I'm bringing the meeting to order. Thank you very much. I would like to make sure we have lots of time for the questioning that people want, and I'm also going to take about 10 minutes at the end for a little bit of committee business to ask for some input on witness panels.
Let me introduce our guests. Thank you very much for being with us today. I know it's a bit of an early morning, but we're running a Friday schedule. We appreciate your accommodation of coming in at 8:30.
I would like to introduce Francis Bradley, chief operating officer, Canadian Electricity Association. We also have Terry Toner, director, environmental services, Nova Scotia Power. We have the Canadian Nuclear Association here, with John Barrett, president and chief executive officer, and Liam Mooney, vice-president, Cameco Corporation. From the Mining Association of Canada, we have Pierre Gratton, president and chief executive officer, and Justyna Laurie-Lean, vice-president, environment and regulatory affairs.
Thank you very much for being here. I'm not sure which of you would like to start off.
Just so you know how I work, I try not to interrupt people who are talking, but I do want to signal when you're coming to the end of your 10 minutes. I'll hold up the yellow card when you have a minute to go. Red means that we're out of time, so please wrap up what you're trying to say in an expeditious way.
The floor is yours.
Thank you, Madam Chair and members of the committee, for inviting the Canadian Electricity Association, or CEA short, to appear before you on this important review of Bill .
I am pleased to represent the association this morning, as our CEO, Sergio Marchi, had a prescheduled commitment outside Ottawa. I am accompanied by Terry Toner, director of environmental services with Nova Scotia Power.
Together, we will provide you with the electricity sector's perspective on the bill, specifically the Impact Assessment Act.
Before I do so, I'd like to say a few words about the association. The CEA is the national voice and forum for the Canadian electricity sector. Our membership is comprised of major generation, transmission, and distribution companies from across Canada, as well as manufacturers, technology companies, and consulting firms representing the full spectrum of electricity suppliers.
Electricity is indispensable to the quality of life of Canadians and to the competitiveness of our economy.
Indeed, the electricity sector is also uniquely positioned to contribute to a cleaner and greener energy era. For us to realize this opportunity, two conditions are critical. Our business environment must be competitive, and the regulatory framework must provide confidence that good projects will get built.
As an industry we are deeply preoccupied by the accumulation of wide-scoping federal and provincial-territorial legislative and regulatory changes. This pancaking effect challenges the economics of needed investments in energy projects.
The ministers who appeared before this committee last week spoke of their intent with Bill , to ensure good projects get built. We applaud the intent; however, we believe that absent constructive amendments, Bill C-69 has the potential to discourage worthy investments.
As a committee, you have an opportunity and obligation to restore public trust and create more predictable, balanced, and workable legislation.
Let me turn to Terry Toner, who will share our specific recommendations.
I'd like to begin by acknowledging that this bill contains a lot of progressive provisions. However, the following adjustments that we'll be talking about would further improve the intent of the . For the sake of brevity, I will be focusing my comments on the impact assessment portion.
Speaking about clarity and predictability, and spoke to the need for project proponents to know what is required of them from the beginning of the regulatory process. We would suggest that some simple yet important modifications are necessary to meet this objective. Minister McKenna has made it clear that this act is focused on major projects. We support this, and we look forward to that being reflected in the project list.
The project list, to be developed by regulation, must firmly establish the scope of application of the . The power of the minister to designate other projects for review must be circumscribed and used only in exceptional circumstances, based on the criteria used to develop the list in the first place. The consideration of alternatives to a project should be limited to ones that are technically and economically feasible. Transitional provisions should also make clear that existing projects already on a regulatory path are not brought under the ambit of the impact assessment act.
In the quest for clarity and focus, we welcome strategic and regional assessments. It is our hope that these may ensure that individual project reviews are not burdened with analysis of impacts well beyond their scope. Too often now, project reviews are the place where we debate and litigate national policy in such domains as climate or indigenous reconciliation. A project review should be just that: a project review.
Speaking about timelines, while the timelines in the bill provide some guidance for project proponents, the government's goal of process predictability is significantly diluted by provisions in the acts that permit limitless extensions and suspensions. Time is of critical value, and it can make the difference between a project built and a project abandoned. We accept that there must be some flexibility, but there must also be discipline and transparency in order to ensure investor confidence in Canadian infrastructure projects.
Extensions decided by the Governor in Council should be published with reasons. There should be limits for the time taken by the minister to establish the terms of reference and the composition of a panel. Once a decision is made at the end of the process, there should be a firm timeline to issue the decision and no capacity for the Governor in Council to delay.
