by Gavin Fitch, Q.C. and Marika Cherkawsky
On October 6, 2021, the Lieutenant
Governor in Council (provincial Cabinet) authorized the Natural Resources
Conservation Board (“NRCB” or “Board”) to grant approval to
Alberta Transportation and Alberta Environment and Parks to construct and
operate the Springbank Offstream Reservoir Project (“SR1” or “Project”),
located approximately 15 kilometres west of Calgary. The Board had issued a
Decision Report on June 22 in which it found that the Project was in the public
interest, having regard for social, economic, and environmental effects. However,
the NRCB can only approve a project it has reviewed with prior authorization of
Cabinet. With Cabinet authorization and NRCB approval, construction of the
Project—which is intended to provide flood mitigation on the Elbow River to
Calgary and other downstream communities—is expected to commence in February
2022.
In 2016 Alberta Transportation applied to
Alberta Environment and Parks (“AEP”) for an approval under the Water Act for
SR1. In addition to requiring approvals under the Water Act and also the
Public Lands Act, the NRCB is mandated under the Natural Resources
Conservation Board Act, RSA 2000, c N-4 (“NRCBA”) to review “water
management” projects. Alberta Transportation prepared an Environmental Impact
Assessment (“EIA”) which formed the basis for the NRCB’s review of the Project.
Finally, because of the potential for the Project to impact fish and fish
habitat, as well as Indigenous persons and First Nations, SR1 was designated as
a project for review by the Impact Assessment Agency of Canada (“IAAC”) under
the federal Canadian Environmental Assessment Act, 2012.
After several rounds of information
requests from the provincial and federal regulators, the NRCB held an 11-day
hearing in late March and early April 2021. The Board’s decision comes after an
eleven-day hearing held between March 22 and April 7, 2021. Shortly after the
NRCB decision was issued in June, federal Environment Minister approved the
Project based on a report issued by IAAC.
The Project
The purpose of the Project is to divert
water from the Elbow River during flood events to an off-stream reservoir,
where retained flood water would then be released in a controlled manner after
peak flows have subsided. The Project is designed to work in tandem with the
existing Glenmore Reservoir, with a total combined storage capacity of
87,771,000 m3, which exceeds the amount of water that overtopped the
Glenmore Dam during the 2013 flood.
The Project was one of the provincial
government’s primary responses to the devastating flooding in 2013 in southern
Alberta and the City of Calgary which resulted in approximately $5 billion in
damages. Following an extensive review of various flood mitigation options, the
Government selected SR1 as the preferred option.
The Law
Pursuant to s. 2 of the NRCBA, the Board
was required to review the Project to determine whether, in the Board’s
opinion, the proposed Project is in the public interest, having regard to the
social and economic effects of the Project and its effects on the environment. As
stated by the Board in its decision, there is no fixed objective test to
determine whether a review-able project is in the public interest. Instead, the
Board makes its determination by balancing the economic, environmental and
social interests in the context and time period in which they arise.
Under the NRCBA, the Board may grant an
approval on any terms and conditions that it considers appropriate. However,
unlike other regulatory bodies in Alberta, the Board does not have an ongoing role
in the regulation of the Project. This means the ongoing review and enforcement
of conditions included in an NRCB approval are normally delegated to a
provincial department that has an ongoing regulatory function.
The Project is in the Public Interest
An overview of the NRCB’s public interest
determination is set out at page 174 to 180 of the Board’s decision. These
pages summarily describe the concerns with the Project raised by many of the
hearing participants and Alberta Transportation’s response to these concerns. Alberta
Transportation’s overall position was that the Project would be in the public
interest because of the positive social and economic impacts and that the
adverse environmental impacts would not be significant after taking into account
their mitigation measures. Generally speaking, the Board agreed with Alberta
Transportation and concluded the Project’s considerable positive social and
economic benefits of mitigating flood events downstream of the Project and, in
particular, on the City of Calgary, outweighed the adverse economic, social and
environmental effects. It was the Board’s opinion that the conditions in the
approval, together with Alberta Transportation’s commitments, would mitigate
any material environmental effects associated with the Project.
Justifiable Need for and Design of
the Project
The Board’s decision makes it clear that
the need to mitigate future flood events on the Elbow River was key in its
determination that the Project is in the public interest. This point is made by
the Board throughout the decision in its reference to the significant benefits
resulting from the Project’s design reducing the risk to human life and
financial losses from damages to residential, commercial and public buildings
and infrastructure, as well as direct and indirect economic losses from the disruption
of businesses.
Damage avoidance outweighs costs of
construction
At the hearing, the Board heard extensive
argument surrounding the escalating costs of the Project and the benefit-cost
analyses and resulting ratios. While the Board acknowledged the costs for the
Project had increased since the initial estimates in 2015, it concluded that
the Project was still expected to deliver a positive economic return. The
Board’s conclusion was based on the benefit-cost ratios presented by Alberta
Transportation. The benefit-cost ratios demonstrated the Project benefits,
measured in damage avoidance to private and public infrastructure and business
interruption costs, were greater than the cost of constructing the Project,
including land acquisition costs.
Social Effects
The Board concluded there were no
unacceptable social impacts associated with the Project. However, it is worth
briefly discussing three of the more prominent concerns expressed by
interveners opposing the Project: dam safety, future land use and impacts on
Indigenous groups and First Nations.
Dam safety
Project opponents argued that the Project
as a whole was the first of its kind in the world and therefore put public
safety at risk. In response, Alberta Transportation presented extensive
evidence around the Project design, operating plan and emergency preparedness
plan. As pointed out by Alberta Transportation, the Project is designated as an
extreme consequence facility pursuant to the Canadian Dam Association Safety
Guidelines and Alberta’s Dam and Canal Safety Directive and therefore must be
designed to the highest level of safety due to its location in proximity to
local population centers. Further, the design of SR1 must ultimately be
approved by AEP’s Director of Dam Safety.
The Board agreed with Alberta
Transportation’s argument and rejected the notion that the Project design was
radical or somehow put public safety at risk. In doing so, the Board not only
accepted Alberta Transportation’s evidence, but also relied on the fact that
further protection against a dam breach or failure would be provided under the
Canadian Dam Association safety guidelines.
Land Use
The off-stream reservoir will be located
on land that is privately-owned, mainly by local ranching families. Therefore,
Alberta Transportation is required to acquire the land, which will then become
provincial Crown land. The Board heard from landowners who will be displaced by
the Project and community members concerned about future land use. While the
Board was sympathetic to these landowners, its decision made it clear that
these adverse social effects were outweighed by the benefits of the Project to
the public at large.
Specific concerns were raised about hunting
and firearms use, access, parking and the continued use of the Project area for
grazing. To address some of these concerns, the Board imposed as a condition of
approval that Alberta Transportation (or AEP) must consult with Indigenous
groups and community members to finalize a Land Use Plan for the Project
Development area and form a Joint Land Use Advisory Committee consisting of representatives
of Indigenous groups and members of the local community.
Indigenous Concerns
Alberta Transportation stated that it
extensively consulted with 13 Indigenous groups and First Nations. Only one of
them—the Stoney Nakoda Nations—participated in the hearing. The Board concluded
Alberta Transportation had largely addressed the concerns of affected
Indigenous communities about impacts to their rights through various mitigation
or accommodation strategies. One of the main mitigation strategies proposed by
Alberta Transportation was its draft Land Use Plan, which gives priority access
to and use of the project area, during non-flood periods, to Indigenous groups.
The final Land Use Plan for the Project area will be developed with
participation and input from Indigenous peoples through the First Nations Land
Use Advisory Committee.
Environmental Effects
The Board found most environmental
effects were low to negligible and any adverse environmental effects would
likely be reduced to acceptable levels with proposed mitigation strategies. The
Board’s decision assessed a number of impact categories, however, it found the
potential adverse effects and conclusions on hydrology and air quality were of
particular importance.
Hydrology
The purpose of the Project is to mitigate
high flow events in the Elbow River associated with floods. As a result, the
Project’s adverse effects on hydrology are unavoidable. However, as noted by
the Board, except during relatively infrequent flood events, the Project design
allows the Elbow River to remain close to its natural riverine state. Only
during flood events will flows exceeding 160 cubic meters per second be
diverted from the Elbow River into the reservoir. The Board found these
point-in-time effects as necessary to achieve the objective of the Project:
flood mitigation and damage avoidance.
Air Quality
Alberta Transportation’s assessment of
air quality impacts resulting from the mobilization of sediments deposited in the
reservoir during flood events and its proposed mitigation measures were
discussed by nearly all other hearing participants who expressed concern with
the Project. However, the Board was satisfied with Alberta Transportation’s
proposed mitigation measures, which included the timely use of tackifiers,
cover crops and revegetation to stabilize sediment, in conjunction with
extensive air quality monitoring.
Conclusion on Environmental Effects
At the hearing, many interveners
expressed an interest in monitoring of environmental effects and the need for
public access to those results. The Board agreed that a transparent approach to
monitoring and reporting on environmental effects was important and included as
a condition of approval that AEP as operator of the Project must make
monitoring results accessible to the public.
Conclusion
This decision demonstrates how the NRCB
weighs evidence of the various effects, some positive and some negative,
resulting from a proposed Project, and balances those effects in forming its
overall opinion as to the public interest. Specifically, this decision
highlights a situation where the Board was convinced a project was in the
public interest on the basis of the considerable social and economic effects
outweighing any adverse economic, social and environmental effects.