Canada: Energy @ Gowlings - May 14, 2009

Last Updated: May 21 2009

Edited by Paul Harricks

Contents

  • The Electricity Industry In Canada
  • What Are Senior Energy Executives Thinking?
  • Proposed Amendments to Ontario's Green Energy Act - Michael Morrison
  • Oilsands Expectations 2009 - Arnie Olyan and Dianna Kyles
  • The Federal Court interprets the Nuclear Safety and Control Act in Keen v. A.G. Canada - Jacques J.M. Shore, Neil McCormick and Stephanie Sutherland
  • The Long Arm of the United States Foreign Corrupt Practices Act of 1977 - Andrew Gray
  • IESO Issues 18-Month Outlook - Neil McCormick
  • BC Energy Plan Progress Report - Nancy Herrmann
  • Up Close With... Jim Smellie

THE ELECTRICITY INDUSTRY IN CANADA

In co-operation with Thomson Reuters, Gowlings is pleased to announce that our book entitled The Electricity Industry In Canada is now available for purchase. The two-volume work, consisting of about 1,400 pages, is a comprehensive look at the electricity sector from coast-to-coast-to-coast. Topics covered include:

  • Nuclear Regulation;
  • Environmental Regulation;
  • Real Estate;
  • Taxation;
  • Sale of Electricity;
  • Conservation and Demand Management; and
  • Import/Export of Electricity.

The provinces and territories are also comprehensively covered. These chapters are structured in a way to make cross referencing an easy task with each chapter containing discussions on:

  • The History of the Provincial/Territorial Electricity System;
  • Legislative Framework;
  • Regulatory Bodies: Structures, Power and Jurisdiction;
  • Licences, Permits, Approvals and Certifications;
  • Generation, Transmission and Distribution; and
  • Emerging Trends, Challenges and Opportunities.

For more information, or to purchase this book, please visit the following Thomson Reuters web site:

http://www.carswell.com/description.asp?docid=5822

WHAT ARE SENIOR ENERGY EXECUTIVES THINKING?

Have you wanted to know what other senior energy executives are thinking about today's hot issues in the energy sector in Canada and around the world? We have. That's why Energy @ Gowlings has introduced a new feature, "What Are Senior Energy Executives Thinking?". From opinions on the development of renewable generation to views on alternative energy technologies to the place of Alberta's oil sands in the continental supply mix, Gowlings will ask the questions you've always wanted to.

This issue's web poll:

There are some experts who believe that the economy is now improving, but not yet in full recovery mode. In the coming months, what will be the most important concern as the energy sector recovers from the recent financial downturn?

Regulatory Reform 19%

The Environment 24%

Access to Capital 54%

Other 3%

The following are some comments from the web poll participants:

  • Access to capital is a challenge today, but over the next few months I think it will be more of a challenge for those of us in the energy sector [and we] will have to scale up our focus on environmental issues.
  • In Ontario, implementation of the Green Energy Act could well destroy any potential recovery
  • I am very concerned that "business as usual" will dominate the scene once decision makers see some increasing stability, i.e. consumers which drive investment in this sector will move away from conservation based choices driven by the economic downturn.
  • The environment always seems to take a back seat to financial concerns.
  • Many of the smaller energy producers are currently capital constrained and the alleviation of that constraint will likely define the next 12 month period
  • The Alberta Tories had better re-think their position on royalties. In my view, that is the single most important factor affecting the economy in Alberta.

DISCLAIMER: This poll is informal, not scientific. It only reflects the opinions of site visitors who have voluntarily participated. The results may not represent the opinions of the public as a whole. Gowlings is not responsible for the statistical accuracy of opinions here expressed.

If you have have a question you'd like to pose, let us know. Your question could be featured in an upcoming edition of the newsletter. Send all your energy-related questions to energy@gowlingsnewsletters.com

PROPOSED AMENDMENTS TO ONTARIO'S GREEN ENERGY ACT
By: Michael Morrison

After a consultative process, the government of Ontario has proposed amendments to the Green Energy Act (Act). The Legislature's Standing Committee on General Government is ready to consider the proposed Act in detail. The following table highlights some of the Amendments.

Topic

Amendments

Policy Development

Home Energy Audits

The buyer can opt out if the audit is not desired (e.g. if major renovations or demolition are contemplated)

Regulations will focus inittially on principal residences and single family homes. The audit will be transferable so that retrofit grants can be accessed by buyers.