We also propose, for your consideration, a provision that could quite importantly give proponents and all participants some confidence that closure may be achieved at the end of an authoritative process, a privative clause that would narrowly contain the scope for legal challenges. There must be proper deference by all parties, including the courts, to the judgment exercised by the authorities entrusted with the administration of this legislation. A project decision must not be the beginning of a new process played out in the courts. There are precedents for such clauses in other federal and provincial acts.
Speaking about balance, it is critically important that the ensure balanced consideration of environmental and economic factors. The current draft is deficient in that it can easily be recalibrated as per the following recommendations.
The requirement to take into account whether the project hinders or contributes to the government's environmental obligations and commitments in respect of climate change is welcomed by our sector. We expect to make positive contributions to the pan-Canadian framework for clean growth and climate change, yet there must be as explicit a requirement to take into account economic benefits, which is currently implied only by reference to a broad concept of sustainability.
In speaking of cost recovery and proponents' obligations, any regulatory process must be subject to cost discipline. Costs charged to proponents should not exceed amounts reasonably incurred by the crown. For predictability and good management, there should also be provided to the proponent at the beginning of the process an estimate of projected costs—in effect, a budget.
Our full submission to the committee next week will summarize the intent and wording of our proposed amendments. We commend them to your attention.
Thank you, Madam Chair.
My name is John Barrett, and I am president and CEO of the Canadian Nuclear Association. With me today is Liam Mooney, vice-president of safety, health, environment quality, and regulatory relations with Cameco Corporation.
The Canadian Nuclear Association has approximately 100 members, representing more than 60,000 Canadians employed directly or indirectly in uranium mining and exploration, fuel processing, electricity generation, and the production and advancement of nuclear medicine.
Today, nuclear energy produces approximately 20% of Canada's non-emitting clean electricity, including 63% of Ontario's electricity. Of note is that, when the Ontario government committed to phasing out coal generation across the province, a major part of this commitment was made possible through the refurbishment of six reactors. Looking to the future, nuclear energy will play an increasingly important role in the overall low-carbon energy mix, as well as in nuclear medicine, advanced manufacturing, and electronics.
Canada's nuclear industry also works closely with indigenous peoples and communities, not only to enable proactive engagement but also to create mutually beneficial opportunities. As one example, Cameco has worked closely with indigenous communities in northern Saskatchewan for decades on environmental stewardship, community investment, employment, education and training, and contracting opportunities. Cameco has demonstrated the power of such partnerships in improving the economic and social well-being for communities and the benefits of working together to bring about real change.
I would like to preface our feedback today by highlighting, first, the concept of cumulative impact, which is a key issue not only with respect to the environment but also with respect to investment in Canada. Large energy projects require large amounts of capital, capital is fluid, and investors do not like uncertainty, so any new legislation, no matter how well intentioned, creates initial uncertainty.
Against this backdrop, CNA would like to offer the following comments and amendments for your consideration on Bill .
Let's start with joint panels. The draft bill proposes that a single government agency be responsible for impact assessment reviews. In the case of the nuclear industry, the bill only provides for the option of an agency-led joint panel review. While joint panels are not new—we've had them in the past—CNA does not believe this will be an improvement over the current process.
Most of the potential impacts considered in relation to nuclear projects are related to radiation protection and international commitments on safeguards and non-proliferation. That work must be overseen by an agency with significant and specialized scientific expertise. The Canadian Nuclear Safety Commission, CNSC, is the only place in government with that expertise. The CNA believes that assessment should remain at the CNSC, as the most efficient and effective way of conducting reviews.
As a full life-cycle regulator, the CNSC licensing regime and regulatory framework already covers the entire life cycle of the project and is subject to the Nuclear Safety and Control Act and its regulations. This allows CNSC, the commission, not only to conduct the impact assessment in the planning phase of the project, but also to ensure that monitoring programs and follow-up conditions required by the impact assessment are directly integrated into the licensing process throughout the various stages of the projects. In this regard, our industry is unique, and the CNSC uniquely has the expertise to best manage our projects.
I'll turn now to the designated project list. Bill makes provisions for a designated project list to be created by regulation. This list determines what projects are subject to review by the new agencies, and by default, what projects will be reviewed by the life-cycle regulator, as is the case in the nuclear industry. It is difficult to fully consider the impact and consequences of the impact assessment agency without fully understanding what projects will come under the IAA review.
The CNA believes a facility or project should undergo one impact assessment for its life cycle. As drafted, proposed section 43 could be interpreted as to require an impact assessment for any activity at a facility regulated under the Nuclear Safety and Control Act. However, maintenance, technological, and capital upgrades are fully regulated by the life-cycle regulator, by provincial regulators, or by other federal authorities, and thus, there is no need for a new IA. Therefore, this could be clarified.
