ARCHIVED - RPP 2007-2008
National Energy Board

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Section II

Analysis Of Program Activities By Strategic Outcome

Analysis by Program Activity

Strategic Outcome

Safety, security, environmental protection and economic benefits through regulation of pipelines, power lines, trade and energy development within NEB jurisdiction.

Program Activity Name:  Energy Regulation and Advice

Financial Resources (million $)

2007-2008	2008-2009	2009-2010
38.1	38.1	36.6

Human Resources  (Full-time equivalents)

2007-2008	2008-2009	2009-2010
307.6	307.6	296.6

The NEB's main business is energy regulation and the provision of energy market information.  The companies that are regulated by the Board create wealth for Canadians through the transport of oil, natural gas and natural gas liquids and other commodities, and through the export of hydrocarbons and electricity.  As a regulatory agency, the Board's role is to help create a framework that allows these economic activities to occur when they are in the public interest.

The Energy Regulation and Advice activity is achieved through the following five goals:

Goal 1.  NEB-regulated facilities and activities are safe and secure, and are perceived to be so

Goal 2.  NEB-regulated facilities are built and operated in a manner that protects the environment and respects the rights of those affected

Goal 3.  Canadians benefit from efficient energy infrastructure and markets

Goal 4.  The NEB fulfills its mandate with the benefit of effective public engagement

Goal 5.  The NEB delivers quality outcomes through innovative leadership and effective support processes

The NEB delivers its programs under these Goals, as outlined in the following sections.

It has been determined that Goal 1, addressing safety and security, and Goal 2, addressing the environment are linked goals, each with its own focus but with common outcomes.  For this reason the intent of each Goal is described first, followed by the objectives of the two goals, which are identical and stated once. 

Goal 1 – NEB-regulated facilities are safe and secure, and are perceived to be so.

Financial Resources (million $)

2007-2008	2008-2009	2009-2010
5.7	5.7	5.5

The NEB's regulatory oversight encompasses the full life cycle of energy infrastructure projects within its jurisdiction (Figure 3).  This includes the design, construction, operation and abandonment of oil and gas pipelines that cross provincial or international borders.  The NEB's mandate also includes oversight for the security of pipelines and international power lines, reflecting amendments made to the NEB Act that came into effect in April 2005.

Figure 3
Regulatory Life Cycle

The NEB's involvement with the safety of a project begins when a company files an application to construct and operate a pipeline, processing plant or power line.  Each application is reviewed from a safety perspective to ensure the project complies with safety regulations.

During construction, NEB inspectors address safety by verifying compliance with regulations and approval conditions, and with emergency response plans.  Once the facility is operating, the NEB's regulatory oversight covers its ongoing safety, including compliance with occupational safety regulations, security, integrity, damage prevention, and emergency response and contingency plans.  The NEB ensures the safety of operating facilities by conducting inspections, investigating safety-related incidents and ruptures, and conducting management system audits.

The safety risks associated with facilities and activities regulated by the NEB are managed through competent design, construction, operation and maintenance practices.  The NEB plays a significant role in safety and security by ensuring a regulatory framework is in place that encourages companies to maintain or improve their safety and security performance.  The Board ensures that safety and security risks associated with construction and operation of regulated facilities are identified and managed by pipeline companies.

Goal Measures

• Number of fatalities per year
• Number of pipeline ruptures and incidents per year
• Public perception of safety
• Number and significance of security infractions

 

Goal 2 – NEB-regulated facilities are built and operated in a manner that protects the environment and respects the rights of those affected.

Financial Resources (million $)

2007-2008	2008-2009	2009-2010
4.6	4.6	4.4

Goal 2 expresses the NEB's commitment to protect the environment and respect the rights of those affected by the construction and operation of regulated facilities and activities.  The NEB promotes environmental protection throughout the life cycle of a project, starting with environmental and socio-economic assessment of proposed projects at the application stage, inspection and monitoring of approved projects during construction and operation, auditing environmental protection programs, investigating spills and releases, and ensuring that the abandonment of projects is carried out properly to protect the environment.

