Electricity regulation in Canada is governed both by the federal and the provincial level, each having its own jurisdiction regarding different aspects of electricity production, distribution, and consumption.
For the most part, Canada’s provinces and territories primarily govern electricity regulation or the regulation of the electricity sector, since it is the provinces and territories which regulates the types of power generation used in their own jurisdiction. It includes regulations on electricity pricing and power rates, the electricity generation, the intra-provincial transmission, and the distribution of electricity to consumers.
As for the electricity regulation at the federal level, the federal government regulates importation and exportation of electricity, and the designated international and inter-provincial transmission lines. The federal government also regulates the nuclear generation sector, which is also a part of the electricity sector.
What are the electricity regulations in Canada?
Since Canada’s electricity regulation is shared between the federal government and the provincial or territorial governments, it follows that laws and regulations for the electricity sector are found in both jurisdictions.
For the federal electricity regulation, it includes the:
- Canadian Energy Regulator Act;
- The Clean Electricity Regulations;
- The Canadian Electrical Code, and the regulations issued by the government regulating agency administering these laws.
(1) Canadian Energy Regulator Act
The Canadian Energy Regulator Act (CER Act) is the federal law which primarily established the Canadian Energy Regulator (CER) and provides for other regulations regarding the energy sector for matters governed at the federal level.
In establishing the CER, the CER Act provides for the positions and roles governing the CER, their powers, duties, and functions (Part 1). The CER Act also provides that the rights of the Indigenous Peoples must be given full regard, as afforded to them by the Constitution Act; thus, this places upon the CER the task to consider any adverse effects of its decision, order, or recommendation on the rights of the Indigenous Peoples (Section 56).
In effect, when electrical power lines are abandoned, consultations must be made not only for the affected public, but also with the participation of affected Indigenous Peoples. This is in the continuing recognition that energy laws and Indigenous Peoples law are interconnected and must be harmonized for the greater public benefit.
The CER Act has also imposed Administrative Monetary Penalties to be implemented by the CER, which can promulgate regulations and penalties according to the violations committed under the CER Act. Violations under the CER Act (Section 115) includes contravention of an order, or a decision, made by the CER; or failure to comply with any condition under a certificate, licence, permit, or authorization.
Electricity regulation in Canada under the CER Act revolves around regulating power lines. A power line may either be:
- International power line: facilities constructed or operated to transmit electricity from Canada to a place outside Canada, or vice versa;
- Interprovincial power line: facilities constructed or operated to transmit electricity from one Canadian province to another;
- Offshore power line: facilities constructed or operated to transmit electricity from an offshore renewable energy project to a Canadian province or a place outside Canada.
The CER thus oversees international and interprovincial power lines (Part 4), its construction, including the prohibitions, such as the prohibition of constructing power lines in Canadian navigable waters, construction of power lines which may cause any ground disturbance, or the abandonment of power lines, unless otherwise permitted by the CER. Violators of these prohibitions may face civil liabilities or imprisonment, or both, depending if the violator was liable for conviction on indictment or for summary conviction.
Electricity regulation under the CER Act also includes regulation of offshore renewable energy projects and offshore power lines (Part 5). The CER is empowered to issue authorizations before any offshore renewable energy project may be started, or before any part of an offshore power line in a province may operate or be abandoned.
Regarding the importation and exportation of electricity (Division 2, Part 7), the CER Act empowers the CER to issue permits or licences authorizing the exportation of electricity, including the criteria to be considered in its issuance, and granting the CER the power to issue electricity regulations for its importation and exportation.
(2) Clean Electricity Regulations
The Clean Electricity Regulations act is currently being developed. The primary goal is to achieve a net-zero electricity grid by 2035 by shifting the reliance from non-renewable electricity producers (coal, natural gas, diesel, etc.) to renewable sources of “clean” electricity (hydro, wind, solar, etc.).
The Regulations plan to reduce greenhouse gas (GHG) emissions produced by the energy sector, while still ensuring affordability and consistent supply of electricity for the consumers. It is part of the 2030 Emissions Reduction Plan, which is Canada’s commitment to achieve the enhanced Paris Agreement target on net-zero emissions.
(3) Canadian Electrical Code
The Canadian Electrical Code is part of the electricity regulation which is individually adopted and implemented by the Canadian provinces and territories. The Code generally governs electrical safety, which includes the electrical installation code, electrical equipment standards, among others.
However, the adoption of the Code may depend on each province, since each may either adopt it entirely or adopt it but is amended accordingly. The Code is generally implemented by the provincial or territorial energy regulating authorities.
Who implements electricity regulations in Canada?
Born out of the Canada Energy Regulator Act, the Canada Energy Regulator (CER) is one of the government agencies responsible for electricity regulation in Canada. The CER governs the enforcement of various laws regarding the construction and operation of inter-provincial and international (import and export) power lines of energy utilities, such as oil, gas, and electricity. Thus, it is the CER which issues export permits or licences for transfer of electricity between Canada and the U.S.
It is also the agency tasked with the licensing of companies or corporations engaged in these energy utilities. In addition, the CER also monitors electricity markets and developments in emerging technologies.
The CER is in addition to the provincial regulators, as established by its respective provincial and territorial laws on energy regulation. These provincial energy regulators implement rules and rates for the generation, transmission, and distribution of electricity in their areas.
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