Executive summary

Canada requires a massive transformation of its electricity systems to reach net zero electricity generation by 2035 and economy-wide net zero by 2050. Current forecasts show that more than 10 gigawatts of new zero-emission electricity will need to be added to the grid each and every year from now to 2050. 

Meeting this target requires a dramatic acceleration in the permitting, construction, and integration of clean electricity facilities – generation, transmission, distribution, and storage. This paper focuses on permitting. It proposes a two-track permitting framework for implementation by governments at every level. The first track would be the existing approvals track, which would remain in place for major facilities or facilities involving unproven technologies or large zones of impact. The new, second track would be an expedited permitting process for proven, small-scale, zero-emission facilities.

This paper sets out the policy framework for the new second track of expedited electricity facility approvals, encompassing eligible technologies, location, and timelines. 

All five orders of government authority in Canada—federal, provincial, territorial, municipal, and Indigenous—could implement this framework for expediting permitting. Based on this conclusion, this paper recommends that the most locally rooted authorities—municipal and Indigenous—have the opportunity to lead the fast-track approvals. This paper also recommends that Canada, the provinces, and perhaps the territorial governments, work together to develop a common framework for fast-track permitting, including acceptable technologies, permitting criteria, and timelines. Appendix B provides a preliminary framework for consideration.

Introduction 

Canada’s electricity system will require major reform to achieve the targets of net zero generation by 2035 and economy-wide net zero greenhouse gas emissions by 2050 (Kanduth and Dion 2022; Lee et al. 2022). The further challenge is increasing the generation, storage, and transmission of clean electricity without adverse local impacts. 

Annual new build required to achieve the 2050 net zero target

A credible estimate is that, for every year from now to 2050, Canada will need to build over 10 gigawatts (10,000 megawatts) of new zero emission electricity generation facilities (Thomas and Green 2022). In concrete terms, this means Canada’s electricity generation capacity needs to grow up to six times faster than it did over the last decade (Lee al. 2022). This pace of growth makes clear the breadth and urgency of the challenge. The focus of this paper is on fast-tracking permitting for new clean electricity generation, transmission, distribution, and storage facilities. 

Beyond expedited permitting, other related challenges include ensuring that new facilities are financed speedily so that construction can proceed as soon as possible after permitting, and eliminating hurdles to the integration of the facility into the grid. Other nations, particularly Germany, have provided powerful examples of governments using novel regulatory tools to mobilize the private sector in financing massive construction of clean energy facilities. In particular, Germany provided an example of how feed-in tariffs can help accelerate the build-out of wind and solar facilities to contribute to major energy systems (Futurepolicy.org 2023). In 2010, Ontario adapted this international experience to implement its Green Energy Act reforms and a feed-in-tariff program. The essence of this program was to provide a rules-based approach for applicants to obtain a long-term electricity supply contract: if an applicant met the rules, it obtained a government contract to buy its clean energy at an agreed-upon rate for a 20-year period. Holding a long-term energy supply contract, applicants could obtain private financing to build and operate new clean energy generation facilities. Box 1, below, summarizes this very broad reform. 

Direct funding by governments can also help drive the construction of new electricity facilities and mobilize private capital. Federal policies and instruments like the Canada Infrastructure Bank, new federal investment tax credits, and the newly established Canada Growth Fund are designed to mobilize private capital for development of clean energy facilities and technologies (Beck et al. 2023). Some of these federal programs include financing support specifically for Indigenous governments to develop clean energy facilities. Provincial supports include Ontario’s Aboriginal Loan Guarantee Program and Alberta’s Indigenous Opportunities Corporation. While the permitting reforms proposed in this paper focus on reducing the constraints to permitting new facilities, both permitting and financing reforms are essential to drive the actions required to hit Canada’s net zero targets.

Given the scale of the required build-out for new facilities, every month saved or added to the time required to permit and build new facilities counts. 

Types of required facilities

Canada’s clean energy transition cannot be achieved without major reforms to how we approve permitting for all core aspects of our electricity systems—generation, transmission, distribution, and storage. 

Expediting permitting for zero-emission generation of electricity is by far the greatest requirement. It is also the greatest challenge.

