Discussion paper on the review of the Physical Activities Regulations

Introduction

The Impact Assessment Agency of Canada (IAAC) is reviewing the Physical Activities Regulations, commonly known as the Project List or the List, which initially came into force with the Impact Assessment Act (IAA) on August 28, 2019. The Project List identifies the types of activities that are considered “designated projects” and therefore subject to the IAA.

The IAA and its regulations form the legal framework for an efficient and effective federal review process of designated projects, including certain clean energy, critical minerals, and transportation projects, in a manner that ensures environmental protection, provides meaningful participation opportunities for the public and Indigenous peoples, and that supports investment to drive clean growth.

The purpose of the IAA is to prevent or mitigate significant adverse effects within federal jurisdiction that may be caused by the carrying out of designated projects. If IAAC determines that an impact assessment is required, then the impact assessment will take into account the positive and adverse environmental, economic, social, and health impacts of these major projects and focus on the prevention and mitigation of significant adverse effects and cumulative effects within federal jurisdiction. Assessments are informed by Indigenous Knowledge and include tools to reduce duplication and promote cooperation among jurisdictions and with Indigenous peoples.

The IAA applies only to major projects. On average, about ten designated projects per year will enter the IAA process, though not all of those will require a full impact assessment as they may be screened out by IAAC under section 16 following the planning phase (see below “Overview of Project Designation and IAA Process” and Annex 1, Summary of Implementation Experience). The objective of the Project List is to identify those major projects with the greatest potential for adverse effects on areas of federal jurisdiction, so that they can enter the impact assessment process. It provides clarity to proponents, investors, the public and Indigenous groups as to which projects are subject to the IAA.

The IAA requires that the Project List be reviewed within a prescribed period, which is prescribed in the Project List regulation as five years after the coming into force of the regulation, by August 2024. The intent of the regulatory review is to ensure, based on implementation experience, that it is still meeting the objective of focusing assessments on those major projects that are most likely to cause adverse effects in federal jurisdiction, and of focusing resources 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 IAA was amended in June 2024 to respond to the October 13, 2023 decision by the Supreme Court of Canada which found that parts of the IAA went beyond federal jurisdiction under the Constitution. Among other important changes, the amendments narrowed the definition of effects within federal jurisdiction and increased reliance on provincial processes and cooperation in federal assessment, so the Project List must now also be reviewed to ensure that it aligns with these features of the amended Act.

The amendments were also part of broader Government of Canada initiatives to improve the efficiency of the impact assessment and permitting processes for major projects. These are set out in Building Canada’s Clean Future. The measures outlined in this plan will reduce duplication, improve predictability and transparency, and increase the efficiency of Canada’s regulatory system for clean growth projects. Included among these measures is the new Cabinet Directive on Regulatory and Permitting Efficiency for Clean Growth Projects. Both the Plan and the Directive emphasize the value of, and commitment to, Canada’s rigorous environmental protection regime, but recognize the urgent need to improve its efficiency through reducing duplication and improving coordination. Accordingly, this lens must also be applied to the Project List review.

Together with the recent amendments to the IAA, these initiatives will ensure more efficient impact assessments in several important ways. The amendments allow more flexibility for coordination with provinces to allow for “one project, one assessment” and they require IAAC to rely more on provincial processes to satisfy the requirements of the IAA. They also provide, through the new federal Clean Growth Office, new opportunities for coordination of impact assessment requirements with other permitting requirements, and for improved coordination of Crown consultations, to improve overall timelines. The Plan and Directive set clear targets for completion of assessments and permitting of five years for designated projects, and two years for projects that are not subject to the IAA. Meeting these targets will require IAAC and federal partners to take a more risk-informed approach to scoping assessment requirements, right-sizing them to designated projects and focussing in on those federal effects that are most likely to be significant.

It is in this context, and in consideration of the first five years of implementation experience under the IAA, that IAAC initiated the review of the Project List. This Discussion Paper sets out options for consultation with the overriding policy objectives of ensuring that the Project List provides certainty as to which projects will be subject to the IAA; focusses federal assessment on those projects with the greatest potential for adverse effects in federal jurisdiction - as defined in the IAA as amended in 2024; and that it focusses resources where federal impact assessment will add value over other regulatory processes. The objective of the Discussion Paper is to initiate public engagement and seek your views on the options for changes to the Project List. Your input will inform a regulatory proposal this Fall.

We are inviting feedback on this Discussion Paper from July 30, 2024, to September 27, 2024.

1. Background

1.1 Overview of Project Designation and IAA Process

The Physical Activities Regulations (Project List) are Governor in Council regulations that function as the principal mechanism for determining which major projects will be subject to the federal impact assessment process. In exceptional circumstances, the Minister of the Environment and Climate Change may, under section 9 of the IAA, designate a project that is not described on the Project List when that project may cause adverse effects within federal jurisdiction, and considering other factors such as whether other processes exist that could address those effects. Despite many external requests for projects to be designated, this authority has only been used exceptionally (see Annex 1, Summary of Implementation Experience), and the recent amendments to the IAA in response to the SCC decision narrow the authority further.

Each physical activity listed on the Project List includes a description and, in most cases, a corresponding threshold (often production capacity) which serves as a representation of the scale or size of a project at which it is most likely to result in adverse effects in federal areas. Proposed physical activities that match the description and meet or exceed the established threshold for the project type are considered ‘designated projects’ and are subject to the IAA. This approach provides certainty and clarity to proponents and others about which projects are subject to federal review.

Proponents of designated projects must enter the planning phase and provide IAAC with an Initial Project Description. IAAC then engages the public and Indigenous groups as part of the planning phase, which may last up to 180 days, and determines, under section 16, if a full impact assessment is required for that project and if so, the scope of that assessment. In response to the SCC decision, the recent amendments further focus the s. 16 decision to require IAAC to find that there are likely to be adverse effects within federal jurisdiction before a full impact assessment can be required and require IAAC to consider whether other federal or provincial processes could address those effects. The amendments also allow the s. 16 decision to be made earlier in the planning phase to allow for more efficiency in the process. In practice, approximately one third of designated projects that have entered the IAA process have not required a full impact assessment under s. 16 (see Annex 1, Summary of implementation experience).

