Archives for October 2012

By Darcy Henton, Calgary Herald October 24, 2012

EDMONTON — Energy Minister Ken Hughes has introduced legislation to repeal controversial Bill 50, but he says the law that empowered cabinet to approve $8-billion worth of critical transmission projects without a public hearing was necessary at the time.

He said Tuesday it was not a mistake to pass the Electric Statutes Amendment Act to seize that power from the Alberta Utilities Commission (AUC) in 2009. “Different times; different needs,” he told reporters at the legislature.

“Now it’s important that we send this responsibility back to the Utilities Commission. The decision to pass that bill to move forward with that critical infrastructure was needed at the time it was done by the government.”

The law, which sparked outrage across the province, enabled cabinet to give the green light to five transmission projects, including two high voltage lines connecting Edmonton and Calgary — worth more than $3 billion — as well as a $400-million line into the industrial heartland northeast of Edmonton.

On Tuesday, critics blasted the Stelmach government’s decision to enact Bill 50 in the first place and also called for the immediate release of a review of Alberta’s electricity retail market that was commissioned to address price volatility.

Hughes said he doesn’t plan to release the report until he has decided how to respond to its 41 recommendations.

“I think it helps the discussion because then people can either focus on certain recommendations that they think there should be adjustments to or not, and we see quite clearly what we’re going to implement right off the bat.”

He said the Conservative government won’t be ready to implement any recommendations before the end of the year and that may not be in time to affect this winter’s electricity prices.

But NDP Leader Brian Mason said Hughes doesn’t want to release the report while the legislature is in session because he doesn’t want the recommendations debated.

“We need to be having that discussion. Other people need to be involved, including the citizens of Alberta, who pay electricity bills every month to keep their lights on,” he said.

“But the minister is withholding the information from the public so that he can make every single decision on every single recommendation in the report, and once that report is released, it will be too late.”

Mason said repealing Bill 50 now that construction has already begun on the transmission lines still leaves Albertans stuck with 100 per cent of the costs of lines that may not be necessary.

Wildrose energy critic Joe Anglin said Bill 50 was wrong and the province should admit it. He said there’s still time to send the projects to the AUC for expert assessment.

“We have time to correct this and save Albertans a tremendous amount of money,” he said.

Keith Wilson, a lawyer who represents landowners in the heartland, said Bill 50 was a mistake because it enabled the lines to go ahead without a public cost-benefit analysis.

He said industry experts have concluded the Bill 50 lines are a massive overbuild that will result in significant increases in monthly power bills and undermine the competitiveness of Alberta’s economy.

Wilson said landowners have opposed the lines because they don’t believe they are in the public interest.

“If their land is to be imposed upon, they want it to be for a good reason and one that is in the public interest,” he added.

Wilson has asked the Alberta Court of Appeal to order new hearings into the Heartland line so the AUC can decide whether Bill 50 lines are really in the public interest. A decision is expected in two to four weeks.

Sunday, 28 October 2012 08:00 Bob Weber, The Canadian Press

EDMONTON – An Alberta government proposal to regulate how energy companies negotiate benefits agreements with aboriginal bands could make it harder to work such deals out, says a lawyer whose firm assists in such talks.

A discussion paper, released by the government last week, suggests that a levy should be applied industry-wide to help bands pay for the work involved in setting up such deals.

It also suggests reversing current practice by recommending that all such deals be made public. That could deter companies from entering into them at all, said Neil Reddekopp.

“The confidentiality is generally a request of our industry partners and it’s something that our clients agree to,” said Reddekopp, whose firm is currently helping about six bands negotiate benefits agreements with energy companies. “I have a hard time seeing this call for disclosure as anything more than an indirect way of discouraging this type of agreement.”

Energy companies frequently negotiate so-called community benefits agreements with aboriginal bands on whose traditional lands they wish to operate. The deals may include cash for community purposes, promises of local employment, environmental agreements or dispute settlement mechanisms.

They are not intended as compensation, said Reddekopp.

“What they’re doing is assisting communities deal with massive changes forced on communities.”

Making such deals public would allow bands to point to other settlements during negotiations, something that would effectively create a tariff, said Reddekopp.

