The Issue of Social Licence and Energy Utility Planning and Investment

  • Michal C. Moore University of Calgary


The vagaries of the term “social licence” and its broad application by various interest groups who tailor its meaning to their widely differing agendas, have proved frustrating for regulatory institutions as well as the energy industry. This problem was the subject of a symposium held in October 2014 in Calgary, and organized by the University of Calgary’s School of Public Policy, to assess the situation and its effects on the energy industry. The use of the term social license may be traced to a growing distrust of regulators and government; in recent years it has been used as a means to demonstrate that the viewpoints of given stakeholders, such as directly affected landowners, specialinterest groups or even minority groups who may only be remotely affected by projects, are being ignored. This issue is exacerbated by the fact that various stakeholders involved in energy projects often have complicated, overlapping and sometimes inconsistent interests in its outcome; this tension is in turn further compounded by the fact there is no firm legal or regulatory definition of social licence. The consequent lack of definitional allows a term or concept such as social licence to be used without precision and authority in the approval process by interested groups, who may insist on rulings or conditions for proposed energy projects to meet a range of ill-defined and unenforceable standards. The regulatory process has been established to solicit and use the contributions of public participation. This participation role, however, brings with it a requirement and commitment to participate under the rule structure established by the regulatory agency, which also typically specifies the qualifications of those testifying as well as establishing the veracity of submittals and oral testimony. This is a key feature separating the policy debates undertaken by legislatures and regulatory institutions that are mandated to implement and enforce policy objectives, but are not in a position to define or re-interpret them. The upshot is that in order to maintain objective control of the hearing and permit process, both the energy industry as well as the full range of engaged public and stakeholders must adhere to the published and governing rule structure in order to sustain and improve the overall energy infrastructure and use system. Absent such a process and rule structure, the system cannot function in a timely, efficient or egalitarian manner. Panelists in this symposium stressed the critical need to maintain a clear, transparent and efficient regulatory process for considering future energy projects and the upgrading and maintenance of existing systems. This process was cited as a clear example of an opportunity to bring together the voices of groups that often feel disenfranchised such as landowner or First Nations people, in a forum that respects, solicits and encourages their participation as key stakeholders. However, the participants also stressed the need to have a uniform set of procedures and rules for hearing projects while stressing the fact that the regulatory process is driven by policy prescriptions and is not a substitute for hearing voices and opinions about the nature and design of energy systems serving the public. The panellists in this symposium were clear that Canada can improve the existing system to consider future regulatory issues. Alberta was cited for positive examples of including citizen engagement in proposed energy developments. A first step in achieving better alignment between regulatory processes and maintaining an informed citizenry will be started by restoring public trust in due process and in regulatory authority. Ultimately, it is clear is that the term “social licence” warrants a definition and standardized framework so that regulators and, potentially, the judiciary will be able to use the term consistently and fairly in the future. A well functioning energy system is critical for society. As well, confidence in the regulatory and policy process are vital for ensuring investment and appropriate, environmentally responsibility energy infrastructure facilities are available for all.