Expediting permitting for electricity transmission systems is also necessary to advance Canada’s transition to clean energy. Improved intra-provincial transmission is essential to serve remote areas and connect areas with renewable energy potential to demand centres. In particular, connecting isolated Indigenous communities to the electricity grid will meet at least two needs: it will allow these communities to replace diesel generation with zero-emission electricity generation; and it will also potentially allow high-value wind energy sites in remote areas to connect to the grid—benefitting any nearby community and contributing to the national target (Natural Resources Canada 2023). An interprovincial electricity system is not strictly necessary to meet the target—Canada could meet the national target by the required timeline without expanding its interprovincial transmission lines. However, it will be a significant advantage and likely less costly to have greater interprovincial connections to move electricity around and realize complementarities between systems (Dolter and Rivers 2018).

Expediting permitting for energy storage facilities is required to support zero emission energy generation. For wind and solar facilities, natural forces beyond human control determine the time and duration of daily wind and solar inputs. These do not always overlap with the time and duration of community energy needs. To avoid losing electricity generated during off-peak hours, there is a need for facilities that store generated electricity. Electricity storage technologies are now viable. In particular, short duration, lithium-ion batteries are now a viable storage option (Lee et al. 2022). Over time, availability of viable storage technologies is expected to increase.

Existing law and policy to permit new clean energy facilities 

Every order of government in Canada has laws that govern the permitting of new electricity generation, transmission, distribution, and storage facilities (see Appendix C). The federal Impact Assessment Act addresses the permitting of major projects listed as designated projects as well as a wide range of projects on federal lands. While a decision by the Supreme Court of Canada in October 2023 will likely narrow the scope of designated projects that are subject to assessments under the Act (Langen et al. 2023), it has upheld its application to projects on federal lands (ss.81-91) and does not likely imperil its application to designated offshore clean energy projects (Reference re Impact Assessment Act, 2023 SCC 23). Federal laws also include sector-specific laws and effects-based federal approvals that govern or restrict the permitting of projects. 

Provincial governments, meanwhile, have laws governing the permitting of facilities on private lands and other laws for facilities on Crown lands. Indigenous governments have laws ranging from broad land claim agreements, particularly in northern Canada, and Land Laws under the First Nations Land Management Act or bylaws under the Indian Act. Municipalities address permitting through zoning bylaws.

Most of these laws have broad application. This breadth reflects the longstanding intent of most jurisdictions to subject energy generation projects to the same legal framework as other facilities in other sectors that may have environmental effects. As such, existing laws address a broad array of circumstances, including major and minor facilities, new and existing technologies, narrow and broad effects, limited and extensive affected areas, and general and sensitive locations. 

Many governments have also made efforts to set timelines for their approval processes. However, most of these timelines are partial, not comprehensive. No existing timelines encompass the time required to move from facility planning through permitting and construction to facility operation. 

In Canada, Ontario has recent experience with clean energy reforms that linked shortened timelines with an innovative approach to permitting and financing new facilities. 

Box 1: Ontario’s Green Energy Program (2009-2014)

In Canada, for the years 2010 to 2014, the Province of Ontario implemented the largest program of clean energy development in Canadian history under the Green Energy Act, 2009. This program illustrates the importance of providing an integrated approach to developing clean energy. The Ontario program had three main components:  -A 20-year feed-in-tariff contract from the Ontario Power Authority (OPA) gave private sector investors security for financing; -A Renewable Energy Approval from the Ministry of the Environment and Climate Change gave proponents a single, consolidated approval and approval process; and -A Grid Access Approval from the Ontario Electricity System Operator gave proponents access to Ontario’s transmission and distribution system. The Green Energy Act also included provincial funding and a requests-for-proposals approach to expand Ontario’s transmission system. In other ways, the Green Energy Act reform illustrates the challenges of seeking to implement major reform across a large jurisdiction. The feed-in-tariff provided above-market pricing of wind and solar facilities, and was later criticized for this cost to the public. In addition, the Renewable Energy Approval process took more time than anticipated because provincial efforts to consolidate approvals resulted in municipal and neighbourhood resistance. The Grid Access Approval process was complicated by the absence of adequate transmission capacity in many parts of Ontario, thereby delaying construction and implementation of new facilities. Furthermore, the Green Energy Act reform to exclude municipal decision-making for permitting approvals triggered a backlash against clean energy projects in rural Ontario that led, ultimately, to the repeal of this Act by a new provincial government in 2019. Despite this repeal, the policy has provided valuable information and experience to other jurisdictions.

Building on Ontario’s experience, there is room to further expedite timelines to approve, build and operate new energy generation facilities where the facilities use proven technologies and have a limited zone and number of off-site effects.

Proposed framework to reform facility permitting 

The framework to establish a new fast-track permitting process for selected facilities has three components: technology, location, and timeline. 