He said the situations are too individual to benefit from standard settlements and throwing other examples into the mix during talks would just confuse matters.

“There would be more information,” said Reddekopp. “Whether there would be more understanding is another question.”

Alberta Aborginal Relations spokesman David Dear said the disclosure proposal is part of an overall plan to bring the secretive benefits negotiations process into the open.

“We thought this made a lot of sense,” he said. “It just adds clarity and honesty around the process.”

He said the proposal to fund the negotiating of such agreements through an industry levy is intended to replace the current practice, where individual companies are asked to make up shortfalls in provincial funding.

Instead, the levy would be assessed evenly throughout the industry and paid out to bands by the government on the basis of need.

Industry wouldn’t be paying more money in total, but the burden would be more evenly spread, said Dear.

Dear acknowledged both ideas came from government and weren’t being requested.

Reddekopp said the government is trying to make benefits agreements harder to reach as a way of discouraging industry from entering into them. Some, he said, view those deals as a form of “ransom.”

The Canadian Association of Petroleum Producers said it’s still reviewing the government proposals.

“Industry is interested establishing consistency, clarity, and fairness in aboriginal consultation matters associated with oil and gas projects,” said vice-president David Pryce in an email. “The paper will be reviewed by CAPP and our members and we will constructively contribute to the discussion over the coming weeks.”

The public consultation period on the proposals will close on Nov. 30.

Keith Wilson appeared before a panel of three justices of the Alberta Court of Appeal on October 12, 2012.

Despite Altalink, EPCOR, and the Alberta Utilities Commission (AUC) all having a number of lawyers present, Keith was able to guide the Justice through his argument why the Commission has a legal duty consider the public interest and the socio-economic impacts of the Heartland and the other Bill 50 lines.

Keith explained that if the court were to accept Altalink’s and the AUC’s interpretation of the law it would mean that nowhere in the regulatory approval process is anyone looking at the cost of these lines and whether we can afford them.  It would mean that the utility companies can add billions of cost without any accountability.

In the end, Keith requested that the court overturn the AUC approval and send the case back to the hearing room so the AUC can receive proper socio-economic evidence and make a decision as to whether the Heartland line is in the public interest.

The justices reserved their decision.  We are expecting them to release their decision sometime later in November or possibly early December.

Attached is an Edmonton Journal story about the court case.  We will keep you posted. 

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Bill 50 being Repealed?

On October 23, 2012, the Alberta Government announced that it was repealing Bill 50.

The government has decided that maybe it wasn’t such a good idea to move the decision on whether new transmission lines are needed from the AUC hearing room into the backroom of Cabinet.  Go figure?

So, the Alberta Government has just brought in Bill 8 (Electric Utilities Amendment Act).  This new law will transfer the decision on “need” back to the AUC.  This means that all future new transmission lines will have to undergo a public needs assessment.

However, Bill 8 will not change the status of the Heartland, WATL and EATL lines.  Those lines stay under the old Bill 50.

Our only hope is that the Court of Appeal will rule in favour of the Shaws.  If the Court does, it will mean that the Heartland, WATL and EATL will be forced by the Court to undergo a public interest and socio-economic assessment.  There is no way these lines will survive that scrutiny.  All of the experts agree these lines are a massive overbuild and will not get used.  They will rust out before they are needed.

Attached is a Calgary Herald articles about Bill 8. 

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Lawyer Keith Wilson has reviewed Bill 2 (Responsible Energy Development Act).  This is what he has to say. (followed by CBC newscast, link below)

The Bill repeals landowners’ sec. 26 standing rights under the Energy Resources Conservation Act.  It does not replace those rights with anything substantive. 

The Bill also removes the rights of landowners to appeal decisions under the Environmental Protection and Enhancement Act and Water Act relating to “energy projects” to the Environmental Appeals Board.

I believe the new legislation should respect landowners and recognize that much of the energy development in Alberta either occurs on private property or impacts it.

http://www.cbc.ca/news/canada/calgary/story/2012/10/25/calgary-energy-regulator-industry-alberta.html#socialcomments

By Lauren Krugel, The Canadian Press; With Files From Herald News Services October 27, 2012

TransAlta Corp. is partnering with a subsidiary of billionaire Warren Buffett’s company, Berkshire Hathaway, to build new natural gas-fired power plants.