The NEB operates in a complex regulatory framework for environmental assessments.  This includes the challenge of navigating environmental assessments through overlapping jurisdictions and various legislation (notably the NEB Act, the COGO Act and the recently amended CEA Act), coordinating with other regulatory agencies and conducting environmental assessments and regulatory processes that are increasingly complex and technically demanding.  To address this, the NEB continues to work with other regulatory agencies, including the CEA Agency, federal departments, provinces and Northwest Territory Boards to improve the environmental assessment process and the coordination of regulatory processes.

To achieve the goal of respecting the rights of those affected, the NEB requires regulated companies to engage those people potentially affected by proposed projects.  The NEB also ensures that interested parties can become involved in the NEB hearing process.  Following project approval, the NEB actively follows up on issues brought forward by landowners, and if necessary acts as a facilitator between landowners and companies to ensure issues are resolved.

The construction and operation of facilities within the NEB's jurisdiction have the potential to adversely impact the environment and the rights of those affected by an NEB‑regulated project.  The NEB has in place and will continue to improve regulations, policies, tools, and procedures that efficiently and effectively ensure that its regulated facilities are designed, built and operated so that the environment is protected and the rights of individuals are respected.

Goal Measures

• Percent of environmental conditions that achieve their desired end results
• Number of major releases into the environment per year^[4].
• Indicators that the rights of those affected are respected

Goals 1 and 2 will focus on the following objectives over the planning period.

Objective 1:  The NEB employs a life-cycle approach to the regulation of energy infrastructure.

The NEB's mandate requires the regulation of the design, construction, operation and abandonment of hydrocarbon pipelines that cross provincial or international borders. In applying regulatory oversight, the NEB strives to take a "life-cycle approach" through which: 1) no single life-cycle stage of energy infrastructure is considered in isolation from the others, and 2) the NEB addresses project risks using the appropriate regulatory tool at the appropriate stage of the project life-cycle.  

Integrated compliance

As part of the Board's goal-oriented regulation approach, the NEB is implementing an integrated compliance system.  This system supports effective and efficient decision-making with respect to where the NEB directs its compliance resources for safety, integrity, emergency, security and environmental management. 

The end state for integrated compliance is a process which delivers a risk-based, life-cycle approach to regulation.  It encompasses the full life-cycle of a project, including design, construction and operation.  It also incorporates two elements in the risk evaluation process:  1) risk posed by a project (project details, location and public concerns), and 2) risk posed by the operating company, based on compliance performance. 

The project risk model is being developed through the small pipeline streamlining project (see Goal 3).   Prioritization within the risk model is based on the traditional risk equation: risk = probability x consequence. 

Regulatory risk is a measure of compliance performance, with probability indicative of the adequacy, implementation and effectiveness of an operating company's management system and programs.  Consequence is measured through an evaluation of the probability of an event impacting safety, security or the environment, and the severity of such an impact. 

The NEB's approach to ensuring the effective management of pipeline safety, security and environmental matters requires that regulated companies implement a comprehensive management system consisting of core programs for such matters as:

• Safety (Construction and Operation)
• Environmental Protection
• Pipeline Integrity
• Security
• Emergency Preparedness and Response

Through this initiative, compliance performance of a company will be directly linked to the adequacy and implementation of its programs to achieve the desired outcomes as set out within a goal-based regulatory requirement.  By implementing an integrated compliance risk-based approach, inspections and audits will be focused on facilities and companies that will benefit the most from an NEB inspection or audit.

Elements required to operationalize integrated compliance and prioritized decision-making include improved data management, assessment tools, and performance measures.  An integral component of the integrated compliance project is a set of leading indicators for measuring effectiveness with respect to safety, security and protection of the environment.  Such measures consider the operating company's commitment to continual improvement and its ability to develop a management system culture. 

