Deck 2: Overview of the National Energy Board s Current Structure, Role and Mandate

Transcription

1 Deck 2: Overview f the Natinal Energy Bard s Current Structure, Rle and Mandate Presentatin t the Expert Panel Cnducting the NEB Mdernizatin Review 29 Nvember 2016 RDIMS

2 Outline 1. Mandate and Rle f the NEB 2. Key Legislatin 3. Review Terms f Reference 3.1 Gvernance 3.2 Determining Public Interest 3.3 Decisin Making Rles 3.4 Overview f Lifecycle Regulatin 3.5 Envirnmental Assessment 3.6 Cnditin Cmpliance 3.7 Lifecycle Oversight Tls 3.8 Land Matters 3.9 Indigenus Engagement 3.10 Public Participatin 3.11 Energy Infrmatin 4. Cnclusin 5. Annexes 1

3 1. Mandate and Rle f the NEB 2

4 1. Mandate and Rle f the NEB The NEB is Canada s natinal energy regulatr. The NEB was established by Parliament t, amng ther things, make regulatry decisins and recmmendatins t the Gvernr in Cuncil (GIC) and prvide infrmatin and advice n energy matters. There have been significant changes in the public cntext since the Natinal Energy Bard Act (NEB Act) was first enacted (e.g., emergence f plicy issues, such as climate change, Indigenus issues, and heightened public awareness f energy issues). Recent years have seen a number f changes t the NEB Act t address specific issues; hwever there has never been a hlistic review. 3

5 1. Mandate and Rle f the NEB (cnt d) The NEB has fur cre respnsibilities: 1. Energy Adjudicatin - Making decisins r recmmendatins t the Gvernr in Cuncil n applicatins, which include envirnmental assessments, using prcesses that are fair, transparent, timely and accessible. These applicatins pertain t pipelines and related facilities, internatinal pwer lines, tlls and tariffs, energy exprts and imprts, and il and gas explratin and drilling in certain nrthern and ffshre areas f Canada. 2. Safety and Envirnment Oversight - Setting and enfrcing regulatry expectatins fr Natinal Energy Bard-regulated cmpanies ver the full lifecycle -- cnstructin, peratin and abandnment -- f energy-related activities. These activities pertain t pipelines and related facilities, internatinal pwer lines, tlls and tariffs, energy exprts and imprts, and il and gas explratin and drilling in certain nrthern and ffshre areas f Canada. 3. Energy Infrmatin - Cllecting, mnitring, analyzing and publishing infrmatin n energy markets and supply, surces f energy, and the safety and security f pipelines and internatinal pwer lines. 4. Engagement - Engaging with stakehlders and Indigenus Peples n tpics within the Natinal Energy Bard s mandate and rle, beynd engagement n specific prjects. 4

6 2. Key Legislatin 5

7 2. Key Legislatin The NEB s primary functins fall under tw key Acts: Natinal Energy Bard Act (NEB Act) the NEB regulates cnstructin, peratin and abandnment f interprvincial and internatinal pipelines; cnstructin, peratin and abandnment f internatinal r designated inter-prvincial pwerlines; imprts f natural gas and exprts f crude il, natural gas liquids, natural gas, refined petrleum prducts and electricity. Canadian Envirnmental Assessment Act, 2012 (CEAA, 2012) as a respnsible authrity, the NEB carries ut envirnmental assessments fr certain designated prjects, including new NEB Act-regulated pipelines ver 40 km in length. 6

8 2. Key Legislatin (cnt d) Legislative changes in 2012 made changes t the NEB Act and intrduced CEAA, Gvernr in Cuncil (GIC) final g/n-g decisin n all majr pipeline prjects. 18 mnth time limits fr majr prject reviews (NEB: 15 mnths, GIC: 3 mnths). Envirnmental assessment respnsibility cnslidated with either the NEB, the Canadian Nuclear Safety Cmmissin and the Canadian Envirnmental Assessment Agency. NEB s enfrcement and cmpliance tls enhanced (e.g. new administrative mnetary penalties). Participatin in NEB prject reviews limited t thse directly affected r with relevant infrmatin r expertise. Mre recently, the Pipeline Safety Act made legislative amendments t the NEB Act t strengthen ur tl-kit t regulate pipelines in the areas f financial requirements fr releases, abandnment, and damage preventin. Hwever, the basic framewrk f the NEB remains unchanged. 7