Technology

A suitable technology for fast-track facility permitting should have five attributes: 

1. It is a proven technology, not an experimental one;
2. It has demonstrably few off-site environmental effects and no human health effects; 
3. It has a demonstrably limited zone of off-site environmental effects;
4. It is readily available to be procured for construction; and
5. It has a demonstrably rapid path to construction and operation. 

At this time, wind and solar facilities are obvious candidates for fast-track permitting for electricity generation. Electricity transmission and distribution facilities are also obvious candidates for fast-track permitting. There are also viable energy storage options, for example, short duration lithium-ion batteries (Lee et al. 2022) Over time, perhaps quickly, other technologies will come to have these five attributes.

Proven technology

Zero emission technologies are evolving rapidly; however, a proven technology should be easier to approve than an experimental technology. Right now, no permitting regime recognizes this distinction, but, all else being equal, an unknown technology will involve more uncertainty about the range of effects and therefore require greater study and regulatory and public review than a well-established, proven technology. Thus, the preferred technology is one that is well established and commercially viable.

Demonstrably few environmental effects and no human health effects

 To be eligible for fast-track permitting, a given technology must of course generate or transmit electricity without emitting greenhouse gases. Yet one must also consider all other potential adverse effects, like other forms of pollution, harm to ecosystems, or the opportunity costs for land use (e.g., agriculture). To be considered for fast-track approval, the technology should have no serious effects on air, water, soil quality, or biodiversity. 

Demonstrably limited zone of off-site environmental effects

Where technology is well understood, it is possible to readily assess the zone of influence of possible off-site effects (that is, how far facility effects extend onto neighbouring properties). The smaller the zone of off-site effects, the less impact there will be on residents or wildlife. Thus, the preferred technology will have either no off-site effects or only a limited zone of off-site effects. Noise from a facility, for example, may not extend beyond the boundary of a site, or may only extend beyond a site boundary at low levels. This preference contrasts with technologies that may have adverse effects far from the site—for example, technologies emitting fine particulate matter.

Notably, the smaller the zone of off-site effects, the greater the number of potentially available sites.

Ready availability for construction

The preferred technology will be readily available for procurement and construction. All orders of governments certainly have the authority to assess the availability of a needed technology, but this challenge would also benefit from coordination among all or most orders of government and the private sector. Although some aspects of supply are beyond Canada’s control, a delay in technology delivery at the end of a permitting process is just as problematic as delay at the start of the process. 

Demonstrably rapid path to construction and operation 

The technology must enable rapid construction. Construction times are as important as approval timelines. Months gained or lost in construction are significant. Eligible technologies will be those that use an easily replicable design, and few site-specific accommodations. 

Location 

Canada’s current permitting processes are inclusive: they apply to a broad range of possible facilities. For example, in the energy sector, legislation and regulations within each major jurisdiction in Canada prescribe that jurisdiction’s permitting processes, such as environmental or impact assessment. These existing permitting processes have general application across the jurisdiction and are designed to respond to every type and scale of facility that provides energy—including the full range of possible energy generation technologies. For instance, the 2019 federal Impact Assessment Act provides a clear example of a broadly applicable assessment process, as illustrated through the list of “designated projects” set out in its Physical Activities Regulations (Physical Activities Regulations 2019). Notably, this aspect of this Act was not considered unconstitutional in the recent 2023 decision of the Supreme Court of Canada.

The inclusive nature of current permitting processes means that they are complex and lengthy. Each time they are triggered, there must be time, expertise, and resources available to understand initial facility details, and the type and range of effects, and then craft a facility-specific regulatory process. For example, current permitting processes under the Impact Assessment Act include an early scoping component to identify and assess the full range of effects (s.18(1)). While early scoping is intended to narrow issues and therefore shorten the overall process and render it more predictable, scoping itself adds time and unpredictability to the front-end of the approvals process. Similarly, where a proposed facility uses an unproven technology, the permitting process requires additional time for government and participant experts to fully understand and evaluate the innovations, and the range of possible effects on and off the facility site. All of these location-specific issues are necessary in existing processes to fully address the type and geographic extent of potential effects on air and water quality, sensitive ecological features, human health, and community well-being. 

Some zero emission technologies may still cause serious adverse environmental effects related to their location. These technologies should remain subject to existing provisions for environmental or impact assessment. 

