Canadian energy policy and regulation are currently dominated by measures to address climate change and by the scope of participation in review processes for proposed new energy infrastructure projects. The two issues are directly related, inasmuch as the demands of many groups and communities for a direct role in decision-making on specific projects are often motivated by their views on climate change. This issue of Energy Regulation Quarterly includes significant contributions to the public debate around both issues.
The concept of “social licence” has, over only a few years, come to play a dominant role in virtually every public review process for energy infrastructure projects. Notwithstanding the lack of understanding of exactly what the term means, it has been elevated to the status of an absolute rule – a sine qua non or absolute precondition – for project approvals. But, when it comes to decision time on individual projects, where tension between local and broader national interests is inevitable, what does it mean to say: “While governments grant permits for resource development, only communities can grant permission.”1
How to balance local and national interests is a significant challenge, particularly in Canada with its wide diversity of regional and Indigenous interests and its vast geography. The lead article in this issue of ERQ on “A Matter of Trust: The role of communities in Energy Decision-Making”, by Michael Cleland (with others), is an important contribution to meeting this challenge by identifying and analyzing some of the dynamics. The article is based on the results of new research from the University of Ottawa and the Canada West Foundation showing that the nature of local opposition, and the underlying concerns, are often not what opinion leaders and political decision-makers have assumed.
To date, policy and regulatory measures to address climate change have been initiated from province to province. We say “to date” because, as this issue of ERQ was closing, the focus shifted somewhat to the federal government with the Prime Minister’s controversial announcement on October 3 of a proposed national price on carbon.2 Provincial initiatives on climate change will, however, continue to play a primary, frontline role that the provinces are unlikely to cede. It is particularly timely, therefore, that this issue of ERQ includes “An Overview of Various Provincial Climate Change Policies Across Canada and Their Impact on Renewable Energy Regulation,” by several lawyers from Blake, Cassels and Graydon LLP, led by Dufferin Harper.
As is apparent from this overview article, policy and regulatory approaches to addressing climate change vary and all present their own challenges. Jason Kroft and Sam Dukesz offer their observations on one particular model in “Cap and Trade in Ontario: Lessons from Europe.”
In their article on “Renewables and Alberta’s Electricity Markets: Some European Learnings”, Kalyan Dasgupta and Simon Ede (with Leonard Waverman) also draw on European experience in discussing the role of renewable energy markets in decarbonisation policies, such as Alberta’s Climate Leadership Plan.
Ian Mondrow’s article on “Competition in Electricity Transmission: Two Canadian Experiments” reviews tentative initiatives in Ontario and Alberta to introduce competition into electricity transmission. It is no coincidence, he observes, that the two Canadian jurisdictions with aspirations to develop competitive electricity markets have found a way to introduce competition into the development of new transmission infrastructure, with the result that “transmission competition” is no longer an oxymoron.
In their article “A Requiem for the Presumption of Prudence after OPG and ATCO”, Venessa Korzan and Moin Yahya conclude that, in two recent decisions, the Supreme Court of Canada has freed up regulators to review costs, regardless of whether they were incurred or forecasted, utilizing whichever statutorily compliant and reasonable test the regulator chose. The once popular view that forecasted costs should be reviewed by regulators under a forward looking ‘onus of proof on the utility’ reasonableness test, while already incurred costs should be reviewed under a presumption of prudence test, is no longer valid.
Martin Ignasiak, Jessica Kennedy and Justin Fontaine provide a case comment on a recent decision by the Alberta Utilities Commission confirming that it has no jurisdiction to consider or assess the adequacy of Crown consultation with Aboriginal groups that may be affected by a project under review. The ruling, they conclude, will help guide the scope of future facilities proceedings before the AUC.
- Liberal Party of Canada, Environmental Assessments, online: <https://www.liberal.ca/realchange/environmental-assessments/>.
- Prime Minister of Canada, Prime Minister Trudeau delivers a speech on pricing carbon pollution (Ottawa: 3 October 2016), online: <http://pm.gc.ca/eng/news/2016/10/03/prime-minister-trudeau-delivers-speech-pricing-carbon-pollution>.