On Friday, October 13th, the Supreme Court of Canada (SCC) released its advisory opinion on The Impact Assessment Act (IAA), better known as Bill C-69.
In a majority opinion, five to two, they found it to be unconstitutional in part because most sections of the Act go beyond Parliament’s legislative authority under the Constitution. Only sections 81 to 91 are considered constitutional and can be separated out. These sections relate to projects that are either federally funded or on federal lands or outside of Canada.
Importantly for Canadian resource development, the SCC was challenged by projects considered “designated projects” in the Act as they are subject to federal review automatically. The SCC found this to be unconstitutional because these projects may be within provincial jurisdiction as laid out in the Constitution. The SCC ruling reconfirms the jurisdictional authority over resource development and limits the federal government’s over-reach.
Nonetheless, the SCC found that the federal government has authority to legislate environmental assessments of major projects, and it affirmed federal jurisdiction over inter-provincial projects, those that cross multiple provinces. The SCC, however, said the government’s approach in the IAA was unlawful.
At the press conference held by environment minister Steven Guilbeault and energy and natural resources minister Jonathan Wilkinson, both said they intend to re-evaluate and put forward new legislation. While, I consider the SCC’s ruling a victory, the resource sector will encounter uncertainty again as we wait for new legislation.
Even though Friday’s ruling does not strike down the Act and is only an advisory opinion, let us not downplay the magnitude of this decision. The ruling confirms the unconstitutionality of the legislation and may set a precedent for future federal rules to ensure they do not infringe on provincial jurisdiction. The majority decision will surely affect the feds’ regulations for the clean electricity plan and the oil and gas emissions cap.
It took several years to reach this conclusion, but the country’s highest court has spoken.
When the Bill was first proposed, the government did a significant amount of consultation, to their credit. That was likely due to the attention it received from the public. It is not common for people to talk socially about a federal bill, let alone know the bill’s number and its details. It is also not often that the oil and gas industry unites around fighting a specific bill, but fight we did – in a non-violent, Canadian way.
I wrote articles on it, wrote to Senators every couple of weeks, attended the Senate energy committee hearing when they came to Calgary, and attended Rally4Resources and Canada Action’s rallies opposing the bill with several hundred other people.
I had three main concerns:
- Everyone had the right to intervene on major projects, even if they were not directly impacted.
- The environment minister was granted the final decision-making authority, meaning they could delay a resource project indefinitely, or veto it altogether, at their political whim.
- The Bill created too much uncertainty for business. Project review timelines were extended indefinitely and the language was often uncertain because ambiguous words were not defined. Burdensome regulations cost businesses money, and that costs people jobs.
The Bill gained notoriety when former Alberta Premier Jason Kenney famously dubbed it the “no more pipelines bill” while he was campaigning. I disliked the name because the tentacles of the IAA were farther reaching than pipelines. The colloquial moniker made it seem like it was only the oil and gas industry’s problem to address. The reality was the legislation affected all resource development, in addition to being an unacceptable power grab by the feds.
The Senate energy committee that studied Bill C-69 proposed 187 amendments. The feds said, “thanks, but no thanks” and rejected almost all of the proposed changes. The Senate did its best to be that sober second thought it is intended to be, but Parliamentarians who supported the Bill failed Canadians.
Honouring a campaign promise, Kenney fought the Bill at every opportunity. He challenged it legally and got a favourable conclusion from the Alberta Court of Appeal, helping him rally support from other provinces. Seven provinces joined Alberta in the legal challenge, but nine out of 10 provinces opposed the scheme in principle. This may be the most Trudeau has united the country since getting into office.
For people who think the expansive IAA was a harmless piece of legislation, consider the first-of-its-kind in Canada Cedar LNG. It is a floating LNG facility in Kitimat, BC that is majority Indigenous-owned by the Haisla nation. Pembina Pipeline Corporation will build and operate it.
Under the IAA, the project was subjected to both federal and provincial environmental assessments, undoubtedly causing delays and adding costs to the project. The BC ministers in charge of granting the provincial approval added an extra 117 days in addition to the 306 days the BC Environmental Assessment Office took to grant approval to proceed to the next step. Concurrently, federal Environment and Climate Change Minister Steven Guilbeault granted project approval, subject to over 250 legally-binding conditions, including being net zero by 2050.
Thank you, Jason Kenney and Danielle Smith, for having the courage to continue to contest this up to the Supreme Court, for not backing down even though it was difficult. This is not a partisan position – taking a principled stand against destructive legislation and federal government overreach should not be partisan. It is okay to push back against something you believe to be a wrong. People who think there should never be animosity or conflict between the federal and provincial governments are naïve.
Alberta did not back down and pursued its fight lawfully through the courts. On October 13, 2023 they were rewarded. Re-establishing jurisdictional regulatory boundaries will help promote regional energy plans, allowing provinces to do what is practicable and right for their citizens.
Deidra Garyk has been working in the Canadian energy industry for almost 20 years. She is currently the Manager, ESG & Sustainability at an oilfield service company. Prior to that, she worked in roles of varying seniority at exploration and production companies in joint venture contracts where she was responsible for working collaboratively with stakeholders to negotiate access to pipelines, compressors, plants, and batteries.
Outside of her professional commitments, Deidra is an energy advocate and thought leader who researches, writes, and speaks about energy policy and advocacy to promote balanced, honest, fact-based conversations.
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