Regulatory Processes in Canada – Rules of Road

1. ENERGY Regulatory Processes in Canada – Rules of Road Presented by : Larry Charach Executive Director Electricity Business Unit Alberta Department of Energy

2. Canadian Regulation • The Map – the Legal Framework. • Federal Regulation • Provincial Regulation • Summary

3. Legal Framework For Regulation • Constitution of Canada • Provincial Powers • Federal Powers • International Agreements • Free Trade Agreement 1989 • North American Free Trade Agreement • Legislation – Government policy • Provincial Legislative Framework • Federal Legislative Framework

4. Government sets policy Other Government departments Canadian Regulatory Framework Canadian Constitution International Agreements LEGISLATION Public Participation Regulators administer policy REGULATIONS Industry projects

5. Alberta Environment Energy Regulatory Framework National Energy Board Alberta Energy Alberta Energy and Utilities Board Energy policy Mineral rights RoyaltyPre-drilling exploration Gas Oil and Electricity Export Federally-regulated pipelines International transmission lines Surface access and rights of way Facilities/scheme approvalsInformation collection and disseminationCompliance/inspectionsCorrelative rightsUtility rates Federal Department and Agencies Environmental impact assessmentPollution control Environmental Standards and approvals Environment Canada Canadian Environmental Assessment Agency Minister of Fisheries and Oceans Canadian Coast Guard Parks Canada Transport Canada Energy Industry Alberta Human Resources and Employment Occupational health and safety Notice of applicationsInformationDirectly affectedPublic Hearings Public Alberta Agriculture, Food and Rural Development Surface Rights Board Surface access and rights-of-way on privately-owned land

6. Energy Industry Public Federal Regulation Gas Oil and Electricity Exports Federally-regulated pipelines International transmission lines Surface access and rights of way National Energy Board Federal Departments and Agencies Environment Canada Canadian Environmental Assessment Agency Minister of Fisheries and Oceans, Canadian Coast Guard, Parks Canada Transport Canada Notice of applicationsInformationDirectly affectedPublic Hearings

7. National Energy Board (NEB) • Independent federal regulatory tribunal, established in 1959 • NEB’s mandate and powers spelled out in federal legislation - NEB Act • NEB reports to parliament through Minister of Natural Resources • NEB a quasi-judicial body

8. NEB Mandate (1 of 2) • REGULATORY • Construction & operation of pipelines (with regard to environment & safety) • Transportation, tolls and tariffs • International trade in oil, gas & electricity • Frontier oil & gas regulation (outside areas of special federal/provincial “Accords”)

9. NEB Mandate (Cont’d) • ADVISORY • Provide advice to federal government • Monitor energy sector and publish reports • NEB DOES NOT REGULATE • Energy in areas of provincial jurisdiction • Inter-provincial electricity trade • Energy emissions (except for the integrity of pipelines and related facilities)

10. Quasi-judicial Administrative Body • Independent • “ Creature of statute” - powers defined by statute • Court - like • Administrative tribunal • Court of record • Follows rules of natural justice

11. Provincial Regulation of Energy Projects • Provinces own resources within their boundaries • Exercise full responsibility for energy policies, legislation, regulation and royalties • Regulatory activities encompass exploration and development, gathering and local distribution • Established provincial energy regimes and regulatory bodies – variety of organizations and structures – Government Ministries Departments, and Agencies

12. Provincial Regulation Facilities/scheme approvalsInformation collection and disseminationCompliance/inspectionsCorrelative rightsUtility rates Alberta Energy and Utilities Board Alberta Energy Energy policy Mineral rights RoyaltyPre-drilling exploration Environmental impact assessmentPollution control Alberta Environment Energy Industry Environmental Standards and approvals Alberta Human Resources and Employment Alberta Agriculture, Food and Rural Development Notice of applicationsInformationDirectly affectedPublic Hearings Public Occupational health and safety Surface access and rights-of-way on privately-owned land Surface Rights Board

13. Regulation Areas • Oil • Gas • Oil sands • Pipelines • Coal • Power plants • Transmission lines • Rates for gas and electric utilities • Minerals

14. EUB Mandate Quasi-judicial Administrative Body Economic, orderly and efficient development in the public interest - public safety Consider - environmental, social and economic factors - emissions - disturbance - impacts - equity - risks - lifestyle - land use

15. EUB Mandate (cont’d) • Assess reserves • Assess requirements • Public safety • Environmental protection • Equity • Conservation • Advice to government • Collection and dissemination of data • Utility regulation

16. Summary • Canadian regulatory bodies operate within a legal framework and share common mandates and processes • Jurisdiction over energy projects is divided between the Provinces and the Federal Government of Canada (e.g. Provincial Ownership of resources) • Energy projects interact with agencies at federal and provincial levels • Provinces have jurisdiction within provincial boundaries. • NEB has jurisdiction for international projects

17. ENERGY Regulatory Processes in Canada – Rules of Road Questions?