Impact assessment is a project planning tool that helps to identify potential harm and benefits before major projects are built, to ensure environmental protection and protection of Indigenous rights, and to provide a forum for public input and for meaningful consultation, engagement and partnership with Indigenous peoples. It is a key element of a larger regulatory landscape for addressing environmental effects, working alongside other regulatory processes at the federal, provincial, and territorial levels, with complementary roles. These include federal regulations or general prohibitions under, for example, the Fisheries Act, Migratory Bird Convention Act, 1994, Canadian Navigable Waters Act, Species at Risk Act or Canadian Environmental Protection Act, 1999 that deal with discrete areas of federal jurisdiction. Lifecycle regulators, including the Canadian Nuclear Safety Commission (CNSC), also play a key role in assessing potential impacts of projects though integrated assessments under the IAA whereby both assessment and licensing requirements are fulfilled though the same process by integrated review panels. Building Canada’s Clean Future sets a target of ensuring that impact assessment and permitting processes for designated projects are completed within five years, and that integrated assessments/licensing of nuclear projects are completed within three years.

1.2 Supreme Court of Canada Decision on the Impact Assessment Act

On October 13, 2023, the Supreme Court of Canada issued a decision on a reference question relating to the constitutionality of the federal impact assessment regime under the IAA. The Court found that parts of the IAA as originally written were unconstitutional, going beyond Canada’s authority to legislate under the heads of power set out in the Constitution. The Government introduced amendments, which received Royal Assent in Parliament and came into force on June 20, 2024, to directly respond to the Court’s decision, ensure the IAA aligns with constitutional authorities, and restore certainty in federal impact assessment.

The Court confirmed that the environment, and impact assessments in particular, are areas of shared jurisdiction between the federal and provincial legislatures under the Constitution. The Court’s decision confirmed that Parliament can enact impact assessment legislation to “minimize the risks that some major projects pose to the environment,” including for provincially regulated projects, as long as the focus of decision-making and the setting of conditions is on preventing and mitigating adverse effects on areas of federal jurisdiction.

The Court confirmed that the Project List approach to identifying the kinds of activities that are subject to the IAA is constitutionally sound, including designation of projects that may be primarily provincially regulated, provided that designation is grounded in the potential for non-negligible[i] adverse effects within federal jurisdiction.

The amended IAA provides greater clarity that projects can only be designated on the Project List if, in the Governor in Council’s opinion, they may cause non-negligible adverse effects within federal jurisdiction. The amended definition of “adverse effects within federal jurisdiction”, described in part 3.1 below, also ensures that these effects are clearly linked to federal matters under the Constitution and meet a minimum threshold of causing non-negligible changes to those federal matters as directed by the Supreme Court.

1.3 Overview of the 2019 Project List

The Project List was created in 2019 following substantial research and consultations with Indigenous communities, industry, provinces, territories, environmental non-governmental organizations, and the public.

It was developed using a criteria-based approach that required a project type to have the greatest potential for adverse effects in areas of federal jurisdiction related to the environment. Effects in areas of federal jurisdiction were analyzed based on past environmental assessments, scientific literature, and consultations with expert federal government departments to determine the potential level of effects and the complexity of each project type. It is also based upon previous experience implementing the Project List that existed under the Canadian Environmental Assessment Act, 2012 (CEAA 2012), and its predecessor, the Comprehensive Study List Regulations under the Canadian Environmental Assessment Act, 1992. More information on the approach to developing the Project List in 2019 is outlined in the 2019 Discussion Paper.

The 2019 List better focused federal resources on the assessment of major projects where impact assessment most adds value beyond other federal and provincial processes, such as by providing a process for integrated assessment of multiple complex effects and mitigation measures, coordination of federal permitting and harmonization among jurisdictions, providing a transparent and structured forum for public engagement, and a single window for Crown consultation. In so doing, the 2019 List reduced the scope of projects that are subject to federal assessment as compared to under CEAA 2012.

The 2019 Project List contains 61 entries that cover 10 different sectors: national parks and protected areas, defence, mines and mills, nuclear facilities, oil and gas, transmission lines and pipelines, renewable energy, transportation, hazardous waste, and water projects. Approximately two-thirds of these are project types that are carried out on federal lands or are federal works or undertakings, as defined in subsection 3(1) of the Canadian Environmental Protection Act, 1999, which, as the Supreme Court’s decision confirmed, are projects over which the federal government has broad decision-making jurisdiction. One-third are project types that are primarily provincially regulated and have the potential for adverse effects on areas of federal jurisdiction, such as fish and fish habitat, migratory birds, and impacts on Indigenous peoples. For the latter project types, the Supreme Court’s decision directed that federal decisions be focused only on those federal effects, and the recent amendments to the IAA ensure that they are.

2. We Want Your Input: Project Review Process and Consultations

IAAC is taking a phased approach to the review of the Project List. During the first phase, in mid-2023, IAAC gathered initial feedback from federal expert departments and analyzed its own experience implementing the IAA between 2019 and 2023. This included identification of Government priorities, information gaps, emerging sectors and new technologies, and regulatory and legislative changes.

During phase 2, in the fall of 2023, IAAC conducted targeted engagement, inviting early feedback from key stakeholders, national Indigenous organizations, provincial counterparts, and three advisory bodies under the IAA (the Minister’s Advisory Council on Impact Assessment, the Technical Advisory Committee on Science and Knowledge and the Indigenous Advisory Committee). During this phase, IAAC used targeted questions and bilateral meetings to identify participants’ experience, knowledge, and priorities regarding projects currently designated on the Project List and to identify proposals for changes. Following the Supreme Court’s decision, IAAC also analyzed each entry on the List against the Court’s decision and the amended definition of effects in federal jurisdiction to ensure that the threshold for inclusion on the List is met for each entry.

The options for consultation outlined in this Discussion Paper reflect this analysis and the feedback from the first two phases of review.

The current public comment period provides the public, stakeholders, and Indigenous groups with an opportunity to provide input on options for consultation. This will inform recommendations and conclusions to be set out in a report to the Minister of Environment and Climate Change. Proposed regulatory changes resulting from the review will follow the usual regulatory development and approval process for Governor in Council regulations, including publishing draft regulatory text through Canada Gazette, Part I for public comment.