The NEB expects to expand the integrated compliance project to include information from socio-economics, lands, and toll and tariff regulation in the process dedicated to a risk-based, life-cycle approach to regulation.  Ultimately, the NEB will have tools and resources in place that optimise regulatory oversight, efficiency, and effectiveness throughout the life-cycle of regulated facilities.

Outcomes

• Effective resource management with compliance activities focused on prioritized areas
• NEB-regulated companies understand what is required to meet compliance requirements, and proactively meet them through management systems
• Regulated industry operates in a manner that protects the employee, contractor, public and the environment

Objective 2:  The NEB, in partnership with federal and provincial/territorial agencies, has in place effective environmental assessment processes.

The Board is committed to developing efficient processes for completing the requirements of the CEA Act for NEB regulated projects.  These projects often involve more than one responsible authority or federal authority.  Dedicated partnerships with key regulatory and government agencies and stakeholders are required to facilitate both efficient application assessments and regulatory oversight during infrastructure life cycle. 

Environmental assessment coordination program

Through the NEB's environmental assessment (EA) coordination program, the NEB is working with federal and provincial government departments to produce an environmental assessment process that meets all departments' EA obligations.  Features of the EA coordination program include:

• NEB providing leadership in facilitating efficient and effective outcomes for EA processes
• Proactively communicating with government departments about the NEB's mandate and processes
• Working with government departments to coordinate EA processes and requirements
• Early coordination on appropriate signals of upcoming applications
• Review and learns with other departments after EA processes completed

Lead agency substitution

The NEB continues to pursue substitution as a way of conducting joint panel reviews.  Under the CEA Act, the Minister of Environment may approve substitution of an NEB environmental assessment process for an environmental assessment by a review panel under the CEA Act.  Substitution could make the review processes more efficient and timely without reducing the quality of the environmental assessment or compromising the public's ability to participate.  Substitution of the NEB's hearing process for the CEA Agency's Joint Panel Review Process for large NEB regulated projects will achieve the NEB's objective for a more efficient process by reducing process uncertainty, reducing upfront coordination times and reducing the number of parties required in decision making.  

Outcomes

• Clearly established process and timelines for coordination prior to receipt of a particular application
• Other regulatory authorities understand the NEB's mandate and process and cooperate effectively in the review and approval of applications
• NEB is the lead on all joint panel projects for large NEB regulated projects
• Clarity and better predictability for applicants

Objective 3: The NEB promotes sharing of information and best practices from pre-application to abandonment.

Part of the NEB's regulatory philosophy around goal-oriented regulation is to encourage the adoption of best practices for all periods of the facility life cycle. The NEB's full life-cycle responsibilities mean that it collects a significant amount of information on the safety and environmental performance of its regulated companies.  This life-cycle responsibility also provides the Board with ongoing, practical lessons about safety and environmental best practices which the NEB applies internally.  The NEB continues to expand its information sharing through public reporting on pipeline integrity, environmental performance indicators, safety and security, and environmental protection and assessment best practices.  The NEB also influences the use of new technology by raising awareness through meetings, partnerships, consultation and communication with industry.  The NEB continues to consult with industry and interested parties to identify opportunities for improvement through participation in bodies such as the Canadian Standards Association (CSA). 

Information sharing and best practices

The NEB is undertaking to first identify gaps for sharing best practices regarding safety, security, the environment, emergency management, integrity management, socio-economic and engagement practices of regulated companies.  Next, the NEB will develop processes to address the gaps, and disseminate best practices information in these areas through targeted delivery venues. Disseminating best practices to industry allows industry as a whole to benefit from the accumulated knowledge of other industry participants.

