Pipeline regulators in Canada are in the midst of a series of important hearings and decision processes related to transmission pipeline applications – which have raised a number of questions about how pipelines are regulated in the country.
Attention seems to be anchored to some extent around the public hearings related to specific pipeline applications – how they are conducted and who gets to speak. The perception possibly being created is that regulatory decisions are made solely on what is heard during the public hearing, and that the regulator is only engaged briefly in the oversight of pipelines.
Nothing could be further than the truth – as the members of the Canadian Energy Pipeline Association can attest. A hearing by a regulator into a proposed pipeline project is merely one aspect, though perhaps the most visible aspect, of a long journey through a comprehensive, long-term, and inter-connected framework of regulatory oversight that begins long before an application ever gets to a hearing, and continues on for the entire life cycle of a pipeline.
Provincial and federal regulations in Canada shape pipeline development from the very point where a company determines that it needs to make a change, or add new energy infrastructure, to the network of transmission pipes crossing the country. Before it even begins to sketch out specific pipeline routes, the project proponent needs to gather technical, environmental, social and market information in support of the project.
The regulator then pokes and prods the application a host of different ways before it reaches a point where it’s able to render a decision on an application or send it to public hearing. Companies must clearly spell out their plans for everything from the route a pipeline will take – including topography, water crossings and proximity to people and existing urban and rural infrastructure – to the materials they’ll use to construct the pipeline. They must detail the consultation they’ll have with community members who may be affected by the pipeline, and the monitoring they’ll put in place to ensure ongoing safe operation of the pipeline. The regulator considers all aspects of the application as well as input it has collected from agencies such as Fisheries and Oceans Canada and perspectives provided at hearings. Only when it is satisfied that the application meets the full range of requirements and obligations does it render a decision.
After the decision, companies must continue to prove to the regulator that they are operating their pipelines in a safe and responsible manner. Failure to live up to the obligations set for pipeline companies by regulators may see the regulator shut down the pipeline for a protracted period, impose new restrictions on operations, or apply significant financial penalties – another strong incentive for companies to comply with all regulations and requirements.
It is not fast, easy or simple for pipeline companies to get their applications approved, nor should it be. The scrutiny of pipeline applications by the public and regulators is important and in all of our best interests. As we continue to discuss the need for improved pipeline capacity to provide access to markets for energy products, it’s important to understand the depth and breadth of regulatory oversight which governs pipeline operations from the planning phase, construction and operation through the life of the pipeline.
Dr. Brenda Kenny
President and CEO,
Canadian Energy Pipeline Association