116 annual
17 report
executive summary

Annual Report Executive Summary 2016/17

2

WHAT WE REGULATE*KILOMETRES OF PIPELINESOPERATING NATURAL GAS & OIL WELLSOIL FACILITIESGAS FACILITIESTHERMAL/ENHANCEDIN SITU PROJECTSOIL SANDS
MINES

COAL
PROCESSING PLANTS* In addition to inspection and incident response support for 12 000 kilometres ofpipelines regulated by the Alberta Utilities Commission.

Alberta Energy Regulator

BITUMENUPGRADERSPRODUCING
COAL MINES1

ABOUT the AER
The Alberta Energy Regulator (AER) is the single provincial regulator for oil, natural gas, oil sands, and coal development in Alberta. The AER ensures the safe, efficient,orderly, and environmentally responsible development ofenergy resources. This includes allocating and conserving
water, managing public lands, and protecting the environment while securing economic benefits for all Albertans.
This means that in almost all cases, companies deal with
the AER alone when developing or proposing to develop
Alberta’s energy resources. It’s our job to make certain that
Alberta’s oil, gas, bitumen, and coal are developed andtransported in ways that don’t• place people at risk;• harm our air, water, land, or biodiversity; or• waste these valuable energy resources.
We determine when, where, and how the energy industry
may use water, and we make sure that energy development
doesn’t harm Alberta’s water; we regulate any energy development that occurs on provincial lands; and we makesure energy development doesn’t damage any aspect ofour province’s environment.
We are part of a broader government system making
sure that Alberta and its citizens receive full value for ourenergy riches.

OUR RESPONSIBILITIESFew organizations on the planet steward such a large andvaried mix of energy resources and infrastructure as the
AER. We oversee some very large established reserves:• 1.6 billion barrels of conventional oil• 165 billion barrels of bitumen• 28.2 trillion cubic feet of natural gas• 36.6 billion tons of coalThat’s a lot of energy, and it requires a lot of infrastructure
to produce, mine, process, and move to markets. We’re responsible for regulating this infrastructure, including pipelines, wells, processing facilities, in situ projects, bitumen
upgraders, and coal mines and processing plants.

energy resources in a safe and environmentally responsible fashion, and without waste.
• We review applications and make decisions on proposedenergy developments (almost 134 000 applications processed since June 2013).
• We oversee all aspects of energy resource activities inaccordance with government policies.
• We regularly inspect energy activities to ensure that all
applicable requirements are met.
• We penalize companies that fail to comply with AER
requirements.
• We hold hearings on proposed energy developments.
To make it happen, the AER employs 1200 inspectors, technical staff, engineers, geologists, scientists, investigators,
stakeholder engagement specialists, mediators, lawyers,
regulatory experts, and other employees in 15 offices andfield centres around Alberta.

ALBERTA’S SINGLE ENERGY REGULATORThe Government of Alberta created the AER in 2013 when
it proclaimed the Responsible Energy Development Act.
We were formed by combining the Energy Resources
Conservation Board and Alberta Environment and Parks(previously Alberta Environment and Sustainable Resource Development).
The AER’s role is to develop and enforce rules and regulations around energy development, taking direction fromgovernment policy.

WHAT WE DON’T REGULATEThe AER’s authority is limited to activities that relate to oil,bitumen, natural gas, and coal development. We have noauthority over any of the following:• any aspect of electricity generation or distribution, including renewable energies, gas utility pipelines, and theprice of natural gas (these are regulated by the Alberta
Utilities Commission);• gasoline or other refined petroleum products; and• oil and gas pipelines that cross provincial or international borders (these are regulated by the National Energy
Board).

The Government of Alberta gives the AER authority toensure that companies develop the province’s massive

Annual Report Executive Summary 2016/17

2

PIPELINE performance
Pipelines have been a hot topic for some time in Alberta
and across North America, with the big question being,
are they safe?
In our province, the numbers show they’re safer than ever.
Still, the AER’s executive vice president of operations knewthat more could be done to improve pipeline safety, andthat the solution wasn’t to just craft more rules.
“We’re not going to improve performance by adding morepages to the Pipeline Act,” Kirk Bailey noted, knowing that
more could be done to improve pipeline safety beyond
crafting more rules.
This past February, the AER released a report revealing
how pipeline operators are performing—with details not
only on the sector as a whole but on individual companies
as well.
While the length of pipelines the AER regulates grew by
11 per cent in the last decade, pipeline incidents actually
dropped by 44 per cent, with the pipeline failure rate
dropping to 1.1 incidents per 1000 kilometres of pipeline
in 2016 compared with 2.2 incidents per 1000 kilometresin 2007.

The AER points to stronger requirements, industry education, improvements to inspection programs, and a greater
focus on pipeline safety among operators for the improvement.
The report showed that pipeline incidents dropped bythree per cent in 2016 compared with 2015. Most incidents
were of medium to low consequence in terms of impacts
on the public, wildlife, and the environment. High-consequence incidents accounted for about 7 per cent of allincidents in 2016.
While the decline in incident rates is encouraging, the AER
believes all pipeline incidents are preventable—especiallyhigh-consequence ones. Achieving this will take a big
effort in many small steps; in 2017 the AER aims to reduce
the two-year average of high-consequence pipeline incidents by two per cent.
The AER will continue to raise the bar each year and takeaction to ensure that performance steadily improves.
The pipeline report was the first to be released, but it will
not be the last. The AER will issue similar reports that will
cover water use in energy development and inactive wells.

ALBERTA’S PIPELINES

The
last

length ofpipelines
grew byincidents
dropped by

10 11% 44%
years

Alberta Energy Regulator

In

2016

incidents/
1000 kmof pipe

1.1

3

To make sure pipeline incidents receive theappropriate response, the AER assigns a high-,
medium-, or low-consequence rating based on
criteria that consider the impacts on the
public, wildlife, and the environment.

HIGH CONSEQUENCE
Incidents that could have significant impact
on the public, wildlife, or the environment,or that involve the release of a substancethat affects a large area or waterbody.

MEDIUM CONSEQUENCE
Incidents that could have a moderate impact
on the public, wildlife, or the environment,
and no impact on a flowing waterbody.

LOW CONSEQUENCE
Incidents that involve little to no substancereleased and have little to no impact on
the public, wildlife, or the environment(but no impact on a waterbody).
No matter the classification, operators are responsible
for all aspects of incident response—from having adetailed emergency response plan in place to taking
actions to remediate and reclaim a site.

OUR GOAL FOR HIGH CONSEQUENCE

In 2017

reduce thetwo-yearaverage by

2%
Annual Report Executive Summary 2016/17

4

ON
OFF
Supported the government response to
the Fort McMurray wildfire by providing
valuable information to industry and by
ensuring the safe startup of operations
once the fire was controlled.

$224
MILLION
Generated over $224 million in annual
savings for industry by making ourregulatory processes more efficient,
without compromising public safety or
environmental protection.

HIGHLIGHTS
2016/17
17
recommendations
Worked with Alberta Health on a
year-long study into air quality andodour concerns near Fort McKay
by making 17 recommendations toimprove conditions.

Developed new rules to manage
tailings with the ongoing support ofa committee of AER stakeholders.

1
Launched Resource.aer.ca, a site where the
AER posts stories, images, and video about
Alberta’s energy development and how it’sregulated—with more than 80 stories andsome 30 000 visitors.

Alberta Energy Regulator

application
reviewdecision

Piloted a new approach requiring asingle, integrated application for all
activities within a project instead of
separate ones for each activity. This new
approach gives a clearer picture of thebroader impacts of energy development.

5

Issued Directive 086, which strengthened
public safety and environmental protection
by introducing new subsurface reservoir
containment rules for projects in the
Athabasca area.

Worked with indigenous elders to develop
Voices of Understanding, a document about
using indigenous oral decision-making tohelp improve interactions between the AER
and indigenous people.

Launched the Enterprise Learning
Branch to provide coordinated andstandardized training to ensure AER
employees have the necessary skills
and knowledge to do their jobs well.

Partnered with Mexico to create theInternational Centre of Regulatory
Excellence—a not-for-profit institution
to help regulators worldwide train,
collaborate, and innovate.

4053

reclaimed sites

Culminated years of commitment to
Peace River-area residents by releasing
new requirements to control gas
emissions from heavy oil and bitumen
operations in the region.

Issued 4053 reclamation certificates,
confirming that companies met all
requirements to reclaim an energy site.

reduceby

3%

Exceeded our target to reduce
pipeline incidents in 2016 with adrop of 3% to 1.1 per 1000 km.

82%
77%

82% of Albertans and 77%
of stakeholders expressed
confidence in the AER.

Developed the Industry
Performance Program andreleased a detailed reporton pipeline performance.

Annual Report Executive Summary 2016/17

6

2016/17 REPORTING ON OUR RESULTS
Since the AER’s launch in 2013, we have promised that
we will be transparent. Keeping that promise requires us
to report on our results by showing where we have madeprogress over the last year, how we are working towards
meeting the goals we have set, and what challenges wehave faced that may have caused us delay.

The 2016–19 strategic plan was developed by examining
the work we need to focus on based on our four pillars ofprotective, effective, efficient, and credible. The plan included our strategic priorities, outcomes, and performancemeasures to ensure that we stayed on track and

OUTCOME

MEASURE
Volume of all water used (by source) for
hydraulic fracturing, enhanced oil recovery,in situ oil sands, and mineable oil sands

PROTECTIVE
Develop an integrated
whole-systemregulatory approach

Total annual volume of fluid tailings,
treated fluid tailings, fines captures
Effective management ofpublic safety and cumulativeenvironmental risks and impacts

Volume of methane emissions

Volume of oil sands emissions

EFFECTIVE
Strengthenrisk-based
regulation

Effective management of resource
conservation and minimize financial
liability on Albertans

EFFICIENT
Transform
Alberta’s energy
regulatory system
to improve
efficiency

The regulatory system is efficient,minimizing duplication, with highly
efficient processes, and onlyintervening to the level necessary

Complete a risk assessment of energyrelated infrastructure by March 2018
Number of high-consequencepipeline incidents
Stakeholder savings resulting from reduced
regulatory burden that does not negatively
impact the environment or public safety
Improve efficiency of AER
application decisions

Percentage of Albertans aware of the
AER who express confidence in theorganization’s ability to fulfil its mandate

CREDIBLE
Increase trust andconfidence in how
energy is developedin Alberta

Stakeholders are confident
about how energy isdeveloped in Alberta

Incorporate key attributes ofregulatory excellence
Level of skills and competencies

Employee engagement
Percentage of IRMS* strategic priorities
supported by the AER

Alberta Energy Regulator

7demonstrated our results. Like the AER itself, the 2016–19
plan was fluid enough to allow us to remain nimble in anever-changing energy sector, and was designed to movewith the ebbs and flows throughout the year.

The targets we set for ourselves in the strategic plan,such as reducing fluid tailings accumulation, lowering
oil sands’ emissions, and improving the application
process, all tie back to our commitment to regulatory
excellence—achieving it and living it as we work toward it.

TARGETSTATUS

Public reporting of water use by industry

On track: Scheduled for spring 2017.

Ensure industry complies with establishedperformance standards

In progress: Revisions to Directive 085 being made toinclude public input. Expected in 2017.

Support multistakeholder engagement process
to facilitate early action on methane reduction

Target met: Multistakeholder process has been created andis being used to develop changes that will ensure a 45%
reduction in methane by 2025.

Ensure industry complies with establishedperformance standards

In progress: Draft regulatory development is 60% complete,ahead of targets.

Establish a tracking and reporting system foroil sands emissions

On hold: Provided input to the Oil Sands Advisory
Group. Awaiting government response.

Address high-risk items as they are identified

In progress: 96% of high-risk wells have been brought into
compliance through Directive 013, and the Inactive Well
Compliance Program has achieved 56% compliance.

2% reduction in high-consequencepipeline incidents from the previous
two-year average

Target met: 24% reduction in high-consequencepipeline incidents.

$100 million in savings to stakeholders
in fiscal 2016/17

Target exceeded: $224 million in savings to stakeholders
due to organizational efficiency projects.

Conduct two pilot projects to evaluate theproof of concept for the single application
and approval process by March 31, 2017

Target met: Three pilot projects completed.

80% confidence score

Ongoing: 82% of Albertans have confidence in the AER’s
ability to fulfil its mandate, while 77% of stakeholders
express confidence, with varied rankings among specificgroups (e.g., landowners, industry, and indigenous peoples).

Begin implementing the AER model for
regulatory excellence

In progress: The Strategy and Development Branch was
created. Developed internal systems to improve efficiencies.

Address high-priority skill and capability gaps
through the implementation of a Centre ofRegulatory Excellence in 2016/17

Target met: Created the Enterprise Learning Branch for
AER employees. Launched the International Centre ofRegulatory Excellence.

Achieve 83% engagement in 2016/17

In progress: Launched many initiatives to improve employee
engagement. Results to be determined in 2017/18.

100% of IRMS strategic priorities
supported by the AER

Target met: 100% of IRMS priorities supported by the AER.
*Integrated Resource Management Framework.
Annual Report Executive Summary 2016/17

8

We know indigenous peoples want their voicesreflected in our decisions. We need to work
together to find solutions while being mindful of
our cultural differences. However, many of ourprocesses fail to link western and indigenous
worldviews—this prompted the AER to set
out on a path to increased understanding.

Alberta Energy Regulator

9WHEN voices matterAll of our voices matter.
Whether we speak in unison or one at a time, in one
language or another, in harmony or in discord, we all havethe right to be heard. This is true in the classroom, in theworkplace, and at home. The regulatory field should be
no different.
We know indigenous peoples want their voices reflectedin our decisions. We need to work together to findsolutions while being mindful of our cultural differences.
However, many of our processes fail to link western andindigenous worldviews—this prompted the AER to set
out on a path to increased understanding.
We made it our mission to build a new type of working
relationship—one based on trust and mutual understanding—and challenged ourselves to look beyond what we
know.
Blackfoot elder Dr. Reg Crow Shoe was our guide on thisjourney. With his leadership and teachings, AER employees
explored how indigenous processes and worldviews cancomplement our own. Specifically, the sessions explored
traditional circle decision-making, a method that can beused to make decisions or to resolve conflict.

Before discussions begin, participants cleanse their minds,
bodies, and spirits in a smudge ceremony. This ceremonial
practice includes lighting dried herbs in a bowl or bundle
to produce smoke.
Next, each circle participant discusses the issues at hand.
A second round of discussions seeks solutions. Understanding is built as participants gather in a circle and taketurns speaking, facilitating a safe environment for people
to share their knowledge and experiences. Each voice isequal. The circle process doesn’t end until a consensus ora decision is reached.
We explored our new awareness of this process with Dr.
Crow Shoe, and together we created Voices of Understanding: Looking Through The Window, a guide intended
to help AER staff and indigenous communities understandhow to draw parallels between western and indigenous
decision-making.
In an intimate circle ceremony hosted in the AER’s Govier
Hall, Dr. Crow Shoe transferred the rights to the bundle
containing the knowledge and process behind Voices ofUnderstanding to AER president and CEO Jim Ellis.

AER employees came to understand the ways that circle
management processes are mirrored in hearings, alternative dispute resolution, and mediation processes we havein place today.

Voices of Understanding prompts us to genuinely consider
the way we think and work and the processes, systems,
and initiatives we use. On our quest to achieving regulatory
excellence, this bundle does not symbolize completion but
rather a step further in our journey to awareness and validation of indigenous decision-making.

“There are applications, leaders, and proper times to speak,”says Barbara McNeil, an AER hearing commissioner. “Inmany ways, circle decision-making echoes what we wantto achieve in mediation.”

This is but one piece in the foundation as we improve ourworking relationships with Alberta’s indigenous people. To
carry this knowledge is a responsibility we are honoured
to accept.

Circle decision-making begins with an opening statement from the ceremonialist, who brings together people
from the involved parties. The ceremonialist has the greathonour of being the steward of the bundle—a physical andsymbolic representation of the right to carry out decisions
from circle processes. That right can only be transferredthrough ceremony.

Annual Report Executive Summary 2016/17

10

HOW a penny

saved became
two billion
dollars earned
Work to make requirements more efficient
started in April 2014 as part of a bigger
strategy to improve how the AER regulates.
Since this time, the AER has generated over
$1.9 billion in total cost savings for industry
without reducing environmental protection
and public safety rules and regulations.

COST SAVINGS(APRIL 2013 TO MARCH 2017)

over

Alberta Energy Regulator$774

million,annually

We knew there were savings to be had, but we didn’t know
how much.
However, three years and nearly two billion dollars later,
the AER’s efforts to make our regulatory requirements
more efficient have translated into real-world savings foran energy industry beset by low commodity prices.
But it wasn’t a response to oil prices that spurred us to
examine our requirements through a different lens andspot opportunities to make improvements. Work to makerequirements more efficient started in April 2014 as partof a bigger strategy to improve how the AER regulates.
Since this time, the AER has generated over $1.9 billion in
total cost savings for industry without reducing environmental protection and public safety rules and regulations.
A portion of these are one-time savings, while the remainder are savings that recur each year and help ensure that
Alberta’s regulatory system remains efficient and effective.
To the end of March 2017, the AER has delivered over
$774 million of industry-verified cost savings that recurannually through regulatory efficiency improvements.
This means each year Alberta’s energy industry saves
over three-quarters of a billion dollars. In 2017/18, we aretargeting additional savings in the order of $100 million.
So why do it? Besides the fact that creating efficiencies
and a more competitive environment was a driver for
merging three regulatory bodies to form the AER, ourefforts bring benefits to industry such as lower operating
costs, lower capital costs, and fewer regulatory delays. This
allows companies to bring projects into operation faster,which in turn provides economic benefits to Alberta.

11

But more important is that regulating with outdated orineffective regulation doesn’t make Alberta safer. In fact,
it could tie up our resources on low-risk issues and hinder
action where the risks are greater. Creating efficiencies
makes development safe, protects the environment better,and helps the economy. In this way, everyone affected byenergy development—be they public stakeholders, indigenous communities, or Albertans in general—benefit from
more efficient and effective regulatory requirements.
Making the regulatory system more efficient can be complicated, but here in Alberta it’s made somewhat easier
because we have only one regulator, not multiple ones
with competing interests.
The savings we’ve achieved have been significant, andbecause they are applied to operations year over year, thevalue of this regulatory efficiency work will be realized byindustry and Alberta for the next 30 years and beyond.

Annual Report Executive Summary 2016/17

12

2017–20 STRATEGIC PLAN
The AER is responsible for making sure the public and theenvironment are protected. We have a strategy to fulfil ourmandate, reach our vision of regulatory excellence, anddeliver results for all Albertans.

of protective, effective, efficient, and credible. The plan
includes our strategic priorities, outcomes, and performancemeasures to ensure we stay on track and demonstrate
our results.

To develop our 2017–20 strategic plan, we examined
the work we need to focus on based on our four pillars

Ensuring the responsible use of water resources, reducing
the inventory of aging infrastructure, lowering methane

STRATEGIC PRIORITIESSTRATEGIC OUTCOMES

FOCUSED OUTCOMES
Sustainable water use

PROTECTIVE
Develop an integrated
whole-systemregulatory approach

Effective managementof public safety, andcumulative environmental
risks and impacts

Reduce fluid tailings accumulation
over mine life
Climate change – reduce
methane emissions
Climate change – 
oil sands emissions
Cumulative effects management

EFFECTIVE
Strengthenrisk-based
regulation

EFFICIENT
Transform Alberta’s
energy regulatory system
to improve efficiency

Effective managementof resource conservationand minimize financial
liability on Albertans

Reduce aging inventory liability

Pipeline safety

The regulatory systemis efficient, minimizing
duplication, with highly
efficient processes, andonly intervening to thelevel necessary

Regulatory efficiency

Effective engagement of Albertans,indigenous peoples, and stakeholders

CREDIBLE
Increase trust andconfidence in how energy
is developed in Alberta

Stakeholders are
confident about
how energy isdeveloped in Alberta

Achieve regulatory excellence

The AER is an integral partner in the Integrated
Resource Management System (IRMS)

Alberta Energy Regulator

13emissions, making certain that pipelines operate safely,and effectively engaging our stakeholders and all Albertans are just a few of the outcomes we’ll work to achieve.
Each year we update our strategic plan to make sure we’readapting to the changes taking place around us—from newtechnology to evolving stakeholder expectations.

This is continuing work and we can take things further byclosely examining our strategy to see how it should evolveto reach our overall outcomes as we ensure the safe, environmentally responsible development of Alberta’s energy
resources.

PERFORMANCE MEASURESPERFORMANCE TARGETS

Volume of all water used (by source) for hydraulicfracturing, enhanced oil recovery, in situ oil sands,
and mineable oil sands

Public reporting of water use by industry

Total annual volume of fluid tailings, treated fluid
tailings, fines captured

Ensure industry complies with establishedperformance standards

VISION

Support multistakeholder engagement process
Volume of methane emissions

Ensure industry complies with establishedperformance standards
Establish a tracking and reporting system foroil sands emissions

Cumulative effects are managed

Develop a framework to manage cumulative effects

Complete a risk assessment of energy-related
infrastructure by March 2018

Address high-risk items as they are identified

Number of high-consequence pipeline incidents

2% reduction in high-consequence pipeline
incidents from the previous two-year average

Stakeholder savings resulting from reduced
regulatory burden that does not negatively
impact the environment or public safety$100 million in incremental savings tostakeholders in fiscal 2017/18

Improve efficiency of AER application decisions

Single decision-making framework for wells,
facilities, and pipelines available for use by
external parties not later than 31 December 2018

Percentage of Albertans aware of the AER who
express confidence in the organization’s ability tofulfil its mandate

Maintain a confidence score above 80% annually

Level of skills and competencies

Close high-priority skill and capability gaps
through the implementation of the Enterprise
Learning Branch in 2017/18

Employee engagement

Achieve 83% engagement in 2017/18

Percentage of IRMS strategic priorities
supported by the AER100% of IRMS strategic priorities
supported by the AER

The AER is recognized for regulatory excellence, ensuring
the safe, environmentally responsible development ofenergy resources for the benefit of all Albertans.

Volume of oil sands emissions

Annual Report Executive Summary 2016/17

14

DRIVERS for change
Our world has changed significantly over the last decade,and we must keep pace to be a good regulator, let alone an
excellent one. And achieving excellence is the AER’s vision.
In the past, local stakeholders living near energy development—the people directly affected by oil and gas activities—were the ones voicing their concerns. Today, people
the world over question the use of fossil fuels and demandaction on climate.
Closer to home, the Government of Alberta’s Climate
Leadership Plan—which aims to reduce Alberta’s carbon
emissions—is well underway, while this past December thefederal government and provinces announced the Pan-Canadian Framework on Clean Growth and Climate Change.
Meanwhile, the oil and gas industry is changing the way
it develops Alberta’s resources; the growth in multistage
hydraulic fracturing activities and in situ oil sands development means more large-scale projects that bring withthem new challenges, risks, and opportunities.
Albertans want to know what’s happening and how it
affects their lives, their families, their communities, theenvironment, and the industry. In response, we re-examined our approach to stakeholder engagement by making
it a core area of regulatory practice. This includes forming
committees in which indigenous peoples, environmental

Alberta Energy Regulatorgroups, municipalities, landowners, and others have avoice in developing regulatory requirements.
Not only is this sound practice, it also helps build trustand confidence in the regulator, without which we can’t
succeed.
Today, development occurs on a larger scale, withprojects having a greater footprint on the landscapefrom multiple wells and associated infrastructure—roads, facilities, and pipelines—a departure from the daysof single wells scattered across the landscape. The AER islooking closely at how multiple energy activities will affectspecific areas, and at the cumulative effects those activities have over time.
One way we can do this is to look at the big picture by adopting a cumulative-effects-management approach. Cumulative effects are the total environmental changes caused byenergy development activities in combination with otherpast, present, and future human actions. The impacts of eachactivity may be insignificant by themselves, but when combined with other activities, the risk to the environment canbe great.
Part of our response is to change the way operators submit
those many applications, starting with a few pilot projects.
Instead of many separate applications, operators willsubmit them as one—a single application, with one public

15

notice—and will receive one single decision from the regulator, be it an approval or denial. Besides being more efficient for industry, it gives communities a better idea about
what companies are proposing.
Meanwhile, people continue to be concerned about thepipelines that carry our oil and gas to markets across North
America and beyond. They demand to see the facts anddemand action to ensure that pipelines are safe. In Alberta,
pipeline incident rates have fallen by almost 45 per centin the last 10 years. While this is encouraging, the AER believes all pipeline incidents are preventable; reaching thisgoal requires a big effort.

People continue to be concerned about
the pipelines that carry our oil and gas tomarkets across North America and beyond.
They demand to see the facts and demandaction to ensure that pipelines are safe.

PIPELINE INCIDENT RATES

fallenalmost45%

in the last 10 years

To help achieve this, the AER is taking steps to make industry more accountable and to increase transparency byreleasing data for Albertans to see. In February, we issued
the Pipeline Performance Report, which details how individual companies and industry as a whole have been performing. The AER will issue similar reports on water use forin situ operations, mining, and oil and gas activities.
If Alberta is to meet people’s changing expectations andstay current with changing technologies, and still compete
in the global market, its regulator must also change by
working with all Albertans to manage our energy resources
today and beyond.

Annual Report Executive Summary 2016/17

16

FOR everyone’s benefit
Historically, contamination was allowed to remain inplace until the site was decommissioned. But the AER has
taken a different approach, requiring more active clean
up at the time of a spill instead of waiting for decommissioning, which reduces the likelihood of contamination
migrating over years in underground plumes.
While Blais said monitoring a spill and remediating in thelocation instead of immediately removing contaminatedsoil works well for some spills, in most cases the longer it
remains in soil, the greater risk it will contaminate groundwater.
This change also means the land is returned back to what it
was before the spill—farmland, forest, or grassland—muchquicker.
The benefits also apply to the ones responsible for the
spill.
“Cleaning up spills immediately can mean a cost savings toindustry,” said Sasha Desjardins, manager of Remediation,
Contamination Management, and Reclamation. “For industry to do nothing is the most expensive option.”
Companies can remediate a spill before it spreads andforego the cost to continually monitor the spill.
It’s rare that a change can benefit everyone, but when it
happens, it leaves one wondering why the change took solong in the first place.
The creation of the AER was one such change—it
brought together all energy-related regulatory activities
under one umbrella. Being responsible for all spill response
and clean up has allowed us to be more effective in our
approach to remediation, which benefits landowners, theenergy industry, the regulator, and Albertans in general.
“Previously, the regulatory agencies had different
pieces of the puzzle. There were different computer
systems, different compliance structures, and different
legislation,” said Sandra Blais, an advisor with the AER.

Alberta Energy Regulator

Energy companies need to prove to the AER that they
have the financial ability to return the land back to a comparable state to what it was before energy development.
So for the AER, these changes allow us to better assess
how much it may cost companies to clean up once theirfacility is no longer needed for energy development.
Better data on spill cleanup costs make our calculations
much more accurate and can sometimes involve an energy
company needing to pay financial security to the AER thatcan be used to clean up any spills if the company goesdefunct. That means the company—not Albertans—is held
responsible for cleaning up energy infrastructure and theirassociated sites. And that benefits all Albertans.

17orderly, and environmentally
responsible development ofhydrocarbon resources
over their entire life cycle.
This includes allocating andconserving water resources,

To regulate Alberta’s energy

our vision

ensures the safe, efficient,

our mission

our mandate

The Alberta Energy Regulator

The Alberta Energy Regulator

resources by protecting whatmatters most to Albertans—public safety, the environment,
and economic value.

managing public lands, andprotecting the environment
while providing economic
benefits for all Albertans.

is recognized for regulatory
excellence, ensuring the safe,
environmentally responsible
development of energy
resources for the benefitof all Albertans.

Annual Report Executive Summary 2016/17

18

ALBERTA ENERGY REGULATOR

www.aer.ca

Head Office
Suite 1000, 250 – 5 Street SW
Calgary, Alberta T2P 0R4@aer_news

inquiries
1-855-297-8311

resource.aer.ca

inquiries@aer.ca
24-hour emergency
1-800-222-6514

ABEnergyRegulator

Alberta Energy Regulator (AER)

www.annual-report.aer.ca

Alberta Energy Regulator