REGULATORY ENHANCEMENT PROJECT IMPLEMENTATION UPDATE AND DISCUSSION WITH FIRST NATIONS

October 2012

1

Introduction In 2010, the Regulatory Enhancement Task Force was established to examine how Alberta’s regulatory system for energy could be improved. The Task Force made six recommendations to the Government of Alberta:

1. Establish a new policy management office to ensure the integration of naturalresource policies and provide an interface between policy development andpolicy assurance.

2. Establish a single regulatory body with unified responsibility for policy assurance(regulatory delivery) of upstream oil and gas development activities.

3. Provide clear public engagement processes that enable parties to engageeffectively at the policy development and policy assurance stages.

4. Ensure a systemic and common risk assessment and management approach isused across the entire policy development and policy assurance system.

5. Adopt a performance measurement framework and a public reporting function tomeasure and communicate the effectiveness of the system and identifyopportunities for continuous improvement.

6. Ensure an effective mechanism to address landowner concerns is developed.

In January 2011, the Government of Alberta accepted the Task Force recommendations and work on the Regulatory Enhancement Project (REP) commenced. The objective of the REP is to ensure Alberta’s regulatory system for energy development is efficient; supports the province’s competitiveness; and effectively supports the achievement of Alberta’s public safety, environmental management, and resource conservation objectives; and respects the rights of landowners.

Since that time, work under the REP has been informed by further internal analysis and the input of Albertans, in the form of letters, responses to a web survey and further engagement sessions. This includes engagement sessions with stakeholders and First Nations, held in summer 2011, to discuss proposed directions for a single regulator for energy activities. These proposed directions were set out in a discussion document entitled, Enhancing Assurance: Developing an integrated energy resource regulator.

Information sessions were held with Treaty 7, Treaty 6 and Treaty 8 First Nations (on September 25, September 27 and October 1, respectively). The information sessions provided participants with an update on REP implementation, and asked them for input to inform further implementation work.

At each information session, participants were provided with presentations on key elements around the REP, including:

• an overview of the REP, and the Government of Alberta’s development of anIntegrated Resource Management System;

• the Policy Management Office;• a proposed single regulator for energy resource activities; and• a public engagement framework.

2

This report summarizes the major themes that emerged from First Nations participants. The views and perspectives gathered from participants will be used to inform further implementation work on the REP, and specifically the development of a clear public engagement process.

The information provided in this report only reflects what was heard from participants during the information sessions, and does not necessarily reflect endorsement or agreement on behalf of the Government of Alberta.

3

REP Overview First Nations participants were provided with a presentation that offered an overview of the REP. The presentation also explained how the REP fits in with the Government’s broader efforts to develop an Integrated Resource Management System (IRMS).

A number of points were made by participants, following the presentation.

• Concerns about regional planning. The point was made that some First Nations’Chiefs have concerns with the regional land-use planning process. The LowerAthabasca Regional Plan (LARP) process was specifically mentioned. It is importantthat these concerns be satisfactorily addressed, especially since regional plans are akey component of the IRMS.

• Environmental monitoring. Participants had questions about monitoring. Theysought clarification about the new environmental Monitoring Commission;specifically, who comprises the Commission and to whom does the Commissionreport. There was also a question about the Commission’s relationship to the singleregulator. It was said that there should be a timely, transparent system forcompliance monitoring, and that the single regulator should play a role in this.

• First Nations involvement in REP. It was asked whether, and to what extent, FirstNations had been involved in the REP process thus far. One person asked howmany First Nations from each Treaty area had participated in the process to date.

• Separate process to address Treaty rights. The point was made that a processmust be in place to examine and address concerns about Treaty rights. These aredistinct from the issues faced by other landowners. First Nations do not want Treatyrights issues to be “lumped in” with general landowner issues. The Governmentneeds to take action on ensuring a process is in place.

4

Policy Management Office First Nations participants were given an overview of the Policy Management Office (PMO), including its scope, structure and intended functions. Two main issues were raised by participants about the PMO.

• The need for additional capacity. First Nations currently find it hard to respond topolicy discussions. As it is, First Nations are struggling to keep up with projectproposals, since there is so much resource development activity. At current capacity,it is challenging to gather required information and share it with the community insufficient time to constructively participate in policy discussions. The PMO needs tohave the right processes and expertise to engage First Nations communities aboutpolicies. First Nations need to be provided with more time and more capacity to beinvolved constructively.