Community Consultation and Municipal Assistance

Creating a new section that clearly ensures administration of the Act is done in such a way as to promote community consultation

A uniform process for proponent consultation with municipalities on site requirements and local infrastructure, as part of the renewable energy approvals process.
Establish a provincial program to ensure municipalities can recover costs associated with renewable energy projects.

Community and Aboriginal Assistance

 

Establish a provincial Aboriginal program to ensure costs associated with renewable energy projects can be recovered.
Establish a program to ensure project costs associated with community renewable energy projects can be recovered.

Health Concerns

Amending grounds for appeal under the Environmental Protection Act to protect against serious health effects.

The Ministry of the Environment to establish and fund an academic research chair to examine potential public health effects of renewable energy projects.

Setbacks

 

Continued consultation by the Ministry of the Environment to establish province-wide minimum setback standards and regulations regarding renewable energy projects (excluding some forms of renewable energy such as rooftop solar) with regard to human health, noise and low frequency vibration.

Enforcement

Inspection and search provisions related to home energy audits and minimum energy efficiency standards for appliances and products will be eliminated.

 

Mandating Domestic Content

New section which clearly establishes the government's commitment to domestic content.

Domestic content levels will be established consistent with trade agreements and consultation with relevant sectors.

Minister's Directive Powers

Clarify that procurement directives under the new directive authority focus only on renewable energy, energy efficiency and conservation.

 

Energy Procurement

 

Reviewing future policy opportunities to address energy technologies including geothermal, solar thermal, combined heat and power and small scale wind.

Stray Voltage

 

Minister to direct the Ontario Energy Board to manage and address issues related to stray voltage. Environmental Commissioner of Ontario (ECO) Ensuring the ECO can meet the responsibilities outlined in the Act Ensuring the information and documentation related to the development of conservation targets is transparent and publicly available.

Continue to monitor energy@gowlings for further updates on the Green Energy Act

OILSANDS EXPECTATIONS 2009
By: Arnie Olyan and Dianna Kyles

The economic freefall in the latter portion of 2008 and the stall of early 2009 has been a rough ride for Canada's oil and gas industry. One of the hardest hit segments has been Alberta's oilsands. As of the end of Q1 2009 a number of oilsands projects have been deferred or delayed, with the recent announcement of the proposed Petro-Canada/Suncor amalgamation (creating "Big Suncor") further focusing certain oilsands players on whether or not their projects will proceed. Decisions on the future of certain projects will have to be made and, as a virtual certainty, a "greening" of the industry undertaken to ensure various markets remain open for export. Although the pace of development of upgrading and extraction will be slower than during the Summer of 2008, the oilsands seem to provide the only realistic means of replacing the world's declining conventional hydrocarbon reserves. The size of Canada's hydrocarbon resources in the form of oilsands remains second only to those of Saudi Arabia - making it inevitable that Canada will remain a major player in the provision of energy for decades to come.

In March of last year we outlined the "Top 10" events expected in 2008 that would provide major strides towards the achievement of new production levels in the oilsands. What follows is an update of those Top 10 events for the 2009 calendar year - the status of projects, movement among the players and the most recent trends noted in industry publications.

  1. Canadian Natural Resources - Horizon Oilsands Project (Phase 1) [110,000 barrels/day]

    First oil at Horizon was produced on February 28, 2009 and the first shipment of light synthetic crude to the sales pipeline began on March 18, 2009. The project is anticipated to spend the remainder of the year ramping up to full production of 110,000 barrels/day. Phases 2 and 3 of the project are currently "on hold".
  2. OPTI/Nexen - Long Lake (Phase 1) [60,000 barrels/day]

    First production of premium sweet crude from the upgrader at Long Lake has been announced by Nexen, which now holds a 65% interest in the project. After purchasing a 15% interest from OPTI for $735 million, Nexen is now operator of both the upgrader and the Long Lake SAGD Project. Syngas from the upgrader is being used (to heat water and produce steam) for SAGD operations, which will significantly reduce the need for purchased natural gas. Over the next year the upgrader is expected to ramp up to full design rates of approximately 60,000 barrels/day. Sanction for Phase 2 has been deferred until late 2009.
  3. Petro-Canada/UTS Energy/Teck Cominco - Fort Hills [145,000 barrels/day]