9 3. Review Terms f Reference Since 2015, the NEB has embarked n a transfrmative agenda. Examples f this wrk, which align t the specific areas in the Terms f Reference, are nted n the slides. 8

10 3.1 Gvernance The NEB reprts t Parliament thrugh the Minister f Natural Resurces. Cmpsitin and expertise f Bard Members The NEB Act prvides fr up t 9 permanent Bard Members appinted by the GIC fr a perid f 7 years (eligible t be re-appinted fr an additinal term f up t 7 years). Permanent Bard Members must reside in, r near, Calgary. The GIC can appint an unlimited number f temprary Bard Members, n such terms and cnditins that the GIC may prescribe. The Bard is currently cmprised f 8 permanent Bard Members, including the Chair and Vice-Chair, and 10 temprary Bard Members (as f Nvember 2016). Bard Members are supprted by 450 expert staff representing varius disciplines (e.g., envirnment, finance, markets, engagement, law). NEB s peratinal and adjudicative functins The GIC designates ne Bard Member t be the Chair, wh is als required t be the chief executive fficer (CEO), r Deputy Head, f the Bard (i.e., tw very different rles). 9

11 3.1 Gvernance (cnt d) Rle f the Chair/CEO/Deputy Head The Chair is respnsible fr apprtining wrk amng members, deciding whether the Bard sits in a Panel, and assigning members t Panels including a presiding member. The Chair may delegate specific authrities t Bard Members, thrugh sectin 14 r 15 f the NEB Act, but nt t staff (see Annex fr details). The CEO has supervisin ver and directin f the wrk f staff (see Annex fr examples f different gvernance mdels). The CEO is als the Deputy Head under certain statues such as the Financial Administratin Act. The Deputy Head has accuntabilities fr verall perfrmance f the agency, financial, and human resurce matters. Rle f the NEB in implementing Gvernment plicies and pririties The NEB s rle is t implement nt set plicies affirmed by federal legislatin. The NEB Act des nt have a mechanism fr the Gvernment t prvide plicy directin t the NEB, r Chair/CEO. The NEB Act des have a mechanism fr the NEB t prvide advice t the Minister n energy issues, when requested. The NEB has been imprving its internal gvernance structure, which allws fr the transparent reprting f critical perfrmance (e.g., NEB Results Framewrk and the Management Systems Manual). 10

12 3.2 Determining Public Interest In its adjudicative rle, the NEB must decide r recmmend if a prject is in the Canadian public interest. Thrughut the lifecycle, the NEB hlds thse it regulates accuntable s that Canadians and the envirnment are prtected. The NEB Act des nt explicitly define the Canadian public interest, hwever it des prvide directin abut certain relevant factrs in subsectin 52(2). The NEB has described the public interest in the fllwing terms: The public interest is inclusive f all Canadians and refers t a balance f ecnmic, envirnmental and scial interests that change as sciety s values and preferences evlve ver time. As a regulatr, the Bard must estimate the verall public gd a prject may create and its ptential negative aspects, weigh its varius impacts, and make a decisin. Given the brad nature f the NEB Act, the NEB has the discretin t cnsider factrs ther than thse expressly listed in it, based n the facts f a prject applicatin, including envirnmental and sci-ecnmic effects that are directly related t a prject. 11

