Government and elected officials from Provinces and Territories

What are the benefits of impact assessments?

In its October 2023 decision, the Supreme Court of Canada set out clear guidance on the types of changes required to make the Impact Assessment Act constitutionally sound. These changes focused on better defining and basing decision-making on matters within federal jurisdiction.

The Government of Canada is confident today’s Impact Assessment Act meets the requirements set out by the Supreme Court of Canada. It establishes a robust, collaborative, and timely assessment process that Canadians expect.

Let’s get specific

Respecting lanes

Today’s impact assessment process will better ensure federal assessments are focused squarely on the prevention of negative effects under federal jurisdiction that could be caused by major projects.

This means the federal decision-making provisions, namely the designation decision, the screening decision, and the final project decision, are clearly anchored on areas of federal constitutional responsibility. The definition of "effects within federal jurisdiction" in the Impact Assessment Act is also meaningfully adjusted to align with areas of clear federal responsibility (in other words, "heads of power").

Shorter timelines

By respecting jurisdictions and allowing for greater opportunities for collaboration, the Government of Canada is confident that it can deliver meaningful assessments more efficiently.

As announced in Budget 2024, the Government of Canada has set an ambitious target of five years or less to complete federal impact assessments and related permitting processes and a three-year target for nuclear project reviews. These improved timelines provide greater certainty for proponents, thus stimulating greater investment in potential projects in the provinces and territories.

Greater harmonization

The Government of Canada and the provinces and territories share the goal of wanting to attract and generate investment to grow a clean economy. The Supreme Court of Canada confirmed that both federal and provincial/territorial governments should work together on assessments, as assessments can involve roles for both levels of government.

The Impact Assessment Act incorporates the flexibility to work with provinces and territories and to implement the principle of "one project, one assessment."

The principle means to do this is through cooperation agreements between the federal government and the provinces or territories. Cooperation agreements outline the approach that will be used when a project assessment is required by more than one jurisdiction.

Cooperation agreements benefit both levels of government by:

• Responding to stakeholder concerns
• Ensuring greater predictability for investors
• Using public resources more wisely
• Sending a signal to investors that Canada’s investment climate is predictable and transparent

Canada and British Columbia have a Cooperation Agreement under the Impact Assessment Act and British Columbia’s Environmental Assessment Act. As such, federal assessments can be substituted to the provincial process, thereby avoiding duplication and fulfilling the goal of "one project, one assessment."

A case in point: Cedar LNG

The first cooperative impact assessment to be completed under the Impact Assessment Act, for the Cedar LNG Project, took only 3.5 years.

Cedar LNG is a small-scale, electrified floating liquefied natural gas (LNG) facility near Kitimat, British Columbia, within the traditional territory of the Haisla Nation. The project is proposed by Cedar LNG Partners LP, a Haisla Nation-led partnership with Pembina Pipeline Corporation.

In accordance with the substitution provisions of the Impact Assessment Cooperation Agreement Between Canada and British Columbia, this assessment was conducted by British Columbia’s Environmental Assessment Office, which gathered the information required to inform federal decision-making. In making the final decision, the Government of Canada considered the conclusions of British Columbia’s Assessment Report and ultimately concurred with British Columbia in approving the project to proceed. The project will need to meet legally binding conditions established by both British Columbia and Canada.

Not all projects are subject to impact assessments

Not every major project in Canada requires a federal impact assessment. Only projects with the greatest potential for non-negligible negative impacts within federal jurisdiction fall under this process, and where federal impact assessment would add value over other regulatory processes, such as by providing a process for coordination of federal permitting and harmonization among jurisdictions, providing a transparent and structured forum for public engagement, and a single window for Crown consultation.

The types of projects are identified in the Physical Activities Regulations (also known as the Project List). The Project List is being reviewed in 2024, five years after its coming into force to ensure it continues to meet these objectives.

Predictability for industry and investors

The impact assessment process now establishes clear expectations and time limits up front with project proponents. It also "tailors" the requirements of each assessment to the nature and complexity of the project and fosters collaboration between the federal government, provincial or territorial governments and Indigenous communities, also reduces duplication.

Access to coordinated federal expertise

Experts from various federal departments provide expert advice in a variety to areas during a federal impact assessment. The Impact Assessment Agency of Canada helps to coordinate this advice, so assessments are robust and based on scientific evidence. The information collected and provided can also be used to strengthen provincial assessments and decision-making.

Many approaches to collaboration

The Impact Assessment Act allows for many approaches to cooperation with other provinces. Each jurisdiction makes its own decision at the end of the assessment, regardless of the type of cooperation used.

• Coordinated assessments: governments coordinate activities and, where possible, timelines and documents.
• Delegation: the Government of Canada delegates some tasks to one or more entities while remaining responsible for the overall assessment process.
• Substitution: the Government of Canada allows another jurisdiction’s assessment process to replace the federal process, providing the information needed to support the federal government in making its decision related to a project.
• Harmonized assessments: the Government of Canada and another jurisdiction jointly develop a process, collaboratively determining how the assessment will be conducted.
• Joint review panel: another jurisdiction along with the federal government jointly appoint panel members and agree on terms of reference for an independent panel to conduct the assessment.