A Literature Review on Regulatory Independence in Canada’s Energy Systems: Origins, Rationale and Key Features, Ian T. D. Thomson, Positive Energy, University of Ottawa, November 2020

The purpose of the University of Ottawa’s Positive Energy initiative is to use “the convening power of the university to bring together academic researchers and senior decision-makers from industry, government, indigenous communities, local communities and environmental organizations to determine how to strengthen public confidence in energy decision-making.”[1] The work of this important project has been featured periodically in past issues of Energy Regulation Quarterly, beginning in December 2017 with an article by Michael Cleland and Monica Gattinger, “System Under Stress: Energy Decision-Making in Canada and the Need for Informed Reform.”[2]

One of Positive Energy’s current projects is aimed at “exploring the relationship between regulators and other actors in energy decision-making processes,” under the title “Policymakers, Regulators and Court – Who Decides What, When and How?” The project is part of Positive Energy’s broader examination of “the roles and responsibilities of decision-making authorities in Canada’s energy decision-making system.”[3] A Discussion Paper outlining preliminary findings and ideas was released in December 2020.[4]

As part of its research for this project, Positive Energy has released a valuable background document, A Literature Review on Regulatory Independence in Canada’s Energy Systems: Origins, Rationale and Key Features (Literature Review).[5]

After leading, appropriately, with a discussion of the “Rationale for Independence,” the Literature Review surveys “Key Moments in The History of Regulatory Independence in Canada,” tracing that history to the delegation of regulatory functions to the Railway Committee of the Privy Council in 1851, “Canada’s first administrative and decidedly non-independent tribunal.”[6] The Railway Committee rejected the American model of independent regulation. However, issues with respect to the suitability of a sub-committee of cabinet for the task at hand (lack of familiarity with the subject-matter, political vulnerability to outside influences, constantly changing membership, etc.) eventually led to the recommendations of the McLean Royal Commission and the establishment in 1903 of the first federal regulatory body, the Board of Railway Commissioners, under the Railway Act.[7]

The Literature Review traces both the subsequent proliferation of regulatory agencies in Canada through the early-to-mid 20th century and, later, the expansion of their roles, which were “once novel and narrow,” to “increasingly affecting and influencing the lives of Canadians…”[8] While in the past “political controversy led to greater independence for regulators from the political process,” more recently “controversy surrounding a regulator has led to reduced faith in regulatory decision-making and lessened regulatory independence for agencies and tribunals.”[9] The Literature Review points to the National Energy Board, the Ontario Energy Board and the Alberta Energy Regulator as examples.

Canada’s energy future is in transition. As Positive Energy has observed: “Clearly articulating and strengthening roles and responsibilities between and among public authorities is one of the most pivotal but understudied factors shaping Canada’s energy future in an age of climate change.”[10] Understanding how those roles and responsibilities have evolved to date should provide a sound foundation for charting that future course. A Literature Review on Regulatory Independence in Canada’s Energy Systems: Origins, Rationale and Key Features is a helpful contribution to meeting the challenge.

  1. Positve Energy, “About Positive Energy” (last visited 18 January 2021), online: <www.uottawa.ca/positive-energy/about-positive-energy>.
  2. Michael Cleland & Monica Gattinger, “System Under Stress: Energy Decision-Making in Canada and the Need for Informed Reform” (2017) 5:4 Energy Regulation Q 11; See also Michael Cleland & Monica Gattinger, “Canada’s Energy Future in an Age of Climate Change: Public Confidence and Institutional Foundations for Change” (2019) 7:3 Energy Regulation Q 19.
  3. Michael Cleland, Ian T.D. Thomson & Monica Gattinger, “Policymakers, Regulators and Courts – Who Decides What, When and How? The Evolution of Regulatory Independence, Discussion Paper” (December 2020) at 4, online (pdf): Positive Energy <www.uottawa.ca/positive-energy/sites/www.uottawa.ca.positive-energy/files/policymakers_regulators_and_courts_-_who_decides_what_when_and_how_final.pdf>.
  4. Ibid.
  5. Ian T.D. Thomson, “A Literature Review on Regulatory Independence in Canada’s Energy Systems: Origins, Rationale and Key Features” (November 2020), online (pdf): Positive Energy <www.uottawa.ca/positive-energy/sites/www.uottawa.ca.positive-energy/files/a_literature_review_on_regulatory_independence_in_canadas_energy_systems_final.pdf>.
  6. Ibid at 8.
  7. Ibid at 10.
  8. Ibid at 11.
  9. Ibid at 19.
  10. Ibid at 5.

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