More On the Other Side of Mapping Out a Canadian Energy Strategy: The Shifting Landscape of Canadian Environmental Regulation

By Keith Edmund White
Editor-in-Chief 

Courtesy of this morning’s Mondaq news-update, we get a view of another challenge to Canada crafting a national energy strategy:  environmental regulation.

On this issue, Dianne Saxe—of the Saxe Law Office and the Environmental Law and Litigation website—offers some excellent analysis* on the three-layered cake of Canadian federalism re:  environmental regulation. 

For a recap of her environmental regulation presentation, I'll just re-post Mondaq's summary:

What happens when municipal bylaws try to control energy or resource projects authorized by the federal or provincial governments? (They have some scope). How far will the Spraytech precedent take them? Can corporations use federal insolvency laws to cleanse themselves of irksome environmental liabilities, such as contaminated sites? (sometimes). These are the type of jurisdictional conflicts that Dianne discussed during her keynote address at last week's Hazmat West Conference in Saskatoon. She also discussed shared responsibilities for waste, as in Enviro West v Copper Mountain Mining.

Here is the presentation: Shared Authority, Shared Risks

The Big Insights:

• Limited, But Still Real, Role in Environmental Regulation.  Municipalities, as political creations of Canada’s provinces, have no constitutional status—so they have limited room to maneuver when it comes to environmental regulation. So, according to Saxe’s presentation, a municipality can’t band fracking through a bylaw, but can probably limit toxic substances especially in certain areas (Presentation Page 8). 
• The New CEAA Scales Back Federal Environmental Assessments.  Federal Environmental Assessments are leaner, faster, and perhaps lesser ‘meaner’? The Harper government in Ottawa reworked the federal government’s role in environment assessment this summer by passing a new Canadian Environmental Assessment Act (CEAA). A May 2012 Ecojustice Legal Backgrounder blasted the new legislation: 

Ecojustice believes that improvements to CEAA are achievable, but not by eviscerating the federal role in environmental assessment, devolving reviews to provincial/territorial governments, and by imposing artificial timelines on a much small number of projects.

• Constitutional Showdown.  There’s a tension between the federal government regulation of bankruptcy (and, from that, the discharge of debt) and the provinces wanting companies to pay for environmental damages. So is letting provinces bill bankrupt companies for environmental clean-up costs counter Canada’s constitutional division of powers? We’ll have to wait and see. (Presentation Pages 29-31; And if you like graphs, check out Saxe's helpful Page 11 Presentation graphic). 
• Sum-Up.  Could the Harper's government-spurred CEAA reform come back to bite them by pushing provinces to step-up their regulation--delaying the energy projects so critical to Canada's near-term economic success?  Maybe.  But, then again, will provinces really step on their own energy futures? 
• *Key Caveat:  And, just in case you don’t see if on the Mondaq page, Saxe's presentation is legal research and analysis—not legal advice.