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Taking Stock of the Grassy Mountain Litigation, Part 2, August 2024

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On August 28, 2024

In Energy

By: Nigel Bankes

PDF Version: Taking Stock of the Grassy Mountain Litigation, Part 2, August 2024

Cases and decisions commented on: (1) AER Panel Decision on Stay Motion Filed by the Municipal District of Ranchland No. 66 (Stay Application) August 9, 2024, and (2) Municipal District of Ranchland No. 66 v Alberta Energy Regulator, 2024 ABCA 274 (CanLII) (PTA Application) August 22, 2024

This ABlawg post is an update to a post from earlier this year: “Taking Stock of The Grassy Mountain Litigation as of February 2024”. In that post, I traced the litigation commenced by Benga and its corporate successor Northback following the June 2021 report and decision of the Joint Review Panel to reject the Grassy Mountain Project exercising authority as the Alberta Energy Regulator (AER). That litigation involved cases in the Federal Court and Alberta’s Court of Appeal and Court of King’s Bench. The Alberta Court of Appeal litigation came to an end in 2022 when the Supreme Court of Canada denied a further leave to appeal. The Federal Court cases are still ongoing, as is the King’s Bench matter, as well as allied litigation brought by First Nations in both Federal Court and in King’s Bench. I refer the reader to my February 2024 post for details on these case as well as the necessary links and references.

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The Alberta Energy Regulator’s Planned Timelines for Orphan, Inactive, and Decommissioned Oil and Gas Infrastructure

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On August 16, 2024

In Energy, Oil & Gas

By: Drew Yewchuk

Regulatory Memo Commented On: Orphan Well Association Annual Report 2023/2024 and AER Bulletin 2024-19, Industry-Wide Closure Spend Requirement for 2025

PDF Version: The Alberta Energy Regulator’s Planned Timelines for Orphan, Inactive, and Decommissioned Oil and Gas Infrastructure

In the past few weeks, the Orphan Well Association (OWA) released their 2023/2024 annual report and the Alberta Energy Regulator (AER) announced the 2025 closure spend requirement. This post assesses the OWA’s plan for the closure of the orphan inventory and the AER’s plan for closure of inactive and decommissioned infrastructure. When does the AER plan for the OWA to complete the closure of the orphan inventory and when does the AER plan for industry to finish decommissioning and reclaiming (or posting security for) Alberta’s inactive and decommissioned oil and gas infrastructure? Target closure dates can be determined by extrapolating from the current orphan fund levy and the closure spend requirement and the estimated total costs of closure.

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The Premier’s Review of the AER: A Recipe for How Industry Can Have its Cake and Eat it too

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On May 30, 2024

In Energy

By: Drew Yewchuk, Shaun Fluker, Martin Olszynski, and Nigel Bankes

Commented on: Final report: Premier’s Review of the Alberta Energy Regulator (May 2024)

PDF Version: The Premier’s Review of the AER: A Recipe for How Industry Can Have its Cake and Eat it too

The UCP government continues to overhaul energy policy and regulation in Alberta with no meaningful opportunities for public scrutiny or input. In January 2023, Premier Danielle Smith appointed a five-person Premier’s Advisory Council on Alberta’s Energy Future (Energy Future Council) to prepare a report on Alberta’s energy future. The terms of reference for this Energy Future Council were set by Ministerial Order 02/2023, which was only released to the public in response to a FOIP request (see When Does a Ministerial Order Have to be Published?). The Energy Future Council submitted its report to the Premier in June 2023, but that report has never been made public. In response to this non-published report, the Minister of Energy and Minerals initiated another panel, similarly closed to public input, to review and report on the Alberta Energy Regulator (AER). On May 22, 2024, the Government of Alberta elected to release this second report (the AER Report) under the names of two of the five members of the Energy Future Council, David Yager and Bob Curran. As was the case with the recission of the 1976 Coal Policy, the AER Report demonstrates that the UCP government takes its instructions on the direction of energy policy primarily from industry, rather than from the public it serves.

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Some Quick Fixes for a Broken Market, And then the Possibility of an Enhanced Electricity Market for Alberta

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On March 20, 2024

In Administrative Law, Energy

By: Nigel Bankes

Matters commented on: Market Surveillance Administrator, “Advice to support more effective competition in the electricity market: Interim action and an Enhanced Energy Market for Alberta”, (21 December 2023, released 11 March 2024) (MSA Advice); Supply Cushion Regulation, Alta Reg 42/2024, and Market Power Mitigation Regulation, Alta Reg 43/2024.

PDF Version: Some Quick Fixes for a Broken Market, And then the Possibility of an Enhanced Electricity Market for Alberta

On March 11, 2024 Nathan Neudorf, Alberta’s Minister of Affordability and Utilities, issued a press release announcing two temporary adjustments to Alberta’s electricity market rules to lessen opportunities for economic withholding and to create new rules for so-called “long lead time” generation assets with a view to further constrain opportunities for physical withholding. Long lead time generation assets are generators that require more than an hour to synchronize to the Alberta interconnected system (AIES). The non-availability of such assets during tight supply periods may effectively be a form of physical withholding of generation from the electricity market which serves to drive up the pool price. Economic withholding refers to the practice of bidding physically available generation into the pool “at prices sufficiently above marginal cost that the generator is not dispatched” also serving to drive up the pool price (MSA Advice at 4).

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Alphabow’s Regulatory Appeal: The AER Hearing Panel Misunderstood Their Job

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On March 11, 2024

In Administrative Law, Appellate Practice, Energy, Oil & Gas

By: Drew Yewchuk

Decision Commented on: Alphabow Energy Ltd: Regulatory Appeals of AER Orders (Regulatory Appeals 1943516 and 1943521), 2024 ABAER 001 (Alphabow)

PDF Version: Alphabow’s Regulatory Appeal: The AER Hearing Panel Misunderstood Their Job

This is a comment on an Alberta Energy Regulator (AER) hearing panel decision following a regulatory appeal of enforcement action against a company that was failing to meet the AER’s expectations for regulatory compliance.

Because of an administrative law mistake by the AER hearing panel, the decision is not what it should be. The AER’s handling of financially troubled corporations with large closure liabilities, significant unpaid debts, compliance troubles, and financial problems is a multi-billion dollar policy problem for Alberta. The decision should have assessed the AER’s policy approach to one of these companies, but the hearing panel misunderstood their role and assessed only procedural fairness and ‘reasonableness’ in the restricted sense that word applies on judicial review. As a result, the decision is less interesting than it should be, since it only finds that what the AER did was legal and says nothing about whether it was good policy or in the public interest.

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