NEB's skirting of climate change issue can't last forever

Calls to take action on climate change keep washing up on the doorstep of the national energy regulator. Whether the NEB will ever listen is another question.

Liberals' green agenda keeps National Energy Board in climate change spotlight

Liberal Leader Justin Trudeau holds a copy of his environmental platform after announcing details of it at Jericho Beach Park in Vancouver on Monday. (Darryl Dyck/Canadian Press)

Try as it might, the National Energy Board just can't escape the climate change discussion. 

In his campaign trail unveiling this week of the Liberal Party's new green agenda, Liberal Leader Justin Trudeau singled out the country's energy regulator for the part he believes it should play in curbing Canada's greenhouse gas emissions. 

Not long ago, the NEB was just a sleepy regulator that went about the business of setting tolls and monitoring pipelines with little attention and even less fanfare. With pipelines now a featured player in the global climate change discussion, those days are clearly long past. 

– Peter Watson, NEB chair

The NEB, whether it likes it or not, now finds itself at the nexus of not only the highly charged world of pipeline politics, but also the national debate on climate change and the upcoming federal election. 

Whether it belongs there depends on who you ask. 

More teeth or rubber stamp?

When Trudeau vows, as he did on Monday, to "put some teeth" back into the regulator, he's talking about changing its stance on so-called upstream emissions, the greenhouse gases associated with extracting fossil fuels. 

This would mark a 180-degree shift for the energy board, which currently looks at the environmental effects along the proposed route of a new pipeline, but stops short of considering any other carbon emissions the line might facilitate.

"There are jurisdictions that have the mandate to implement regulatory approaches associated with emissions," said Peter Watson, the NEB's chair. "It just happens that's not us." 

And therein lies the crux of much of the frustration around the climate change file in Canada. The issue of how carbon emissions from the oilsands will be kept in check has washed up on the NEB's doorstep, because it lacks any better place to go. The energy board, however, doesn't want any part of it, so environmental advocates are left with little recourse but to keep banging on the door.  

So far, they've had little success. The NEB position has held up against challenges in court and on constitutional grounds. Similarly, the regulator remained unmoved while gathering testimony from thousands of interveners concerned about Canada's emissions profile during the Northern Gateway hearings.  

As Trudeau's policy direction suggests, however, the NEB still isn't off the hook. 

The NEB says upstream emissions from the oilsands fall outside its mandate. (Kyle Bakx/CBC)

The argument for why the NEB should consider upstream emissions when weighing whether a new pipeline is in the national interest is straightforward.

Since the continued expansion of the oilsands hinges on new pipeline capacity, then it stands to reason that the environmental consequences of any increased production should be considered before a new pipeline is approved.

It's the position U.S. President Obama has taken toward the Keystone XL project, which is still waiting to get the green light from the U.S. State Department. 
In Canada, however, recent amendments to the National Energy Board Act have made it even more difficult for potential interveners to even raise the question of whether upstream emissions have a place in the discussion. 

"I'm acutely aware of how complicated this issue is, but it's just not our role to manage that part of the issue," said Watson. "It's a role for other governments and they're working on it. I'm comforted by that."

Policy void

Others feel less comfortable that climate change policies at either the provincial or federal level will actually result in emissions reductions, which, unsatisfying as it may be for everyone involved, keeps them returning to the NEB. 

Despite the Federal Court ruling that the NEB's stance on upstream emissions is legally sound, Erin Flanagan, an analyst at the Pembina Institute, an environmental think-tank, believes the regulator still has the wherewithal to expand its mandate if it so chose. 

"There's no sandbox around the National Energy Board that I can read through the act," Flanagan said. "They've decided that they're reviewing certain infrastructure projects and they're reviewing environmental and economic impacts from these projects, but how they're defined is up to the board. They have a significant amount of wiggle room." 

Regardless of the finer points of interpreting the NEB Act, the regulator's central role in the conversation is seen as indicative of a larger policy gap that remains unaddressed. 

"Do we have a coherent national climate change policy?" asked Nigel Bankes, a professor of resource law at the University of Calgary. "The answer is no, and maybe that's what we should be focusing on rather than the particular role of the National Energy Board."

Ottawa has pledged for years to develop a climate change plan that will deal with emissions on a sector-by-sector basis. Other than regulations for coal-fired power plants, however, few tangible steps have been made in that direction. 

It's a policy void that will keep the NEB in the middle of the climate change discussion — no matter how much the regulator would like to be elsewhere. 


Paul Haavardsrud writes for CBC's western business desk in Calgary. He is also a producer on CBC Radio’s national business desk where he talks about business on Radio One in the afternoons. Prior to that he worked for newspapers. On Twitter, he’s @paulhaavardsrud.


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