• Have an online presence. It was suggested that the PMO develop a website assoon as practical. A continual issue is the ability to access information. Having aPMO website could enable people to easily find information about policydevelopment, in a single place. An online presence could also be used to facilitatepolicy discussions. Interested parties could subscribe to electronic newsletters oremail updates, or participate in online conversations. Many members of First Nationsare in rural and remote areas of the province, but have access to the internet. APMO website would enable people to participate without having to make a trip toEdmonton or Calgary.

5

Single Regulator for Energy Resource Activities Participants were provided a presentation on the proposed single regulator for energy resource activities. The presentation explained the proposed authority of the regulator, its structure, and the processes and tools that will be at the regulator’s disposal to manage applications for energy resource activities.

There were a number of issues raised by participants about the proposed single regulator.

• Interface with Indian Oil and Gas Canada. A concern was raised about theinterface between the Energy Resources Conservation Board (ERCB) and Indian Oiland Gas Canada (IOGC). In the past, First Nations have had problems whenoperators of energy resource activities are non-compliant or have incidents (e.g.,spills) on First Nations lands. The activity will usually have a provincial licence, butalso a lease on reserve lands that has been granted by IOGC. First Nations havefound themselves caught between ERCB and IOGC in these circumstances, witheach agency saying the issue falls under the other’s jurisdiction. Participantswondered how the move to a single regulator would address this challenge.

• More details about the single regulator’s board. Participants asked for detailsabout the single regulator’s board, including its size and expertise. One commentwas that the board needs to have good expertise with environmental issues, sincethe single regulator will be taking on regulatory responsibilities from the Departmentof Environment and Sustainable Resource Development.

• First Nations representation on the board. Participants asked whether FirstNations will be able to make recommendations as to the board’s membership. Thepoint was made that people with First Nations’ knowledge should be at the table, sothat the board is making decisions with this perspective. One concern is that theGovernment of Alberta’s evaluative tools will not be sufficient to determine whethercandidates have the proper knowledge.

• Powers of the regulator to address First Nations’ concerns. Some questionswere asked about the ability of the single regulator to address issues of concern toFirst Nations. These included:- Whether the single regulator will “have teeth” to enforce reclamation and

remediation requirements, including fining companies and forcing them to live upto remediation commitments.

- Whether the minimum requirements for a project will change, and the power ofthe single regulator to set these requirements.

- How the single regulator will resolve conflicting assessments. For example,where assessments of a particular project are undertaken by different parties (theproponent, First Nations, third parties), and these assessments do not agree witheach other.

6

• Emergency management. A concern was raised about emergency managementand preparedness for emergencies. Currently there is confusion about who is incharge of what, especially when it concerns First Nations lands. Participants wish tosee resolution of the confusion, and have responsible parties clearly identified.

• The scope of the regulator. Participants raised issues related to the scope of thesingle regulator and the issues for which it will have responsibility. Major issues werethe following:- Whether the Alberta Utilities Commission will be integrated into the single

regulator now or in the future.- How the single regulator will interface with the forestry industry. The point was

made that forestry companies do not always consult with First Nations as theyshould.

- What role the single regulator will have in managing and administeringconservation and stewardship tools, such as transferable development credits.These are contemplated under the Land Use Framework as tools to helpmanage where development occurs. These will need to be considered by thesingle regulator when it makes decisions about projects.

• Transition to the single regulator. People stressed the importance of having aclear transition plan. First Nations would like to know what the Government ofAlberta will do with applications that are submitted before the single regulator is inplace. One suggestion was that new applications should not be taken, and newapprovals should not be issued, until the single regulator is in place.

7

Public Engagement When completed, the public engagement framework will guide engagement of stakeholders, First Nations, and all Albertans, so they can inform the development of energy policies. Development of this framework is the responsibility of the PMO.

To set the context, First Nations participants were invited to consider: • What issues require public engagement;• Who should be involved in engagement;• How do we make engagement timely and meaningful; and• What makes an engagement process effective?

With these questions in mind, participants had general discussions about a public engagement framework. The following major themes emerged from those discussions:

• First Nations consultation is distinct. Courts have determined that there is adistinct legal duty to consult with First Nations. “Lumping in” First Nations withstakeholders and other groups will water down this distinctiveness. One concern isthat First Nations attendance at public engagements would set a dangerousprecedent, leading people to question the value and necessity of the distinctprocesses that are currently in place for First Nations.

• Unsure of the need for a public engagement framework. Some participantsquestioned their need for a framework, given the distinct legal rights that FirstNations have with respect to consultation. It was explained this framework couldapply to issues that fall outside the “legal duty to consult” established by courts.Some participants signaled they do not see any issues falling outside that legal duty,and hence, they have no need for a public engagement framework.

• Engaging with other groups is uncomfortable for First Nations. Many membersof First Nations do not like attending open forums with other groups because whenthey have done so in the past, they have felt unwelcome. Other attendees will makeracist and derogatory comments about First Nations rights, often because they areuninformed. This is hurtful and uncomfortable. Some participants said they would bewilling to try engaging with other groups, but would be cautious when doing so.

• A separate engagement process feels hollow. So long as challenges with theFirst Nations Consultation Policy (FNCP) remain unresolved, it feels hollow todiscuss the creation of a public engagement framework. The Government of Albertahas not responded to Chiefs’ concerns about the FNCP in a satisfactory way.

• Bundling policy issues makes sense. The proposed approach of bundling relatedpolicy issues together would be helpful. It would make things more holistic, and be abetter use of everyone’s time.

8

• First Nations have capacity challenges. As things stand now, First Nations arefinding it very hard to keep up with paperwork, notices, requests and variousprocesses when policies and projects are proposed. They would have to do a lot ofwork to bring information out to the larger community so that people could provideinformed input. In many cases, this would mean taking information out to many smallareas, which would be time-consuming and resource-intensive. First Nations needadditional capacity to take advantage of engagement and consultation opportunities.

• Make engagement accessible. “One size does not fit all.” Different approachesneed to be used for different communities. Consider the use of websites and onlinediscussions, which could better enable people in remote areas to participate. Onecomment was that the engagement approach being used for the Social PolicyFramework is good, as it involves an accessible online component. However,participants cautioned that access to technology is not universal. Engagementprocesses should be kept accessible to everybody using various methods. Forexample, provide concise messages in First Nations community newsletters.

• Provide updates and reports. First Nations appreciate updates along the way.Reporting back comments is helpful. Each First Nation is unique and will havedifferent input on an issue. It is helpful to see other communities’ views on issues.Follow up on issues is vital; a lack of follow-through erodes trust.

• Use plain language to communicate. Use plain language as much as possible.Make use of story-telling to describe concepts and explain issues.

• Style of engagement is important. The right approach needs to be taken, inculturally appropriate ways. Emails and faxes might not work to set up engagementprocesses. This takes building of relationships. You are coming into First Nationsterritory and home, so it is best that First Nations lead these processes.

• Be honest and open about the use of input from engagement activities. Mereattendance by First Nations members at an engagement session does not meanthey have agreed to anything or have been consulted. Be honest about what hashappened in the process.

• Address current issues. Certain policy issues would be helpful to address soon:- Emergency management protocols. Things are too compartmentalized right now,

and this endangers land. With the move to a single regulator, there is anopportunity to improve this.

- Land use (e.g., SSRP). These could be planned better. Clarity is needed for FirstNations participation.

- Notice is a hot topic. First Nations do not have capacity to respond to shortnotices, and the 21-day minimum creates an adversarial dynamic.

- The regulations being developed for the single regulator are crucial. First Nationswish to be engaged on these, and dates for this engagement should bescheduled as soon as possible.

9

Moving Ahead with Implementation The Regulatory Enhancement Project wishes to thank the individuals from First Nations that participated in these information sessions. The input and perspectives provided by participants will be informative as the Government of Alberta continues implementation work on the REP. As further progress is made, it is expected that First Nations will continue to be engaged.

Once implemented, the six recommendations of the Regulatory Enhancement Task Force will result in an enhanced system for energy resource development that reflects the principles of the REP - a system that is effective, efficient, adaptable, predictable, fair and transparent.

10

REGULATORY ENHANCEMENT PROJECT IMPLEMENTATION UPDATE AND DISCUSSION WITH STAKEHOLDERS

October 2012

1

Introduction In 2010, the Regulatory Enhancement Task Force was established to examine how Alberta’s regulatory system for energy could be improved. The Task Force made six recommendations to the Government of Alberta:

1. Establish a new policy management office to ensure the integration of naturalresource policies and provide an interface between policy development andpolicy assurance.

2. Establish a single regulatory body with unified responsibility for policy assurance(regulatory delivery) of upstream oil and gas development activities

3. Provide clear public engagement processes that enable parties to engageeffectively at the policy development and policy assurance stages.

4. Ensure a systemic and common risk assessment and management approach isused across the entire policy development and policy assurance system.

5. Adopt a performance measurement framework and a public reporting function tomeasure and communicate the effectiveness of the system and identifyopportunities for continuous improvement.

6. Ensure an effective mechanism to address landowner concerns is developed.

In January 2011, the Government of Alberta accepted the Task Force recommendations and work on the Regulatory Enhancement Project (REP) commenced. The objective of the REP is to ensure Alberta’s regulatory system for energy development is efficient; supports the province’s competitiveness; and effectively supports the achievement of Alberta’s public safety, environmental management, and resource conservation objectives; and respects the rights of landowners.

Since that time, work under the REP has been informed by further internal analysis and the input of Albertans, in the form of letters, responses to a web survey and further engagement sessions. This includes engagement sessions with stakeholders and First Nations, held in summer 2011, to discuss proposed directions for a single regulator for energy activities. These proposed directions were set out in a discussion document entitled, Enhancing Assurance: Developing an integrated energy resource regulator.

On September 24, 2012, an information session was held in Calgary with stakeholders, to provide an update on REP implementation, and to gather their input to inform further implementation work. Participating stakeholders included representatives from: the oil and gas industry; the coal industry; municipal governments, environmental non-government organizations, and landowners.

At each information session, participants were provided with presentations on key elements around the REP, including:

• an overview of the REP, and the Government of Alberta’s development of anIntegrated Resource Management System;

• the Policy Management Office;• a proposed single regulator for energy resource activities; and• a public engagement framework.

2

This report summarizes the major themes that emerged from stakeholders. The views and perspectives gathered from stakeholders will be used to inform further implementation work on the REP, and specifically the development of a clear public engagement process.

The information provided in this report only reflects what was heard from participants during the information sessions and does not necessarily reflect endorsement or agreement on behalf of the Government of Alberta.

3

REP Overview and the Policy Management Office Participants were provided with a presentation that offered an overview of the REP, and its relationship to the Integrated Resource Management System. They were also given an overview of the Policy Management Office (PMO), including its scope, structure and intended functions.

Some issues and questions were raised by participants about the PMO.

• Integrate with federal policy. One question was whether the PMO will examinefederal government policies. The point was made that several federal policies relateto or impact the development of energy resources. Having well-integrated provincialand federal policy is as important as having well-integrated policies among Albertagovernment departments.

• First Nations consultation interface. Participants wondered what role, if any, thePMO would play with respect to consultation with First Nations. It was noted thatthere are specific legal duties to consult with First Nations in certain situations.Somehow this needs to be considered by and integrated with the work of the PMO,in order for there to be certainty and alignment in energy resource policies.

• The PMO as a catalyst. The comment was made that the federal government’smajor projects management office has been an effective catalyst for resolvingconflicts in government departments. A question was whether PMO will serve asimilar conflict resolution function, in order to bring an end to gridlock and getdecisions made.

• Innovation and the PMO. One question was whether and when the PMO wouldbecome involved when there is a new innovation in energy development. In somecases, the Government of Alberta will not have policies in place for innovativepractices or new technologies. Policy conflicts and policy gaps should be addressedquickly when this situation arises, so that innovative projects are not unreasonablydelayed and those employing innovation have certainty about the policy landscape.

4

Single Regulator for Energy Resource Activities Participants were provided a presentation on the proposed single regulator for energy resource activities. The presentation explained the proposed authority of the regulator, its structure, and the processes and tools that will be at the regulator’s disposal to manage applications for energy resource activities.

There were a number of issues raised by participants about the proposed single regulator.

• Discretion of the regulator. Some details about the single regulator will not be inthe enabling statute that creates the regulator, but will be articulated in regulationsunder the statute. People wondered about the scope of these regulations. It wassaid that the Energy Resources Conservation Board (ERCB) currently has verybroad discretion. One question was whether the single regulator’s discretion will beas broad as that of the ERCB, and to what degree the regulations will curtail theregulator’s discretion.

• Flexibility with the use of regulation. It was noted that flexibility is important, sothat the single regulator can respond to emerging issues easily. One concern is thatstipulating requirements in a government-enacted regulation, rather than letting thesingle regulator set these requirements on the fly, might constrain this flexibility.

• Expected outcomes for the regulator and industry. There was a question aboutwhat outcomes are expected to be achieved the single regulator, as proposed, is upand running. It was reiterated that timeliness and predictability are importantoutcomes for industry.

• Seismic industry. The seismic industry currently uses exploration directives. Thesedirectives enable the seismic industry to work with their regulator (ESRD) onoperational issues. There was a question as to whether the seismic industry willhave the ability to continue using these directives with the single regulator.

• Definitions of parties with standing. Concerns were raised about the definition ofdirectly and adversely affected parties, and about “prescribed persons” as it relatesto issues of standing. Some participants said they were nervous about thesedefinitions. In particular, they were worried their organizations might not fit withinthese definitions, even though they would like to participate in the decision-makingprocess about projects.

• Interface with federal and provincial legislation. Participants wondered how thesingle regulator will interface with requirements in other federal and provinciallegislation. For instance, one person wondered about the regulator’s interplay withAlberta’s Municipal Government Act.

5

• Maintain expertise in the regulator. One comment was that the ERCB has done agood job, and that it has added value due to its technical expertise and knowledge.This should not be lost in the transition to the single regulator.

• Separating the regulator’s board from hearing commissioners. A concern wasraised about the proposal to separate the single regulator’s board from the functionof hearing applications. One participant cautioned that the greater the disconnectbetween the hearing commissioners and the function of the board, the greater therisk that decisions about applications will be disconnected from the culture andphilosophy of the board and organization.

• Extend to other energy sources. One question was whether the single regulator’sscope will extend to other energy sources, beyond oil, gas, oil sands and coal.

• The registration of agreements. Participants noted that there are other forms ofagreements in use beyond surface agreements. They wondered if other types ofagreements will also be registrable with the single regulator. Also, participants askedif freehold mineral owners will have the right to register agreements. The seismicindustry, which uses temporary agreements rather than surface agreements, alsoasked about its eligibility to register these agreements.

• Long lived projects. Some projects happen on a sustained basis over many years.Participants wondered what kind of thinking there has been about the singleregulator having ongoing interactions with industry players with long-lived projects. Itwas said that more expertise should be developed in the regulator in this area.

• Environmental equivalency. It was asked whether and how the single regulator willplay a role with respect to environmental substitution and equivalency. This hasconsequences for the federal government’s role in environmental law and policy.

• The need for smooth transition. It was pointed out that the move to a singleregulator will be complicated, yet energy resource activities will still be happening.There is a need for a smooth and clear transition from current regulatory authoritiesto the single regulator. Industry members and other stakeholders will need to knowwhich rules and decision-making processes will apply to which applications.Certainty and predictability are crucial.

6

Public Engagement When completed, the public engagement framework will guide engagement of stakeholders, and all Albertans, so they can inform the development of energy policies. Development of this framework will be the responsibility of the PMO.

To inform the development of a public engagement framework, stakeholders were asked for their views and perspectives on four main topics:

• What issues require public engagement;• Who should be involved in engagement;• How do we make engagement timely and meaningful; and• What makes an engagement process effective?

What issues require public engagement:

• Issues that arise from the shift to a single regulator.

A number of issues are likely to arise in the course of moving to a single regulator for energy resources. For example, the regulator might quickly find certain policies are misaligned, in conflict or missing. These should be resolved with the input of stakeholders.

• Address the core concerns.

Public engagement should aim to focus on the core issues “that come up again and again.” These core issues usually lie at the root of “flare-ups” that often preoccupy the regulator and government. They are also usually significant issues that with which members of the public have interest and knowledge. If the core issues are addressed, then many smaller, symptomatic problems will be resolved.

• Focus on policies, not projects.

Remember that the purpose of the public engagement framework is to inform policy development about energy resources. This should always be kept in mind when determining the issues on which to engage. Public engagement should focus on sector-wide issues, not granular issues about specific energy projects. The basket of issues will evolve over time, but generally they will be issues that are broad in their impact; that is, they will impact many different projects and situations.

• Address issues that are identified by communities and stakeholders.

Policy issues will arise “from the grassroots” in communities. Members of the public, community groups and municipal governments will likely identify issues they feel need to be addressed, and they will let the Government of Alberta know. Stakeholder

7

organizations are also quite familiar with policy issues that impact their memberships and missions. They can identify issues that require public engagement.

For example, participants in the discussion identified a number of issues that require public engagement:

- Municipal taxation of oil and gas projects;- Administrative penalties used by the single regulator;- Issuance of mineral rights;- Water use;- Municipal land use planning and its interface with energy issues;- Compliance of energy companies; and- Regulations that will be made under the statute that creates the single regulator,

which are expected to cover rules of practice for the regulator.

• Keep engagement separate for issues concerning First Nations.

Participants said that issues concerning First Nations should be kept separate, using a process distinct from the public engagement framework. There are unique issues and legal requirements with respect to First Nations, and this should be respected. However, there must be a “clear line of sight” between the public engagement process and the First Nations process when it comes to informing policy development. The interests and legal rights of First Nations are a significant component that affects policies about how and where energy resources are developed, and associated issues.

Who should be involved in engagement:

• Who is engaged is issue-dependent.

Not all policy issues will be of interest to all Albertans, or to all stakeholders. Some issues will be specific to certain sub-sectors. For this reason, government needs to be flexible about who is engaged.

Participants said that generally, if the right process is used then the right people will tend to become involved. Government’s overriding objective should therefore be to make sure the appropriate parties can become involved. This will largely depend on the issue that is the subject of the engagement. Considerations include:

- The scope of the issue. If it is an issue with broad impacts (e.g., should oilsands be developed), then many different stakeholders and the general publicshould probably be engaged.

- The level of the issue. For very specialized or technical issues, it makessense to engage stakeholders that are very knowledgeable.

- The geography of the issue. If the issue is very regional, then engagingpeople and groups from other regions might not make much sense.

• Defining stakeholders will be challenging.

8

Many participants discussed the challenge of identifying stakeholders. It was said that the Government of Alberta might not always know the appropriate stakeholders for certain issues. Some suggested that the government use a process to “define” stakeholders that are eligible for public engagement. Others cautioned against this, saying it would add unnecessary complexity and risk leaving voices out of the mix.

Participants made several suggestions for identifying stakeholders, including: - Existing stakeholder lists used by Alberta Energy, ESRD, other departments, and

the ERCB, should be consolidated and reviewed. This list could be used as base,and be expanded on to fill identified gaps.

- Examine who is impacted the most by certain issues. Those who are impactedthe most should obviously be engaged. Those for whom there are little or noimpacts may not need to be engaged.

- Ensure the “little guy” has a voice. Don’t rely solely on the largest groups and thebest-known organizations. Smaller organizations have valuable expertise andinput to contribute as well.

- Consider who has capacity to participate. A climate of full participation isdesirable. It makes sense to engage organizations that can commit the time andresources to regular, ongoing engagement and associated work.

- Consider groups versus individuals. Engaging stakeholder umbrella groups mightbe a prudent approach, for the sake of logistics and timeliness. One umbrellagroup can have thousands of members. Umbrella groups can act as gateways tolarge numbers of stakeholders, while enabling government to keep publicengagement processes manageable and efficient.

- Consider the use of an evaluative tool to determine engagement scope. It wasmentioned that the seismic industry uses a type of matrix when commencing aproject, to determine the appropriate level of engagement. This kind of approachcould be used to determine the scope of stakeholders that are engaged.

• Consider a static list of parties to engage.

There were suggestions that government establish a list of parties that should always be engaged, regardless of the issue. The rationale for a static list is that certain stakeholders are almost always impacted by policies relating to energy resource development. These could include:

- Municipalities. Energy developments either happen on municipal lands, or impactsurrounding municipal lands. The sale of mineral rights can also impactmunicipalities.

- The single regulator. As the entity that will be responsible for implementinggovernment policy, it makes sense for the regulator to be engaged. The singleregulator can also contribute technical expertise to discussions and a perspectiveof how policies influence things at the project level.

9

• Take a broad approach to engagement.

While the nature of the policy issue will strongly influence who should be engaged, the Government of Alberta should ensure engagement is broad. There should be widespread communication so that people can find out that public engagement on an issue is occurring. This will enable stakeholders to “self-identify”. Self-identification is an important part of the process, because those who are interested and feel they have something to contribute will get involved. Consequently, communications that promote and support public engagement need to be thorough and effective.

• Be cautious about engaging extra-Alberta parties.

Participants had mixed views about engaging parties from outside Alberta. Some felt that voices from outside the province would be worthwhile to engage to help inform policy development. For instance, it could be wise to engage parties that wish to invest in Alberta in the future, since their decisions will in part be based on Alberta’s policies. It was also said that certain national and international organizations would bring external perspectives about resource development, which could be helpful to have in mind when formulating policy.

Others disagreed, stating that Albertans should be the ones who inform policies about Alberta’s resources and their development. One concern was that international organizations can have their own financial interests that might conflict with those of Albertans. Their views will not necessarily be about what is best for the province, but what best fits their agendas. Another view was that many organizations from outside Alberta do not have “skin in the game”. They do not live or work here, and will not have to live with the consequences of the policy decisions that are ultimately made.

How do we make engagement timely and meaningful:

• Make sure the engagement is credible.

To be meaningful, public engagement needs to have credibility. When it is seeking input, the government should undertake engagement only if there truly is an opportunity to influence decisions. People do not wish to be engaged in a “window dressing” process to discuss matters that have already been decided. That kind of approach is a waste of everyone’s time and resources. It also compromises the credibility of government and of public engagement generally.

• Be clear about the scope of discussion.

Participants in a public engagement process should understand the purpose and scope of the engagement. The government should clearly articulate the boundaries of the issue and what decisions around the issue have already been made. That way, those

10

who participate know which aspects of the policy issue are debatable, and which aspects are not. This will make better use of everyone’s time, avoid misunderstandings, and help keep participants engaged.

• Be upfront with information and present it clearly.

Public engagement can only be meaningful if people have substantive content to consider and discuss. It is very hard to have discussions about a concept in the abstract. The government should present information early, openly and honestly, so that public engagement participants can make informed contributions. The right amount of information needs to be provided. Major issues and considerations and options should be set out. Drafts or “straw dogs” should be provided where practical, but not so detailed that it appears as if decisions have already been made. Information should also be clear, streamlined and easily read, to make the best use of people’s time.

• Match the scope and form of the engagement to the issue at hand.

When it comes to designing a public engagement process, “one size does not fit all”. Participants said that a set of core principles should underlie public engagement, and engagement processes should adhere to these principles. However, the exact form of engagement needs to be flexible, as it will depend on the policy issue at hand and who needs to be engaged.

A number of different tools and mechanisms should be considered and used. These could include traditional open houses, group meetings, online discussions, workshops, or circulating papers by email for comment. Participants cautioned against using a single mechanism during an engagement process, as this could result in vital voices being unheard. For example, not all citizens and organizations have easy access to the internet; using only an online process would preclude their engagement.

• Report back to participants.

Public engagement should be transparent, so that participants in the process can have confidence in its credibility. To ensure the process is transparent, the government should report back to participants at each stage of the process. People should be able to access these reports and understand:

- what input was heard;- how the input was considered by the government;- what decisions have been made, based on that input; and- the rationale for decisions.

Reporting back is important at each stage of the iterative conversation between government and participants. This way, people can see how input is informing the development of a policy over time. To the extent possible, reports back to participants should aim to capture the intensity and emotions around certain ideas and comments.

11

• Dialogue should be respectful and constructive.

Whatever its form, a public engagement process must be respectful. Everyone who is interested in being heard should have the opportunity to be heard. Engagement should be a forum “where it’s safe to speak freely”, with diverse and unique opinions welcome. People who participate in the process, and those managing the process, should respect parties’ right to disagree with one another.

To be meaningful, public engagement should also foster constructive discussion. It is about more than individuals saying their piece or “just being heard”. Engagement should dig deeper, exploring concepts and divergent interests. People should come away from the process with a better understanding of other parties’ viewpoints. To achieve this, it might be necessary to set out expectations of those who are engaged. One comment was that, “Sometimes you have to tell people what makes a good participant.”

• Examine and learn from existing models.

There are a number of models currently used to undertake public engagement with stakeholders and Albertans. Rather than “reinventing the wheel”, it makes sense for the PMO to examine these models, learn from them, and adapt them as necessary. Examples of existing public and member engagement models that were cited by participants were:

- the Alberta Electric System Operator (AESO);- the Clean Air Strategic Alliance (CASA); and- the Government of Alberta’s Land Use Secretariat.

• Cast a broad net early in the process.

At the earliest stage possible, a public engagement process should broadly seek involvement from any and all interested parties. This will enable interested individuals and organizations to connect with the engagement as soon as possible. As one participant said, “Getting people involved earlier is better every single time, otherwise people get involved in reactionary ways.”

Communications are therefore critical when undertaking public engagement. There should be processes in place so that stakeholders and the public can know when engagement is taking place on a policy issue. This will be especially critical once the single regulator is established. It was suggested that public notice should be required when the single regulator notifies government that a new policy needs to be developed or that a policy change is necessary.

• Use a fair process that people understand.

Parties that are engaged should have the benefit of understanding the overall engagement process, including overall timelines and major milestones. For example, participants should know:

12

- who is responsible for the engagement process;- how many rounds of engagement will occur, and when;- when reporting back can be expected between rounds of engagement; and- when decisions will be made.

Understanding the process helps participants have confidence in the process. It also helps ensure the process remains timely, efficient and credible. When establishing timelines, the government should have respect for participants and their decision-making process. For instance, stakeholder associations need time to engage their memberships and develop official positions. If timelines are uncertain or unreasonable, then organizations can be unfairly disenfranchised. On the other hand, if timelines are established and known early, then stakeholder associations can adjust or tailor their processes to accommodate the engagement schedule. Again, effective and open communication is critical.

• Make sure this work is well-resourced.

As one participant stated, “This work is not cheap.” Effective and meaningful engagement requires considerable resources. For this reason, the PMO requires an adequate budget to coordinate public engagement. Participants speculated that it might not make sense for the PMO to have lots of full-time workers dedicated to public engagement, since the number, nature and scope of engagement processes will change over time. One suggestion was that the PMO retain skilled consultants to assist with engagement, as a flexible and cost-effective approach.

Regardless of how the process is resourced, public engagement should be undertaken by individuals who understand the policy issue at hand. They must have the capacity to navigate and broker complex policy discussions, and be able to listen, synthesize discussions, analyze input, and report back to participants. During an engagement process, policy experts should be “in the room” as a resource to participants. They should listen respectfully and be available to answer questions that participants might have about the issues being discussed.

• Enhance capacity in government.

One observation was that, once a more robust approach to public engagement is pursued by the PMO, Albertans will expect the same from other Government of Alberta departments. It may be worthwhile to work with other ministries to explore how public engagement can be made more consistent. This might require enhancing capacity in certain ministries.

Another suggestion was that the PMO should communicate with elected officials about the new public engagement framework and the types of policies it will address. Stakeholders often have contact with elected officials. It would be helpful for elected officials to have a consistent understanding of the major policy issues facing the energy sector, particularly when the PMO is examining these issues.

13

What makes an engagement process effective:

• Maintain focus.

It is important that public engagement stays on track. When discussing difficult or complex policy issues, the process may go down “rabbit-holes”. Some tangential issues are appropriate to explore, and may in fact assist in resolving the main policy issue in question. However, there is a risk of getting “side tracked”, and this could undermine the effectiveness of the engagement. To mitigate against this risk, the public engagement process should create a climate of focus. The goals of the engagement should be clearly communicated upfront, and at regular intervals, so that participants have a clear view of the end destination. This will help everyone stay on topic and help ensure the engagement is effective.

• Ensure the engagement is accessible.

For an engagement process to be effective, people need to be able to become involved. The process must be accessible for everyone who is interested. This means selecting the right mix of tools and approaches, so that individuals and organizations have multiple avenues for providing input. It also means choosing convenient locations and reasonable timelines.

• Employ effective communication.

Participants stressed the importance of effective communication when undertaking a public engagement process. They had several suggestions for communications:

- Understand the audience. Consider the demographics, literacy rate, educationlevel and other aspects of the target audience(s) for a public engagementprocess. Communications should be appropriate for the audience.

- Talk about goals and milestones. Make sure parties engaged in the process areaware of the end goals, key milestones, and overall timelines.

- Explain how information will be used. Engaged parties need to understand howtheir input and ideas are being captured and how they will be used.

- Explain decisions. Once decisions have been made, it is important to describe toparticipants how their input led to these decisions. Explain the rationale fordecisions in ways that people can understand.

- Raise awareness about the engagement. Above all, communications need topromote the public engagement process. All relevant parties should be awarethat an opportunity exists to participate and to be engaged.

• Commit to ongoing and transparent feedback.

Follow-up with engaged parties is crucial. Individuals and organizations wish to know what is happening throughout the policy development process. They want assurance

14

that their input and views have been heard and acknowledged, and want to understand the government’s thinking in light of the engagement.

It is important that follow-up be timely, not months later as an afterthought. Follow-up efforts should also be substantive, and describe the proposed or expected next steps. Even if the government has decided not to proceed with a policy, or has decided to pursue an entirely different direction, stakeholders and concerned citizens benefit from knowing this. As one participant stated, “We know politics can cause changes unexpectedly, but at least let us know what’s going on.”

15

Moving Ahead with ImplementationThe Regulatory Enhancement Project wishes to thank the individuals and organizations that participated in these information sessions. The input and perspectives provided by participants will be informative as the Government of Alberta continues implementation work on the REP. As further progress is made, it is expected that stakeholders will continue to be engaged.

Once implemented, the six recommendations of the Regulatory Enhancement Task Force will result in an enhanced system for energy resource development that reflects the principles of the REP - a system that is effective, efficient, adaptable, predictable, fair and transparent.

16