In addition, many of our sites are large and with significant space for new facilities, including new reactors and research facilities that could require an IA under the new agency. Most nuclear sites have undergone full environmental assessments. They have had continuous environmental monitoring and their environmental impact is well understood. If a new project were to occur on one of these existing sites, it should not require a full impact assessment, but rather, an assessment of the delta between what has already been done and what is now required. In our view, the delta assessment could be best done by the life-cycle regulator.
On timelines, CNA members have significant concerns over the proposed timelines. We understand and we appreciate the government's intention with an early planning phase, but are somewhat skeptical of the potential effectiveness.
As the early planning phase occurs after the proponent has provided an initial project description, the proponent will have already undertaken stakeholder engagement to ensure the business case and to have some degree of confidence that the issues can be mitigated. The CNA believes the current process already allows for the important early input and engagement from local communities, indigenous groups, and public stakeholders.
In addition to the uncertainty caused by creating a new agency-run early engagement process, Bill dramatically increases the scope of assessment, by adding several new elements of review. While the criteria, aims, and goals of environmental assessment are well understood and measurable, there is a great deal of uncertainty around some of the new elements of assessment. We would like to work with the government to provide greater definition on how the various elements are weighted in decision-making. Are all elements weighted equally? Is there a minimum weighting level that must be met?
Answers to such questions will help proponents factor these elements into their project descriptions and their early engagement with stakeholders. Also, our members have concerns about how closure will be achieved with respect to issues raised through the review process. It is our view that, without some decision-making procedure that allows closure on contentious issues, the new IA process will simply add uncertainty and increased timelines, create additional work with minimal project benefits, and result in multiple legal challenges.
I will now hand it over to Liam Mooney for our recommendations.
One specific amendment that the CNA would like to propose is on the multiple scoping phases in the proposed process. The planning phase was intended, in part, to improve certainty and predictability by determining the requirements that the proponent would have to meet early in the process. In our view, the bill's process does not achieve that goal.
The proposed bill sets out an initial scoping by the agency as informed by federal authorities, all other jurisdictions, the public, and indigenous groups. However, the bill also allows for two additional scoping phases: one at the sole discretion of the agency, and one by the review panel, which is appointed later. These final two potential scoping phases are well into the process. They could change the scope of the project after the proponent has spent years and millions of dollars to comply with the original scoping decision.
For panel reviews, a “one project, one review” process can only occur if the scoping stage is coordinated amongst the agency, the review panel, and all federal regulators, as well as harmonized with provincial or other jurisdictional requirements. For this to occur, two overarching amendments must be made: first, the chronology of the provisions in the proposed bill must be changed, and second, successive scoping stages throughout the assessment process must be replaced by a consolidated, single, harmonized scoping early in the process, which is led by the review panel.
The CNA would also like to propose an amendment with respect to uranium mining. Similar amendments have been proposed by the Mining Association of Canada and the Prospectors & Developers Association of Canada. More specifically, designated projects that are related to uranium mines and mills, like any other designated mining project, should undergo agency assessments with full access to provisions with co-operation with provinces and indigenous governing bodies.
Uranium mines and mills, like all other mines and mills, are subject to provincial regulatory and permitting frameworks, but they are also regulated by the Canadian Nuclear Safety Commission. Federal environmental assessment legislation has historically allowed the CNSC to co-operate with a province in the ongoing oversight of uranium mines and mills. However, Bill would preclude this co-operation and prevent agency-led assessments, joint review panel assessments, and substitution for all designated projects that are regulated by the CNSC. As a result, the opportunity for co-operation with a province and using a “one process, one assessment” approach is lost by treating all such projects as exclusively in federal jurisdiction.
There's no justification for such different treatment, because the complexity and impacts of uranium mines and mills are not in a different category from those of other mines and mills. Co-operative assessment processes across jurisdictions increase efficiency and decrease timelines and costs, and should be available to uranium mines and mills. The CNSC, like other federal regulatory bodies, would have the opportunity to be engaged in an agency-led assessment as provided for in the proposed process to encourage coordination within the federal government.
The CNA urges the committee to recommend changes to the provisions dealing with CNSC-regulated projects to permit designated projects related to uranium mines and mills to access the agency assessment provisions of the bill, including the suite of provisions related to co-operation with provinces and indigenous governing bodies. Further, we would propose that mines and mills be specifically excluded from the automatic panel review created by proposed section 43, by adding “other than a uranium mine or mill” after each reference to the Nuclear Safety and Control Act.