    In October 2008, Petro-Canada announced the deferral of the construction decision for the Fort Hills upgrader, which has now been delayed indefinitely. The final investment decision for the mining portion of the Fort Hills project has also been delayed, with Petro-Canada stating it hoped to take advantage of the softening construction market to reduce costs. Big Suncor will have major decisions ahead of it as it must determine which oilsands mining projects it wishes to undertake, and whether the Fort Hills upgrader (originally planned for the Edmonton area) is now necessary.
  4. Suncor Energy - Upgrader 2 Expansion [Current production: 350,000 barrels/day(Base Mine and Millenium); Voyager Expansion: 190,000 barrels/day]

    Commissioning of Suncor's $2.3 billion expansion of its second upgrader is now complete and will allow Big Suncor to produce a total of 350,000 barrels of light synthetic crude per day from its two upgraders. The schedule for the $20.6 billion Voyageur expansion was slowed considerably in October, ostensibly due to the precipitous drop in oil prices, the spike in construction costs and uncertainty in financial markets. Query whether a revival of the Voyageur expansion (including construction of a 3rd upgrader) will become a priority following the creation of Big Suncor.
  5. Imperial Oil/Exxon Mobil - Kearl Lake (Phase 1) [100,000 barrels bitumen/day]

    The project is still in the preliminary engineering phase, with a revised cost model and go/no-go decision expected at some point in 2009. Work continues at a consistent pace with detailed design engineering, procurement of certain long-lead items and site preparation ongoing. No upgrader is planned to process the bitumen.
  6. Total E&P Canada/Enerplus Resources - Deer Creek/Joslyn (Phase 1 North) [50,000 barrels bitumen/day]

    A one-year delay of Phase 1 (North) was announced by Total in July of 2008. Total has also withdrawn its application with regulators for the Northern Lights (formerly Synenco) oilsands mine, stating that it wanted to focus on its Joslyn North mine and other projects while determining its strategy for Northern Lights. Total's commitment to the oilsands seems clear, but its specific and next steps in developing its assets are not always transparent.
  7. EnCana/ConocoPhillips - Foster Creek and Christina Lake Expansions [120,000 barrels bitumen/day]

    Christina Lake was producing 12,000 barrels of bitumen/day and the most recent expansion of this facility has increased production capacity to 18,000 barrels/day. Total combined production from the two projects in Phases "1A" and "1B" is currently 63,000 barrels/day. Phase "1C" construction at Christina Lake is nearing completion, with start-up expected in 2010. Phase "1D" at Foster Creek has received regulatory approval and first production (steaming) will ramp up in Q4 of 2009. Production capacity will effectively double by 2010 to about 120,000 barrels per day. Expansion is progressing as scheduled.
  8. Petro-Canada - Strathcona (Edmonton) Refinery [135,000 barrels/day of light synthetic crude]

    Refit of the refinery to handle (oilsands) light synthetic crude oil was complete as of December 2008 and the Strathcona Refinery is now ramping up to process 135,000 barrels/day. Subject to pre-existing commitments, and as an asset of Big Suncor, this recently updated refinery would be the obvious destination for Big Suncor product processed through any of the Suncor upgraders.
  9. Husky Energy - Sunrise (Phase 1) [Proposed 50,000 barrels/day]

    Husky is currently conducting front-end engineering work on the project, including area infrastructure and site preparation in order to "optimiz[e] development planning". However, a go/no-go decision, and the timing of same, has not yet been made.
  10. Devon Canada - Jackfish (Phase 1) [35,000 barrels/day]

    Operation (SAGD steaming) has begun and production is ramping up for Phase 1 of the Jackfish project. Application for regulatory approval of Phase 2 has been made, with detailed engineering and some construction underway.

Conclusion

If expectations in early 2008 could be characterized as optimistic, expectations at the close of Q1 2009 could best be characterized as realistic, with a dose of uncertainty thrown in for good measure.

Certain information for this article was taken from Oilsands Review: The Unconventional Authority (January, February & March 2009)

THE FEDERAL COURT INTERPRETS THE NUCLEAR SAFETY AND CONTROL ACT IN KEEN v A.G.CANADA
By: Jacques J. M Shore, Neil McCormick and Stephanie Sutherland

Although an employment-related ruling, the Federal Court's recent affirmation of the decision to terminate Ms. Linda Keen as President of the Canadian Nuclear Safety Commission (Commission) is worth exploring in light of its interpretation of the Commission member appointment provisions of the Nuclear Safety and Control Act.

