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Alberta government says energy regulator review won't include its main mandate

EDMONTON – The Alberta government says the province’s energy regulator is performing well and there are no plans to make major changes to the agency.

Premier Rachel Notley had voiced concerns that the Alberta Energy Regulator has responsibility for both promoting energy development and protecting the environment.

Energy Minister Marg McCuaig-Boyd said Notley’s comments were misconstrued.

“She (Notley) and I have been clear since the beginning that we are not breaking up the AER,” the minister said in an interview Thursday.

“It is working well. Industry likes it.”

Last month, the NDP announced a review of 300 government agencies and boards, including the energy regulator, to ensure they are performing to the maximum benefit of Albertans. A report on the first phase of the review is expected by March.

A few weeks after the announcement McCuaig-Boyd sent a letter to AER chairman Gerry Protti to reassure the agency that the review would not include its regulatory mandate.

“While the governance structure will be examined under the review, I have confirmed with Premier Notley that the AER’s regulatory mandate does not need to be reviewed,” reads the letter.

Jim Ellis, the energy regulators president and CEO, said the agency is heartened by the decision.

“The government of Alberta recently advised us that they will not be proceeding with a review of our mandate,” Ellis said Thursday in an email.

“This is an important signal to the AER and a validation of the important work we do … ensuring the efficient, safe, orderly and environmentally responsible development of Alberta’s energy resources.”

In 2013, the regulator took over responsibility for reviewing the effects of oil, natural gas, oilsands and coal projects from Alberta’s Environment Department. That change stemmed from legislation that was passed to make it easier for the energy industry to navigate the regulatory system.

The Canadian Association of Petroleum Producers said the decision not to review the AER’s mandate will help maintain regulatory certainty within the industry as it deals with depressed commodity prices.

The government’s letter reaffirms that the regulator has a stable, solid mandate and is performing well, said David Gowland, manager of the association’s Alberta operations.

“Any time there is a question about mandate change or reviews, that creates a lot of uncertainty and tends to spook investment in Alberta, both Canadian and foreign investors,” Gowland said.

“Taking this off of the table helps to restore some of that stability and trust.”

McCuaig-Boyd said the government is confident in the AER, but she wouldn’t rule out changes in the future.

“There are always areas where we can improve and we are working on those, but as a single regulator.”

The government announced Alberta’s climate change strategy last month. The plan includes a carbon tax, limits on oilsands emissions and phasing out coal-generated electricity.

McCuaig-Boyd said the government will be working with the regulator to achieve those goals.

“I have talked with Mr. Ellis on that,” she said. “He said there is lots of work to do, but we are going to get through it and we are quite confident that we can make the whole industry better.”