Existing permitting processes also give rise to further location-specific issues by using different criteria to guide the location-specific effects that must be studied compared to the location-specific effects that govern decision making. For example, considering existing environmental assessment processes, the model of environmental assessment that has prevailed in Ontario for almost 50 years under its Environmental Assessment Act has required the study of alternatives and relied on criteria to first screen out and then evaluate alternatives, but its decision-making test makes no reference to alternatives (see sections 6.1 and 9). Similarly, the federal Impact Assessment Act requires study of 19 factors as part of information gathering for the impact assessment of a designated project (s.22), but identifies only five factors to consider in the decision about whether a project is in the public interest and should therefore be approved (Impact Assessment Act 2019, s.63). Importantly, the Supreme Court of Canada’s recent Reference Decision on the Impact Assessment Act distinguishes between these two different sets of factors. The Court did not criticize the factors within information gathering (i.e., s.19), but did criticize the factors within decision making (s.63). Needless to say, use of different criteria and broad discretion for information-gathering and decision-making does not provide an efficient process or predictable results.

An innovative approach to permitting is to be focused, not inclusive. The first point of focus was addressed above: facilities that propose use of eligible technologies—those technologies that satisfy the five criteria set out above—should trigger the fast-track permitting process. Notably, several attributes of eligible technologies directly limit the type and geographic extent of adverse effects. This should enable a second point of focus – these facilities should require only a focused study of their location effects. 

Here, focus can enable streamlining. Streamlining occurs at the front end of the fast-track permitting process by focusing on eligible technologies. Additional streamlining may also occur throughout the permitting process because the eligible technologies will have limited location effects.

In particular, where a proposed facility uses an eligible technology, the location of this facility can be guided by a limited number of clear and binding criteria. These criteria should meet three demands: 

1. Binding rules: Every criterion to be applied should be set out as a binding rule. 
2. Yes/no answers: The rules must be yes/no rules. No discretion¹.
3. Objective application: The rules must have objective application. No subjective standards.

If a facility meets all the rules, it gets approved. Permitting approval alone may not be sufficient to start construction, but this would be desirable; regardless, meeting all permitting criteria must be necessary—universally. 

Here are examples of good and bad permitting criteria:

Good: Noise level must be lower than 40 dBA at property line.

Bad: Noise levels must avoid adverse impacts on neighbours.

The number of required criteria should also be limited. Based on the location issues eliminated or narrowed by the attributes of eligible technologies, it should be possible to simplify the number of required permitting criteria to address three core questions: 

1. Community impact: Does the facility have the support of local government? 
2. On-site impacts: Does the facility avoid harm to key ecological features? 
3. Off-site impacts: Does the facility avoid adverse impact on nearby uncompensated residents? 

1. Community impact: Does the facility have the support of local government?

Current permitting regimes for new energy facilities assign a lead role to federal or provincial approvals. The framework outlined in this paper for a new fast-track approach to projects does not propose to amend existing permitting regimes. These would remain in place for clean energy projects that do not meet the fast-track criteria. 

For proposed facilities to be subject to fast-track approval, however, local municipal and Indigenous governments would play crucial roles. In particular, local governments will need to champion clean energy facilities. 

The need for new clean electricity facilities applies to virtually every community across Canada. This paper recommends that fast-track permitting focus on communities where there is local government support. Recent experience shows that new facilities that lack local government support give rise to long-term problems, including public backlash and litigation (Cleland et al. 2016). Stated bluntly, Canada will not meet the net zero challenge where, for example, approvals create or foment a rural-urban divide or violate Indigenous treaty and inherent rights. Empowering and resourcing supportive local and Indigenous governments to meet the net zero challenge is ultimately the best remedy for softening or sidestepping local resistance.

Basic support from municipal and Indigenous governments not only presents the greatest opportunity for long-term clean electricity benefits, it present similar long-term benefits for local democracy and promotion of Indigenous rights.

For many municipal governments, the powers and processes to approve new facilities are generally well-established in municipal laws. Here, the reforms to provide fast-track permitting may not be significant, but there must be clear attention paid to achieving local support—locality by locality. Each local government may require different reforms to attract and maintain support.

Indigenous governments may in some cases have well-established laws and procedures to support and provide fast-track permitting; however, many such governments may not have established laws or permitting processes. Respect for Indigenous traditions and rights is an essential starting point for any of the permitting reforms proposed in this paper. There may also be some benefit to communities and Indigenous organizations getting together and strategizing about sharing and building upon best practices that align with community and cultural values. 

The scale of what is required means that many if not most local governments engaged in this net zero challenge will be very active, processing multiple applications year after year. This will require new dedicated staffing and expertise to apply the fast-tracking criteria consistently across the local territory.