Thank you very much, Madam Chair and members of the committee. It's a pleasure for the Mining Association of Canada to be with you today.
Members of the committee, I'm mad.
Last week, you heard from , who said:
||All projects that are currently under review will be reviewed under the National Energy Board
||Even after the legislation is proclaimed, these projects that began under the current system will remain under the current system unless the proponent makes the choice to move to the new one. It would be a decision that the proponent would make.
It makes sense. Such logic befits a democratic country such as ours, where rule of law is respected.
What he didn't tell you is that for mining projects and all others subject to agency assessment, the rule of law will be ignored by this bill. In the case of mining, only projects at the very end of their reviews, awaiting final decisions, will remain under CEAA 2012. All other projects that are any earlier in the process will transfer to the new IA act and essentially start again in some way, shape, or form to be determined by officials on a case-by-case basis, however they think best, at a date we don't yet know.
When we asked why this is, we were told that the government is concerned that there would be projects a few years after the act came into force that would still be governed by CEAA 2012, and that these assessments would lack public confidence. They said they wanted to clean house and bring all assessments forward under one act, to make their workload a little less complicated. The fact that it will make the workload of mining companies wanting to invest billions of dollars in Canada a whole lot more complicated didn't seem to matter.
I ask this committee: Why is it that the government feels there will be a lack of public confidence in mining reviews but not pipelines? Why the double standard in Bill ?
Shouldn't the government be more concerned about the lack of international investor confidence in Canada's respect for the rule of law?
To be clear, it is not fear or opposition to the IA act that makes me say this. As will be evident in a minute, we believe that the proposed legislation, implemented well, may result in an improved review process for mining over CEAA 2012. The problem is the uncertainty. Proponents making billion-dollar investments need to know what the rules are and how they will be implemented. You can't have this certainty knowing that the rules may change midstream in some way.
Thus MAC strongly recommends that the committee support the proposed amendment in our submission that would change the transition provisions by amending proposed section 181 so that projects undergoing CEAA 2012 agency assessment will continue under CEAA 2012, but allow the proponent to request transition of the assessment to the IAA or impact assessment act; i.e., the same as for NEB projects.
Now let me turn to comments on the rest of the proposed legislation. A number of measures, implemented well, as I said, hold the promise of an improved review process for mines.
Mining is constitutionally the responsibility of provinces, and each of Canada's provinces has its own environmental assessment regime. In addition to the requirements for building and operating a mine, provinces require companies to develop reclamation plans and provide financial assurance for their implementation. Co-operation with other jurisdictions on project review is, therefore, critical for the mining sector.
Although CEAA 2012 introduced the possibility of substitution to other jurisdictions, in practice this has only been taken up by one province, British Columbia.
CEAA 2012 also introduced legislated timelines, which are critical for industry and the smooth functioning of assessment. However, CEAA 2012's timelines are rigid and have had the unintended effect of making co-operation more difficult and at times unworkable with other jurisdictions that have not pursued substitution.
The proposed IAA maintains timelines but provides for flexibility to better align with other jurisdictions, plus it contains a number of other measures that should improve co-operation with provincial governments. As well, we are encouraged that the proposed legislation provides for extending co-operation with indigenous governments.
There is one notable exception with regard to uranium mines and mills, and that is the one my colleague and friend Liam Mooney just mentioned. I won't repeat what he just said—I think he made exactly the same point I was going to make—except to emphasize that while, as I've just said, there are measures in this proposed legislation that promise to improve coordination for mining projects with other levels of government, it takes a step backwards when it comes to uranium mines and mills. That needs to be addressed in the way that Liam Mooney just outlined. We urge this committee to take that recommendation extremely seriously. It's our understanding as well that this is an inadvertent measure, so I'm hopeful this committee will recognize that and correct it.
Beyond provincial assessments and permitting and federal assessment, many mines require other federal approvals. Inadequate interdepartmental coordination has been a source of duplication and delays for mining for years. MAC, therefore, is encouraged by proposed subsection 13(2) and related provisions, which hold the promise of improved coordination and shorter timelines, though I might add that the different treatment of NEB projects and CEAA suggests there is still work to do to improve coordination between two parts of government.
Perhaps our greatest concern with CEAA 2012 has been how it has disproportionately applied the responsibility for cumulative effects to proposed mining projects and not to the sources of most environmental effects. The project-by-project approach to addressing cumulative effects in CEAA 2012 is dysfunctional, penalizing responsible project proponents while failing to address cumulative effects resulting from activities that are not designated projects under the act.
