Canadian carbon politics redux: climate change following a Liberal majority win

P. Jason Kroft, Allison Sears and Jonathan Drance - 

On October 7th we provided you with a snapshot of the campaigns of each of Canada’s Federal political parties and each of their respective carbon policies.  With the election of a Liberal majority, everyone seems to be asking the question, where do we go from here on the climate change front?

Recall that, during the campaign, the Liberals proposed a “medicare” style approach to combating carbon emissions, which allows the provinces to design their own emissions platform within the confines of a national target and Federal oversight. The Liberals coined this plan as not too hot, not too cold, but just-right, striking an appropriate balance between the economic diversity inherent across the provinces and Canada’s need to take a tougher stance on emissions. With Prime Minister Trudeau currently enjoying wide support during his post-election honeymoon period and the Paris climate change conference on the horizon, it appears that the Liberal government is employing an “all hands on deck” strategy in an effort to develop some consensus as to strategy and broad principles prior to the meetings in Paris. Certainly, there is an appearance of cohesion, at least outwardly, among the provinces and the Federal government as we approach the Paris conference. For businesses in Canada, it is important to anticipate where the Federal emissions target will be set and to begin to consider the effect such a target may have on the individual Canadian provinces.

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Alberta Announces new Climate Change Policy

 Allison Sears - 

On a sleepy Sunday afternoon (yesterday, that is), Premier Notley unveiled her new Climate Leadership Plan for Alberta. In addition to making available the full report of her Climate Change Advisory Panel (Climate Leadership – Report to Minister), Premier Notley outlined four policies that will be implemented to reduce greenhouse gas emissions in Alberta:

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Key developments in Canadian private M&A law for the oil and gas industry - Q3 2015

Jennifer McPherson, Andrew Beamer, Allison Sears and Chip Johnston

The following is an overview of key developments in Canadian law and regulatory practice applicable to private M&A in the oil and gas industry from July 1, 2015 to September 30, 2015.

Oil & Gas Regulatory

  • Alberta’s royalty review panel is expected to report to the provincial government by the end of 2015.  The timing of the province’s decision on a new royalty framework is not known, but it has indicated that any royalty changes will not be made effective until 2017.
  • Alberta’s Climate Change Advisory Panel completed consultations on a new provincial climate change policy that is expected to recommend tougher rules on emissions.  The panel’s report to the province is expected imminently, but it is not known when it will be made public.  
  • The federal department of natural resources sought comment on draft guidelines designed to assist oil and gas companies subject to new federal legislation requiring the disclosure of payments made to governments.


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Carbon Emissions and the Canadian Oil & Gas Sector

Jason Kroft, Allison Sears, Glenn Cameron and Jonathan Drance

As Prime Minster Trudeau and Alberta’s Premier Notley prepare for the Paris Climate Change conference in the coming weeks, it cannot be lost on them that Canada’s carbon emissions have either more or less levelled off or are only marginally increasing in every sector of the economy except one: oil and gas. The oil and gas sector is now the largest source of carbon emissions in Canada and emissions from oil and gas activities have been growing faster than in any other sector.

The following table sets out Environment Canada’s summary of carbon emissions in Canada by sector, as at the base year (2005) and projected for the target year (2020) for measuring carbon emissions under the Copenhagen Accord.












Oil & Gas












Emissions Intensive












Waste & Other








Source:  Environment Canada - Canada’s Emissions Trends (2014).  Numbers may not sum due to rounding.

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Carbon Emissions and the Canadian Electricity Sector

Jason Kroft, Allison Sears and Jonathan Drance - 

In most countries, the electricity sector is a major source of carbon emissions, at least to the extent its major fuel sources are fossil fuels.  Canada and the United States make an interesting and instructive contrast, given the abundance of hydropower in Canada and the vastly less significant role that fossil fuels, particularly coal, play in Canada’s electricity sector.

In the United States, the electricity sector is the primary source of carbon emissions, accounting for roughly 33% of all annual emissions.  In Canada, the electricity sector accounts for just over 10% of all carbon emissions, lagging well behind the oil and gas and transportation sectors in particular.  The following table sets out the carbon emissions in Canada by sector, measured in millions of tons (Mt), as at the base year (2005) and the target year (2020) for measuring carbon emissions under the Copenhagen Accord.

