The deeply flawed role of the Canada Energy Regulator (CER)

Part 4 in a series of 18 discussion papers

No environmental assessment or public inquiry process of any kind in Canada has ever answered the crucial question, which is whether the planned growth of Canada’s oil production to 2030 and 2040 is compatible with keeping increased warming to 1.5°C. For the past nine years, the CER (formerly known as the National Energy Board, or NEB) has turned a blind eye to a fundamental question, which remains unanswered.

The CER is the Federal Government’s energy agency. Since 2013, in its annual reports entitled Canada’s Energy Future, the CER has published analyses and projections showing the expected future levels of Canada’s oil productions, along with information about other aspects of energy supply and demand in Canada. On the eve of the Federal Government’s approval of the TMX pipeline expansion project in 2015 and 2016, the CER (then the NEB) was projecting very substantial ongoing expansion of oil production in Canada to 2040.

Although Canada became a signatory to the Paris Agreement in December 2015, making a solemn commitment to take action to limit the increase in global average temperature “to well below 2°C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5°C”, the CER has consistently failed during all the years since then to examine the much lower and declining future levels of oil production in Canada that could be safely aligned with a 1.5°C or 2°C world. The CER’s annual reports since 2016 have never examined that question.

In its most recent projections of Canada’s future oil production levels up to 2050 released on December 9, 2021, the CER was again silent on that question.    

Facing sharp public criticism from leading Canadian energy economists and climate scientists for that ongoing failure, the Minister of Natural Resources on December 16, 2021, belatedly instructed* the CER to conduct an internal study to determine what future level of oil production in Canada would be safely aligned with a global effort to limit warming to 1.5°C. No annual report was published in 2022.

The government’s most recent Emissions Reduction Plan published on March 29, 2022, informed Canadians only that the Minister of Natural Resources has sent a letter to the CER asking that it conduct a new scenario analysis:

On December 16, 202, Natural Resources Minister Jonathan Wilkinson, wrote to the Chairperson of the CER’s Board of Directors Cassie Doyle, to request that the CER produce fully modelled net-zero scenarios consistent with 1.5 degrees of warming under the Paris Agreement. The 1.5 -aligned Scenario Analyses will include fully modelled scenarios of supply and demand of all energy commodities in Canada, including clean fuels, electricity, and oil and gas. This modelling will also include the future trends in low-carbon technology and energy markets, to provide Canadians with information they need to better understand the future energy transition.

Emissions Reduction Plan, March 29, 2022

But the “modelling” has not been done, or at least has not yet been released to the public.  It is not yet available to Canadians. The promised 1.5°C-aligned analysis by the CER will likely not be publicly available until sometime in 2023, possibly within the next month or two

In the meantime, our government has been justifying decisions to expand our oil production (decisions that involve projects and infrastructure that will have an operating lifetime of 20 or 30 years) based on the existing CER projections which are not remotely aligned with 1.5°C or 2°C. The ERP document, released by the government on March 29, 2022, acknowledges that it is continuing to use the CER’s existing projections as a “framework” to approve projects and that the Canadian oil industry is using the currently available CER projections “to make investment decisions.

On April 6, 2022, the Federal Government announced the approval of a major new offshore oil field in Newfoundland which is expected to come into production by 2028. Known as Bay du Nord, it will contribute an additional 200,000 to 300,000 bpd to Canada’s oil production level. The approval came just one week after the Emissions Reduction Plan was published. 

By 2023, Canada’s oil production will have increased by another 350,000 bpd above the 2021 level – and by 2024 it will be 530,00 bpd higher, according to the CER’s 2021 data. That represents a 10% rise in our oil production within the next two years. And even when the CER’s promised new analysis is eventually released, we have no assurance that it will give us a reliable answer.

The forthcoming CER analysis, when it is eventually disclosed to the public, will not be the result of an independent inquiry process. The CER’s study is entirely closed to public access. There have been no public hearings, no media access, and there is no public record of the information being considered by CER staff members. The CER is quietly deciding in secrecy what evidence it will look at, and what lines of inquiry it will ignore. A proper examination of this crucial question must be conducted by an independent public inquiry process.

* Letter sent December 16, 2021 by the Minister of Natural Resources to the CER requesting that it “undertake scenario analysis” relating to Canada’s future oil production: