2024–25 Annual Report of the Commission of the Canada Energy Regulator - Roles of the Commission
A Court of Record
The Commission renders decisions and recommendations pursuant to its mandate set out in the CER Act and other legislation. The Commission follows the rules of natural justice and relevant jurisprudence including in relation to the rights of Indigenous Peoples recognized and affirmed by section 35 of the Constitution Act, 1982.
As an independent, quasi-judicial body, the Commission operates at arm’s length from the Government of Canada. Neither the CER’s Board of Directors nor the Chief Executive Officer may provide direction with respect to any decision, order or recommendation that is made by the Commission or a commissioner. The Commission makes its decisions independently, following legislation and rules that guide how it operates as a tribunal. This means it acts fairly and in Canada’s public interest.
Under the CER Act, the Commission has all the powers, rights and privileges vested in a superior court of record with respect to any matters within its jurisdiction. The Commission also has a broad jurisdiction and can inquire into and determine (including on its own initiative) any matter where a person has contravened or failed to do anything required by the CER Act or where some action is required in the public interest. It can also inquire into any accident involving a pipeline or other CER regulated facility and make findings, recommendations, or decisions as appropriate, following that inquiry.
The Commission’s adjudicative processes can be relied on to completely or partially fulfill the Crown’s duty to consult Indigenous Peoples for projects under the CER’s jurisdiction. For certificate applications, where the federal cabinet is the final decision-maker, the Crown Consultation Coordinator files reports and submissions on the hearing record, resulting from supplemental consultation with Indigenous Peoples. These reports and submissions inform the Commission’s assessment of the project and the resulting recommendation report that is submitted to the Minister of Energy and Natural Resources for consideration by the Governor in Council.
The Commission has the power to make orders for the enforcement of its decisions. It may make rules for carrying out its work and managing its internal affairs, including rules respecting the powers, duties and functions of Commissioners; its procedures and practices; its sittings; and its decisions, orders, and recommendations.
Commissioners, including the Lead Commissioner and Deputy Lead Commissioner, are appointed by the Governor in Council. In 2024-25, the Commission was comprised of seven full-time Commissioners. For more details on the CER’s Commissioners, please refer to Appendix A – Commissioner Biographies.
Lifecycle Regulation
Infrastructure Projects
The CER is a lifecycle regulator that, under the CER Act, ensures that international or interprovincial pipelines, power lines and applicable federally-regulated energy facilities are constructed, operated and abandoned in a way that protects the public and the environment.
The Commission is an expert tribunal, supported by knowledgeable CER staff, that makes decisions and recommendations on infrastructure applications in the Canadian public interest. The CER Act lists a number of factors that the Commission must consider and balance in the making of certain decisions. The Commission uses transparent hearing processes that are built on the inclusive participation of rights holders, stakeholders, industry and the Canadian public. The Commission relies on the best available scientific information and data as well as Indigenous knowledge to make its decisions.
On certain projects, the Commission receives oral Indigenous knowledge to better understand the impacts of those projects on potentially affected First Nations, Inuit and Métis communities. The Commission endeavours to conduct these sessions in-person in locations convenient for the participation of potentially impacted Indigenous Peoples.
Anyone interested in a hearing before the Commission can access all public hearing record information through REGDOCS on the CER’s website. In making its decisions or recommendations, the Commission only considers information on the hearing record.
If a project is approved, it transitions into the construction and operation phases. As part of the approval, the Commission sets conditions on various matters, including to reduce risks, prevent harm and provide updates. During a project’s construction and operation phases, the CER and the Commission, as needed, ensure that companies comply with those conditions. The Commission can also initiate enforcement actions where it deems it necessary.
Once a regulated facility has reached the end of its useful life, the Commission oversees the final phase of its lifecycle - decommissioning and abandonment. When companies apply to abandon a facility, the Commission assesses the proposed abandonment activities and includes conditions to ensure it is done in a safe and sustainable manner.
The Commission also has the authority to make decisions on oil and natural gas exploration and production projects under COGOA, CPRA and the Northwest Territories’ Oil and Gas Operations Act, and offshore renewable energy projects and offshore power lines under CER jurisdiction under the CER Act.
Commission Consideration of UN Declaration and the Commitment to Reconciliation
The Commission is committed to listening to Indigenous communities and integrating the principles of the UN Declaration into its decision-making processes, particularly where Indigenous rights and interests may be impacted, such as new facility applications.
The Commission remains committed to advancing Reconciliation and transformative change in its relationship with Indigenous Peoples. It recognizes that Indigenous knowledge and perspectives can strengthen the Commission’s approach to assessing project applications, improve its processes and help to build valuable cultural competencies. The Commission strives to incorporate Indigenous perspectives and values in all aspects of its work and benefits from opportunities to hear oral Indigenous knowledge from community members.
