Alberta government undermining independence of province's energy regulator: Opposition

Alberta's energy minister is undermining the independence of its energy regulator, one of several examples of the United Conservative Party government extending its grasp into supposedly arm's-length public agencies, observers say.

"We've been seeing this consistent pattern of political interference in public agencies," said Nagwan Al-Guneid, energy and climate critic for the New Democrat Opposition. "This weakens public confidence."

In February, Energy Minister Brian Jean wrote a letter to the Alberta Energy Regulator suggesting three coal exploration applications for the province's Rocky Mountains should be exempt from a government order banning such development.

Jean said Northback Holdings's plans for the Grassy Mountain site in southwest Alberta should be considered an advanced project even though it has already been rejected by provincial and federal environmental reviews.

In response, the Municipal District of Ranchland filed documents with Alberta's top court asking the regulator for leave to appeal its decision to accept the applications.

"We felt (the letter) was an overstep," said Reeve Ron Davis.

"It looks to me like there's been political interference. I don't feel it's appropriate at all."

In a decision released Tuesday, the regulator denied the request for an appeal.

"The (regulator) has concluded that acceptance of the applications, and request for a hearing, is not an appealable decision as defined in (the Responsible Energy Development Act)," the decision says. "Therefore, the request for regulatory appeal is dismissed."

Alberta Premier Danielle Smith waved off concerns about governmental overreach.

"I would say that it's an independent process," she said Tuesday.

"I think (the letter) was just some clarity about which (developments) might be able to have an opportunity to go through the regulatory process. The Alberta Energy Regulator's going through that, and I'll just let them do their work."

Josh Aldrich, spokesman for Alberta Energy, said the letter was intended to clear up which projects were exempt from the development ban.

"The (regulator) is an independent body that reviews applications to ensure they meet Alberta's stringent environmental criteria – not the government. The (regulator) has not made a decision on the applications.”

Al-Guneid said Jean's letter is the latest example of the government's attempts to control bodies intended to be independent. She pointed to documents recently released under Freedom of Information legislation that indicate the Alberta Electric System Operator was strong-armed into requesting a pause on renewable energy development.

"That is extremely problematic," said Al-Guneid.

Another arm's-length body, Alberta Health Services, is being dismantled and replaced by four agencies that will report directly to government.

In an inquiry into the growth of renewable energy, the Alberta Utilities Commission was specifically told to focus on criticisms of the industry made by UCP members.

A group of University of Calgary academics with expertise in resource law recently pointed to the same impulse in a report on the energy regulator written for the government by David Yager, an oilpatch executive and former Wildrose Party president.

The Wildrose eventually merged with the Progressive Conservatives to form the UCP. Yager is now on the regulator's board. In a blog posting, the academics said Yager's report sends mixed messages on independence from politicians.

"This is not a vision of real independence, either from the line departments of government, the minister’s office or even from the industry it regulates," wrote Nigel Bankes, Shaun Fluker and Martin Olszynski. "Instead, it is a vision of dependence and direction."

In an interview, Olszynski called the arm's-length status of the energy regulator "a fiction" that allows the government to blame the regulator for unpopular decisions or outcomes while making clear what it wants.

"This government seems really intent on controlling all these other agencies of the state," he said.

Davis said he just wants to feel as if regulatory decisions that affect development on the land where he lives are rational choices, not political options.

"(The government) should be able to make comments, but I don't think they should have overarching ability to change decisions," he said.

"It's not an arm's-length decision-making body at that point."

This report by The Canadian Press was first published June 4, 2024.