We are inviting feedback on this Discussion Paper from July 30, 2024, to September 27, 2024.

3. Approach to Reviewing the Project List

IAAC is committed to regularly reviewing its regulations and is undertaking a review of the Project List as required five years after the coming into force of the regulations (see section 111 of the IAA and section 3 of the Physical Activities Regulations).

The objective of this review is to ensure the Project List:

• provides certainty as to which projects will be subject to the IAA;
• is appropriate in scope and focusses federal assessment on those projects with the greatest potential for adverse effects within federal jurisdiction - as defined in the IAA, as amended in 2024;
• focusses resources where federal impact assessment will add value over other regulatory processes and as such reduces duplication; and
• supports the Government of Canada’s clean growth agenda.

3.1 Adverse effects within federal jurisdiction:

Under the amended definitions in the IAA, adverse effects within federal jurisdiction include:

• Non-negligible adverse changes to:
  • fish and fish habitat;
  • aquatic species as defined in the Species at Risk Act;
  • migratory birds;
  • federal lands;
  • the marine environment and transboundary waters, from transboundary pollution;
  • with respect to the Indigenous peoples of Canada, impacts from changes to the environment on physical and cultural heritage, current use of lands and resources for traditional purposes, or any structure, site or thing that is of historical, archaeological, paleontological, or architectural significance; and
  • health, social or economic conditions of Indigenous peoples of Canada.

In the case of projects on federal lands or which are federal works or undertakings, such as nuclear projects, navigation canals, projects in national parks, defence projects, federally regulated rail, federally regulated ports, airports, interprovincial and international pipelines and transmission lines, and offshore projects, where the federal government has broad jurisdiction, adverse effects in federal jurisdiction are defined more broadly and include non-negligible adverse changes to the environment or to health, social or economic conditions.

3.2 Scope of the Review:

Using the 2019 Project List as a baseline, the review is focused on:

• ensuring alignment with the Supreme Court’s decision and 2024 amendments to the IAA;
• IAAC experience in implementing the IAA, including trends in requests for Ministerial designation under s. 9, and projects for which IAAC determined that a full impact assessment was not required following the planning phase under s.16;
• expert advice of federal departments;
• changes that may merit targeted adjustments to thresholds or project types (e.g., emerging sectors, technological change, or changes in the regulatory environment);
• technical changes to align definitions or clarify terminology;
• stakeholder and Indigenous feedback;
• ensuring that the federal assessment process adds value above other applicable federal and provincial processes; and
• ensuring that it aligns with the Government of Canada’s clean growth agenda.

When considering new project types that are not on the current Project List, we undertook analysis to determine whether a project type is likely to cause adverse and complex effects in areas of federal jurisdiction related to the environment, and considered where value may be added above other applicable federal and provincial processes.

The following are the results of the above approach, and we would welcome your views on definitions or key concepts that would help clarify any of the existing entries or proposed amendments.

4. Options for consultation

Project types are organized by sector with a brief overview of the potential effects and the regulatory lens for each sector. Linkages to the scope of the Project List review and options for consultation are then summarized.

4.1 Federal Lands and Protected Areas

The Project List includes the following projects on federal lands or federal protected areas:

• In a National Wildlife Area, a Migratory Bird Sanctuary, or a protected marine area:
  • Electrical generating facilities or electrical transmission lines;
  • Dams, dykes or reservoirs for the diversion of water;
  • Oil or gas facilities or pipelines;
  • Mines or mills;
  • Industrial facilities;
  • Canals or locks;
  • Marine terminals;
  • Railway lines;
  • Public road or parkway;
  • Aerodromes or runways;
  • Waste management facilities; or
  • Aquaculture facilities.
• New physical work (e.g., facilities and structures) on Parks Canada managed land that is contrary to its management plan or its ski area site guidelines;
• In National Marine Conservation Areas, pipelines, disposals at sea or works (e.g., facilities and structures) that are contrary to its management plan;
• In a National Park:
  • Dams or other structures for water supply outside the park or for recreational or power generation purposes;
  • Water supply agreements under the Canada National Parks Act or expansions by more than 20 percent of existing water supply agreements;
  • Commercial development, that requires disposal or occupation of land in Banff, Jasper, Yoho, or Kootenay National Parks outside the town sites and ski areas that has not been subject to strategic environmental assessment and public review as part of a park management plan; or
  • Railway line, public road, or parkway.
• The following defence projects:
  • Military base or station established for more than 12 consecutive months;
  • Expansion of a military base or station by 50 percent or more;
  • Decommissioning and abandonment of a military base or station;
  • Military training area, range or test establishment established for more than 12 consecutive months, outside an existing military base;
  • Testing of military weapons for more than five days in a year outside training areas, ranges, and test establishments; or
  • Low-level flying of military fixed-wing jet aircraft for more than 150 days a year as part of a training program at an altitude below 330 m above ground level in and area not set aside for that purpose.

Overview

The federal government exercises primary jurisdiction over federal lands including nationally protected lands, and offshore and coastal federal lands. Because of this, effects within federal jurisdiction resulting from projects on these lands include those to the land, water, air, all flora and fauna, as well as potential impacts to Indigenous peoples and their rights, and health, social and economic effects for Indigenous and non-Indigenous communities.

The federal government has established several types of areas to protect and conserve the environment. These include national parks and other lands managed by the Parks Canada Agency, National Wildlife Areas, Migratory Bird Sanctuaries, and conservation areas in the marine environment. For some types of projects in these areas, impact assessments can help support the government’s protection and conservation objectives.

For projects on federal lands that are not described on the Project List, the IAA, under section 82, requires federal authorities to conduct an environmental effects evaluation to determine whether the project would be likely to result in significant adverse environmental effects, before taking any action that would allow the project to proceed.

Considerations within Scope of the Review

Since the IAA entered into force, there has been one designation request for a military test establishment project, which did not result in designation under the IAA.

Feedback from early engagement included suggestions to add new project types on federal lands because these are clearly within federal jurisdiction and to expand the Project List to include other types of sensitive lands, such as critical habitat on federal lands, that may have federal conservation or protection objectives. Feedback also suggested that in certain sensitive federal lands, there is a risk of adverse impacts caused by activities adjacent to these lands.