13 3.3 Decisin-making Rles Pipeline prjects greater than 40 km in length (see Annex fr details) Under the NEB Act, the NEB makes a recmmendatin n whether the prject is in the present and future public cnvenience and necessity and shuld be apprved. GIC makes the decisin. Under CEAA 2012, the NEB makes a recmmendatin n whether the prject is likely t cause significant adverse envirnmental effects and whether thse effects can be justified. GIC makes the decisin. The NEB makes the decisin n whether pipeline prjects 40 km in length r less, and pipeline facilities, shuld be apprved. The NEB makes the decisin n whether a pwer line certificate shuld be granted. The decisin is subject t GIC apprval. The NEB has n jurisdictin ver land cmpensatin disputes; these issues are within Natural Resurces Canada s (NRCan) purview. NRCan versees the appintment f a negtiatr r arbitratin cmmittee and the Cmmittee makes the decisin. As the NEB Act des nt clarify gvernance, the NEB has been imprving its internal decisin making rles t prvide clarity n wh is respnsible fr making what decisins in the rganizatin, within the current legislative framewrk. Therefre, sme key gvernance issues remain t be addressed. 12

14 3.4 Overview f Lifecycle Regulatin The NEB hlds thse it regulates accuntable s Canadians and the envirnment are prtected thrughut the lifecycle f the prject, frm applicatin t abandnment. Because it is a lifecycle regulatr, the NEB culd be cnsidered the steward f the pipeline safety system. The NEB is wrking t increase the understanding f its lifecycle rle and expectatins f cmpanies t adhere t its regulatins. 13

15 3.5 Envirnmental Assessment The NEB always cnducts an envirnment assessment (EA) fr prjects, regardless f whether CEAA 2012 applies, as a part f its public interest mandate. In circumstances when CEAA 2012 applies, the envirnmental assessment is cnducted in accrdance with the requirements f CEAA The Bard has decades f experience in taking a science-based apprach t cnsider ptential envirnmental effects when making regulatry decisins. All f the Bard s envirnmental assessments examine key issues which include physical and meterlgical envirnment; wetlands; water quality, and quantity; traditinal land and resurce use; and human health, aesthetics, and nise. The NEB cntinues t imprve its EA prcesses, fr example updating the Filing Manual t better specify the envirnmental and sci-ecnmic infrmatin required by the Bard t assess energy infrastructure prjects. 14

16 3.6 Cnditin Cmpliance If a prject is apprved, the cmpany must cmply with all cnditins as set ut in the certificates, rders, and any ther regulatry instruments. Orders issued during peratins phase (such as thse issued pursuant t reactivatin, deactivatin, decmmissining applicatins) may als set ut cnditins. Cnditins are legal requirements, designed t prtect the public and the envirnment by reducing pssible risks. The Bard verifies and enfrces cmpliance with all f the cnditins thrugh assessment f cnditin-related filings and cmpliance verificatin activities. Where nn-cmpliances with requirements are identified, the NEB carries ut apprpriate enfrcement actins. Sme cnditins require that Bard apprval be received prir t prceeding with related activities. The NEB practively psts cnditin cmpliance infrmatin nline, and has started psting additinal infrmatin, such as inspectin reprts, relating t cmpliance verificatin activities. 15

17 3.7 Lifecycle Oversight Tls In additin t cmplying with cnditins, cmpanies must cmply with the Onshre Pipeline Regulatins, Damage Preventin Regulatins, Prcessing Plant Regulatins, and all ther applicable regulatry requirements. The NEB evaluates regulated cmpanies, their facilities and activities n an nging basis t determine apprpriate cmpliance versight. This risk-infrmed apprach analyzes and cnsiders incident data, cmpliance histry, industry trends, cmplexity f activities, and safety and envirnmental impacts in rder t fcus n areas f the highest pririty when planning cmpliance verificatin activities. Cmpliance verificatin activities include: inspectins, audits, emergency exercises, emergency prcedures manual reviews, cmpliance meetings, etc. When nn-cmpliances are identified, the NEB uses its enfrcement tls t btain cmpliance, deter future nn-cmpliance, and prevent harm. These tls include, fr example, Safety Orders, Administrative Mnetary Penalties, revking authrizatins t perate and prsecutins. The NEB will always take all necessary enfrcement actins. 16

