Section 1

Federal Requirements for Waterpower Development Environmental Assessment Processes in Ontario

PRACTITIONER'S GUIDE – Version 1.0, March 2006

---

1.0 Introduction and Purpose

1.1 Background

The demand for power in Ontario continues to increase. The Independent Electricity System Operator (IESO) has predicted that annual peak demand for power will rise from just over 24,000 MW in 2004 to almost 27,000 MW in 2013. Considering an IMO projected supply shortfall of between 5,000 and 7,000 MW by 2007, the Electricity and Conservation Supply Task Force noted that:

"If no new capacity or demand reduction measures are taken, the Province will be critically dependent on external sources of electricity, energy costs will be higher and more volatile and reliability could be reduced " (from: Tough Choices: Assessing Ontario's Power Needs. Final Report to the Minister. January 2004).

There have been a number of recent provincial government policy initiatives to increase installed capacity and energy production in Ontario. In addition, the province has established clear targets for the addition of new, renewable energy, including waterpower. As a result, there is explicit rationale to expand or modify existing waterpower facilities and to build new facilities.

In response to these developments, the Ontario Waterpower Association (OWA) is interested in providing guidance to proponents in order to facilitate the efficient environmental assessment of waterpower development projects in Ontario. Consequently, the OWA, in collaboration with Fisheries and Oceans Canada (DFO), has developed this Practitioner's Guide for addressing Federal Requirements for Waterpower Development Environmental Assessment Processes.

1.2 The Ontario Waterpower Association

The OWA was formed to provide a collective voice for the waterpower industry in Ontario. OWA's founding members represent more than 95 % of the waterpower producers and generating capacity in Ontario.

The mission of the OWA is to encourage the responsible growth of the waterpower industry in Ontario. OWA's strategic objectives are to:

• represent the common interests of Ontario 's waterpower industry in a corporate relationship with government;

• provide an effective forum for coordinating and promoting the common interests of the waterpower industry in Ontario;

• enhance the competitiveness of the Ontario waterpower industry; and

• identify common interests and cooperate with various organizations to promote a positive image for waterpower.

In Ontario, waterpower projects are required to comply with the provisions of Ontario Regulation 116/01 (Electricity Projects Regulation). Many of these projects must also be assessed in accordance with the requirements of the Canadian Environmental Assessment Act (CEAA). Given the potential need for proponents to address the provisions of both the Electricity Projects Regulation and CEAA, an understanding of how these two processes can work together and of federal information requirements for the environmental assessment of waterpower projects is critical.

This Practitioner's Guide provides advice on federal information requirements for waterpower projects and on opportunities to coordinate CEAA and Electricity Projects Regulation requirements. With a better understanding of federal information requirements, it is expected that more efficient and better coordinated projects will result, with the inherent benefit of promoting environmental sustainability.

This Practitioner's Guide has been developed by the OWA, in collaboration with Fisheries and Oceans Canada (DFO), and with the advice and input of the Canadian Environmental Assessment Agency, Environment Canada, Transport Canada, the Ontario Ministry of the Environment (MOE), the Ontario Ministry of Natural Resources (MNR) and OWA members.

1.3 Purpose of the Practitioner's Guide

This Practitioner's Guide is intended to provide users with a knowledge and understanding of the key components of CEAA and information requirements of key federal agencies and how these relate to waterpower projects under the Electricity Projects Regulation process. The Practitioner's Guide is also intended to assist proponents in the coordination of federal and provincial environmental assessment requirements for waterpower projects. Coordination of assessments will assist in avoiding duplication, result in time and cost savings and achieve more effective and environmentally sound decision-making.

This Practitioner's Guide provides an overview of CEAA and its requirements. Since the requirement to address CEAA for waterpower projects is frequently related to regulatory approvals under the Fisheries Act and Navigable Waters Protection Act (NWPA), the more detailed information requirements related to these Acts have also been provided.

The focus of this Guide is on federal environmental assessment (EA) requirements for projects subject to the provisions of the provincial Electricity Projects Regulation. While it is recognized that some waterpower projects may have other provincial EA requirements, these requirements are not addressed in this document.

The intent of this Guide is to build upon recent initiatives, such as the Canada – Ontario Agreement on Environmental Assessment Cooperation, to assist in coordinating the assessment of waterpower projects that have both federal and provincial EA requirements. In addition to being a valuable tool for project proponents, the Practitioner's Guide is also intended to be useful for government departments who are providing input to the review of waterpower projects.

Specifically, this Practitioner's Guide provides information and direction on:

• key CEAA components;

• the federal Fisheries Act;

• the federal Navigable Waters Protection Act (NWPA);

• the key differences between the federal and provincial EA processes;

• the types and level of detail of information required by key federal departments for assessing waterpower projects;

• considerations for a coordinated process (i.e. CEAA and Electricity Projects Regulation requirements); and

• key federal contacts.

This Practitioner's Guide is not intended to be all encompassing but rather to provide sound and practical advice to proponents. The information contained in this document is intended to provide guidance only. For specific legislative and regulatory wording or provisions, the user should refer to the relevant statutes and regulations.

1.4 Format of the Practitioner's Guide

The Practitioner's Guide consists of the following sections:

• Section 1.0 – Introduction and Purpose;

• Section 2.0 – Waterpower Development in Ontario;

• Section 3.0 – Relevant Policy Initiatives;

• Section 4.0 – Environmental Assessment Requirements for Waterpower Development Projects;

• Section 5.0 – A Primer on the Canadian Environmental Assessment Act (CEAA);

• Section 6.0 – Key Differences Between Federal and Provincial EA Requirements;

• Section 7.0 – Fisheries Act, Navigable Waters Protection Act and Other Approvals;

• Section 8.0 – Federal Information Requirements for Waterpower Development Projects;

• Section 9.0 – Role of Conservation Authorities and the Ontario Ministry of Natural Resources;

• Section 10.0 – Considerations for a Coordinated Process; and

• Section 11.0 – Key Contacts.

The following appendices have also been included:

• Appendix A – Canada – Ontario Agreement on Environmental Assessment Cooperation

• Appendix B – Overview of Electricity Projects Environmental Screening and Individual EA Processes (Provincial)

• Appendix C – Identifying Expert Federal Authorities Under CEAA

• Appendix D – Potential CEAA Triggers for Waterpower Development Projects

• Appendix E – Environmental Assessment Components: Key Differences

• Appendix F – Potential Federal Information Requirements

• Appendix G – List of Acronyms