Supportive local governments will also require additional resources to set and administer the appropriate array of (a) incentives to maximize direct employment in construction and maintenance and indirect spinoff employment, and (b) compensation to affected but non-participating landowners through, for example, discounts in electricity rates and/or property taxes. Within every community, there will be overall benefit if these aspects of approval are standardized, not individually negotiated. Otherwise, there are likely to be bottlenecks at the approvals process. Every facility proponent will hold up approval processes to seek the best deal for their facility. Among different local authorities, there should be some authority to vary some measures, but there should be care taken to ensure that any variance is applied consistently. 

The importance of community engagement cannot be overstated, but facilities that meet the fast-track criteria outlined here should be able to earn community support. The use of the right technology should allow all members of a community to accept that the new facility involves no serious adverse effects on the environment or human health. The use of clear and binding permitting criteria should allow a community to understand the limited impacts the facility will entail. Where the local government also provides clear terms for local benefits to support community acceptance, facilities that meet these terms should be readily approved at the local level. 

There is a role for every jurisdiction to develop and apply its own specific criteria so long as the criteria are consistent with the general framework. For example, there may be a certain ecological feature or species of flora and fauna that merits explicit attention because of its rarity and/or cultural importance. So long as the local jurisdiction ensures that every facility is subject to the same decision-making criteria, this kind of adaptation should increase, not diminish community support. 

Taken together, the fast-track permitting reforms to address eligible technologies and facility siting should allow community engagement on a specific facility to be uncontroversial. For every facility, there must be clear notice to any affected resident and provision for notice to any interested resident. There must also be opportunity for the public to provide additional information that challenges the application of any permitting criteria. However, such challenges should be rare and easily resolved: if the additional information is relevant to applying any of the criteria, it should be used and the criteria applied anew to ensure that decision making is consistent with all criteria. 

2. On-site impacts: Does the facility avoid harm to key ecological features? 

This criterion addresses the facility site. Its purpose is to identify the ideal on-site conditions. Ideally, establishing a new zero emission facility will have no serious negative impacts on-site and only trigger a limited number of negative physical changes. 

Based on recent experience, the most important topic to consider for on-site impacts is natural heritage. In Ontario, wind farms and solar farms triggered issues with on-site endangered species (Semeniuk and Stueck 2023). Many orders of government have authority over endangered species and/or their habitat, led by different provincial and federal laws that apply according to ownership or jurisdiction over the lands where species are located (Kauffman 2023). The climate crisis is no excuse to worsen the biodiversity crisis. Canada’s natural heritage needs greater protection, not increasing harm. 

Many jurisdictions currently protect natural heritage by avoiding harm to key ecological features. The proposed fast-track criterion for this topic is to require explicit consideration and protection of natural heritage features and functions. The focus will be on key ecological features as some features and impacts have greater ecological significance than others. Thus, for example, highest priority must be given to avoiding harm to endangered species and their critical habitat. 

Ontario’s Green Energy Act reform illustrates the problem with allowing endangered species issues to be regulated separately from renewable energy facility approvals. Although Ontario sought to make its renewable energy approval a consolidated approval, it failed to consolidate endangered species issues into this approval. The Renewable Energy Approval process mandated more than one dozen reports, but none required express avoidance or even consideration of endangered species habitat. However, in decision-making, Ontario provided that statutory appeals to a tribunal would be successful if an opponent established “serious and irreversible harm to plant life, animal life or the natural environment” (Environmental Protection Act 1990, s.145.2.1). This test did not reference, but clearly encompassed endangered species issues. Thus, Ontario had a disconnect between the information required to obtain approval and the impacts that could overturn an approval. This disconnect became prominent in wind farm litigation that involved an endangered species—the Blanding’s Turtle—and its habitat (Prince Edward County Field Naturalists v. Ostrander Point GP Inc. 2015 ONCA 269). The result was a tribunal overturning a Renewable Energy Approval on appeal and, after court litigation, the Court upholding the Tribunal result. Ultimately, the Approval was remanded to the Tribunal for a further hearing where the Tribunal affirmed its initial conclusion to set aside the Approval. 

Overall, serious efforts should be undertaken by each order of government that implements expedited permitting to make clear where and how to site new facilities to avoid key natural heritage features, particularly endangered species and habitat.

Current experience also suggests that the term key ecological feature should have specific definition and application. For example, Ontario’s Greenbelt Plan (2017) identifies 12 types of key natural heritage features and 4 types of key hydrologic features: (Government of Ontario 2017). There should be provision for some variation in the types of key features. This provision would provide room to reflect provincial or local circumstances. On the other hand, there should be a core list of key features that cannot be ignored, i.e., the critical habitat of endangered species. 