18 3.8 Land Matters Once a Certificate has been issued, the NEB must decide a detailed rute fr the pipeline. Cmpanies must apply t the NEB with a plan, prfile and bk f reference setting ut the rute and must als ntify landwners and the public. If a persn wning r having an interest in lands affected by the prpsed rute ppses it, a hearing is held. The NEB makes the determinatin n the best pssible detailed rute f the pipeline and the mst apprpriate methd and timing f cnstructin. Once a detailed rute has been determined, the cmpany may need t acquire lands fr a pipeline. The NEB Act sets ut the requirements fr land acquisitin agreements which includes cmpensatin fr the acquisitin f lands and damages caused by the cmpany s peratins. The Bard has the authrity t grant immediate right f entry fr any lands n specified terms and cnditins. The NEB has identified pprtunities fr the Land Matters Grup t prvide feedback n strategic matters, early advice and input int the energy develpment discussin. 17

19 3.9 Indigenus Engagement Meaningful Indigenus engagement is a critical cmpnent f NEB activities. The Crwn relies n the NEB prcess t the extent pssible t meet its duty t cnsult. Federal departments undertake any additinal cnsultatin necessary n matters utside the NEB s mandate. The NEB prcess is shaped by Indigenus cnsultatin requirements in federal legislatin (see Annex fr details). Fr pipeline applicatins: The NEB requires the prpnent t undertake cnsultatin with Indigenus peples early in the design phase, prviding infrmatin and pprtunities t discuss the prject, and identify cncerns, ptential impacts and mitigatin measures. Thrugh the NEB s Enhanced Abriginal Engagement, the NEB practively cntacts ptentially impacted Indigenus peples that may be affected by an applicatin requiring a public hearing t prvide infrmatin abut the NEB and hw t participate. 18

20 3.9 Indigenus Engagement (cnt d) Fr pipeline applicatins (cnt d): The NEB s prcess is an pen and transparent frum designed t btain as much relevant evidence as pssible n Indigenus cncerns abut the prject, ptential impacts n Indigenus interests, and pssible mitigatin measures. Effrts are made t make hearing prcesses accessible t Indigenus peples. The Bard assesses all f the infrmatin prvided t it, including infrmatin n the cnsultatin undertaken with Indigenus grups, the views f Indigenus grups, Prject impacts n Indigenus interests and prpsed mitigatin measures. The Bard applies its technical expertise and regulatry experience t determine the residual impacts n Indigenus interests and balances thse with the ther scietal interests at play when assessing a prject. This is dcumented in the NEB recmmendatin reprt. 19

21 3.9 Indigenus Engagement (cnt d) The NEB recgnizes the imprtance f strengthening relatinships with Indigenus peples. With this in mind, and cming ut f the Chair s Natinal Engagement Initiative, the Bard made three cmmitments: 1. Use reginal presence t build strnger relatinships with Indigenus peples t develp and deliver cnsistent pint f cntact fr lifecycle regulatry infrmatin; 2. Engage Indigenus peples t deliver wrkshps n the lifecycle f energy infrastructure, energy literacy, safety and envirnmental prtectin, and the NEB s rle in these areas; and 3. Cntinue a practive dialgue with Indigenus peples n their unique viewpints, needs and requirements fr lifecycle regulatry infrmatin, and develp the NEB s Indigenus engagement prgrams t prvide sustained and cnsistent interactin. The NEB has wrk underway t implement the cmmitments nted abve including, fr example, develping an Indigenus Engagement Strategy. 20

