This blog was triggered by the recent proposals by the Government of Ontario to introduce legislation to reduce some of the requirements to get transmission projects approved https://ero.ontario.ca/notice/026-0892. I support these proposals.
There is definitely a need to get things built quicker, cheaper and easier in Canada. The current geopolitical environment has made that very clear.
I had a front seat view of the obstacles to getting new infrastructure built in Canada when St. Catharines tried to build a new hydro plant along Twelve Mile Creek. This is a river that is largely man-made and already has two hydro generation plants on it: OPGs Decew plant along the Niagara Escarpment and the much smaller St. Catharines Heywood Generating located near the entrance of the river into Lake Ontario. Most of the water flowing through the Decew plant and into Twelve Mile Creek is diverted. The creek in its original form was substantially smaller. The environmental, in particular, and other regulatory challenges were significant and eventually the project was cancelled as being no longer financially viable.
There seems to be two types of responses by governments to this challenge. The first is to use government powers to get projects built. The federal governments Major Projects Office is an example of this. The second is to change the rules and regulations so that they are less of an obstacle to development. Both federal and provincial governments are using a mix of these two approaches.
I am not a fan of governments using their authority to push selected projects through though I recognize there are times when it is needed. As Andrew Coyne of the Globe and Mail so aptly put it with regards to the Major Projects Office, only in Canada would our response to too much bureaucratic regulation be to create another bureaucracy. There are a number of dangers with this approach such as decisions being made for political rather than economic reasons and the removal of some controls leading to more corruption and spiralling costs. However, my biggest complaint with this approach is that it leads to a two-tier system. Those projects the governments have selected get to avoid the governments own rules while all the others do not. These other projects can range from major new plants all the way to new small buildings or building extensions. While individually the selected projects may be the largest, collectively all the other projects will have a much bigger on Canada. Leaving the constraints in place for all these projects continues to put a drag on the Canadian economy.
I recognize that there are times that this full frontal approach is needed and that with the current trade war this may be one of those times. This just should not be a standard approach.
I prefer removing all the unnecessary or onerous regulations instead. These changes apply to everybody so all affected projects benefit. Ontario does have a Minister of Red Tape Reduction. The first one was Frank Sheehan of St. Catharines in the Mike Harris government. The current one is Andrea Khanjin from Barrie. I do not know how much good they do but I suspect that are able to get rid of some of the smaller nuisances and that cannot hurt. It takes trying times like this for a major dent in the regulations to be made.
This is also not about eliminating regulations. They are necessary and projects need to be able to show that they can meet their environmental, labour and other obligations. But regulations should not delay projects for years and years without just cause, or add unrealistic expenses or allow a small minority to prevent their approval. The desired changes to the regulations are about improving the process, not changing the goals.
I encourage the Ontario government to continue to remove unnecessary regulations and red tape. There is no shortage in our electricity distribution industry and I would be happy to point some out.