The mining industry is not the only user of the land base. Its impacts are localized and, on most metrics of environmental effects, dwarfed by other activities.
We're encouraged, therefore, by the approach proposed in the IAA, which includes cumulative effects as a factor to consider in decision-making, but not as a sole factor. The IAA also proposes to strengthen provisions for regional and strategic assessments.
Governments are best placed to undertake cumulative effects assessment on a regional basis. We've been advocating these measures for over 15 years, so we are pleased to see them incorporated in Bill .
It is critical, however, that the completion of regional assessments not be a prerequisite to individual project assessments. It would be unreasonable and prohibitive to Canada's investment climate to delay projects while awaiting governments to address all relevant gaps.
It will take many years to complete regional studies across the country, and we can't wait for all of those to be completed before we allow projects to move forward.
Related to these issues is the project list, where mining makes up the vast majority of CEAA projects despite a relatively small footprint. While the revision of the regulations designating physical activities is subject to separate consultations, we are concerned that the IAA will remain arbitrarily and disproportionately applied to mining. Should this be the case, it will hamper our sector while not achieving the sustainability, public trust, and indigenous reconciliation goals the act is purported to advance.
Let me conclude with the following message. Our sector has entered a new period of strong commodity prices, and decisions are being made around the world on where to invest. Unfortunately, pipeline politics and the general politicization of natural resources development, in a country that is a recognized leader in natural resources, are putting our country's future at serious risk.
Canada's relative share of global mineral exploration investment has fallen by half in the past five years, and the number of projects submitted for review has hit record lows since the original CEAA was proclaimed in 1992.
Sadly, most of my members are not choosing Canada right now, and I fear that, unless the situation I described improves quickly, Canada is going to largely miss the current cycle. This will impact a sector with nearly 400 agreements with indigenous communities across Canada, which has become the largest employer of indigenous people and one of the largest clients of indigenous businesses.
Canada is in desperate need of some stability and predictability in the regulatory environment governing natural resources. It is in this spirit that we submit our comments on this proposed legislation. The proposed legislation, while not perfect, addresses some long-standing concerns we've had with federal environmental assessment and some more recent problems we've experienced with CEAA 2012. If implemented well—this is a critical “if”—and if you support our two critical amendments, the proposed legislation could bring some certainty and predictability back to the federal project review of mining projects.
I might add also that, from our perspective, it's an excellent question because we try to frame, as best as possible, the work of our industry within that larger context, because that is really the key element of the industry. It can contribute all of this very dense source of clean electricity to our country and to others around the world. When we look at the act, we see that this is the opportunity to allow projects to proceed on a timely basis, producing the confidence among all stakeholders, among communities and citizens, that this is very safe, the environmental protection is there, and people are satisfied with that.
What is coming down the track, internationally and certainly in Canada, is that we're being seen, right now, as a leader in the development of advanced nuclear technology that may be reduced in size so that you have smaller types of reactors that could have applications that open up a vast array of possibilities in Canada and elsewhere, where you're not looking at huge capital projects that could break the bank, but smaller reactors, right down to a kind of battery that could go in small communities.
I'll stop here, but the main point is that working hand in glove, industry with the act, we could really do some very impressive things for our country.
Thank you. We'll just see how it goes. I may not need it all.
I want to thank Mr. Gratton for his intervention saying that there should also be support for the public, indigenous, and so forth—financial support to participate in the regulatory process. We talk about it for the EIA process but we never talk about the parallel. I would encourage him to write a letter of support for the Canadian Environmental Network, which is seeking restoration of the fund that Mr. Baird cut. It was started in 1979 and it was very helpful because then we had constructive input to industry. I would encourage you to speak to the Canadian Environmental Network. Thank you for your intervention on that.
I think it was the Canadian Electricity Association that raised this issue. They were concerned that there's not enough emphasis in this review on the economic benefits. Surely it's equally important that we also identify the economic costs. For example, some development could impact other sectors, like the fishery, or it could impact the traditional harvest or tourism, or it could cause health impacts through air pollution or contamination of water.
Back in the 1980s, my recollection is that we did a lot of work before review panels, not just on the environmental and economic impact assessment but also on the social impact. For some reason, by the time we got to the mid-1990s, that disappeared. Would you not agree that there probably is a lot of expertise out there that we could just bring back? This isn't something new and different that, when looking at the sustainability of a project, we look at a more broad-based....
Is it not also true that the federal government has an international obligation to deliver on the 2030 sustainable development goals, and this is the mechanism to do that?