Major changes are coming to the Canadian energy regulator if the recommendations of an expert panel are accepted. Pipeline operators and the Alberta-based oil and gas industry—which is desperately seeking increased market access as oil sands production booms—stand to be the big winners.

The report, tabled May 15 by the five-member panel, suggests replacing the National Energy Board with a more focused regulatory body called the Canadian Energy Transmission Agency (CETA), which would review and license all inter-provincial or international energy infrastructure projects.

Jim Carr, the natural resources minister responsible for the NEB, said years of bitter disputes over two British Columbia pipeline projects—Enbridge’s Northern Gateway and Kinder Morgan’s Trans Mountain Expansion—have broken the NEB review process and destroyed the Canadian public’s trust in the regulator.

The Liberal Party was elected in 2015 with a mandate to change the NEB, he argued, to not only make it more inclusive for non-stakeholders, but also to streamline project reviews so that pipeline operators enjoy less uncertainty and receive a more timely response, either positive or negative.

“Our strategy is to create a process and room for all Canadians who have an interest in these major projects to express themselves. Ultimately, the cabinet will take its responsibility and make decisions in the national interest,” Carr said in a 2016 interview.

“We think that when those decisions are made, Canadians will say, ‘Yes, that was a thoughtful and reasonable way to get to a decision.’ Not every single Canadian is going to agree the decision was the right one.”

In line with Carr’s vision for a modernized NEB, the key feature of the expert panel’s report is a one-year public engagement period that is managed by the Major Projects Management Office, which coordinates policy across different federal departments.

“When a new project comes forward, [government] must first ask itself at a strategic level if it is consistent with policy aspirations,” Brenda Kenny, engineer, former head of the Canadian Energy Pipelines Association and a panel member, said in an interview. “Phase one would be evidence-based, fact-based, but focused on assessing a project against national interests.”

In the past, policy issues such as the impact of a new pipeline on upstream greenhouse gas emissions or were shoehorned into a project’s technical review because there was no other venue.

“Both industry and environmental groups told us the same thing: Canadians feel forced to use NEB project reviews as the venue for resolving policy questions about climate change because of an absence of any better alternative,” the panel’s report said.

“The end results are NEB proceedings that serve no one’s interests, and which needlessly exacerbate conflict between industry groups…and indigenous and environmental groups…”

Once “phase one” is completed, Prime Minister Justin Trudeau and his cabinet will decide if the project proceeds to the next phase.

“That’s the job of a government—to consult, to offer lots of opportunity for a discussion and then to make a decision we believe to be in the national interest, for which we shall be held accountable by the people of Canada,” Carr said.

If the answer is positive, the pipeline project begins phase two, a two-year technical review conducted jointly by the CETA and the Environmental Assessment Agency, which answers to Environment Minister Catherine McKenna.

Gaetan Caron, former head of the NEB and now an executive fellow with The School of Public Policy at the University of Calgary, describes the new process as a “one-year political check” for the federal government followed by “two years of nuts and bolts.”

During both phases, Kenny says indigenous peoples will be included more than they have in the past. First Nations and indigenous communities are often split on pipeline projects that traverse their tradition lands. Some are covered by treaties with the Canadian government, while others—particularly in British Columbia where First Nations have led opposition to Trans Mountain Expansion—are not.

According to panel members, “Indigenous peoples shared with us their experiences of being considered at the last minute, of having their knowledge ignored, and of being ‘accommodated’ to the barest extent possible so that projects can move forward.”

“Why would we expect our First Nations partners to believe for one minute that we mean good faith when [pipeline proponents] have already got it largely cooked and passed by the regulator,” said Kenny.

Another key recommendation of the panel’s report is to split research and technical report preparation from the NEB into an independent body modeled on the U.S. Energy Information Administration. Kenny says the intent is to improve the credibility of energy data and analysis by separating it from policy and regulatory functions.

The new organization will be called the Canadian Energy Information Agency and it will be located in Ottawa, close to Statistics Canada and other federal government departments. Also moving to the nation’s capital from Calgary, Alberta, will be the CETA board of directors and a small contingent of technical staff whose job is to review non-oil and gas projects, such as power transmission lines.

Caron says the most positive thing about the expert panel review is that it’s over: “One day we’ll stop fussing about the bureaucracy, the mechanics of [pipeline] review, and we’ll begin tackling the very substantive issues we have as a nation to define a sustainable path forward for energy production and development.”

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