Economic Regulation
In the case of oil and gas products, the Commission is responsible for the economic regulation of pipelines throughout their lifespan, ensuring that tolls (the price for transportation service) are just and reasonable and do not create any unjust discrimination. In making its determinations in this area, the Commission considers whether tolls provide enough revenue for pipeline companies to operate and make a reasonable return and whether shippers have access to infrastructure to transport oil and gas products at a reasonable cost. The Commission exercises its economic oversight through assessing toll and tariff applications and considering complaints received from shippers. This is assisted through the CER’s annual survey of pipeline shippers which seeks feedback on the quality of pipeline services, and the effectiveness of the CER’s toll and tariff oversight.
The Commission regulates other economic aspects of pipelines under its jurisdiction, including requiring companies to have access to financial resources to cover potential costs of unintended or uncontrolled releases, and requiring companies to set aside money to abandon pipelines at the end of their useful lives.
The Commission also makes decisions on exports of natural gas, oil and electricity. Depending on the type of product, these exports may involve short-term orders, long-term orders, permits, or licenses. The CER does not regulate imports of energy into Canada.
Dispute Resolution and Complaints
The CER provides multiple avenues for parties to more efficiently and effectively resolve complaints and issues. Use of these processes provides parties with greater flexibility which can reduce the need for, or duration of, adjudicative processes. For example, the CER provides alternative dispute resolution services to allow for non-binding mediation on certain files, such as compensation matters, detailed routing, and tolls and tariffs disputes. Where mediated agreements can be reached, it can remove or reduce the need for the Commission to adjudicate a matter. Another way in which the Commission achieves efficiencies through negotiated settlements is in applications filed pursuant to the Guidelines for Negotiated Settlements of Traffic, Tolls and Tariffs, which provides a streamlined framework to assess applications for negotiated toll settlements in the context of tolls and tariff applications.
The Commission also adjudicates complaints and compensation related matters. Companies and landowners can apply to the Commission for a ruling on matters which parties have not been able to reach agreement on, such as the acquisition, lease or taking of lands or damages caused by activities of the company related to its exercise of powers under the CER Act. Since the introduction of the CER Act in 2019, parties have been able to bring these matters to the CER and the Commission for resolution, through a certain and predictable process.
Creating an Efficient and Predictable Regulatory Environment
The Commission is committed to creating an efficient and predictable regulatory environment. One way that it does this is dealing with all applications and proceedings before it as expeditiously as the circumstances, procedural fairness and natural justice permit and within the time limits set out in the CER Act. Time limits are defined amounts of time within which a panel of Commissioners must complete their assessment and make a decision or recommendation on certain types of applications. Once again last year, the Commission processed all applications within the legislated time limits. In fact, the Commission strives to exceed these time limits by setting and meeting service standards that define even shorter time limits for certain types of applications. Last year, the Commission met these services standards for routine applications under section 214 of the CER Act by releasing decisions for these types of applications in 40, 90 or 120 days instead of the 130, 210 or 300 days mandated in time limits.
Since 2019, the CER has met its legislated time limits for infrastructure project reviews 99 per cent of the time, with no missed time limits since the 2020-21 reporting period. The CER has also met service standards 98 per cent of the time since the 2020-21 time period. Predictable and timely processes support effective participation and provide industry with a degree of regulatory certainty to allow for project planning.
The Commission strives to continually improve how it works. In 2024-25, the Commission reduced the time to decision for CER Act section 214 applications through such initiatives as refining the notification process and reducing the amount of time required to determine the completeness of applications. This initiative substantially reduced the number of days from application receipt to completeness, from 78 days in 2022-23 to 35 days in 2023-24, and a further reduction to 30 days during this reporting period. Additionally, the average completion time for section 214 applications has been reduced to 111 days in 2024-25, down from 128 days in 2023-24. This significant efficiency was accomplished while still maintaining rigorous and transparent assessments.
The National Energy Board Rules of Practice and Procedure, 1995 (the Rules) govern the procedures to be followed during written or oral hearings and set out the mechanisms for complaints and the conduct of public hearings. A four-phased comprehensive review of the Rules is ongoing to update this key document, including potential amendments and improvements. As part of Phase I of the review, funding was available to support the participation of eligible Indigenous Peoples. In total, 96 participants including First Nations, regulated companies, landowners, industry and landowner associations attended online sessions held in Fall 2024 and 52 provided written submissions for Commission consideration. Phase II is underway and will include a draft summary Report, expected in late 2025.
The Commission continues to update its Filing Manual regularly to stay current, capture best practices, and ensure applicants know what information to include in their applications. These updates, including in relation to factors such as environmental, socio-economic, engineering and safety, help in creating complete applications that aid effective decision-making.
As illustrated through the initiatives outlined above, the Commission is committed to enhancing efficiencies and Canada’s global competitiveness by making decisions in a predictable and timely manner. Since the CER came into being, no Commission decisions have been overturned by a higher court, illustrating the strength and robustness of Commission assessments and decisions. This provides certainty to investors and stakeholders, drives innovation and enables the carrying out of sound projects that create jobs for Canadians.
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