Ms. Keen's termination arose as a result of her decision to extend what had been a routine shutdown of the Chalk River nuclear reactor. The extended shutdown came about after it was discovered that the reactor's cooling pumps were not attached to an emergency power source, as was required under Chalk River's licence. Ms. Keen had ordered the shutdown as an emergency measure, without holding a formal hearing of the Commission at which interested parties could testify and share their views. This delay in the reactor's operation led to a worldwide shortage of essential medical isotopes, which are used in the treatment and diagnosis of over 20 million patients each year.

Despite a request from the Minister of Natural Resources, Gary Lunn, to meet with Atomic Energy Canada Ltd., the Crown corporation that owns Chalk River, and despite a directive issued by the Governor in Council emphasizing the importance of the production of medical isotopes, Ms. Keen refused to lift the order to keep the reactor inactive. The issue was finally resolved when a bill was passed by Parliament to overturn Ms. Keen's decision and re-open the reactor for 120 days, after parliamentary hearings concluded that the risk from operating the reactor with a single pump was much lower than judged by Ms. Keen.

Shortly after the re-opening of the Chalk River reactor, Ms. Keen was removed as President of the Commission, although she retained her status as a full-time member of the Commission until her resignation was tendered several months later. The Minister, at the time of Ms. Keen's removal, indicated to Ms. Keen that her actions had led the Minister and Governor in Council to doubt whether Ms. Keen had the "fundamental good judgement required by the" President. According to the Minister's letter, "serious questions [had] arisen about whether the Commission, under [Ms. Keen's] leadership, could have dealt more appropriately with the risk management of the situation." In short, it was felt that Ms. Keen had overreacted to the situation in Chalk River, and had failed to consider the negative impact that a shortage of the nuclear medical isotopes would have on medical treatment and diagnosis throughout the world.

Ms. Keen then brought proceedings against the Government of Canada in Federal Court, claiming that her removal as President had been unlawful and invalid, and requesting that the order of removal be set aside. The government had argued that the issues were rendered moot as a result of Ms. Keen's resignation from the Commission. However, Justice Hughes decided that the matters should be heard, as there was the possibility of future claims by Ms. Keen, and as the issue of whether the President was appointed 'at pleasure' or 'during good behaviour' was an issue that could affect others in similar senior-level government positions.

The central issue of the proceedings was whether Ms. Keen had been appointed as President of the Commission 'during good behaviour' (as applied to full-time members of the Commission, under section 10(5) of the Act), or whether she was appointed 'at pleasure' of the Governor in Council. If it was 'at pleasure', Justice Hughes stated that the requirements of procedural fairness would have been met, as Ms. Keen had been informed that it was no longer the pleasure of the Governor in Council to have Ms. Keen as President of the Commission. However, if she was designated as President 'during good behaviour', Justice Hughes felt that Ms. Keen had not been provided adequate grounds to demonstrate why she was lacking in 'good behaviour', and that if she had been lacking in good behaviour she should not have been permitted to retain her position as member of the Commission, which the Governor in Council had in fact permitted.

Justice Hughes, in his 40 page decision, determined that the President is appointed 'at the pleasure' of the Governor in Council pursuant to the Nuclear Safety and Control Act, and therefore the Governor in Council had satisfied the requirements of procedural fairness in removing Ms. Keen as President of the Commission. In his reasoning, Justice Hughes relied in part on the official commission letter that had been issued by Her Majesty at the time of Ms. Keen's appointment. Justice Hughes stated that "...the commission [of President] as granted by Her Majesty to Ms. Keen clearly states that her appointment as member is for five years "during good behaviour" and that the designation as President is "during Our Pleasure". It could not be more clear..". Because Justice Hughes found that Ms. Keen was not appointed 'during good behaviour' - and because Ms. Keen had resigned as a member of the Commission - the question of whether Ms. Keen had demonstrated 'good behaviour' did not have to be determined.

At the time of the release of the decision, Ms. Keen had stated that she was considering whether to appeal the Federal Court's decision, as well as whether to bring a civil suit against the government. However, the 30-day period in which Ms. Keen would have been able to file a notice of appeal expired on May 8th, without any notice of appeal having been filed with the Court. Therefore, unless Ms. Keen is able to get leave from the Federal Court of Appeal to file a late notice of appeal, it seems unlikely that she will be appealing the decision of Justice Hughes. It remains to be seen whether she will commence a civil suit against the government.