Additionally, there must be regulatory checks to ensure that the information on this habitat remains current. Current experience shows a patchwork of largely unsatisfactory efforts to ensure that current natural heritage information is readily available. For its Renewable Energy Approvals under the Green Energy Act reforms, Ontario sought to address an existing patchwork of inconsistent information by requiring that facility proponents carry out site-specific investigations to identify existing information and supplement this information as required. This approach is expensive and time-consuming. It would be preferable for local authorities to have the resources to gather most of the required information and then map and make available such information in electronic form. This preferred approach will likely require financial and/or technical support from federal or provincial governments to local governments to ensure that all participating orders of government have the most current information relevant to assessing key ecological features. 

3. Off-site impacts: Does the facility avoid adverse impact on nearby uncompensated residents?

This criterion would not apply to every proposed facility. The ideal facility location will have no residents within the zone of off-site impacts or, alternatively, no residents within the zone of off-site impacts who do not support the facility. Indeed, many or most of the technologies suitable for fast-tracking produce little to no off-site impacts.

Thus, this criterion would apply only where there are residents within the zone of off-site impacts for a proposed facility and the impacted residents do not support the facility.

Where it does apply, this third criterion has three required components. These arise from recent experience with clean energy facilities. This experience highlights the importance of addressing social impacts. Problems with long-term community support arise where neighbours have impacts imposed on them without any identified benefit. This problem was particularly apparent regarding wind farms where a patchwork of turbine locations created a patchwork of participating and non-participating landowners. In this context, a participating landowner was a landowner that received some economic benefit from the facility and thus supported it—usually, the economic benefit arose from having a component of a proposed facility on that landowner’s land. This patchwork created neighbourhood conflict as the non-participating landowners believed they were burdened with one or more impacts (e.g., noise, visual) without any benefit (Comeau et al. 2022). 

The first required component of this criterion is to define an impact zone around a facility or a specific component of a facility (e.g., a wind turbine). The size of the zone will vary according to the technology involved. Different sizes of wind turbine, for example, will have different zones of impact. Based on existing experience, it is essential to provide clear guidance on this topic for all permitting decisions. The requirements that govern applicable technologies should mean that impact zones can be defined for each relevant typeof technology and scale of facility. 

The second required component is to address negative impacts according to their intensity. For example, it should be possible to require that no facility will produce noise at the property line for any residential neighbour that is greater than 40 dBA or existing levels. The basis for this precise technical standard of a 40dBA limit is an international World Health Organization standard for night-time noise.

Once there is information on the applicable zone of impact and the intensity of the impact, it should also be straightforward to determine whether the third component applies to a given facility. Where compensation for adverse impacts is warranted, this will involve a government—any order of government—or a proponent providing some monetary benefit to any landowner within the zone of impact who is not leasing land or otherwise benefiting from the facility. 

These community benefits can be shared in multiple ways. One way is for local municipal governments to reduce assessed local property taxes or utility bill rebates for a non-participating but affected landowner (Comeau et al., p. 36). Recent regulatory reforms in New York State and California, for example, require all new renewable energy facilities to provide a benefit package for the host community of the facility, which can include utility bill credits (Arnold and Beck 2023). A second way is the availability of a renewable energy credit for sale to local residents only (Comeau et al., p. 20). A third is to distribute a portion of annual revenues to the local community for re-investment (Comeau et al., p.29). Here again, reforms in New York State and California show how Canadian jurisdictions can include these types of provisions within community benefit packages.

Whatever the details of these components, this third criterion on off-site impacts must adhere to the three tests for criteria set out above, namely a binding rule, in yes/no terms, that has objective application. 

Appendix A provides examples of proposed permitting criteria.

Timelines 

To reach Canada’s net zero goal by 2020, each clean energy facility that meets the fast-track criteria should have an expedited timeline for permitting and getting the facility constructed and operating. 

Coupling a commitment to new energy output with an expedited timeline is not new. Within established permitting processes, such as federal and provincial environmental assessments, there is a well-recognized trade-off between the size of a facility and the time required for approvals: the larger the facility, the longer the timeline. Unfortunately, despite best efforts, the existence of a regulatory timeline does not guarantee a predictable date of facility operation. Canada has several on-going examples of major energy generation projects exceeding their predicted timelines significantly—by factors, not percentages. For example, the actual timelines of major hydroelectric dam projects in British Columbia (Site C) and Labrador (Lower Churchill) were more than double the predicted time frame (BC Hydro 2023). Furthermore, time is money: these timeframe exceedances have also resulted in major budget overruns (CBC News 2022). These examples point to the importance of limiting the types of technologies and scales of facility that are suitable for rapid permitting. 

