CEEN 590 Formal Government Processes

outline

Overview Clean Energy Act Canadian energy governance Canadian (and BC) government Aboriginal rights – Idle no More

Overview

Governance in 2 stages Formal procedures Next week: (informal) processes; actor

dynamics Core distinction:

Authority: ability to make rules backed up by coercive power of the state

Power/influence: ability to influence outcomes

Today: foundations for authority

Clean Energy Act

 What are the 5 most important objectives of BC electricity policy?

 What is the definition of self-sufficiency in the Act?

What is the definition of clean or renewable?

How are integrated resource plans developed and approved?

CEA - Objectives

Self sufficiency"electricity supply obligations" means(a) electricity supply obligations for which rates are filed with the commission under section 61 of the Utilities Commission Act, and(b) any other electricity supply obligations that exist at the time this section comes into force,determined by using the authority's prescribed forecasts of its energy requirements and peak load, taking into account demand-side measures, that are in an integrated resource plan approved under section 4;

"heritage energy capability" means the maximum amount of annual energy that the heritage assets that are hydroelectric facilities can produce under prescribed water conditions.

(2) The authority must achieve electricity self-sufficiency by holding,(a) by the year 2016 and each year after that, the rights to an amount of electricity that meets the electricity supply obligations, and(b) by the year 2020 and each year after that, the rights to 3 000 gigawatt hours of energy, in addition to the amount of electricity referred to in paragraph (a), and the capacity required to integrate that energysolely from electricity generating facilities within the Province,(c) assuming no more in each year than the heritage energy capability, and(d) relying on Burrard Thermal for no energy and no capacity, except as authorized by regulation.

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Self Sufficiency in 2007 Energy Plan self sufficient by 2016, + insurance of 3000

GWh/year by 2026 result: ensures substantial surplus available

for export in almost every year New Clean Energy Act continued this policy

(insurance date moved up to 2020) 2007 regs: assume “critical water

conditions” (in regulation) 2012: changes to “average water

conditions”

Clean energy – LNG “cheat”

(c) to generate at least 93% of the electricity in British Columbia from clean or renewable resources and to build the infrastructure necessary to transmit that electricity;

"clean or renewable resource" means biomass, biogas, geothermal heat, hydro, solar, ocean, wind or any other prescribed resource;

Governance in Context actions – behavioural actions

energy choices by firms, consumers

policies – rules produced by government that influence actions Objectives (increase renewable

electricity) Instruments (renewable portfolio

standard) Settings (10% by 2012)

governance – who decides the rules

Sustainable Energy Policy 9

Gattinger: 4 key energy policy imperatives (MESS)

1. Markets – more efficient and competitive

2. Environment – pollution, biodiversity, climate

3. Energy Security – assurance of adequate, safe, affordable supply

4. Social Acceptability – coping with local opposition to projects

5+ Governance Imperatives

1. The Rich Fuel Endowment: The problem of too many choices

2. Dependence of US Continental Markets3. Divided Political Jurisdiction4. Regional-Spatial Realities, and Producer-

Consumer Tensions5. Environmental Issues 6. Aboriginal Peoples’ concerns

Modified from Doern and Gattinger, Power Switch

Governance – 3 Core Questions Who decides? Who participates? At what level of

government? (vertical dimension)

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Vertical Dimension –Division of PowersPROVINCIAL 109 – all lands, mines,

minerals, and royalties to the provinces

92 – provincial management and sale of public lands (federal jurisdiction over “Canada Lands”)

FEDERAL 91 –international and

interprovincial trade 91 –tax any mode or

means Spending “Indians” Fisheries and

navigation General

criminal law Peace, order, good

governmentWhat about local government? International government?

Gattinger: energy federalism The character and dynamics of federal-

provincial relations in the energy field

January 15, 2009 Sustainable Energy Policy 14

Four Periods of Energy Federalism 1867 -1930 -- nationalist cooperative 19030-1950s – expansionist

collaborative Energy development as economic

development 1960s-mid-1980s – competitive Mid-1980s to present – third-rail

January 15, 2009 Sustainable Energy Policy 15

PeriodizationDoern and Gattinger

1. WW II to 1973: Regulatory Nation- (and Province) Building

• energy development as economic development

• shift from coal to oil2. 1974-1984: The Energy Crisis and

Government Intervention3. Mid 80s to 2000s: Energy Deregulation,

Free Trade, and Sustainable Development

January 24, 2013 Sustainable Energy Policy

The Enduring Legacy of Trudeau’s 1980 National Energy Program

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Why history lesson?

Can’t understand current Canadian energy policy and governance without it

Context:1.Two most important problems in

Canadian politics: Quebec and relations with US

2.In Canadian federal-provincial relations, energy second only to Quebec January 24, 2013 Sustainable Energy Policy 18

NEP Enduring legacy

January 24, 2013 Sustainable Energy Policy 19

Prime Minister Stephen Harper, during 2008 election campaign, on Stephan Dion’s carbon tax

“It’s like the national energy program in the sense that the national energy program was designed to screw the West and really damage the energy sector. This is different in that it will actually screw everybody across the country.” 