22 3.10 Public Participatin The NEB Act specifically requires that fr pipeline and pwerline applicatins, the NEB must hear frm thse wh are directly affected and may hear frm thse wh have relevant infrmatin r expertise. There can be tensin between mre public input versus qualified expert input, in meeting the requirements f the Act (e.g. time limits). In additin t the hearing prcess, the Bard believes that it is essential t engage with a wide variety f external grups as part f its nging versight f energy facilities and regulated activities. The NEB s active engagement, bth within and utside the hearing prcess, helps the NEB t: Ensure the NEB is perating in the public interest; Cllabrate n the mst effective means t help ensure that energy facilities are safe fr the public, wrkers and the envirnment; Practively identify and respnd t emerging issues; and Effectively regulate facilities under the NEB s jurisdictin ver their lifecycle. The NEB is fcused n prviding mre pprtunities fr Canadians t meaningfully participate in NEB public hearing prcesses (e.g., increased public input int the prcess). 21

23 3.11 Energy Infrmatin The Bard mnitrs energy markets, and assesses Canadian energy requirements and trends f il and natural gas discvery. This supprts the NEB s respnsibilities under Part VI f the NEB Act (imprts and exprts). The Bard peridically publishes assessments f Canadian energy supply, demand and markets (e.g., NEB s Energy Futures Reprt). These assessments address varius aspects f energy markets in Canada. Part II f the Act states that the Bard shall study and keep under review energy matters ver which Parliament has jurisdictin, and prvide the Minister with such advice as the Minister may request. Fr example, in February 2015 the NEB received a Ministerial request t study and develp a reprt n the applicatin f best available technlgies used in federally-regulated pipeline prjects. This request was amended in April 2016 t include envirnmental cnsideratins and submitted t the Minister n 30 September. The NEB has been leveraging its existing energy infrmatin and advisry capacity t prvide cmprehensive energy infrmatin and data t Canadians (e.g. data visualizatin, pipeline map, cnditins table, inspectin reprts n the web). 22

24 4. Cnclusin The NEB recgnizes that rebuilding public trust is critical. We have embarked n an ambitius transfrmatin agenda t help achieve this bjective. This wrk is underway within the existing legislative framewrk. The NEB s rle is t implement nt set plicies affirmed by federal legislatin. As it has dne with previus legislative changes, the NEB will faithfully implement any future changes t the NEB Act and CEAA Changes t and actins by the NEB alne will nt be sufficient. It is imprtant t understand that the NEB is nly ne part f the brader energy system in Canada. There are ther issues utside f the NEB s mandate that are als very imprtant t the public, fr example climate change and the rights f Indigenus peples. The NEB takes its respnsibilities seriusly, and Bard Members and staff are talented and dedicated prfessinals wh wrk hard t help t ensure the safety f Canadians and the prtectin f the envirnment. 23

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26 Natinal Energy Bard Established as a Bard Canadian Nuclear Safety Cmmissin Alberta Energy Regulatr Established as a Established as a crpratin 5. Annex Gvernance Mdels N divisin f administrative and adjudicative functins Chair is CEO Chair, Vice Chair, seven ther permanent Members, currently (29 Nv 2016) ten temprary Members (appinted by GIC) Chair apprtins wrk amng Members; has directin/cntrl ver staff Chair, Vice-Chair, Members make quasi-judicial decisins and recmmendatins crpratin N divisin f administrative and adjudicative functins President is CEO Only President is full time, fur part-time Members, three temprary (appinted by GIC) President apprtins wrk amng Members; has directin ver staff Members, including President, make quasijudicial decisins under the NSCA Divisin f crprate, peratinal, adjudicative functins Crprate: bard f directrs (Chair, tw directrs; appinted by Lieutenant GIC): - Supprted by cmmittees (e.g., regulatry review cmmittee; gvernance cmmittee) - Sets general business directin; apprves regulatry change - Nt invlved in day-t-day peratins - Appints CEO, subject t Minister s apprval (cannt be Chair r ther directr) Operatinal: CEO is accuntable fr day-t-day peratins, including hearings. Reprts t Chair. Adjudicative: Chief Hearing Cmmissiner; five ther full-time; five part-time - Only cmmissiners d hearings (nt staff); invlved in develping practice and prcedure; d ADR - Cannt be Chair, directr, CEO Ontari Energy Bard Established as a crpratin N divisin f administrative and adjudicative functins Chair is CEO Chair, tw Vice-Chairs, ne fulltime Member, seven part-time Members (appinted by Lieutenant GIC) Chair, Vice-Chairs sit n Management cmmittee: - Manages activities f OEB, including delegating Bard pwers t emplyees. - Develps practice and prcedure, by-laws abut, fr e.g., administratin and management f OEB Statutrily required MOU between Minister and OEB abut, fr e.g., accuntability relatinships. Chair, Vice-Chairs, Members, delegated staff make quasijudicial decisins. 25

