Stacking rule upon rule may seem like a good way to ensure public safety and protect the environment. After all, shouldn’t more rules bring about better behaviour?
Thing is, technologies evolve and new types of resource plays emerge, which means the rules established years ago may no longer fit, or they may fail to address new risks altogether. Applying requirements that are outdated or duplicated, or that fail to adapt to emerging industry trends, can make the AER an ineffective and inefficient regulator and place undue economic strain on companies.
The AER has for the last two years been examining our regulatory model to identify and improve AER requirements, focusing on targeted changes with quick and meaningful results. The Near-Term Action Program (NTAP) identifies ways to make the regulatory system more effective and efficient through targeted, timely improvements.
Here are five things to know about NTAP:
- Not about the price of oil. Work to make requirements more efficient started in April 2014, well before the current downturn in energy prices. The efforts to make the regulatory system more efficient are part of a bigger strategy to improve how the AER regulates.
- Less is more. Regulating with outdated or ineffective requirements doesn’t make Alberta safer. In fact, it can tie up AER resources on insignificant issues and hinder regulatory action where the risks are greater.
- A good example. Recent modifications to Directive 017: Measurement Requirements for Oil and Gas Operations is an example of regulatory change bringing about improvements to the way we regulate at no risk to public safety or the environment. Responding to advances in oil and gas measurement technology, the AER made the directive more relevant, which will save industry over $200 million a year.
- Program with benefits. NTAP brings three main benefits to industry: lower operating costs, lower capital costs, and fewer regulatory delays. These benefits allow companies to bring projects into operation faster, which in turn provides economic benefits. This program is delivering around $400 million in annual savings for industry.
- Better reporting, better results. By simplifying and integrating requirements, we’ve improved both the relevance and quality of information that companies report to us, allowing us to better monitor compliance with the conditions set out in environmental approvals. The changes being made to ensure that regulation is relevant, efficient, and timely not only improve environmental and public protection, but also allow industry to improve its cost competiveness and contribute more to Alberta’s economy in terms of royalty payments, taxes, and jobs.
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