Prelude to NEP 1957-1961 1959 – National Energy Board

Created 1961 – National Oil Policy

two market policy▪ east of Ottawa Valley, cheap imported

Venezuela oil▪ Ontario and west, more expensive Canadian

oil▪ delivered by Trans-Canada Pipeline▪ continental price under umbrella of US

protectionism▪ growing exports to US

Rapid growth in oil and gas industry

January 24, 2013 Sustainable Energy Policy 20

Prelude to NEP 1973-1980 1973 – OPEC oil embargo

link to global geo-politics: Arab-Israeli War price controls on domestic crude oil and natural

gas subsidized consumption by refiners through oil

import compensation program (OICP) 1975 – Petro-Canada established

foster resource development increase federal government information about reserves

1979 – Iranian revolution led to world price doubling gap between Canadian prices and world prices increased

January 24, 2013 Sustainable Energy Policy 21

1980 Political Economy of Energy in Canada Oil coalition: federal

Conservative Party, western provincial governments, and oil industry rapid convergence to

world prices smaller federal share of

revenues privatization of Petro-

Canada enabling foreign

ownership

Federal Coalition: federal Liberal and NDP Party, central and eastern provincial governments slower increase in prices larger federal share of

revenues strengthening of Petro-

Canada regulation on foreign

ownership

January 24, 2013 Sustainable Energy Policy 22

National Energy Program October 1980 budget “a centralist, nationalist and

interventionist political and policy initiative which at its core was intended to substantially restructure the key relationships of power and the sectoral and regional distribution of wealth in Canadian energy politics” (Toner and Bregha 1984).

January 24, 2013 Sustainable Energy Policy 23

National Energy Program 1980 3 goals

security of supply▪ Petroleum Incentive Program (PIP) encouraged

exploration and development Canadianization▪ 50% Canadian ownership by 1990 (from 29%)▪ PIP criteria favoured Canadian firms on Canada Lands▪ enlarge Petro-Canada through acquisitions

interregional equity in price and revenue sharing▪ 8% Petroleum and Gas Revenue Tax (PGRT)

January 24, 2013 Sustainable Energy Policy 24

Backlash Against NEPcbc retrospective video

Universal industry opposition Vehement opposition by Alberta

– led by Premier Peter Lougheed cutback in oil production cancellation of 2 oil sands projects

Compromise of 1981 produced a new pricing system old domestic oil increased to 75%

world price new conventional oil at world price

January 24, 2013 Sustainable Energy Policy 25

NEP denouement

Beginning in 1982, world oil prices began to plummet

January 24, 2013 Sustainable Energy Policy 26

NEP denouement

Oil price decline after 1982 Mulroney Era (Progressive

Conservative) begins in Fall 1984 Western Accord effectively

dismantled NEP deregulated oil prices phased out PGRT

January 24, 2013 Sustainable Energy Policy 27

NEP Enduring Legacy

Lesson: mistaken federal government overregulation

Strengthened Alberta’s anti-Ottawa tendencies

Revived as a bogey-man to discredit major federal energy-related initiatives including climate action

January 24, 2013 Sustainable Energy Policy 28

Government in Canada

http://www.youtube.com/watch?v=yi1yhp-_x7A

Sustainable Energy Policy 29

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Parliamentary Government –Executive

executive governor general (federal) lieutenant governor (provincial)▪ Both largely ceremonial

premier and cabinet▪ Premier/PM: leader of the party with

the most seats in the legislature▪ Cabinet: selected by the Premier/PM

from members of the legislature of the premier/PM’s party

▪ Party rules and system norms make Premier/PM remarkably powerful (Ruff)▪ Cabinet selection▪ Party nomination

Parliamentary Government –Legislature MP – member of

Parliament MLA – members of

legislative assembly influence limited by

majority rule – government must have support of majority

party discipline – all members must vote how their party tells them to▪ Party policy set by caucus – in reality

by cabinet and especially leader

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Parliamentary Government –Legislature

House of Commons – 308 seats Conservative (165) – 54% New Democrat (101) Liberal (35) Bloc Quebecois (4) Green Party (1) Independent (1)

Sustainable Energy Policy 32

Votes and SeatsVote % Seat %

Conservative 40 53

NGP 31 33

Liberal 19 11

BQ 6 1

Green 4 0.3

Parliamentary Government –LegislatureBRITISH COLUMBIA – 85 SEATS

BC Liberal (49) - 58% New Democrat (35) Independent (1)

ALBERTA – 83 SEATS

Progressive Conservatives (61) 70%

Wildrose Alliance (17) – 20%

Liberal (5) 6% NDP (4) 5%

Sustainable Energy Policy 34

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Parliamentary Government –Judicial

Provincial Courts Federal Court of

Appeals Supreme Court of

Canada Very little role in

energy policy except for aboriginal rights

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Parliamentary Government – Forms of Law

statuteenabling legislationAct of legislature

regulationdelegated legislationorder in councilcabinet (informal)lieutenant governor (formal)

contracts, permits

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Parliamentary Government – Policy that is not Law

Legally required rules are a subset of “public policy”

Example: BC Energy Plan document

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Bureaucracy

Minister: Elected politician Member of cabinet and legislature

Appointed Officials Example: BC Ministry of Energy and

Mines

Mandate

Essential Elements of Authority Division of powers Head of state PM or premier Cabinet Members of

legislature

Legislatures Minister Appointed officials Bureaucracies Courts

Sustainable Energy Policy 39

Aboriginal Rights and Title Governments have a duty to consult and

accommodate First Nations (Haida) Not a veto (Haida, Taku)

“Free, prior and informed consent” from UN Declaration Non-binding on signatories Canada late signatory with condition that

FPIC not a veto Obligations involved in accommodate

uncertainSustainable Energy Policy 41

Summary

Authority vs power Formal bases for policy in statute

and regulation provincial dominance executive dominance Next week: policy process, actor

dynamics