It may also be appropriate to include time limits for each crucial step in facility development. Every month counts. Examples of crucial steps include: (1) the time from initial notice of interest from a proponent to filing of a complete application; (2) the time for all regulators to review and decide whether or not to approve the application; (3) the time from facility approval to the commencement of facility construction; (4) the time required to complete all facility construction; (5) the time from the completion of construction to facility operation; and (6) the time from facility approval to grid connection.

There are many means to make a time limit enforceable. They can be made enforceable by governments against proponents and also by proponents against governments and third-party suppliers and contractors. For example, in Ontario, overall timelines were set out under the feed-in-tariff terms and conditions (see, for example, Ontario’s Feed-In-Tariff FIT 2.0 released in August 2012). These set out a required date for commencement of operations that was binding absent a specific waiver agreement. Similarly, the reforms in New York State now establish statutory time limits for issuing building permits, ranging from a maximum of six months for projects located on pre-approved brownfield sites to one year for all other projects (Arnold and Beck 2023).

Who can do what to implement the proposed reforms 

Canada’s Constitution and legal framework gives rise to five orders of government authority with jurisdiction to pass laws governing facility permitting: federal, provincial, territorial, municipal, and Indigenous. When looking at what each authority can do to achieve net zero emissions, there are two sources of legal authority: (1) existing laws, and (2) legal and constitutional powers to amend existing laws or pass new laws. 

Appendix C examines each of these five orders of government authority to assess their jurisdiction and opportunity to implement reforms to permit new clean energy facilities. It concludes that all orders of government—federal, provincial, territorial, municipal and Indigenous—could implement all aspects of expedited facility approvals. 

Building on this legal conclusion that all orders of government could implement all aspects of the fast-track permitting proposed in this paper, this paper advances two policy recommendations. 

First, this paper recommends that the most locally rooted authorities—municipal and Indigenous—lead project decisions for fast-track approvals. 

Second, this paper recommends that the Federal Government and the provinces work with other orders of government to develop a common framework to implement fast track approvals. This common framework should specify eligible technologies, permitting criteria, qualifications for local reviewers, and timelines. Appendix B describes this common framework. 

Imagining the future—permitting reforms in action 

To assist understanding, this paper provides two hypothetical examples of how proponents and local governments could act to advance clean energy facilities if the proposed reforms were implemented. 

Example 1: Solar farm in rural municipality

Saul R. Plexis owns a 100-hectare parcel of farmland in rural Ontario and is interested in using some of that land to generate electricity as a new income stream. Saul was aware that his local municipality had taken an active role in promoting solar farms. His town council did so to seek the annual rate subsidy available to its local utility for all ratepayers, gain new tax revenues from constructing and operating the new facility, and obtain the complete rebate available to local governments who had developed a long-term energy plan setting out annual targets for constructing new facilities by 2035 and 2050. 

Using a model program developed by the province, municipal staff had loaded their existing GPS information on a new website and quickly retained a local consultant to address a small number of gaps in the local data. On completion, the website enabled any interested landowner to determine immediately if their land was eligible for consideration as a future solar farm of between 1 and 15 megawatts. This determination would involve review of the three criteria on facility location and consideration of where the site fits under the local utility’s connection capacity across the municipality, as set out in the municipality’s long-term energy plan.

Saul went on the municipal website and quickly determined that a 30-hectare parcel on his lands met the three permitting criteria and was within the 5-year capacity of the energy plan for utility connection. He then went onto the municipal register to place his lands in the first tier of the public queue for immediate consideration by the municipality. As a first-tier site, the municipality and local utility would act in the next 30 days to visit his site to verify permitting criteria and connection capacity, commission a survey, and move it up to the second tier in the municipal register—which would be visible on public-facing elements of the municipal site and trigger municipal notice to all property owners abutting Saul’s site or within 120 metres along road access. The utility would also send to Saul a feed-in-tariff contract and construction agreement and schedule. As soon as Saul completed these contracts, his site would be listed on the third and final tier in the municipal register. This would complete the planning phase of the facility. The municipal register also contained further listings to identify completion of construction and utility connection. Once the facility was built and operating, the municipality would update its energy plan on its annual and long-term targets. 

