Largely funded by the oil and gas industry, the BC Energy Regulator is responsible for both permitting and ensuring companies follow the rules. New legislative changes will cede more powers and responsibilities to the government agency.

Image Credit: Matt Simmons, Local Journalism Initiative

One of British Columbia’s government agencies is poised to get a lot more power.

Premier David Eby’s NDP government has just introduced legislation to give new responsibilities to the BC Energy Regulator (BCER), which oversees the province’s growing oil and gas sector and other energy projects.

The changes will put the regulator — largely funded by the oil and gas industry — in charge of fast-tracking renewable energy projects like wind and solar, along with the $3-billion North Coast transmission line that will power liquefied natural gas (LNG), mining and other industrial projects.

Through a suite of agreements with various B.C. ministries, the regulator has long had special powers to make decisions related to ecosystem health, wildlife, cultural heritage sites, climate, Indigenous and non-Indigenous communities and more.

Regulator officials can issue tickets, fines and warnings, and order companies to stop working if they are breaking the law. The agency is also responsible for issuing permits for energy projects — everything from pumping water from a stream and laying a pipeline under a river to setting allowable levels of greenhouse gas emissions at natural gas wells.

In announcing the regulator’s new powers earlier this year, the B.C. government touted the agency’s transparency and its adeptness in working with First Nations and energy companies. A recent investigation by The Narwhal and Investigative Journalism Foundation found the regulator’s inspectors don’t always enforce laws and regulations designed to protect the environment and human health.

So what exactly is the BC Energy Regulator? Read on.

What is the BC Energy Regulator, or BCER?

The regulator is a Crown corporation, like BC Hydro and BC Transit. It answers to the B.C. Ministry of Energy and Climate Solutions, headed by Adrian Dix.

When the regulator was formed in the 1990s, it was called the BC Oil and Gas Commission.

“The original purpose of the BC Energy Regulator was very much to facilitate the development of the oil and gas industry in the province,” Deborah Curran, executive director of the Environmental Law Centre at the University of Victoria, previously told The Narwhal.

At the time, the B.C. government was courting fossil fuel companies to set up shop in the province, and it established dedicated ministries — such as the Ministry of Natural Gas Development — to help the sector get up and running. To support oil and gas development, the regulator was given special powers that superseded decisions normally made by other ministries.

What kind of decisions can the regulator make?

The regulator has broad decision-making powers. For example, the regulator can make decisions and issue permits to clear an archaeological site or cut down old-growth forests to clear land for fossil fuel projects. The regulator also has primary responsibility for overseeing major projects like the controversial Coastal GasLink pipeline.

Former premier John Horgan’s NDP government renamed the commission in 2023, and expanded its responsibilities to include hydrogen, ammonia, methanol and carbon storage projects.

In an emailed statement, the regulator said its role is to provide “sound regulatory oversight of the energy industry” and ensure companies comply with their permit conditions and B.C.’s laws. “We do not advocate for industry nor solicit economic development,” the regulator said.

Why will the regulator be overseeing more natural gas projects?

The majority of B.C.’s fossil fuel production is natural gas. Mostly composed of methane, the fuel, which is used for heating and energy generation, is a powerful greenhouse gas with 80 times more warming potential over a 20-year period than carbon dioxide.

Companies have been extracting natural gas in B.C. for decades, but activity has ramped up over the past dozen or so years. It’s projected to reach record highs in the next few years as new LNG export projects come online. That means the regulator will be overseeing far more natural gas projects.

The majority of natural gas extraction in B.C. takes place through hydraulic fracturing, commonly known as fracking. Fracking involves drilling into shale rock formations and injecting a mix of fresh water and chemicals to fracture the rock and release the gas.

Canada’s first LNG exports will be shipped this year, when the first phase of LNG Canada’s facility in Kitimat, B.C., starts operations. LNG Canada will receive gas from Coastal GasLink. The consortium of foreign-owned companies behind the project, including Shell, plans a second phase, doubling production, if it can secure investment.

More LNG developments are underway or proposed, and all fall under the purview of the energy regulator. Construction has started on Woodfibre LNG in Squamish, B.C., and Cedar LNG in Kitimat. The government is expected to decide whether to green-light the proposed Ksi Lisims LNG plant northwest of Terrace, B.C., near the Alaska border, and its feeder pipeline, the Prince Rupert Gas Transmission line, sometime in the next few months.

Do BCER inspectors always enforce regulations?

The BC Energy Regulator oversees all activity associated with fracking and LNG development, including construction of pipelines like the Prince Rupert Gas Transmission (PRGT) line. Yet the agency’s compliance and enforcement division includes just 17 inspectors, who report to seven supervisors.

The Narwhal, in collaboration with the Investigative Journalism Foundation, recently published five reports about the energy regulator’s compliance and enforcement department. In at least 1,000 instances, inspectors documented apparent environmental infractions but did not penalize the companies for breaking the rules.

The investigation into the regulator’s sometimes secretive approach to monitoring the fossil fuel industry in B.C. found the agency often notes when companies are breaking regulations or laws in hidden records but does not issue any official citations. Instead, it chooses to employ what it calls a “graduated enforcement model.” Critics call the method inadequate, suggesting the energy regulator has become “captured” by the industry it oversees.

The investigation also uncovered a regulator database of “serious leaks” at gas wells and an exemption granted to one of Canada’s biggest oil companies for more than 4,000 pipelines not compliant with regulations. Thousands of records describing problems at wells and pipelines — including dangerous levels of leaking gases and chemical spills affecting wildlife and livestock — were brought to light.

During the five-year period when the Coastal GasLink pipeline was being built by Calgary-based TC Energy, the regulator levied just $3,680 against the pipeline company for infractions. Meanwhile, the Environmental Assessment Office — the agency’s regulatory counterpart in the Ministry of Environment — fined Coastal GasLink more than $1 million for causing impacts to land, fish and wildlife during construction.

Why should British Columbians care about the BC Energy Regulator?

As the BC Energy Regulator takes on new responsibilities, it will continue to be the primary government agency in charge of all fossil fuel infrastructure. Fossil fuels are the largest contributor to global climate change, accounting for more than 75 per cent of global greenhouse gas emissions and nearly 90 per cent of all carbon dioxide emissions, according to the United Nations.

Climate change will directly cause an additional 250,000 deaths annually between 2030 and 2050, according to conservative predictions by the World Health Organization. It will disproportionately impact marginalized communities, meaning the brunt of it — including deaths — will be experienced by those least able to access support.

Oil and gas development such as fracking, pipelines and LNG export facilities also impact ecosystems and present risks to public health and safety. Studies have found fracking is linked to earthquakes, reproductive issues and groundwater contamination.

In northeast B.C., where most of the province’s natural gas comes from, Treaty 8 First Nations have witnessed the steady degradation of their lands for decades. In one instance a B.C. Supreme Court judge found the provincial government — including the regulator — guilty of infringing on Blueberry River First Nations’ treaty rights by permitting and encouraging so much resource development that community members were no longer able to hunt and fish.

— This story was originally published by The Narwhal

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