Perhaps the word that best describes the current Canadian energy regulation landscape is “challenged”. The issues facing energy policy-makers and regulators are profound, described by many as “existential”. The challenges, however, go well beyond addressing specific policy and regulatory issues to redefining the very role of energy regulation — and of regulators in particular — as it has been understood until now.

By the time this Issue of Energy Regulation Quarterly (ERQ) is released, the National Energy Board — established by Parliament 60 years ago, in 1959, to be a truly independent, arm’s length decision-maker¹ — will have been abolished and replaced by the Canadian Energy Regulator (CER). Public discussion of the legislation enacting this change, Bill C-69², has focused on the implementation of a fundamental restructuring of the assessment process for proposed energy infrastructure and other developments under federal jurisdiction. Little attention has been paid to the fact that the structure and organization of the CER are based on a model that is radically different from past models for energy regulation tribunals in Canada. It is a model that was implemented in Alberta with the establishment in 2012 of the Alberta Energy Regulator and is being implemented in Ontario to “reform” the Ontario Energy Board.

In essence, the model trifurcates the roles of regulatory decision-making (vested in the case of the CER in a Commission, consisting of up to seven full-time “commissioners” and an unspecified number of part-time commissioners), executive management (vested in the Chief Executive Officer, who is neither a commissioner nor a member of the board of directors) and “governance” (vested in a part-time board of directors, under the leadership of a part-time Chairperson). The model might be described as a “seismic” shift in approach, with clear implications for “independence” as that principle has previously been understood in the context of energy regulation.

The Cambridge English Dictionary definition of “seismic” includes: “having very great and usually damaging effects…”³ Future Issues of ERQ will explore the implications for the role of energy regulation tribunals and regulators.

Meanwhile, the proposed restructuring of the Ontario Energy Board is outlined in this Issue of ERQ by David Stevens in “Ontario Government takes steps to reform the Ontario Energy Board” and Bob Heggie discusses some governance and management issues raised by the new model in “Governance of Administrative Agencies: Is the tail wagging the dog?”

An important role for ERQ continues to be to provide analysis and context that go beyond the day-to-day headlines. In the lead article in this Issue of ERQ, “Canada’s Energy Future in an Age of Climate Change: Public Confidence and Institutional Foundations for Change”⁴, Michael Cleland and Monica Gattinger make a persuasive argument that “Canadian climate policy from the early 1990s is most easily understood if one assumes that energy and climate imperatives had simply been disconnected.” The country has achieved little on greenhouse gas emissions reductions, they assert, while the viability of the country’s single largest export industry has been compromised. Finding solutions, they add, will require, among other things, resolving questions around the roles and responsibilities of decision-making institutions and their essential architecture.

Jeffrey Simpson’s article on “Canada’s Climate Change Challenge” also discusses the need for balance in the climate change/energy development debate. While he believes there is a growing awareness of climate change as an issue, “there is also support for balanced and commonsensical approaches that reject apocalyptic rhetoric, unreasonable solutions and little, if any concern, for people who work in resource-dependent areas where there are few, if any alternatives, to developing them.”

This Issue of ERQ also includes the regular “Washington Report” feature, by Robert S. Fleishman, covering key federal and state energy and environmental regulatory and litigation developments in the U.S. from 2018 through mid-2019.

ERQ is collaborating in conducting a series of interviews with the chairs of Canada’s public utility tribunals, as described more particularly in the introduction in this Issue to the interview with Mark Kolesar, Chair of the Alberta Utilities Commission.

Scott Hempling provides a view on “‘Regulatory Settlements’: When Do Private Agreements Serve the Public Interest?” He cautions that settlements are double-edged swords: “They have positive value if they solve public-interest challenges, negative value if they edge the commission out of its statutory role.”

In the public policy world of today, energy and climate change are inextricably interlinked and, increasingly, the debate focuses on mechanisms for pricing carbon. Now, the debate has moved to the courts where four provinces have launched constitutional challenges to the federal government’s legislation imposing a carbon pricing regime on provinces that do not meet a threshold standard. In “Canada’s Existential Crisis over Climate Change Regulation: Tempest in a Teapot?”, Lisa DeMarco and Jonathan McGillivray review the current litigation that is headed to the Supreme Court of Canada. The authors point out that, notwithstanding what might appear to be another “existential crisis” (as reflected in their title), “a closer examination of the evidence in all of the proceedings tells a very different story — a story of nation-wide consensus on the urgency of climate change and the necessity of addressing it, in part through carbon pricing.”

1. Harrison, “The Elusive Goal of Regulatory Independence and the National Energy Board: Is Regulatory Independence Achievable” What Does Regulatory ‘Independence’ Mean? Should We Pursue It?” (July 2013) 50:4 Alta L Rev 757.
2.  Bill C-69, An Act to enact the Impact Assessment Act and the Canadian Energy Regulator Act, to amend the Navigation Protection Act and to make consequential amendments to other Acts, 1^st Sess, 42^nd Parl, 2019 cl 28 (as passed by the House of Commons June 21 2019).
3.  Cathy Armor, The Cambridge English Dictionary, (Cambridge: United Kingdom, 2019) sub verbo “seismic”, online: <https://dictionary.cambridge.org/dictionary/english/seismic> (emphasis added).
4.  This article is the most recent contribution to Energy Regulation Quarterly generated by ongoing research by the Positive Energy project at the University of Ottawa.