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The 2015 Canadian Federal Election what "Real Change" might look like for Canada's oil and gas industry

On October 19th the centre left Liberal Party, led by Justin Trudeau, was elected to govern Canada winning 184 of the 338 seats in the House of Commons.  The Liberals defeated the Conservative Party that has governed for the past ten years.

This is the second political change to occur in the last five months that directly impacts Canada’s oil and gas industry.  In May Alberta’s left leaning New Democratic Party was elected ending 44 years of Progressive Conservative government in that province.

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Court finds municipality acted in bad faith, orders municipality to enter good faith negotiations with wind turbine developer

A recent Ontario Divisional Court decision, wpd Sumac Ridge Wind Inc. v. Kawartha Lakes (City), represents an important precedent for project developers who are facing opposition from municipalities. The court held that a municipality’s attempt to prevent the development of a provincially approved wind turbine project by passing a resolution that prevented its completion was both ultra vires and an act of “bad faith”. The resolution was accordingly quashed.


Ontario’s Ministry of the Environment had granted wpd Sumac Ridge Wind Inc. a Renewable Energy Approval to construct five wind turbines within the City of Kawartha Lakes. In order for wpd to construct the turbines, the company needed to access and upgrade certain municipal roads. However, Kawartha Lakes was opposed to the project and, even though the Ministry had approved it, passed a resolution that said:  "… any request by Wpd … for use of … [the road in question] … to support [the] proposed wind turbine development [will] be refused…."  The resolution had the effect of preventing the project’s construction. In response, wpd brought an application for judicial review.

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Restoring an OEB rate ruling, the SCC reaffirms discretion of Canadian tribunals and holds that regulators are not required to allow utilities to pass on costs of collective agreements

 Glenn Zacher, Patrick Duffy and James Wilson - 

On September 25, 2015, the Supreme Court of Canada released a 6-1 decision that has far-reaching implications for provincial energy tribunals and administrative tribunals generally, and which may also impact collective bargaining between regulated entities and their unions.

The case, Ontario (Energy Board) v. Ontario Power Generation Inc., 2015 SCC 44, arose from the decision of the Ontario Energy Board (OEB) not to allow Ontario Power Generation (OPG) to recover through rates $145 million in compensation costs paid to its unionized workers under their collective agreements. The Supreme Court’s ruling focused on two important issues: (i) the scope of the OEB’s discretion to set just and reasonable rates and (ii) the right of tribunals to participate in appeals of their own decisions. 

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One Step Forward, One Step Back - Final Investment Decisions for BC LNG

 Jonathan Drance and Brandon Mewhort - 

A number of BC LNG projects are approaching – or at least appear to be approaching – a Final Investment Decision to proceed with construction.

Usually, there are two important factors that determine whether and when a Final Investment Decision is made: the economics of the project and the status of its required regulatory approvals.

In the past, the economics for BC LNG projects appeared promising, while obtaining regulatory approvals was the main obstacle in the way of development. However, over the last 12-18 months, it seems the opposite has become true.  

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Federal Election 2015:The Campaigns and Canadian Carbon Politics

P. Jason Kroft and Luke Sinclair

As election mania heats up in Canada, it is becoming increasingly important to analyze and contrast how the three front-running parties, the Conservatives, the Liberals and the NDP, intend to deal with key electoral issues. Two of such issues involve the economy and the environment, of which energy, and specifically carbon emissions, make up a fundamental piece. In response, each party has released its own platform aimed at tackling carbon emissions in an effort to fight climate change. When questioned, each party gives the impression that its own policy represents the best balance between economic stability and curbing emissions and to vote for any other platform would ensure economic collapse on one end, or environmental destruction on the other. However, a closer look at each policy actually reveals more similarities than differences. Obviously, more useful and relevant than campaign policies and promises will be examining what the successful party (assuming a majority government) or parties (in the event of a minority coalition) implement after the election is complete. We will return to this topic after the election to examine where policies and promises diverge in practice.

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