In addition, there were suggestions to add projects such as solar, hydrogen, peat mining, carbon capture and storage and onshore wind, which, when proposed on federal lands where provincial assessment may not apply, could cause significant adverse effects in areas of federal jurisdiction.

For example, input for onshore wind projects suggested adverse effects on biodiversity from these projects (notably habitat loss, bats, and migratory birds). Input also suggests these projects may impact species under the Species at Risk Act.

Peat projects on federal lands may have effects on birds, aquatic species, species under the Species at Risk Act, greenhouse gas implications, as well as impacts on Indigenous peoples and their rights. Solar power generation on federal lands may cause adverse effects on birds and bats. Hydrogen production concerns were raised due to lack of clear understanding of impacts on fish and their habitat.

The Government of Canada’s clean growth objectives could lead to more complex projects being proposed on federal lands where a provincial assessment may not apply. The impact assessment process could provide a consistent and predictable approach to assessing these projects and meeting government objectives.

Options for consultation

Consider amendments to:

• expand the list of activities within sensitive federal lands (e.g., adding peat mining, solar, onshore wind, hydrogen production activities when proposed above a certain threshold to avoid adding low-risk projects to the List); and
• expand the list of sensitive federally protected lands (i.e., lands with conservation or protection objectives) where designated projects will be subject to an impact assessment, in addition to those already listed in sections 1-11 of the Project List.

4.2 Mines and Metal Mills

Mining and metal mill projects described on the Project List include:

• coal mines with a production capacity of 5000 t/day or more;
• diamond mines with an ore production capacity of 5000 t/day or more;
• metal mines with an ore production capacity of 5000 t/day or more;
• metal mills with an ore input capacity of 5000 t/day or more;
• rare earth element mines with an ore production capacity of 2500 t/day or more;
• stone quarry or sand or gravel pits with a production capacity of 3 500 000 t/year or more;
• uranium mines with an ore production capacity of 2500 t/day or more;
• uranium mills with an ore input capacity of 2500 t/day or more; and
• oil sands mines with a bitumen production capacity of 10 000 m³/day or more.

Overview

Mining projects have the potential to cause adverse effects on multiple areas of federal jurisdiction, including fish and fish habitat, aquatic species as defined in the Species at Risk Act, and migratory birds as a result of land clearance, handling of waste rocks and tailings, surface runoff, changes to water flow, potential infill, realignment of streams, and associated activities required to access mines, transport materials, and conduct onsite activities. In addition, uranium mines could also contain significant concentrations of radioactive elements (primarily thorium-230 and radium-226, along with their associated decay products) that require long term management to avoid potential adverse effects on fish and fish habitat and migratory birds. Depending on their location, many mining projects have the potential to impact Indigenous peoples and their rights.

Mining is regulated at the provincial level and projects are typically subject to provincial assessment processes. Despite being a provincially regulated activity (apart from uranium mining), mining activities are frequently subject to federal permits due to their potential to cause adverse effects to areas under federal jurisdiction (e.g., Fisheries Act, Migratory Birds Convention Act, Explosives Act, Canadian Navigable Waters Act). Metal and diamond mines are also subject to the Metal and Diamond Mining Effluent Regulations, under the Fisheries Act. Uranium mines are regulated by a lifecycle regulator, the CNSC. Uranium mines and mills not subject to IAA would continue to be subject to the CNSC’s regulatory regime throughout their lifecycle.

Considerations within Scope of the Review

Around 50 percent of projects currently undergoing a federal impact assessment, either under the IAA or continuing under CEAA 2012, are mines. There has been a total of 15 mining projects that have come into the IAA process since 2019. Ten of these projects have been metal mines (most of them gold mines), three are coal mines, one is a rare earth element mine, and one is an oil sands mine.

However, no coal mine project has met the Project List thresholds since they were increased in 2019. Thus, the coal mine projects entered the IAA system through designation requests to the Minister. These requests were received primarily from Indigenous groups citing the potential impacts on Indigenous peoples and their Aboriginal and treaty rights, and adverse environmental effects in areas of federal jurisdiction, mostly due to selenium impacts on water and fish.

Through this lens, returning to a lower threshold for new and expansions of coal mining projects may both reduce the number of designation requests received by the Minister and provide more certainty to industry, Indigenous groups, other stakeholders and the public.

For uranium mines proposed on existing licensed sites, regulation and environmental monitoring by the life cycle regulator may result in regulatory overlap with the IAA. The environmental effects of existing operating uranium mines are well understood and regulated, and requiring a federal impact assessment for the expansion of mines may be unnecessary to mitigate potential adverse effects in federal jurisdiction.

During early engagement, we heard different, and sometimes conflicting, views related to mining. We heard suggestions to differentiate between brownfield and greenfield mining, raising thresholds for certain types of mining such as copper, nickel, zinc, and rare earth element mines as well as removing uranium mines from the List. Others have suggested decreasing mining thresholds to capture more mines that may have effects under federal jurisdiction, particularly coal projects. We also heard calls to remove mining projects from the List entirely and rely on provincial governments to regulate this sector.

Analysis of these entries suggested adding more clarity to the List. For example, by adding or adjusting definitions and mining terminology.

The Government of Canada recognizes the importance of economically and environmentally sustainable development of natural resources to help achieve a net zero economy. Critical minerals, for example, remain vital to the production of essential technologies like electric vehicle batteries, semiconductors, and green energy systems. Within this context, the Government of Canada has developed the Canadian Critical Minerals Strategy to provide a clear roadmap for advancing development of critical minerals (e.g., lithium, nickel, cobalt, copper, rare earth elements and graphite) and associated technologies. This strategy also highlights the importance of collaboration on federal impact assessments as well as informed participation and decision-making, and high environmental standards for critical mineral projects. Federal impact assessment can therefore add value for assessing major critical mineral mining projects.

Options for consultation

Consider amendments to:

• lower thresholds, including expansions, for coal projects to return to thresholds applied under CEAA 2012 (3000 t/day) and to capture large expansion of existing coal mines; and
• exclude uranium mine expansions on licensed sites.

In addition to these options, some technical amendments could also be made to provide clarification on definitions and thresholds. For example, additional clarity may be necessary to specify that re-opening existing mining sites (that are not expansions) would not be considered a new mine.

4.3 Nuclear Facilities, Including Certain Storage and Long-Term Management or Disposal Facilities

Nuclear facilities described on the Project List include:

• nuclear reactors with a combined thermal capacity of more than 900 Megawatts thermal (MWth) on a Class 1A licensed site and 200 MWth outside licensed Class 1A sites;
• storage facilities for nuclear waste outside licensed boundaries of an existing nuclear facility;
• facilities for the long-term management or disposal of nuclear waste;
• facilities for processing, reprocessing or separation of isotopes of uranium, thorium or plutonium with a production capacity of 100 t/year or more;
• facilities for the manufacture of products derived from uranium, thorium or plutonium with a production capacity of 100 t/year or more; and
• facilities for processing or use of a nuclear substance other than uranium, thorium or plutonium with a half-life greater than one year, in a quantity of more than 10¹⁵ becquerels/year.

Overview

Because nuclear projects are federally regulated, effects within federal jurisdiction include environmental effects to the land, water, air, all flora, and fauna, as well as potential impacts to Indigenous peoples and their rights, and health, social and economic effects for Indigenous and non-Indigenous communities. The Canadian Nuclear Safety Commission (CNSC), through the Nuclear Safety and Control Act (NSCA), regulates the use of nuclear energy and materials to protect health, safety, security, and the environment. The CNSC’s Regulatory Framework and regulatory oversight are internationally peer-reviewed and well-respected.

The construction and operation of nuclear projects, including site preparation, has the potential to cause adverse environmental effects such as changes to fish and fish habitat, direct mortality to aquatic species, birds and changes to water flow or levels. They also have the potential to cause adverse effects to human health, cause socio-economic effects, and cause cumulative adverse effects. As a lifecycle regulator, CNSC assesses potential environmental and health effects at the initial licensing stage and monitors throughout the lifecycle of the project through compliance oversight of nuclear facilities. For major nuclear projects, the IAA can provide added value in its consideration of a broader scope of effects within federal jurisdiction, a prescribed legislative framework for public and Indigenous engagement, and for a public interest decision to be made on those effects.

The IAA established a scheme for integrated review panels with the CNSC, with IAAC as the single window to lead assessments and Crown consultation on nuclear projects. Integrated reviews under the IAA incorporate licensing requirements under the NSCA so that a decision statement under the IAA and a license issued by the CNSC follows a single integrated assessment. Should the project proceed, the CNSC continues its regulatory oversight throughout the project life cycle. The recent amendments to the IAA clarified that agreements can also be made with provinces to be part of integrated review panels. As part of the plan outlined in Building Canada’s Clean Future, efficiency-enhancing steps to support clean growth in the nuclear sector are being implemented. This includes a three-year target for the conduct of integrated assessments for nuclear projects. IAAC and the CNSC are collaborating closely to ensure readiness to meet this target and to support proponents in their role in ensuring an efficient integrated assessment process.

Considerations within Scope of the Review

Nuclear energy projects – both large and small - represent a strategic opportunity for Canada, and are necessary, to advancing Canada’s clean growth objectives. Timely deployment of new nuclear power will be required for Canada to meet its objective of moving the electricity grid towards net-zero by 2035 and achieving a net-zero emissions economy by 2050.

In terms of IAA implementation experience, to date no nuclear projects have entered the IAA process, but there are several new reactor projects that are likely to seek regulatory approval in the coming years. The Minister has considered requests under s. 9 to designate one nuclear reactor project and determined it did not warrant designation.

The thresholds established in 2019 were designed to capture nuclear development at lower thresholds on greenfield sites, exclude most single small modular reactor (SMR) development on already licensed sites (but may capture groups of SMRs that collectively meet the threshold), and to capture large-scale nuclear reactors on already licensed sites. Since 2019, there have been two notable shifts in the sector: an apparent down-selection in SMR technologies; and a greater interest in the deployment of large-scale nuclear reactors to address the existential threat of climate change.

During early engagement, some commenters suggested that all reactor projects, regardless of size or location, should be added to the List. Others suggested exemptions to further distinguish between activities on greenfield sites from those on already licensed sites, given that CNSC lifecycle oversight on already licensed sites includes security plans, off-site emergency preparedness arrangements, an environmental risk assessment and environmental monitoring.

In addition, some commenters suggested removing several nuclear projects, including large and small new nuclear reactor projects on brownfield fossil fuel electricity sites, from the Project List. To displace high-emitting energy sources with clean energy, there is potential to re-purpose these brownfields rather than pursuing industrial development on undisturbed greenfield sites. In some of these cases, the nuclear technology may already have undergone a licensing review, and the effects of other types of electricity generation on the sites may already be well characterized and studied.

Given the considerations above around already licensed sites, and emerging plans to deploy these technologies, raising thresholds for multiple SMRs and exempting all single SMRs proposed on already licensed sites may better focus assessment resources where assessments would add value.

IAAC is also inviting broader comment on the suggestions we heard to raise thresholds for, or remove from the List, new large-scale reactors using known technology (e.g., a technology licensed by CNSC) and that are on already licensed sites. In this event, projects that are no longer designated would still be subject to Environmental Protection Reviews by the CNSC under the NSCA. All greenfield deployment of reactors above the threshold would continue to be subject to integrated assessments under the IAA. Consideration would also need to be given to process continuity for any assessments already underway.

With respect to opportunities to develop nuclear energy on sites previously used for fossil fuel electricity generation, IAAC invites comments on whether a study or other mechanism could be useful in considering the potential residual or incremental effects of a change to using licensed nuclear technology on fossil fuel brownfields. This undertaking could in turn inform scoping of future assessments to make them more efficient, standard mitigation measures, and/or a potential exemption from the List or threshold changes.

Options for consultation

Consider amendments to:

• exempt all single SMR proposals using previously licensed technologies when proposed on Class 1A licensed sites; and
• explore increasing thresholds or other basis for exempting multiple SMRs using previously licensed technologies when proposed on Class 1A licensed sites.

Alternatively, we are seeking views on exploring a basis for:

• removing all SMR as well as large-scale nuclear reactors using known technologies (e.g., a technology licensed by CNSC) when proposed on Class 1A licensed sites; and
• exempting or scoping down assessments of nuclear projects using known technologies when proposed on brownfield fossil fuel electricity generating sites.

4.4 Oil, Gas and Other Fossil Fuels

Oil and gas related projects described on the Project List include:

• fossil fuel-fired facilities with a production capacity of 200 MW or more;
• in situ oil sands extraction facilities with a bitumen production capacity of 2 000 m³/day or more, in a province without provincial legislation to limit greenhouse gas emissions from oil sands;
• offshore exploratory wells;
• offshore production of oil or gas;
• oil refineries with an input capacity of 10000m³/day or more;
• liquified natural gas (LNG) facilities with a minimum processing capacity of 3000 t/day or storage capacity of 136 000m³ or more;
• facilities that produce liquified petroleum products from coal with a production capacity of 2000 m³/day or more;
• sour gas facilities of 2000 t/day or more;
• petroleum storage facilities with a capacity of 500 000 m³ or more; and
• natural gas liquid storage facilities with a capacity of 100 000 m³ or more.

Overview

Projects that process or consume large quantities of oil and gas may lead to adverse effects in areas of federal jurisdiction, such as effects on fish and fish habitat and migratory birds through land disturbance and water pollution from accidental spills.

Provinces are the primary regulators of these projects, and in many cases, they would undergo a provincial environmental assessment. Under the Atlantic Accord Acts, which establish a joint management regime for the Atlantic offshore, oil and gas exploration and production is regulated by the Canada-Nova Scotia Offshore Petroleum Board and the Canada-Newfoundland and Labrador Offshore Petroleum Board (the Offshore Boards).

Under the IAA, regulations exclude exploratory drilling projects from a project-specific federal impact assessment in an area of the Canada Newfoundland and Labrador offshore as long as those projects respect the mitigation and follow-up measures described in the Regulations Respecting Excluded Physical Activities (Newfoundland and Labrador Offshore Exploratory Wells).

Other regulations that may apply to these projects include federal regulations protecting fish and fish habitat and migratory birds, and regulations under the Canadian Environmental Protection Act, 1999 that specifically regulate greenhouse gas emissions from coal-fired and natural gas-fired electricity, as well as methane (a potent greenhouse gas) and air pollutant emissions from some oil and gas facilities and related equipment.

Considerations within Scope of the Review

The in situ oil sands facility entry specifies that these projects are designated only in situations where provinces do not have legal frameworks to limit the amount of greenhouse gas emissions from these projects. However, given the current provincial emissions cap in place where these projects are proposed, in practice this entry has not captured any in situ oil sands extraction facility since its introduction in 2019, nor is it expected to apply in the future. One of the options for consultation is that this entry be removed from the List given the existing provincial legal frameworks in place.

In addition, other types of designated oil and gas projects that entered the planning phase were among the project types screened out under s. 16 most often, without requiring a full impact assessment. Of the five fossil fuel-fired power generating facility projects that have entered the IAA process, three have been screened out because the potential adverse effects in areas of federal jurisdiction would be limited or sufficiently addressed through other existing federal and provincial legislative and regulatory frameworks. This is not a new trend for this sector. All six fossil fuel-fired power generating facility projects that came in under CEAA 2012 were screened out for similar reasons.

Feedback received during early engagement suggested removing fossil fuel power generating facilities and in situ oil sands facilities given their low potential for requiring federal permits and authorizations. Conversely, we also heard suggestions to capture more oil and gas projects because of their contribution to greenhouse gas emissions and potential impacts on Indigenous peoples, including retaining or expanding the entry on in situ oil sands facilities.

Other suggestions include adding non-green hydrogen to the List, as it is produced from using fossil fuels. Concerns were also raised regarding the transportation of hydrogen.

We have seen that federal assessment adds value to certain oil and gas projects such as LNG and offshore oil and gas, where adverse effects in federal jurisdiction, such as effects to fish and fish habitat, marine pollution, and effects on federal lands for offshore activities, are more likely.

Options for consultation

Consider amendments to:

• remove in situ oil sands facilities from the List; and
• remove fossil fuel-fired power generating facilities from the List.

4.5 Electrical Transmission Lines and Pipelines

Electrical transmission line and pipeline projects described on the List include:

• international transmission lines with a voltage of 345 kV or more that require 75 km or more of new right of way;
• federally regulated interprovincial electrical transmission lines;
• certain offshore oil and gas pipelines; and
• international and interprovincial pipelines that require 75 km or more of new right of way.

Overview

Transmission lines and pipelines are linear projects that run over long distances. Potential adverse effects associated with linear projects are linked to habitat loss and disturbance along their right of way. Pipeline projects pose additional risk such as spills and runoff of chemical products.

Electrical power lines that cross provincial or international borders and require an assessment by the Canada Energy Regulator under the Canadian Energy Regulator Act, or pipelines that cross provincial or international boundaries, are federally regulated and are described on the Project List. Transmission lines or oil and gas pipeline projects which are located completely within one province are provincially regulated and are not subject to federal impact assessment.

Considerations within Scope of Review

No electrical transmission line projects have been assessed under the IAA. An integrated assessment was commenced for one pipeline project and was later terminated. The Minister has received one request to designate a pipeline project and determined that designation was not warranted.

Feedback received during early engagement suggested designating interprovincial electrical transmission lines, regardless of whether they are federally regulated, and ensuring hydrogen and ammonia pipelines in addition to oil and gas pipelines, are captured.

Based on experience implementing the IAA to date, it appears that the current Project List entries for electrical transmission lines and pipelines are meeting the objective of focusing federal assessment on projects with the greatest potential for adverse environmental effects in areas of federal jurisdiction, and in areas where federal assessment adds value beyond federal regulatory oversight and provincial processes.

Options for consultation

Consider amendments to:

• ensure the definition of pipeline is consistent across entries to capture a range of commodities.

4.6 Renewable Energy Projects

Renewable energy projects described on the Project List include:

• hydroelectric generating facilities with a production capacity of 200 MW or more;
• instream tidal power generating facilities with a production capacity of 15 MW or more or all non-instream tidal projects; and
• wind power generating facilities in the offshore and in boundary waters with 10 or more wind turbines.

Overview

Renewable energy projects such as wind, solar, tidal, wave and hydroelectricity represent a strategic opportunity to advance Canada’s clean growth objectives and are anticipated to increase in number in coming years. The federal impact assessment process can add value and help support the development of these projects by providing a process for coordinated assessment of multiple adverse effects and mitigation measures, coordination of federal permitting and harmonization among jurisdictions, providing a transparent and structured forum for public engagement, and a single window for Crown consultation.

Provinces regulate hydroelectric projects and typically require environmental assessments. Other renewable projects such as onshore wind, biorefineries and solar are also regulated at the provincial level. Under the Canadian Energy Regulator Act, the Canada Energy Regulator regulates wind and tidal projects in many federal offshore areas. Proposed changes to the Atlantic Accord Acts, which establish a joint management regime with Newfoundland and Labrador and Nova Scotia in the offshore, would expand the mandate of the Offshore Boards to include renewable energy such as offshore wind and tidal.

Some types of renewable energy projects are currently included on the List based on their potential to cause adverse environmental effects in areas of federal jurisdiction, such as from land clearing, in-water works degrading fish habitat, changes to water flow or levels, direct mortality of fish, effects on aquatic species as defined in the Species at Risk Act and effects to migratory birds.

Considerations within Scope of the Review

Since 2019, one hydroelectricity generating facility was subject to the IAA. In addition, designation requests were received for a wind power and hydrogen generation project as well as an onshore wind project, and neither were designated by the Minister.

While no offshore wind project has yet been proposed at the Project List thresholds, these projects are anticipated in the future. There are two Regional Assessments on offshore wind currently underway for the Canada-Nova Scotia and Canada-Newfoundland and Labrador areas under the IAA, which will help inform future project-specific federal impact assessments and decisions for offshore wind projects in the study areas. Expert analysis and input suggest that, to ensure the most efficient assessment process, proposed offshore wind projects must have secured a seabed license, prior to coming into the IAA process.

IAAC also heard suggestions to add large onshore wind projects, biorefineries and solar projects to the List due to their potential for adverse effects on migratory birds and species at risk, as well as potential for impacts to Indigenous peoples and their rights.

These projects are provincially regulated. However, when proposed on sensitive federal lands where provincial assessment may not apply, and where a broader range of adverse effects could be considered, there may be value in assessing them under the IAA (see Federal Lands and Protected Areas section).

Expert input also suggested that wave energy devices may benefit from the IAA process, alongside tidal stream devices, since preliminary examination of the technologies suggest that they could cause adverse effects in areas of federal jurisdiction.

Options for consultation

Consider amendments to:

• add wave energy projects, consistent with other offshore renewables on the List, given their potential to cause adverse effects in areas of federal jurisdiction; and
• clarify that proposed offshore wind projects must have secured a seabed license prior to being subject to the IAA process.

In addition to these options, technical amendments are being considered to provide clarification on definitions, for example by aligning the definitions for offshore wind with the Atlantic Accord Acts for projects proposed in those areas.

4.7 Transportation

Transportation related projects described on the project List include:

• aerodromes and runways with a length of 1000 m or more or that is capable of serving certain types of large aircraft;
• international or interprovincial bridges or tunnels;
• navigation canals or locks;
• causeways of 400 m or more;
• highways with 75 km or more of new right of way;
• marine terminals for ships larger than 25 000 dry weight tonnes;
• railway lines totaling 50 km or more in new right of way; and
• railway yards of 50 ha or more.

Overview

Linear transportation projects that run over long distances, such as railways and highways, may cause adverse effects related to habitat loss, fragmentation and disturbance, particularly when located on new rights of way. Depending on the type of habitat disturbed, this may impact fish and fish habitat or migratory bird nesting habitat. They can also have impacts on Indigenous peoples and their rights.

Because the federal government has primary jurisdiction over aerodromes, airports, runways, and railways and railyards operated by federally regulated operators, effects within federal jurisdiction include environmental effects to the land, water, air, all flora, and fauna, as well as potential impacts to Indigenous peoples and their rights, and health, social and economic effects for Indigenous and non-Indigenous communities. These projects are rarely subject to provincial environmental assessments.

Aerodromes, airports and all-season runways have the potential to cause adverse effects on migratory birds due to mortality from collisions with aircraft. They can also pose a risk to fish and fish habitat and aquatic species at risk due to spills and runoff of chemical products, salt or fuel.

Considerations within Scope of the Review

Since the coming into force of IAA, three aerodrome projects have entered the IAA process, two of which were determined to not require a full impact assessment under section 16 of the IAA. No canals have been assessed under the IAA and one causeway project is currently in the planning phase. Three marine terminals are currently being assessed under the IAA, at various stages in the process. One railway yard that met the Project List thresholds was determined not to require a full impact assessment as the effects in areas of federal jurisdiction would be mitigated through other federal or provincial regulations.

The Minister has also received a total of 9 designation requests for transportation projects including roads, aerodromes, and railway yards. Of these, one was designated by the Minister, but that designation was later set aside by the Federal Court of Appeal. For those that were not designated, it was determined that the IAA would not add value for these projects on the basis that the potential for adverse effects would be limited through project design, the application of standard mitigation measures and through existing federal regulatory and/or legislative mechanisms or through provincial licensing processes.

In light of this implementation experience, we are considering potential removal of provincially regulated railway yards from the Project List because of the ability of other existing federal regulatory and/or legislative mechanisms or provincial processes to assess and mitigate potential effects.

Options for consultation

Consider amendments to:

• adjust the Project List so that only federally regulated railyards are captured.

In addition to these options, some technical amendments could also be made to provide clarification on definitions and thresholds. For example, internal analysis has shown that additional clarity for terminology used for public highways, right of way and railways would be beneficial to understanding these entries.

4.8 Hazardous Waste

Hazardous waste projects described on the List include:

• hazardous waste facilities that are not more than 500 m from a natural water body and that are used exclusively for the treatment, incineration, disposal, or recycling of hazardous waste.

Overview

Hazardous waste projects have the potential for adverse effects to fish and fish habitat, aquatic species as defined in the Species at Risk Act and migratory birds when in proximity to water bodies due to potential accidental release of hazardous substances.

Provinces and territories are the primary regulators of these projects, and in many cases, they would undergo a provincial environmental assessment.

Considerations within Scope of the Review

No hazardous waste project has been subject to the IAA since it came into force. The Minister has received three designation requests for hazardous waste projects and determined that none warranted designation under the IAA on the basis that the potential for adverse effects would be limited through project design, the application of standard mitigation measures and existing federal regulatory and/or legislative mechanisms or provincial licensing processes.

Through implementation, IAAC and other stakeholders have determined that the recognized definition of hazardous waste is so extensive that it may capture in situ management of mine waste including remediation activities, meaning that projects that were not intended to be designated may be subject to the IAA.

Feedback received during early engagement suggested removing the reference to distance from natural waterbodies from the hazardous waste entries, as potential effects on Indigenous peoples may be present regardless of distance to waterbodies.

Given the above, the current wording of the hazardous waste entry may require refinement to ensure that it is working as intended.

Options for consultation

Consider amendments to:

• clarify that the intent of the entry is not to capture the in-situ management of mining waste.

4.9 Water Projects

Water projects described on the List include:

• a dam or dyke on a natural water body, resulting in the creation of a reservoir with a surface area that would exceed the annual mean surface area of the natural water body by 1 500 ha or more; and
• a structure for the diversion of 10 000 000 m³/year or more of water from a natural water body into another natural water body.

Overview

Water projects have potential effects on fish and fish habitat and aquatic species as defined in the Species at Risk Act, as well as on migratory birds. These effects may be caused, for example, by the direct removal or degradation of habitat, direct mortality of fish or aquatic species as defined in the Species at Risk Act, restriction of movement, changes to water flow and possible pollution or spills.

These projects are primarily regulated at the provincial level but may require federal authorizations under the Fisheries Act and the Canadian Navigable Waters Act.

Considerations within Scope of the Review

Since the coming into force of the IAA, one water diversion project has entered the federal impact assessment process. IAAC determined under section 16 that a full impact assessment was not required because any potential adverse effects within federal jurisdiction would be sufficiently addressed through existing legislative and regulatory frameworks. No dam or dyke project has met the thresholds under the Project List. There have been 13 requests to designate water projects (9 were grouped into one project). In each case the Minister decided that designation was not warranted.

Feedback received during early engagement and implementation experience gained by IAAC since 2019 suggests that there may be a need to clarify the terminology in these entries, for example to provide clarity on what would be considered a diversion structure, a natural water body and how a project meets the thresholds.

Options for consultation

Consider amendments to:

• clarify the meaning of “water diversion structure” and “natural water body”.

4.10 Periodic Reviews of Project List

The timeframe for the current review of the Project List is prescribed in the Project List as five years after coming into force. Subsequent periodic reviews would provide opportunities to consider new project types that may have adverse effects in areas of federal jurisdiction and should be added to the Project List. They would also allow an opportunity to review the List entries based on feedback and IAAC’s evolving experience in implementing the IAA.

Options for consultation

Consider amendments to:

• set a subsequent review timeframe for five years following any regulatory changes.

5. Next Steps

With the publication of this Discussion Paper, IAAC is commencing a 60-day public consultation on the Project List review.

Comments and submissions can be provided at the following link: online consultation by September 27, 2024.

The results of the Project List review will inform the recommendations and conclusions set out in a report to the Minister of Environment and Climate Change. The report will consider feedback received from stakeholders, Indigenous partners, and the public during all phases of this review.

Proposed regulatory changes resulting from the Project List review will follow the usual regulatory development and approval process for Governor in Council Regulations, including publishing draft regulatory text through Canada Gazette, Part I for further consultation opportunities. IAAC expects that this regulatory process would begin in Fall 2024.

Annex 1: Summary of Implementation Experience

(From August 28, 2019 to June 20, 2024)

As part of the approach to reviewing the Project List, IAAC reviewed experience implementing the IAA, including projects that have met the Project List thresholds, trends in Ministerial designation requests under section 9, and decisions by IAAC under section 16 on whether a full impact assessment was required after a project was designated. The following outlines the summary of implementation experience under the IAA.

1. Designation Requests Statistics

Total Ministerial Designation Requests Considered: 55*

• Total individual projects which the Minister was requested to designate (graph): 50
• Repeat requests to designate the same project: 5
• Minister could not designate due to ss. 9(7) limitations (activity has substantially begun or federal authority exercise of a power, duty or function permitting the activity): 7
• Those found to not warrant a designation: 39
• Designation decisions set aside by the Courts: 2
• Total designated: 2 (both were coal mining projects)

* Includes 3 requests for projects originally requested to be designated under CEAA 2012 and for which we received new requests to designate under IAA

2. Projects that have submitted an Initial Project Description (IPD)

Full Impact Assessment not required (IAAC screening decision, s.16): 10

• Fossil fuel-fired power generating facilities: 3
• Liquified Natural Gas Facilities: 1
• Aerodromes: 2
• Interprovincial Bridges: 1
• Marine Terminals: 1
• Railway Yards: 1
• Water Diversion: 1

Ongoing Assessments, total: 26

• Ongoing Substituted Assessments: 3

  • Liquified Natural Gas Facilities: 2
  • Metal Mines: 1

• Projects in the Planning Phase, total: 13

  • Fossil fuel-fired power generating facilities: 2
  • Liquified Natural Gas Facilities: 1
  • Coal Mines: 1
  • Metal Mines: 5
  • Rare Earth Element Mines: 1
  • Aerodromes: 1
  • Causeways: 1
  • Hydro Electricity Projects: 1

• IAs in the Impact Assessment phase, total: 10

  • Metal Mines and Metal Mills: 4
  • Oil Sands Mines: 1
  • Highways: 3
  • Marine Terminals: 2

Completed Impact Assessments, total: 1

• Liquified Natural Gas Facilities: 1 (note: IA substituted to British Columbia)

Terminated Impact Assessments, total: 4

• Oil Upgrader and Refinery: 1
• Coal Mine: 1
• Railway Yard: 1
• Oil and Gas Pipeline: 1

Annex 2 – Summary of Options for Consultation