The Calgary-based power generator announced the agreement Friday with Iowa-based MidAmerican Energy Holdings Co.

“It’s a unique opportunity for TransAlta to be much more aggressive about the size and number of plants that we could develop. We like MidAmerican’s disciplined approach to development and, more importantly, we share a common view on returns,” TransAlta CEO Dawn Farrell told analysts on a conference call to discuss the company’s third-quarter results.”

Farrell said Canada will need more than $200 billion in new power generation investment over the next two decades, driven by growing energy development in Western Canada.

“If you look at Canada, there’s a huge potential for expansion of (liquefied natural gas), which potentially will need power. There’s lots of opportunities here in Alberta in the oilsands as the oilsands guys build up their plans over the next 10 to 15 years. There’s opportunities in Saskatchewan,” she said.

“And many of those projects are fairly big projects with fairly big price tags, so I think as we look at Canada and its expansion over the next 10 years and the kind of generation that’s required, that offers some pretty big opportunities.”

TransAlta and MidAmerican have a relationship dating back more than decade, including investments in geothermal generation in California and several U.S. gas-generating assets. The deal announced Friday is MidAmerican’s first foray into the Canadian market.

“At MidAmerican, we have been seeking an entry point to the Canadian electricity generation market, where we see strong potential for growth,” MidAmerican CEO Greg Abel said in a release.

The agreement encompasses all new natural gas-fuelled generation opportunities considered by either TransAlta or MidAmerican in Canada, including TransAlta’s proposed Sundance 7 project, an up to 800-megawatt project based in Alberta, which under current plans, would be completed by 2016 or 2017. “This gives us the opportunity to be much more aggressive here in the short-term about projects that we think are possible, and also be much more aggressive about larger projects,” Farrell said.

All development and construction or acquisition of approved projects will be funded on a 50-50 basis and TransAlta will be responsible for construction management, operation and maintenance of projects that proceed.

Farrell said it’s too soon to know just how big the partnership with MidAmerican may become.

TransAlta has spent about $4 billion since 2005 to build 1,600 megawatts of new power capacity, including coal and renewables, according to the company’s website.

In a research note, Desjardins analyst Jeremy Rosenfield said “notionally, we view MidAmerican’s support as a positive development that could accelerate some of (TransAlta’s) growth.”

TransAlta made the announcement while reporting that third-quarter profit grew 12 per cent on lower maintenance costs and strong margins in most of its operations. Earnings for the quarter were $56 million, or 24 cents a share, up from $50 million, or 22 cents a share, a year earlier. Revenue fell nearly 15 per cent to $538 million.

The company said results were constrained by a loss in its energy trading business and lower power prices in the Alberta and Pacific Northwest.

Lower natural gas prices have brought power prices down to 10-year lows in several regions. Farrell said she expects power prices in the U.S. Pacific Northwest region to improve with a recent climb in U.S. gas prices, but warned Alberta pricing will likely remain weak, with the return to service of TransAlta’s Sundance 1 and 2 coal-fired units after the company was forced by regulators to rebuild them.

© Copyright (c) The Calgary Herald

By Tamara Gignac, Calgary Herald October 26, 2012

Landowners and politicians are divided on the merits of a single regulator to oversee all future oil, gas, oilsands and coal development in the province.

The Redford government is proposing new legislation to bolster oversight of the province’s energy industry.

Companies currently must file applications to the Alberta government as well as to the arms-length Energy Resources Conservation Board (ERCB).

But under Bill 2, also known as the Responsible Energy Development Act, a single provincial body would be responsible for energy resource developments.

The Tories say the legislation will give Alberta the regulatory teeth it needs to issue higher fines for individuals and companies who break the law.

The new rules are also good for property owners, who for the first time can register private surface agreements, according to the province.

“That’s a big one,” said Mike Deising, a spokesman for Alberta Energy.

“If a landowner and the industry have a deal — but industry doesn’t live up to their end of the bargain — the landowner can take it to the regulator,” he said.

“Previously, they could have gone to court but there wouldn’t have been regulatory enforcement.”

Disputes sometimes arise over the placement of pipelines or gas wells, with landowners and conservation groups pitted against large petroleum producers.

One such case involves Rosebud resident Jessica Ernst, one of the province’s most outspoken critics of fracking, a process where water, chemicals and sand are blasted deep underground to break up coal formations and release natural gas.

Ernst alleges that fracking has contaminated the hamlet’s water supply. She’s launched a lawsuit against Encana, the province and the ERCB, and remains skeptical that a new single regulator will do much to protect landowners

“It’s a way to deregulate the industry,” she said. “It means less red tape for the energy companies. They used to have to go to the different agencies to get all their permits and there were different eyes reviewing each application. Now it’s just going to the ERCB.”

The new regulatory regime involves combining the 75-year-old ERCB with the regulatory functions of Alberta Environment and Sustainable Resource Development.

That’s a problem, believes NDP critic Rachel Notley.

Energy Minister Ken Hughes said the point is to provide a single window for industry, thus reducing duplication.

But Notley argues the move hurts landowners because it creates a conflict of interest for the regulatory body charged with environmental protection.

“One of the mechanisms that helped landowners was being able to go the Ministry of Environment. Now that is all moved into this new agency, which is essentially ‘ERCB plus,’” she said.

Notley fears that under the new system, projects will be pushed through too quickly without proper consideration given to potential effects on Alberta’s land and water supply.

Jason Hale, Wildrose MLA for Strathmore-Brooks, said his party plans to take a close look at the new legislation and may propose some amendments, if necessary.

“The PC government seems to have lost the importance of individual property rights,” Hale said. “We’re going to talk to some of the stakeholders and the land-rights groups to see if they have any concerns with this bill.”

Alberta has seen its share of conflict between energy companies and communities where the industry builds pipelines and wells.

The province is even considering a new urban policy for oil and gas projects after the Calgary neighbourhoods of Royal Oak and Rocky Ridge raised concerns about a sweet oil well in their community.

Some landowners, however, agree with the notion of a single energy regulator.

Barbara Gardener, who owns a ranch south of Longview, was pleased earlier this year when Suncor Energy withdrew a contentious plan to drill 11 sour gas wells and build a pipeline on land in Kananaskis County.

But she said in many cases, there needs to be compromise. “We’d like to keep everything pristine and nice but you have to have balance,” she said. “Everybody gets mad and up in arms but it comes down to economics. If we want to have nice roads, schools and hospitals we all have to work together.”

—With files from the Canadian Press

—[email protected]

Twitter:/TamaraGignac

© Copyright (c) The Calgary Herald

By Colette Derworiz, Calgary Herald October 26, 2012

A land-use strategy focusing on water, economic development and conservation needs in southern Alberta will get a full public airing during a series of consultation sessions this fall.

The South Saskatchewan Regional Plan, which includes an area spanning 83,774 square kilometres from just north of Calgary to the United States border, is the second in a series of land-use plans in the works by the Alberta government.

They are based on the province’s major watersheds.

In the South Saskatchewan region, it includes Calgary, Medicine Hat, Lethbridge and Airdrie. It also contains the Castle wilderness area, where a logging plan was recently put on hold by the province until the completion of the plan for the area.

Residents interested in commenting on the strategy will be able to attend any of the public sessions being held across Alberta.

From Nov. 6 until Dec. 6, the sessions will be held across the province — including in Cardston and Red Deer on Nov. 6; Calgary on Nov. 13; Airdrie and Pincher Creek on Nov. 20; and Canmore on Nov. 21.

For more details on sessions in your area, go to www.landuse.alberta.ca.

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© Copyright (c) The Calgary Herald

By The Canadian Press October 25, 2012

BROOKS, Alta. – The new managers of XL Foods Inc. are taking immediate steps to ensure the troubled plant meets requirements that will allow it to continue operations.

Bill Rupp, CEO of JBS USA’s North America and Australia beef business, says the first goal is getting the plant up and running and after that, management will consider whether to move forward with purchasing the plant.

He says at this point he doesn’t see anything to prevent that from occurring.

JBS has ordered an independent audit of the plant to review the facility and food safety procedures.

Rupp also says they are also doing intensive training with current employees to make sure they are aware of JBS standards and a session was underway next door to the news conference.