27 5. Annex Delegatin f Authrity Sectin 14 allws the Chair t authrize ne r mre members t exercise the Bard s pwers r perfrm Bard s duties r functins fr certain matters. Members cannt be authrized under this sectin fr sme applicatins under Part III (cnstructin and peratin f pipelines and pwer lines), Part IV (traffic, tlls and tariffs), Part VI (exprts and imprts), Part VII (interprvincial il and gas trade) and Part IX (administrative mnetary penalties). Sectin 15 allws the Chair t authrize ne r mre members t reprt t the Bard (full Bard r Panel), with recmmendatins n a matter befre the Bard. The Bard desn t hear the evidence directly, but cnsiders the reprt and makes the actual decisin. 26

28 5. Annex Decisin Making Rles Pipeline prjects greater than 40 km in length Under the NEB Act, the NEB makes a recmmendatin n whether it is in the present and future public cnvenience and necessity and shuld be apprved. T cnsider the present and future public cnvenience and necessity, the Bard must cnsider the public interest. The Bard prepares and submits t GIC a reprt that includes its recmmendatin n whether a certificate shuld be issued and its reasns, and setting ut the terms and cnditins that the Bard cnsiders necessary r desirable in the public interest, regardless f the recmmendatin. Under the NEB Act, GIC makes the decisin. GIC can 1) direct the Bard t issue a certificate; 2) direct the Bard t dismiss the applicatin; r 3) refer the reprt back t the Bard fr recnsideratin f the recmmendatin and/r a term r cnditin. Under CEAA 2012, the NEB makes a recmmendatin n whether it will cause significant adverse envirnmental effects and whether thse effects can be justified. GIC makes the decisin (r GIC can refer the reprt back t the Bard fr recnsideratin). 27

29 5. Annex Indigenus Cnsultatin The NEB prcess is shaped by Indigenus cnsultatin requirements in, fr example: The Cnstitutin Act, 1982 (sectin 35(1)), The NEB Act (e.g., s.55.2 standing test, s.52(2) cnsideratin f all relevant issues and the public interest), The CEAA 2012 (e.g., s.5 definitin f envirnmental effects, s.19 factrs t be cnsidered), The NEB s Filing Manual (e.g., expectatins fr cnsultatin by the prpnent). 28

30 5. Annex: Activities by Numbers APPLICATIONS RECEIVED Sectin 52 certificates (pipeline greater than 40 km) 2 Sectin 58 rders (pipelines 40 km r less) 52 Part VI Imprt/Exprt 526 Traffic, Tlls and Tariffs 22 Abandnment 1 COMPLIANCE ACTIVITIES Inspectins 142 Emergency Exercises 20 Emergency Prcedures Manual Review 13 Cmpliance Meetings 137 Audits 6 Reprt Reviews 30 ENFORCEMENT ACTIVITIES UNDERTAKEN Ntices f Nn-Cmpliance and Assurances f Vluntary 143 Cmpliance Inspectin Officer Orders 4 Safety Orders (riginal and amended) 8 Administrative Mnetary Penalties 12 Ntices f Nn-Cmpliance and Assurances f Vluntary 143 Cmpliance Surce: 2015 Annual Reprt t Parliament 29