Pipeline security management

In 2004, the NEB Act was amended to include the concept of security.  In 2005, the NEB issued a Notice of Proposed Regulatory Change communicating its expectation that companies would have a Security Program.  A tool that will assist both the Board and companies is a consensus-based guidance document explaining the elements of an effective security program.   The NEB is chairing a CSA sub-committee with industry participants. The committee's deliverables will include determining the elements of the standard as well as deciding whether the standard will be mandatory or serve as guidance.

Outcomes

• Regulated companies have an increased awareness of best practices and can make informed decisions about their implementation
• Standards and guidance document held and maintained by CSA for effective security program requirements

Goal 3 – Canadians benefit from efficient energy infrastructure and markets.

Financial Resources (million $)

2007-2008	2008-2009	2009-2010
9.9	9.9	9.5

The Board strives to ensure that Canadians benefit from efficient energy infrastructure and markets.  The Board contributes to this goal through two main mechanisms: regulatory decisions around the construction and operation of energy infrastructure, and the provision of energy market information.

Pipeline infrastructure is essential to carry energy products from producers to Canadian consumers and export markets.  The NEB-regulated pipeline system carried about $100 billion in oil, oil products, natural gas and natural gas liquids in the last year.  The pipeline structure provides enormous economic benefits to Canadians by transporting these products in a safe and environmentally responsible manner.  The Board regulates the tolls and tariffs of pipelines to ensure that there is a fair and adequate return to encourage investment and allow for effective maintenance.

High energy prices are a signal to producers to develop new energy sources, including frontier sources and alternative sources such as oil sands.  Procedures also require investments in infrastructure to carry new production to energy users.  Unnecessary delays in building new infrastructure imposes costs on producers as they cannot bring their new production to market.  It also imposes costs on consumers because delays in bringing on new supplies perpetuate tight market conditions, leading to higher prices.  Thus, it is important that the Board provide timely and predictable regulatory processes.   The Board works to meet this commitment to clients through service standards which have been defined for many of the NEB's regulatory functions and associated services (Table 1).

The Board monitors energy markets and provides Canadians with a broad suite of information and analysis in areas primarily related to its regulatory mandate: natural gas, oil and electricity.  The Board publishes a major outlook for Canada's energy future which serves as a basis for planning for many industry sectors.  The Board will publish its next 25-year outlook in 2007.  The Board monitors energy exports to ensure that Canadian energy users have access to domestically produced energy on terms and conditions at least as favourable as those available to export buyers, and to analyze whether energy markets are functioning properly.  The Board also advises the Minister of Natural Resources of key energy market developments upon request and may provide recommendations on policy matters related to its regulatory role from time to time.

Goal Measures

• Indicators that Canadian energy and transportation markets are working well
• Indicators that the Board's advice and energy information products benefit Canadians
• Indicators that the Board's regulatory processes are efficient and effective

Table 1
NEB Service Standards

Reasons for Decision 80% of Reasons for Decision completed within 12 weeks following a public hearing	Financial audits 80% of draft financial reports sent to the audited company within 8 weeks of completing field work 80% of final financial audit reports sent to company within 3 weeks of receiving the audited company's comments on draft financial report
Export/import authorizations Short term export orders for oil, gas and natural gas liquids: 2 working days Natural gas import and export orders 2 working days Electricity export permits: 80% in 75 days	Non–hearing Section 58 application cycle times Category A (complexity of issues considered minor): 80% of decisions released in 40 calendar days Category B (complexity of issues considered moderate): 80% of decisions released in 90 calendar days Category C (complexity of issues considered major): 80% of decisions released in 120 calendar days
Electricity export permits Category A (complexity – minor) Applicant Notification:  100% within 10 calendar days Decision Release:  80% within 40 calendar days Category B (complexity – moderate) Applicant Notification:  80% within 10 calendar days Decision Release:  80% within 90 calendar days Category C (complexity – major) Applicant Notification:  80% within 10 calendar days Decision Release: No service standard	COGOA applications Well drilling applications Decisions rendered within 21 calendar days of receiving a complete application Geological and geophysical applications Decisions rendered within 30 calendar days of receiving a complete application
Onshore pipeline regulation (OPR) audits 80% of draft OPR reports sent to the audited company within 8 weeks of completing field work	CPRA applications 80% of decisions for Significant Discovery and Commercial Discovery Applications on Frontier lands rendered within 90 calendar days from the day that all information is available to begin the evaluation process
Landowner Complaints Respond with initial course of action: 100% within 10 calendar days    Resolve the complaint: 80% within 60 calendar days