The plant is scheduled to reopen Monday after being shut down a month ago following a massive beef recall and E. coli concerns.

By The Canadian Press October 22, 2012

BROOKS — The company taking over management of an Alberta meat packer at the centre of a beef recall and E. coli scare is meeting with the people who work at the plant.

JBS USA officials were to meet with XL Foods employees in Brooks on Monday in groups of 100 to talk about plans for the plant, which has been closed since Sept. 27.

Doug O’Halloran of the United Food and Commercial Workers said union officials were to meet Tuesday with industrial relations staff from JBS USA.

Reaching out to the workforce and union is a positive sign for the future of Canada’s second-largest beef operation, he suggested.

“It’s certainly a step in the right direction because we’ve had no communication with XL, so the fact that JBS has reached out and wants to have a discussion I think bodes well,” O’Halloran said.

The Canadian Food Inspection Agency has said test samples from meat processed at the plant last week as part of an inspection came back free of E. coli.

The food agency is finishing a review of hygiene, meat-handling and sanitation procedures, but no date has been set for the plant’s reopening.

“We certainly have some questions going forward about what their (JBS) plans are … and right now we’re sort of in limbo, not really knowing what to expect … so we’re quite interested in having a meeting and seeing what they have to say,” O’Halloran said.

All the beef from the extensive recall is being dumped at a landfill.

By Sarah O’Donnell, Edmonton Journal October 23, 2012 7:28 AM

EDMONTON – Alberta’s chief electoral officer will be able to name names of groups that violate Alberta’s political spending laws under an amendment to election rules that will be introduced in the upcoming legislative session, Government House Leader Dave Hancock said Monday.

“It’s not retroactive legislation, but it will give the chief electoral officer what some of us thought he already had,” Hancock said, speaking of the Election Accountability Amendment Act, one of 10 bills the government announced Monday that it plans to introduce or vote on in the upcoming six-week session.

Previous amendments to Alberta’s election law allowed the chief electoral officer to levy penalties and make decisions about whether political donations complied with provincial laws. But when that change occurred, Hancock said, it wasn’t made clear that the chief electoral officer could also make those decisions public.

“This act will make that clear,” Hancock said.

As of July, chief election officer Brian Fjeldheim’s office said it had looked into 81 cases of allegedly inappropriate political contributions. Of those, 37 investigations resulted in fines and another 14 in warnings. He said the legislation prevented him from revealing the details of those investigations, including who had been fined.

In addition to the promise of more transparent election laws, Hancock said a mandatory new home warranty and a requirement for power transmission lines to be approved by the provincial utilities commission will be among the key pieces of legislation to be introduced when MLAs return Tuesday to the legislature.

The government also will introduce a new Education Act for a third time, which Hancock said will clarify wording related to the role of human rights, an issue that prompted protests last spring from some parents who home-school their children and worried the new act would force them to teach values they believe to be immoral.

[email protected]

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A look ahead at the legislation

Members of the Redford government said Monday they intend to introduce 10 pieces of legislation in the fall session. Here’s a quick look at the bills, based on the provincial government’s descriptions:

Bill 1: The Workers’ Compensation Amendment Act, introduced in the spring, gives firefighters coverage for work-related post-traumatic stress disorder.

Bill 2: The Responsible Energy Development Act creates a single provincial regulator for energy project that relate to removing oil, gas, oilsands and coal from the ground.

Bill 3: The Education Act, being introduced for a third time, is meant to modernize the dated School Act.

Bill 4: The Public Interest Disclosure Act is being touted by the government as whistleblower protection for people in the public sector so they can disclose problems without reprisal.

Bill 5: The New Home Buyer Protection Act creates a mandatory new home warranty for all new homes built in Alberta.

Bill 6: Amendments to the Protection & Compliance Statutes promise new penalties for health, safety and trade violations.

Bill 7: The Election Accountability Amendment Act aims to “increase democracy and enhance accountability in the electoral process,” according to a government news release. PC House Leader Dave Hancock said it will include changes clarifying that Alberta’s chief electoral officer can publicly report on decisions the office makes or penalties it levies for violations.

Bill 8: The Electric Utilities Amendment act is meant to ensure all future power transmission line project are reviewed and approved by the Alberta Utilities Commission, not provincial cabinet.

