Loopholes aren’t enough to get big projects done.
That’s the message that the energy sector is delivering loud and clear to the Carney government.
Just weeks ago, the Carney government passed Bill C-5, otherwise known as the One Canadian Economy Act.
For some, the bill was a step in the right direction. After years of purposeful blocking of energy projects by the Trudeau government, any step toward finding ways to cut through the bureaucratic processes the Liberals have added to the project approval process over the past decade is welcome.
As the Montreal Economic Institute (MEI) astutely notes in a recent publication, “Bill C-5 is an admission that the current processes are too complicated and burdensome.”
But, at the same time, Bill C-5 only offers a loophole to get around the Impact Assessment Act (IAA) for projects that the government deems to be in the national interest. If a specific project is not given that designation by the government, it still faces all of the same red tape that has led to failure to get major projects approved over the past decade.
The MEI notes that only 20 projects are currently undergoing an impact assessment under the IAA approval process, and they are all far from completion despite having spent an average of nearly three years going through the process. Just one project, Cedar LNG, has successfully navigated the IAA process since it became law a long six years ago.
Thus, if the federal government doesn’t deem a project to be “in the national interest,” something exclusively in the wheelhouse of the Carney Liberals and their advisors, the project is most likely a dead man walking.
The clear answer here is not to leave it up to the Carney Liberals to decide when a project is in the national interest and therefore won’t be stuck for years on end going through bureaucratic red tape. It’s to overhaul the energy project approval process entirely so that approving a project is the default mindset in Ottawa.
Author Krystle Wittevrongel lays out six reforms that can be made to the IAA to get projects moving.
First, limit the scope of federal assessments to areas of federal jurisdiction. For those projects that are within provincial jurisdiction, provinces, not the federal government, should conduct reviews.
Second, fast-tack projects that are using existing infrastructure or rights of way by focusing assessments on new or additional impacts not covered by an earlier assessment rather than reassessing the whole project.
Third, remove the ability of the minister to extend the time limit or suspend the impact assessment process.
Fourth, have the federal government automatically recognize provincial assessments that have already been done, to avoid further overlap and duplication that is a hallmark of the present process.
Fifth, restrict the scope of factors under consideration for an assessment, with a focus on environmental impact.
Finally, provide certainty for project proponents as to whether an impact assessment is even needed. By stopping the minister from being able to order an assessment if he or she feels like ordering one, there will be certainty provided as to whether a project actually needs an impact assessment or not.
These are ideas should be no brainers for a government that claims it wants the Canadian economy to become more self reliant.
The current IAA, passed in 2019, was largely designed so that projects wouldn’t move forward. It’s time for a new impact assessment law that is actually designed to ensure that projects do get built, to contribute to Canada’s faltering national economy.
Canada faces trade headwinds from abroad and has seen hundreds of billions of dollars’ worth of projects delayed or cancelled because of government obstinance in recent years. Now is the time for the Carney government to pursue real reform that doesn’t just offer loopholes for a small subset of projects but rather encourages proponents to come forward with new project ideas with an expectation that there are rules in place that actually want to see projects succeed, rather than being designed for failure.
Jay Goldberg is the Canadian Affairs Manager at the Consumer Choice Center
Jay Goldberg is the Canadian Affairs Manager at the Consumer Choice Center. He previously served as the Ontario Director at the Canadian Taxpayers Federation and a policy fellow at the Munk School of Public Policy and Global Affairs. Jay holds a Ph.D. in Political Science from the University of Toronto.