Goal 3 will focus on the following objectives over the planning period.

Objective 1:  Regulatory processes fit the scope and risk of applications and other regulated activities.

Efficient application processing

To more efficiently consider facilities applications, a process will be established to determine what the appropriate areas and depth of assessment should be.  The process will include development of high level criteria for determining the types of regulatory processes that best suit the different applications it receives.  Factors impacting the risks to safety, environment, people and markets of building pipelines will be examined as part of the risk assessment. 

Expected results include a suite of process options that reflect the complexity and extent of the public interest issues associated with applications.  This will result in more flexible processes that reduce cycle times, and reduce the number of applications required to be submitted for review.   This objective will be implemented in conjunction with the NEB's integrated compliance approach.

Streamlined application processing

The NEB is working to streamline the application and assessment process for low-risk NEB Act section 58 facility applications.  At the same time, the NEB will ensure that assessment scrutiny increases in a controlled manner with increasing application risk or uncertainty. 

Small pipeline application streamlining

Using a simplified assessment process for low-risk facility application will reduce the time required for regulatory decisions on small, routine pipeline facilities, reduce industry's application costs related to small pipelines, and reduce industry avoidance of federal regulation for small pipelines.  The process will include the following elements:

Technically uncomplicated, straightforward application + Satisfactory company compliance record + Life-cycle compliance tools available for any required project or company follow-up = Streamlined application assessment

A satisfactory company compliance record is verified using inspection reports, audit reports and condition compliance. 

Objective 2:  The NEB's energy information program focuses on emerging market issues and regulatory challenges.

Energy information program

The NEB collects and analyses information about Canadian energy markets through regulatory processes and market monitoring in order to support the Board's regulatory program and to provide information to support better decisions by policy makers, industry and the public.  In its energy information program, the Board will focus on informing Canadians on energy market developments and issues related to the Board's regulatory mandate, which includes primarily gas, oil and electricity market developments. 

The Board's energy information program is comprised of Energy Market Assessments, which provide detailed analyses of aspects of Canada's energy system, concise briefing notes, energy pricing information on the NEB website and semi-annual energy market outlooks. 

NEB's Energy Information Program Energy Market Assessments Briefing notes Energy pricing information website Energy market outlooks

From time to time, the Board facilitates the provision of information in updated formats.  Over the next planning period, the Board will be developing a process to convert Frontier Information Office reports, prepared under the COGO Act, from microfiche to a web-based digital format.  This is a valuable service provided to industry.  This data is used as an evaluation tool for industry to help determine their exploration and production interests in the federal non-accord lands.   Without access to existing data on well data and geoscience data, companies could be forced into undertaking expensive exploration programs just to predetermine what is already known.   As an example of a tangible benefit, $5 million over five years for the electronic conversion of data will reap considerable returns in savings in exploration costs to industry.  It should also reduce unnecessary exploration activity, thereby reducing the environmental impact of exploration activities.  The microfiche conversions is currently unfunded and requires the support of central agencies before it can be undertaken.

Report on Canada's energy future

Part of the Board's energy information program, the Energy Futures project is a study of Canada's long-term energy supply and demand.  The Board has undertaken cross-country consultations with key stakeholders and the report will integrate the analysis of energy sector markets into a single "all energy" market analysis and outlook.  The Energy Futures project will describe plausible energy futures for Canada with a view to inform interested Canadians on how the energy system could evolve over the next 25 years to 2030.  The report will include a range of potential scenarios for energy supply, demand, and air emissions.  This report meets the Board's mandate under Part VI of the NEB Act section 118.