This decision and the surrounding circumstances have affected the energy industry in Canada in two ways. First, it clarified that full-time members of the Commission are appointed during good behaviour, while the President is appointed at the pleasure of the Governor in Council as the representative of Her Majesty. This removes any question as to the way in which the appointment provisions of the Nuclear Safety and Control Act are to be interpreted. Second, the situation as a whole has illustrated the importance of finding a balance between safety issues and health issues (such as the production of essential medical isotopes), and the importance of ensuring that the regulatory authorities responsible are capable of finding and maintaining such a balance.

It is useful to note as well that this decision is important not just in terms of interpretation of the Nuclear Safety and Control Act appointment provisions, but also with respect to similar appointment provisions for other senior-level government assignments. Wording similar to 'during good behaviour' and 'at pleasure' is used in the appointment provisions of Acts governing various regulatory bodies, and the interpretation of 'at pleasure' and 'good behaviour', therefore, will affect regulatory bodies across Canadian government.

THE LONG ARM OF THE UNITED STATES FOREIGN CORRUPT PRACTICES ACT OF 1977
By: Andrew Gray

In February of this year, KellogG Brown & Root LLC entered into a plea agreement with the United States Department of Justice (DoJ), and KBR, Inc. and Halliburton Co. entered into settlements with the United States Securities and Exchange Commission (SEC), pursuant to which those companies together paid US$579 million in combined criminal and civil penalties.

The plea agreement and settlements relate to alleged bribes paid to Nigerian officials to secure EPC contracts to build LNG trains on Bonny Island, Nigeria.

In relation to the same allegations, on 5 March 2009 UK citizen Jeffrey Tesler was arrested in the UK on ten charges of breaching the United States Foreign Corrupt Practices Act of 1977 (FCPA) and further charge of conspiracy to breach the FCPA.

The arrest was made by the London Metropolitan Police acting on a mutual legal assistance request issued by the DoJ. An arrest warrant is outstanding for another UK citizen, Wojciech Chodan, in respect of the same charges.

If convicted on all charges, under US law the two UK citizens face a maximum prison sentence of 55 years, and the DoJ is also seeking forfeiture by them of more than US$130 million.

Agency as a Basis for Jurisdiction

US companies and prosecutors view other countries' limited success in prosecuting bribery of foreign public officials as a means of unfair competition in international trade. To level the playing field the DoJ and SEC actively pursue the extra-territorial jurisdiction granted to them by the FCPA.

The FCPA anti-bribery provisions apply to (a) US issuers and US domestic concerns wherever they may be, (b) other persons who are within the territory of the United States, and (c) in each previous case their respective officers, directors, employees or agents, or stockholders acting on their behalf.

Although Chodan's indictment states that he is both a UK citizen and UK resident, and at the relevant times was employed by a UK company (or later hired as a consultant by a UK company and then by an international joint venture), the DoJ asserts that he acted as an agent of a US domestic concern.

Similarly, Tesler, a UK citizen and UK resident alleged to have acted through a Gibraltar corporation, is charged as an agent of a US issuer, an agent of US domestic concern and an agent of a person within the territory of the United States.

In other cases, it has been asserted that a UK company was a person acting within the territory of the United States through the actions of its agent, in circumstances where commercial people may not realize that an agency relationship existed.

For example, the 2007 information filed by the DoJ against a Scottish company Vetco Gray UK Ltd (Vetco UK) and others asserted that Vetco UK was in the territory of the United States, "by frequently using ... affiliated U.S. entities and their personnel to perform acts" for its benefit. In that matter, Vetco UK agreed to pay a US$12 million fine, having previously agreed to pay a US$5.25 million fine in 2004 arising out of separate FCPA charges.

Prosecution of Individuals

US prosecutors have recently noted the deterrent value gained by prosecuting individuals, and we expect the charges against Chodan and Tesler to be part of a growing trend of US prosecutions of individuals (which may include non-US nationals) for FCPA violations. We also detect a growing severity in the punishment of individuals.

Very broadly, the Vetco cases referred to above were based on allegations of winning contracts in Nigeria through bribery of public officials, and to that extent bear similarity to the facts of the KBR/Halliburton matter in which Chodan and Tesler allegedly played a part.