Example 2: Wind farm on Reserve Lands

A First Nation in a remote area of western Canada relies on diesel generators for its electricity. Recently, seeking energy independence from costly diesel fuel imports, the Council of this First Nation completed the steps to allow it to pass laws, lease lands and enter contracts under the Framework Agreement on First Nation Land ManagementAct redressing the constraints of the Indian Act. 

The Band Council identified that its current and future energy needs could be met by a two-megawatt, zero-emission electricity generating facility. Recognizing that the Reserve includes highlands of barren Canadian Shield, the Band Council created a new staff position to explore wind energy options. Band staff then retained consultants to take wind measurements and assess the area’s wind energy potential. This work identified that the area had potential to generate up to 100 megawatts of wind energy. This led Band staff to go to the Canadian Energy Regulator website to identify potential energy options. The site informed the Band about the option to develop a long-term energy plan setting out annual targets for constructing new facilities and connecting to the electricity grid. 

To develop an energy plan for new generation facilities, Band staff used a model program developed by the province with Indigenous government input. Band staff trained on use of GPS technology downloaded available digital mapping information to apply the newly established Canada-wide permitting criteria to identify the best possible turbine locations and configurations. Band staff identified gaps in the existing information, but took advantage of the new Canadian Energy Regulator program to fund the required GPS work. Staff retained a team of Band members who had obtained the required training. Band staff also created a new dedicated web site so that all members of the First Nation could access existing information and add their local and traditional knowledge. Staff quickly determined that at least three blocks of Reserve lands met the three permitting criteria. Under its new program, the Canadian Energy Regulator provided guidance on passing a land law that would incorporate the permitting criteria into a Band Council approval process that included community-wide consultation. Once Band Council approved its land law and confirmed that Band staff had completed the initial steps of required consultation, Band Council authorized staff to go onto the Canadian Energy Regulator register to place all three blocks in the first tier of the queue for immediate consideration by this Regulator. 

To address connection issues required for the long-term energy plan, Band staff went to the Canadian Energy Regulator web site to obtain required information on the proximity of each site to the nearest transmission line. Using GPS tools and digital mapping, Band staff identified that their Reserve was more than 100 kilometres from the nearest transmission line. Plugging this information into the Canadian Energy Regulator website, Band staff saw that the Canadian Energy Regulator made provision to approve new transmission lines to remote communities in two circumstances—where the energy generated could produce energy for the grid greater than 10 megawatts per 20 kilometre distance or where a new line might connect more than one remote community that was on diesel fuel. The Band Council liked both options and reached out to two other remote communities to identify possible interest in making a joint application to the Canadian Energy Regulator.

For each first-tier site in a remote Indigenous community that completed the transmission line information, the Canadian Energy Regulator would act in the next 30 days to visit each site to verify permitting criteria, commission a survey, and move each verified block up to the second tier in its register—which would be visible on public-facing elements of the federal website and trigger public notice. The Canadian Energy Regulator also required that the Band confirm issuance of community notice to all residents of the Reserve. 

The next step required the Canadian Energy Regulator to work with the Band and any other identified community to address a transmission line connection plan including the proposed location of the on-Reserve portion of the transmission line and the proposed location of the off-Reserve portion of the line. Within 60 days of Band sites obtaining second-tier status, the Canadian Energy Regulator completed a transmission line plan. 

By the terms of the Regulator’s mandate, the completion of a transmission plan required further actions by the Band Council. First, the Band Council confirmed that its staff had completed required community consultation on the transmission line plan. Next, the Band Council passed a second Land Law that acknowledged the completion of its long-term energy plan and accepted the location and timing details of the Canadian Energy Regulator transmission line plan. This Land Law approved the plan to connect the community to the grid within two years for the first site for 10 megawatts and committed the Band to support future development of the other two sites that would add 40 megawatts to the grid within five years. 

Conclusions 

This scoping paper sets out a framework to reform Canada’s permitting processes by establishing a two-track framework including a new fast track permitting process to provide expedited approval for new clean energy facilities. There is opportunity for participation by all Canadian jurisdictions—federal, Indigenous, provincial, territorial, and municipal—and all residents of local communities, however urban or remote. 

The scale of this needed build-out has no precedent. This need is long-term—from now to 2050. Short-term reforms will not be sufficient. Reforms must be sustainable financially and able to be implemented in communities across Canada.

1. Discretion cannot be completely avoided. Most generally, there will always be some uncertainty that causes issues at the boundary of a rule; however, the rule must be framed to minimize uncertainty.