The Energy Futures Report will contain a reference case and scenarios that yield choices related to concrete options over a 25 year timeframe.  Feedback from consultations indicates that Canadians want to see more frequent Energy Futures reports that are firmly grounded in sharing of information and increased dialogue like that conducted in the recent cross-Canada consultations.  The value of energy information was emphasized for effective decision making.  Energy Futures consultation reports can be found on the NEB website at www.neb-one.gc.ca/energy/EnergyFutures/2006/index-eng.htm.

Outcomes

• Efficient, streamlined applications processes; reduced cycle times
• Project proponents are clear about the timeframe and process involved for their applications
• Canadians are able to make informed choices about energy market options

Goal 4 – The NEB fulfils its mandate with the benefit of effective public engagement.

Financial Resources (million $)

2007-2008	2008-2009	2009-2010
2.7	2.7	2.6

The NEB's focus on effective public engagement processes is key to making decisions in the public interest, and to providing efficient regulatory processes and practices.  Processes are designed so that decision makers are presented with the complete range of views required to make fully informed decisions in the Canadian public interest.  This enables parties impacted by projects that are before the Board to provide effective input into the Board's decision-making process.  

In recent years, there has been a trend of increased public participation in government decision-making, as more and more Canadians want to be involved in decisions that affect their lives.   The Board has responded by adapting its processes to accommodate participation in Board processes for parties to Board matters.  The Board's objective is to maintain the implementation of its mandate while providing ease of participation. 

Accordingly, the Board is continually implementing new approaches to make the Board's processes accessible to all Canadians.  For example, the accommodations made to NEB processes in the review of the Mackenzie Gas Project in 2005 – 2006 were welcomed by intervenors.  Further, simplified processes, information sessions, and Internet accessible regulatory documents are some of the innovations that have been introduced by the Board.  Stakeholder feedback has been positive in response to the Board's efforts to enable effective participation.

Looking forward, the Board has committed to reviewing options for interest-based approaches.  The NEB has already had success with promoting negotiated settlements where possible, and sees room for increased use of non-hearing approaches. 

One obstacle to full and effective participation is the Board's lack of authority to grant funding to qualified public participants.  The Board's objective is to find a mechanism by which the Board can obtain participant funding.  The NEB is evaluating options and developing an action plan to address this concern.

Goal Measure

• Board processes provide for effective participation by parties to Board matters

The Board will focus on the following objectives for Goal 4 over the planning period.

Objective 1:  Engagement and communication practices for NEB matters meet the needs of stakeholders

The purpose of the engagement portion of this objective is to ensure that both the Board's and public stakeholders' needs are met by effective participation in Board processes.  The Board will implement its new public engagement program which will proactively assist Canadians to effectively participate in Board matters (Table 2). 

Table 2
Elements for effective participation in Board processes

Principles Engagement supports effective regulatory oversight Each situation must be assessed and the best tools chosen for the case

Tools Templates for public presentations Process for initiating engagement process Public engagement portal (toolkits, issue tracking, information sources, practitioners, databases) Public and Aboriginal engagement plans, including objectives and measures Follow-up satisfaction surveys

Processes  Pre-application engagement Landowner engagement Appropriate Dispute Resolution

Outcomes Improved responsiveness to stakeholder needs and situations Strengthened relationships with stakeholders All relevant information comes before the Board in hearing matters NEB mandate fulfilled with the benefit of public involvement

 Northern engagement

A number of drivers contribute to the NEB's work to define and establish its northern engagement program.  They include:

• Anticipated increase in oil and gas activity in the North
• Role of NEB often not understood in the North
• Northern community and advisory board members are requesting that the NEB take a more active role through increased local presence in discussions and decision-making on resources

In 2007 – 2008, the NEB will work to develop approaches for northern engagement based on community research conducted in 2006 – 2007 (Figure 4).  The participatory research approach, which includes Community Assistants advising on community protocols and wishes, will yield an understanding and sensitivity of the community context.  

