A panel of experts appointed by the Trudeau government is recommending the shutdown of Canada’s scandal-plagued pipeline regulator.
In a groundbreaking report, the panel made 26 sweeping recommendations, including the replacement of the Calgary-based regulator, the National Energy Board (NEB), with a new Ottawa-based organization called the Canadian Energy Transmission Commission. It also recommended the creation of a new energy information agency.
The recommendations follow years of public criticism that the regulator, the NEB is biased and too close to the Calgary-based energy companies, which it is supposed to oversee objectively. They were based on feedback from nearly 200 people, with a special focus on indigenous voices, in 10 major Canadian cities, along with public feedback sent in online.
They said this would also be consistent with emerging energy trends as pipelines become less important and renewable energy is expected to grow.
“Everywhere we were there was this issue with confidence, transparency, indepedence, safety and security… that was repeated constantly and that’s why we have to listen to them and make this major reform,” said Hélène Lauzon, co-chair of the panel and a lawyer who presides over the Quebec Business Council on the Environment.
“They had this perception that the NEB was not impartial, that they were biased when they were generating their reports. All these recommendations work together and if the minister wishes to answer all the (public concerns), it would be better to go ahead with all the recommendations. We think they are realistic and feasible.”
The proposed commission would retain an office in Calgary and its expertise on pipeline safety in that city. But a new board of directors, support staff with other functions such as an expanded expertise on electricity transmission issues, and communications officers would be added in Ottawa, panel members told National Observer in an interview on Monday.
A representative of the NEB said the regulator has not yet had time to review the recommendations thoroughly, but is open to the report’s suggestions.
“Obviously, as an organization, we are looking forward to anything that helps makes us better,” NEB communications officer Rebecca Tayor. “We’re going to be taking a look at the recommendations, then it’s going to be up to the minister to decide whether he implements any of them.”
Lack of trust, impartiality a “repeated theme”
Prime Minister Justin Trudeau gave his natural resources minister, Jim Carr, a mandate to “modernize” the regulator in order to restore public trust in federal oversight of major energy projects, including major pipeline expansion proposals such as Kinder Morgan’s Trans Mountain expansion and TransCanada’s Energy East project. The government subsequently created the panel to consult with Canadians and study the issue.
Throughout a cross-country tour, members of the panel noted that questions about trust were raised often throughout their consultations.
Gary Merasty, a member of the Peter Ballantyne Cree Nation and a former Liberal MP was was also a panel co-chair, said the recommendations were also made to improve the government’s engagement with First Nations.
“More than any other group, the expectation of indigenous people is huge through these projects,” he told National Observer. “What we’ve heard is that we need to ensure indigenous are involved at the earliest opportunity possible.”
The panel also recommended introducing a new independent committee of public stakeholders, including indigenous representatives to be consulted on some of the ongoing operations issues of the new commission to restore trust in the oversight process. The panel also recommended a new ombudsman to deal with complaints.
Recusals in the midst of scandal
The regulator has also been targeted by fierce criticism from pipeline opponents who believe it overlooked critical indigenous, environmental, and scientific evidence in its recent reviews of the Kinder Morgan and TransCanada projects. It declined to permit cross-examination of evidence during the Kinder Morgan hearings, for example, and refused to grant intervener status to hundreds of concerned individuals and environmental groups.
In the case of the Energy East proposal, the entire panel assigned to review that TransCanada project was forced to recuse itself, along with the NEB’s chief executive Peter Watson, due to the appearance of bias last September following revelations uncovered by National Observer in July and August.
At the time, National Observer revealed that Watson and other senior NEB officials had met privately with a representative of TransCanada, former Quebec premier Jean Charest, who gave them political advice about how to gain public support in Quebec for a new pipeline.
During an interview with National Observer in February, other members of the panel noted that one of the key problems they had identified was the NEB’s close proximity to the headquarters of Canada’s largest oil and gas companies in Calgary.
“This is something we have identified in terms of what we’ve heard,” said Lauzon, a lawyer who presides over the Quebec Business Council on the Environment, in February. “The perception is that because the head office is in Calgary, this is one of the reasons people believe it’s too close to the industry. We’ve heard the word ‘captured’ by the industry. So this is something we’re hearing and this is something which could be improved in terms of having more representation from all other stakeholders.”
Editor’s note: This article was updated at 1:45 p.m. on Monday with new comments from panel members. By Mike De Souza & Elizabeth McSheffrey in News, Energy, Politics | May 15th 2017