In connection with the underlying facts of the 2004 Vetco case, three UK nationals (two of whom were resident in the UK, the third in Malaysia) and one US national reached settlements with the SEC in respect of alleged books and records offences. One individual agreed to pay a penalty of US$50,000 plus $64,675 disgorgement of profits and interest, and the other three agreed to pay US$40,000 each.

Although the alleged bribery and contract values involved in the Vetco matters were far smaller than in the KBR/Halliburton matter, and Chodan and Tesler might not expect the maximum possible penalties, the personal prosecutions arising from the 2004 Vetco case appear light by comparison to the treatment of Chodan and Tesler thus far.

Comment

When dealing with US entities in international business transactions, it is prudent for non-US entities and nationals to assume that the FCPA will apply to them. The threshold for being treated as an agent of a US issuer or US domestic concern, or vicariously in the US via the acts of an agent, appears to be relatively low. Certainly a formal agency agreement would not be required. Of course, Canadian companies will also be subject to the Corruption of Foreign Public Officials Act (CFPOA).

Similarly, when dealing in US dollars, payments between two non-US countries will typically flow through New York, satisfying almost all the requisite elements for US jurisdiction. Again, it is prudent to implement policies and procedures to ensure compliance with both the CFPOA and FCPA when conducting international business in US dollars.

Finally, one of the FCPA violations alleged against Mr. Chodan (for which he faces a maximum penalty of five years in prison) is that he emailed a memo to executives in Houston containing false statements to be released to French authorities investigating potential crimes in connection with the Bonny Island project. While it is obviously far preferable to ensure that bribes are not paid in the first place, if a company is (or suspects that it is) under investigation, rapid and effective implementation of both a communication policy and a document retention policy will be required.

For more information on how we can help your company navigate the complex laws, regulations and governance issues which arise in international business transactions, visit Gowlings' International Business Ethics and Anti-Corruption page:
http://www.gowlings.com/services/service.asp?intServiceId=87

IESO ISSUES 18-MONTH OUTLOOK
By: Neil McCormick

Ontario's Independent Electricity System Operator (the "IESO") recently issued its 18-month outlook, covering the period from April 2009 to September 2010 (the "Outlook"). The IESO "remains positive" in respect of the reliability of Ontario's electricity system over the Outlook period as nearly 4,700 MW of new and refurbished supply is expected to come into service. Moreover, the addition of a new interconnection between the Hawthorne transformer station in Ontario and the Outaouais station in Québec, allowing transfers of up to 1,250MW by May 2010, is also expected to contribute to reliability.

In addition, throughout the Outlook period, the installation of several shunt capacitors at Buchanan, Middleport and Nanticoke and the up-rating of the Hanover to Orangeville 230kV circuits will increase the capability to direct energy away from the Bruce area. These near term reinforcements are expected to reduce the potentially constrained generation of the seven or eight Bruce units before the 500kV double-circuit line between Bruce and Milton is available.

In evaluating the adequacy of available resources for the Outlook, the IESO incorporated planned reductions in coal-fired emissions in Ontario, which are scheduled to commence in 2009. The IESO concluded that such reductions should not affect reliability in 2009, though the picture in 2010 is less clear, since complete strategy for emissions reductions in 2010 has not been confirmed.

Over the Outlook horizon both peak and energy demand are expected to decline as the economy contracts. Energy demand is forecast to decrease by 1.6% in 2009 and in spite of eventual economic recovery, demand is forecast to decline by 2.0% in 2010 as embedded generation and conservation efforts further reduce demand.

The following table summarizes peak demands under normal and extreme weather conditions:

Season

Normal Weather Peak (MW)

Extreme Weather Peak (MW)

Summer 2009

24,998

27,094

Winter 2009-10

22,758

23,818

Summer 2010

24,501

26,597

The full text of the Outlook can be viewed at the following site:

http://www.ieso.ca/imoweb/pubs/marketReports/18MonthOutlook_2009mar.pdf

BC ENERGY PLAN PROGRESS REPORT
By: Nancy Herrmann

BC Energy Plan: February 2007

In February 2007, the Ministry of Energy, Mines and Petroleum Resources announced the BC Energy Plan: A Vision for Clean Energy Leadership. The plan focused on 55 policy actions including: aggressive targets for zero net greenhouse gas emissions, new investments in innovation, and an ambitious target to acquire 50 per cent of BC Hydro's incremental resource needs through conservation by 2020.

