The federal government is proceeding with modifications that will exclude several energy projects from a layer of its environmental assessment process. Simultaneously, a senior government insider has indicated that the Liberals are set to retract proposed changes that sought to sidestep regulations safeguarding at-risk species.
In May, the government introduced a range of regulatory adjustments as part of an initiative to streamline project approvals. One of these proposals sought to waive certain projects from the “jeopardy test” mandated by the Species at Risk Act if they are considered to be of national interest.
Over 600 species are encompassed under the legislation. In August, five former chairs of a panel advising the government on endangered wildlife penned an open letter expressing concerns that the proposed alterations could lead to the deliberate extinction of endangered species.
According to a senior federal government source who spoke to CBC News, forthcoming legislation will uphold the authorities of the act, including jeopardy tests. The source spoke on condition of confidentiality as they were not authorized to speak publicly, with The Toronto Star initially reporting this development.
Projects that are now exempt from certain regulatory reviews were publicly disclosed by the government on Wednesday. It was announced that specific energy projects would be removed from the jurisdiction of the Impact Assessment Agency of Canada (IAAC) to expedite the review process for those projects. Pipelines, transmission lines crossing international or provincial borders, and offshore renewable energy projects will no longer be subject to environmental assessments by the IAAC but will be solely reviewed by the Canada Energy Regulator (CER).
The government’s news release stated that the CER possesses expertise in conducting impact assessments evaluating a project’s effects on various environmental aspects, including air, water, soil, climate change, wildlife, species at risk, and Canada’s environmental obligations. Additionally, certain oilsands extraction projects and fossil fuel-fired power generating projects will also be excluded from the list of projects undergoing IAAC review.
Heather Exner-Pirot, the Director of Energy, Natural Resources, and Environment at the Macdonald-Laurier Institute, commented that these changes will tangibly attract investments by reducing regulatory costs. She emphasized that regulatory costs pose a substantial burden, necessitating significant upfront legal due diligence expenses before any revenue is generated.
The alterations come following Prime Minister Mark Carney’s pledge to streamline regulatory approvals for major projects during the previous election. Shortly after the 2025 election, the Liberals, in collaboration with the Conservatives, passed Bill C-5. This legislation enables the government to fast-track major projects deemed to be in the national interest, affecting reviews for other major projects lacking that designation.
Consultations on the proposed reforms concluded in July, with the report on these consultations published on the same day the regulatory changes were announced. Julia Levin from the Environmental Defence advocacy group expressed surprise at the decision, condemning it as detrimental to Canada’s environmental safeguards and climate progress. Conversely, Exner-Pirot asserted that an environmental assessment will still be conducted, albeit by a single regulator instead of two. She highlighted that the regulatory shift coincides with Carney hosting an “investors summit” the following week, signaling a proactive stance to attract capital to Canada.