WPC Panel Tackles Canadian Policy And Regulatory Challenges

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CAPP president and CEO Lisa Baiton.

While Canada may not be able to compete dollar-for-dollar on the scale of United States funding for cleantech, there’s a real urgency to find a made-in-Canada solution that can put this country back on track, a World Petroleum Congress session heard Monday. 

“As a leader in clean technology, we need a simple and co-ordinated approach on policy and on incentives if we really want to put the billions of dollars into clean technology,” Lisa Baiton, president and CEO of the Canadian Association of Petroleum Producers (CAPP), told a session on advancing sustainable solutions through a Canadian policy and regulatory lens.

“That capital is waiting as industries and investors look at Canada's uncertain regulatory and policy environment and that uncertainty really discourages the investment in the very energy systems that would allow Canadians to thrive in a lower carbon future.”

The non-profit Council for Clean and Reliable Energy, which provides a platform for dialogue and analysis on energy policy, also is advocating for a national energy vision, said Karen Taylor, vice-chair of the council and an independent energy consultant. “It should be principles-based, deal with energy supply and demand and work hand-in-glove with Canada’s climate change framework,” she said.

“If we are going to talk about principles, first and foremost, we need a vision — what is the vision for Canada? What is the vision for this industry?”  said Baiton.

One vision could be pride in Canada’s abundant oil and natural gas reserves and in Canadian companies that are already global leaders in emissions-reducing technology, she said. “We should start with a vision as our first principle for Canada which is: how do we leverage that and remain competitive?”  

The second principle is pragmatism. “We need a better alignment and understanding on how highly correlated, different policy pieces are,” said Baiton. “All equally important, but you can't deal with climate change in isolation of energy security. Energy security is national security or continental security and you can't deal with that without thinking about the economy.”

Charlene Johnson, CEO of Energy NL, which represents service and supply companies, believes that while there are more opportunities than challenges in the Newfoundland and Labrador energy sector, there also are obstacles.

“When it comes to federal processes, especially in terms of environmental regulations, we have some work to do,” said the former provincial minister of environment and conservation. “We have some work to do to streamline processes to remove politics and have projects stand on their own merits,” said Johnson.

“There's nobody in this room that's going to disagree that protecting the environment is paramount,” she said. “We need protection and we need progress. We do not need added processes.”

As for what is needed, “we need to strive for stability in the regulatory regime and in the environmental assessment process,” Johnson said. “We need clarity, we need certainty and the process needs to be apolitical. We have to have streamlined processes that can’t be onerous, just for the sake of being so.”

Although the federal Court of Appeal rejected an appeal by environmental and Indigenous groups of Equinor’s proposed $16 billion Bay du Nord project offshore Newfoundland and Labrador’s East Coast, the company has postponed it for up to three years.

Johnson said she was confident all along that the project would be approved. “It stands on its own merits. It's one of the lowest carbon emitting projects in Canada [and] one of the lowest in the world,” she said.

“You leave this to the experts. These are the people that do the work to approve whether or not a project should proceed.”

However, unexpected and unexplained delays in the process — twice in this case — increase the level of uncertainty and risk, encouraging investments to go elsewhere, said. “And what ends up happening is that companies don't have projects here. They don't complete projects here.”

Downstream, Canadian refiners are facing their own challenges with the implementation of the federal Clean Fuel Regulation which was six years in development, said David Schick, vice-president-Western Canada, innovation and regulatory affairs for the Canadian Fuels Association which represents 15 Canadian refiners.

“We're finding that the application and implementation of that policy is being challenged by new policies that are being brought onstream that challenge the investment decisions that we're needing to make in the near term,” he said.  

“We are working really diligently but it seems like one policy is coming after the next one, reducing the policy certainty that allows us to move forward and let these projects get built in order to meet our GHG reduction targets,” said Schick. “So it's really critical that there's an understanding that these things don't work in isolation, because we're also working with provincial policies which are often very stringent as well.” 

“They also need to be able to be coherent with one another and allow for credits to be generated under both policies in order to help increase the certainty around building and sales.”

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