Bill 9: The Alberta Corporate Tax Amendment Act introduces a handful of changes, including allowing sharing taxpayer information in certain circumstances, such as upon request by the Auditor General.

Bill 10: The Employee Pensions Act is being promoted as an update to make Alberta’s private sector pension legislation in tune with changing times.

© Copyright (c) The Edmonton Journal

Written by Trevor Busch

Thursday, 18 October 2012 17:31

The ongoing tainted beef crisis at XL Foods in Brooks has been negatively impacting the province’s beef industry up and down the supply chain.
Besides the direct repercussions of over 2,000 employees temporarily laid off by XL Foods, feedlots have been backed up, cattle prices have been affected, and consumer confidence has been severely undermined.
On the weekend, the beleaguered company announced they were re-calling 800 workers previously laid off to allow the Canadian Food Inspection Agency (CFIA) evaluation to proceed, which requires the limited re-activation of beef processing activities in order to complete a comprehensive assessment.
Little Bow MLA Ian Donovan, who serves as the agriculture critic for the Wildrose Alliance Party, commented on the initial investigation by the CFIA and his hope this week’s limited re-activation of the plant will be a significant step towards full-scale operations resuming.
“I guess there wasn’t a lot of information going out, which with it being a short-term situation, that’s what I think they thought it was going to be, just a quick blip and no big problem, and then the situation got longer and they figured out there were maybe a couple more issues there,” said Donovan.
“It’s too bad it took as long as it did to get rectified. They’re opening modified, to work on the carcasses that are in there, to get everything working. So hopefully that works out, and they can get rolling again and back on their feet. Cattle prices have dropped quite a bit, because there’s not the market for it.”
Wildrose Alliance leader Danielle Smith, along with Donovan and Strathmore-Brooks MLA Jason Hale, served free hamburgers at a barbecue on the Legislature grounds last week. Smith spoke to the media about the ongoing XL Foods beef incident, food safety in Alberta, and how to support Alberta beef producers going forward.
Donovan is hoping any investigations into the E. coli problem at XL Foods will reveal any weaknesses that may exist in food safety procedures.
“I think we have great food safety already. I think it has been identified there was problems — everybody wants safe food in Alberta, it’s our bread and butter, our industry. I would like to see an investigation to figure out what the hold-up was, and see why it went as long as it did without some of the issues on it. I don’t know if it’s an XL Foods issue or a CFIA issue, or what it is — I’d like to get more information. I think we’ve got a safe food product in Alberta, and I think we’ve got the guidelines to show for it.”
Although the incident at the XL Foods plant falls predominantly under federal jurisdiction, that doesn’t mean it hasn’t already profoundly impacted the beef industry in the province, according to Donovan.
“One of the things is we’re hoping to figure out what happened with the CFIA. This isn’t really a provincial issue, it’s a more federal issue, because CFIA are the inspectors for the federal plant.”
As far as provincially, it hurt our economy, not including the 2,400 employees they had working there that are off work, there’s also cattle buyers and cattle haulers, there’s feedlots that were backed up — there was quite a hit to a lot of people in Alberta. I don’t like to see that, especially with feedlot alley being in my riding, in Little Bow riding. As far as that goes, we know it was a big hurt that way.”
An investigation into the matter is warranted, added Donovan.
“Anytime there’s something like that where it’s shut down upwards of three weeks, I think there needs to be an investigation of some sort to find out what went wrong, is there safeguards that would have caught that, if stuff wasn’t being cleaned, or the boiler — I’ve been hearing from one source that the boiler wasn’t getting hot enough that they were using to clean. That should have been identified, and I think they’ve identified that now, and that should never be an issue again. But those are the things that you need to look and find out and see how that has slipped through the cracks. Our party stance is we’d like to see an investigation on this, just to see what happened, and to make sure that there are guidelines in place make sure it doesn’t happen again.”
Despite the issues surrounding the tainted beef recall, Donovan is confident domestic consumers won’t omit beef from their weekly shopping list.
“Feel safe that it is a good product, and that you’re also helping your neighbours out when you’re eating it. We’re all in it together, and I think that’s what we need to do, is show that in Alberta we’re very confident in the food we’re getting, and keep on using it.”