Figure 4
Areas for Northern Engagement Research

Based on understanding developed through community interviews and feedback, the NEB will identify and implement engagement practices for meeting the unique needs of northern communities.  This will provide a foundation for the NEB's regulatory oversight work in the North (Figure 5).  Outputs include a northern engagement toolbox for staff, along with training and communication for how and when to use the tools.   Ultimately, by proactively engaging northern communities prior to the expected increase in oil and gas activities, the Board will facilitate responsible and timely development of these resources.

Figure 5
Northern Engagement Regulatory Outcomes

Outcomes

• NEB's engagement approaches meet the needs of the NEB and northern communities
• Responsible and timely development of northern oil and gas resources

Proactive communications strategy

The NEB is following a proactive communication strategy focusing on communicating the NEB's role, enabling participation in Board matters as required, and providing key energy information.   Key elements for delivering on this strategy include information tools for Canadians who wish to obtain accurate, relevant energy market information (e.g. Energy Pricing page on the NEB website); support in early public engagement initiatives to better inform Canadians as new projects get underway in targeted areas; and a new branding strategy to better incorporate NEB vision and values.

Improved website and electronic communication

Over the next year the NEB will be updating its website in order to make the Board more accessible, and to pro-actively explain its role to Canadians. 

Electronic communication will be developed to the level of a tool that stakeholders can use to inform themselves about the Board's mandate and, if they are affected, how to be involved in the Board's processes. 

The website will reflect the direction and branding of an updated NEB communications strategy, so that it meets audience informational and navigational needs, is more efficient to maintain and is compliant with Government Online and Common Look and Feel standards as set by Treasury Board.

Outcomes

• Canadian public has easy access to appropriate information about the NEB's directives, processes and its mandates, including how to participate effectively in NEB matters
• NEB proactively engages stakeholders through targeted communications, outreach programs and activities, with a focus on evaluation and continual improvement

Objective 2:  The NEB has a range of interest-based approaches to fulfill its regulatory mandate. 

For those applications and processes within the NEB's control, the Board's direction is to use interest-based processes where possible and, generally, to explore their use prior to relying on adjudicative processes.  This should also result in more efficient processes, reduced cycle times and costs.  At the same time, there are instances where a hearing is the most effective and appropriate approach.  Interest-based approaches and hearings together form a range of process options which the Board can use according to the specifics of the application.  Over the next year, the NEB will develop a suite of interest-based processes for regulatory processes.

Outcomes

• Improved regulatory cycle times
• Better outcomes for proponents and society

Examples of interest-based approaches Appropriate Dispute Resolution (negotiation, mediation, workshops to increase understanding) Negotiated settlements (market participants make their own decisions instead of imposing the judgements and decisions of the regulatory agency) Collaborative regulatory development between industry and different levels of government

Objective 3:  The NEB has and employs participant funding for infrastructure applications.

NEB public proceedings involve a wide range of stakeholders affected by energy infrastructure.  Participant funding is widely considered to be a prerequisite to enable members of the public to effectively participate in quasi-judicial regulatory processes.   Public participants in federal environmental assessments sush as panel reviews and comprehensive studies are entitled to participant funding through the CEA Agency.

A key driver for the NEB to establish a participating funding program is regulatory efficiency and effectiveness.  Having participant funding will help enable the NEB to effectively use the substitution provision under the CEA Act.  Through this provision, the NEB can be designated by the Minister of Environment to act as the lead agency in applications directly related to its mandate.  This provision allows the substitute authority to design and implement the regulatory environmental approval process.  This arrangement reduces the duplication of regulatory and administrative requirements between different agencies that would otherwise need to be involved, without reducing the quality of the environmental assessment or compromising the public's ability to participate. 

