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Home > Speeches and Presentations > Speeches and Presentations 2006 > Vision for Effective Regulation

Vision for Effective Regulation

Kenneth Vollman
Chairman
National Energy Board

CAMPUT Confenrence
Ottawa, Ontario

15 May 2006

NEB Vision

The title for this armchair discussion is a "Vision for Effective Regulation Across North America," so let me begin by sharing with you a vision statement that our Board has developed during the past year.

In my view the key to this statement is the phrase responsible development. These words are meant to capture our belief that the development of infrastructure by private interests within a competitive market framework serves the public interest, but the regulator must have regard to the potential social and environmental impacts not fully dealt with by markets. We see ourselves as a partner with other stakeholders and we work together to ensure that concerns are identified and understood and that the correct balance is achieved among economic, social and environmental factors. In terms of our culture, we believe we should be active, effective and knowledgeable. That means, for example, that we anticipate and prepare for issues that come before the Board, we are results oriented, and are we capable of dealing with the highly complex multi-disciplinary matters surrounding energy regulation. By taking these actions in partnership with our stakeholders we are able to use the very best minds and information to help us efficiently solve problems, foster innovation and make wise decisions. Finally, we do our job for the benefit of all Canadians.

To achieve that vision, or excellence in energy regulation, we all have jobs to do.

Top 3 jobs for regulator

I'm not going to talk today about all of the things we have been doing right. That would take a long time. Let me simply quote from an article Weintraub and Hester published in the Globe and Mail a couple of months ago. They were comparing regulation in this country with other countries in the hemisphere: "Canadian success is a product of years of consistent and co-ordinated government policies and investment, respect for the rule of law, and an appropriate regulatory regime, all to create the right climate for investors to bet on the country."

But to achieve excellence in energy regulation, there is more to be done. In the next few minutes I'm going to highlight what I see as the three top priorities for regulators, government and industry. Because of the short time I have I'm simply going to list them and will be pleased to elaborate on those that interest you during the armchair portion of this session.

Top three jobs for the regulator are to:

1. Establish clear processes - and make transparent our service standards;
2. Inform policy makers; and
3. Enhance our performance or results-based culture

Top 3 jobs for government

I'm going to step out of my comfort zone now and make some suggestions about what we need from our political masters.

1. One of the key issues facing regulatory boards in Canada today is ensuring we have adequate capacity. The most common concern I hear from Board Chairs as I travel the country is about appointments and funding. There are some really remarkable stories I could tell here such as inability to deal with applications because of a lack of quorum, or inability to arrange travel to a hearing because of a lack of cash.
2. Almost as important is the need to address overlap and duplication. On this point let me say I was delighted to receive a letter from Minister Ambrose two weeks ago authorizing, on a pilot basis, the substitution of the NEB process for a CEAA panel. The next major improvement I would like to see is sorting out processes and timelines for multi-jurisdiction projects. There are a number of ways of doing this^*. Personally, I favour a lead agency concept - but the key thing is to have the debate select a course of action.
3. Finally, we often see hearing time being used very inefficiently as parties debate matters better dealt with by policy, such as global warming or aboriginal consultation.

* These include legislated time limits, establishing a major projects office, identifying and empowering a lead agency to set timelines, setting out timelines in the terms of reference of joint panels, and mandatory publishing of service standards.

Top 3 jobs for industry

Finally, I have a job jar for our industry partners.

1. The major point I'd like to make is the importance of involving stakeholders in project planning. Incorporating stakeholders' interests in project design is often the best way to resolve issues and will greatly reduce regulatory time.
   
   The importance of stakeholder involvement was summarized very succinctly by Kathy Sendall, speaking at a recent industry stewardship awards dinner in Calgary: "Regulators grant permits, communities grant permission."
2. Industry knows much more about the market environment in which it operates than do governments or regulators. Educating us should be an important element of your business strategies - particularly by your trade associations.
3. It should go without saying, but incomplete applications have numerous negative consequences. They cause frustration among stakeholders and impede efficient regulatory processing.

Infrastructure is critical

High energy prices are sending strong signals that we need to use energy more efficiently and that we need to develop new sources of supply. Market participants are responding. But they need a clear policy framework and timely processes within which to make their decisions.

Let's remember that the last major investments in federally regulated infrastructure projects happened almost a decade ago in the mid-1990s - I'm thinking of the Sable Offshore Energy Project and the Alliance pipeline.

Initially I was surprised that the conference asked us to speak for only 5 minutes. But I quickly came up with a possible explanation. The issues that confront us today are essentially the same issues we've been talking about for the past three annual CAMPUT conferences. There has been only modest progress on addressing these issues. Let me leave you with this thought "what will it take to achieve some real action?"

Will the lights have to go out?

I recently read this quote: "Many times, the public and their legislative bodies will not react unless the crisis is apparent".

Let's not wait until we're sitting in the dark. Let's work together as partners to make sure the lights stay on and prove this statement is not true for energy projects in this country!

 

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Date Modified:

2011-10-28