In addition, the plan focused on providing new measures to enhance energy security in the province including initial discussions with First Nations, the Province of Alberta and communities to discuss a potential Site C project. The Site C project is a proposed third dam on the Peace River in B.C. If built, the project would flood several thousand hectares of land near Fort St. John, producing enough electricity to power approximately 460,000 homes.1 The project would produce about 4,600 gigawatt hours of electricity annually, representing approximately 10 per cent of the electricity produced annually at BC Hydro's existing hydroelectric facilities.2

The "Report on Progress": April 2009

In April 2009, the Ministry of Energy, Mines and Petroleum Resources reported on the province's progress in carrying out the BC Energy Plan. Some of the highlights include:

  • Residents across the province are eligible for rebates through the LiveSmart BC: Efficiency Incentive Program. The program was launched in May 2008 and invests $62 million dollars over four years to help B.C. residents reduce their energy costs and carbon footprint through upgrades to homes and businesses. The high demand for the LiveSmart BC energy audits has resulted in an increase in energy advisors from 30 to over 100.
  • Since 2008, the Innovative Clean Energy (ICE) Fund has approved investments of over $47 million in 34 projects within B.C. To date these investments represent a total value of over $174 million, which assist in developing clean and renewable energy technologies in areas of solar, geothermal, tidal, wind, and bioenergy.
  • In March 2009, Phase Two of BC Hydro's Bioenergy Call for Power was announced. The Call for Power focuses on converting biomass into clean, cost-effective and carbon-neutral electricity. The four successful proposals in Phase One of the call will generate a combined total of 579 gigawatt hours of electricity annually, or enough to power more than 52,000 homes.
  • In furtherance of its energy security policy action, the Province reported that BC Hydro is investing $3.6 billion in upgrades for heritage asset power plants, including existing dams like the W.A.C. Bennett Dam, transmission and distribution systems, and facilities. The Report on Progress did not comment specifically on the status of the Site C project. However as of March 2009, BC Hydro had completed Stage 2 consultation of the Site C project.3
  • In addition to its energy security mandate, the Province announced the BC Hydro Standing Offer Program for clean, renewable or high-efficiency co-generation projects for less than 10 megawatts. The Program will assist more small clean, renewable projects on to the grid and expanding the Province's clean energy supply.
  • Lastly the Province has made strides in its "no nuclear power" policy action. In April 2008, the Province announced it would not support uranium exploration and development in B.C. In 2009, the Province issued an order to prevent permits from being issued for uranium and thorium exploration and development.

In highlighting the clean energy initiatives taken by the Province over the last 2 years since the introduction of the BC Energy Plan, the Report presents the Province as an environmental leader in the management of its natural resources.

Up Close With ... Jim Smellie

In this instalment of Up Close With... we feature Jim Smellie from Gowlings Calgary office.

In relation to the energy sector, he has extensive experience as counsel before the National Energy Board, Alberta Utilities Commission and other provincial regulatory tribunals, and has represented natural gas producers, transmission pipelines, distributors, government, petrochemical interests, marketers and shippers in respect of facilities applications, export/import authorizations, and tariff issues both in the normal course and on major project-specific briefs such as the Sable Offshore Energy/Maritimes & Northeast Pipeline Projects, MacKenzie Gas Project and the proposed Alaska Pipeline.

In electricity matters, Jim has extensive experience, including on behalf of the Alberta Electric System Operator, before provincial and federal regulators concerning open access, cost of capital and other tariff issues, greenfield and thermal plant expansions, export authorizations and transmission system expansions.

He also advises clients concerning the acquisition, disposition and financing of regulated energy assets including pipelines, cogeneration plants and electrical transmission facilities.

His regulatory and administrative law focus also includes broad experience before the Canadian Transportation Agency and the Canadian International Trade Tribunal on anti-dumping matters.

His litigation focus includes commercial arbitrations (both as counsel and arbitrator), appearances in the Federal Court, Federal Court of Appeal, provincial superior and appellate courts and the Supreme Court of Canada.

Footnotes

1. Legislative Library of British Columbia. "Background Brief: The Site C Dam: Historic Overview and Key Issues". May 2007. Paper updated January 2008.
2. Ministry of Energy, Mines and Petroleum Resources. "Facts on Independent Power Production". March 25, 2009. P. 2.
3. Ministry of Energy, Mines and Petroleum Resources. "Facts on Independent Power Production". March 25, 2009. P. 2.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions