As with all new ventures, seed capital was required and provided by the Canadian Gas Association. From its humble beginnings as a five issue “pilot project,” ERQ has achieved its ambition of providing timely public discussion on important regulatory decisions.

The requirement for a particular kind of periodical focused on energy regulation arises from the fact that this branch of study cuts across many legal and policy categories including public law, private law, contract law, economics, environmental, safety and energy policy. Over the last decade there has been a related increasing intensity of energy regulation as regulators attempt to balance economic, social and environmental considerations in the public interest. A good example of this complexity and diversity is the high degree of legal and economic issues presented by the regulation, or restructuring of electricity network systems.

Since its inception, the journal has operated and continues to operate through an era of climate change. In recent years, the subject of climate change has attracted considerably more attention and the ERQ continues to be a leading vehicle in this complicated discussion. The same comment could be made in relation to the impact of energy development on Indigenous populations and the growing area of energy justice. The high degree of diversity in the field of energy regulation underscores the importance of developing a core literature and the ERQ has and will continue to fill that need as these issues mature.

Without authors there would be no journal. By my count, since its foundation the ERQ has published upward of 300 articles. As a devoted reader, I am grateful to the community of authors, editors, reviewers, and sponsors who collectively support the project, have kept its reputation high and have nurtured thought-provoking discussions for a decade.

Not every publication will be successful. Success is earned, article by article, edition by edition. To succeed the journal must attract authors that will, through the published content, establish credibility with readers and practitioners in their day-to-day work. In this tenth anniversary celebratory issue it is clear the ERQ has met that challenge and has achieved the aims it set for itself. I look forward to reading ERQ’s pages over the next ten.

Nova Scotia: Peter Gurnham^[12]

Congratulations to the ERQ on its tenth anniversary.

The ERQ has become an important resource for Canadian Energy Regulators and is part of their toolbox. There is no other journal in Canada that focusses on energy regulation in the way the ERQ does.

David Mullan’s yearly update on administrative law is a must read and always provided a one stop, concise, thoughtful update on leading decisions from the courts and certain regulators. David helped us understand many important issues such as our role with respect to the Duty to Consult. His timely and well researched advice was and is much appreciated.

Gordon Kaiser’s annual update on important regulatory decisions from provincial boards keeps us in touch with the challenges fellow board members are dealing with across the country. His frank analysis of our decision was welcome, if at times humbling.

The Editorial by Gordon Kaiser and Rowland Harrison is something I read in each edition and very much look forward to it.

Beyond these regular features there has been a treasure trove of excellent articles and analysis on energy issues, book reviews, information from the United States and much more.

To Gordon Kaiser, Rowland Harrison, Tim Egan, and all of those responsible for the ERQ, please know that you have provided an excellent and appreciated public service to the regulatory community, those interested in energy issues, academics and others.

I have no hesitation in saying that I and others like me were better regulators because of what we learned in the ERQ.

GOING FORWARD

As we look forward to the next decade, we thank the many energy lawyers and energy regulators that over the years contributed to the ERQ. Every three months we managed to produce three or four articles and a couple of book reviews and more recently webinars. Webinars, it turns out, have proved to be very popular particularly for young lawyers. Over the next 10 years we will likely add podcasts which we expect will be equally important.

As always we ask our loyal readers to let us know if there is anything we can do to improve the ERQ. The Canadian energy industry is changing rapidly and we will strive to review the change as it happens. In the next 10 years both Canadian energy regulators and the ERQ will face greater challenges than in the first 10 years. The transition to a low carbon economy will involve a significant investment in new technology. That will involve a more complicated and demanding form of regulation and careful analysis on the part of the ERQ.

1. Gordon Kaiser is an arbitrator and mediator at Regulation Law Chambers in Toronto where he specializes in disputes involving energy and competition law. He is a former Vice Chair of the Ontario Energy Board, Market Surveillance Administrator for the Province of Ontario and Special Counsel to the Atty. Gen. Canada on competition law disputes. He is also a co-managing Editor at the ERQ.
2. David J. Mullan, “Regulators and the courts: A Ten Year perspective”, (November 2013) 1 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/articles/regulators-and-the-courts-a-ten-year-perspective-1>.
3. Robert S. Fleishman “The Washington Report”, (April 2021) 9:1 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/regular-features/the-washington-report-8>.
4. Scott Hempling “From streetcars to solar panels: Stranded cost policy in the United States”, (7 September 2015) 3:3 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/articles/from-streetcars-to-solar-panels-stranded-cost-policy-in-the-united-states>.
5. Justice David M. Brown, “The Joy of Decision Writing”, (November 2014) 2 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/articles/the-joy-of-decision-writing>.
6. Dave Morton is Chair and CEO of the BC Utilities Commission. He has served in the capacity since 2017.
7. Colleen Kaiser & Geoff McCarney, “Agile Regulation for Clean Energy Innovation: Examining the early experience of two Canadian institutions”, (December 2021) 9:4 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/articles/agile-regulation-for-clean-energy-innovation-examining-the-early-experience-of-two-canadian-institutions>.
8. Maya Stano et al., “Cumulative Effects can Infringe Treaty Rights”, (December 2021) 9:4 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/articles/cumulative-effects-can-infringe-treaty-rights1>.
9. Gordon E. Kaiser, “Reconciliation: The public Interest and a Fair Deal”, (December 2021) 9:4 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/regular-features/reconciliation-the-public-interest-and-a-fair-deal>.
10. Eric Bremermann et al., “British Columbia Reduces Regulatory Barriers to Hydrogen Investment”, (October 2021) 9:3 Energy Regulation Q, online: ERQ <energyregulationquarterly.ca/articles/british-columbia-reduces-regulatory-barriers-to-hydrogen-investment>.
11. Bob Heggie is the CEO of the Alberta Utilities Commission.
12. Peter Gurnham, K.C. was Chair of the Nova Scotia Utility and Review Board from 2004 to 2022. He is currently Special Advisor to the First Nations Financial Management Board with respect to water and wastewater regulation for First Nations Communities.