The inability to designate participant funding is an impediment to the NEB fully taking on the role of lead agency in a case of substitution.  The intent of this objective is to find a mechanism by which the Board can obtain participant funding along a model similar to that employed by the CEA Agency. 

Outcomes

• NEB able to function fully as a lead agency when designated substitution under the CEA Act
• Outcomes that reflect the public interest

Goal 5 – The NEB delivers quality outcomes through innovative leadership and effective support processes.

Financial Resources (million $)

2007-2008	2008-2009	2009-2010
15.2	15.2	14.6

Goal 5 focuses on the leadership and management accountabilities needed to support a high performance organization that delivers on its commitments.  This goal is about sound business management and effective decision-making, to ensure that the organization has the people, technology, facilities, records management procedures, and financial resources available to carry out its mandate. 

The NEB's core work includes, but is not limited to: processing of oil, gas, electricity, commodity, and exploration and development applications within the NEB's mandate; regulatory oversight for safe, secure, economically and environmentally sound construction and operation of approved projects; and provision of energy and energy market information.  Core work utilizes approximately 80 percent of NEB resources.

An important focus for the NEB over the next planning period continues to be addressing the challenge of recruiting, developing and retaining the technical and analytical expertise that is essential to delivering on expected business results.   In a highly competitive employment market, and at a time of high demand for expertise throughout the energy sector, the NEB has identified ensuring the capacity to deliver on its mandate as a critical issue over the next planning period.   The NEB's strategy for building capacity includes recruitment and retention strategies, succession planning, leadership development, and a development and performance management system.

The NEB continues to implement an ISO‑standard Quality Management System  as part of our commitment to remain a respected leader in energy regulation.  This will assist the NEB in establishing a culture of continuous improvement and ensure consistency in direction and results.

Goal Measures

• Employee satisfaction
• Per capita cost of regulation
• Progress against planned activities

Goal 5 will focus on the following objectives over the planning period.

Objective 1:  The NEB has the necessary capacity to fulfill its mandate

The period covered by the NEB's current People Strategy (human resources plan) continues to be a time of great change and challenge, both outside and inside the NEB.  Staff will face increasing demands as a result of globalization, shifts in resource supply and technology changes.  Leaders are required to implement a results-based approach emphasizing innovation, accountability and risk taking, while dealing with an increasingly diverse workforce.  The NEB will experience intense competition for a smaller pool of knowledgeable, competent employees required to carry out its mandate. 

The NEB is currently in an environment where it must compete with the responsiveness of the private sector in offering competitive wages and benefits.  The rate of attrition due to industry's active recruitment within the energy sector, and due to impending retirements means that retaining staff at mid and senior levels will become increasingly important to our success.

To meet these challenges, the NEB requires strong leadership, a sustained commitment to creating a highly desirable workplace for all qualified candidates, and an on-going long-term strategy to ensure that the organization has the necessary capacity to fulfil its mandate. 

Recruitment, retention, succession planning

Given the unique role that the NEB plays on behalf of the Canadian public, the greatest challenge is to attract and retain the people needed to enable the NEB to fulfill its mandate.   The NEB's People Strategy outlines its long-term needs and approach for recruiting and retaining qualified employees.  Through this plan, the NEB is updating and improving recruitment and retention strategies and success planning on a number of fronts (Figure 6).  The NEB's goal is to foster the commitment and dedication of individual employees through:

• Greater flexibility and use of various staffing mechanisms
• Ensuring our human resource systems and processes support incentives and flexible work arrangements
• Provision of appropriate and timely learning and development programs
• Well-crafted, comprehensive accountabilities and measurement criteria

Tools that will help the NEB achieve this goal include standards for human resources services, employee opinion surveys, NEB branding literature for post-secondary recruitment, employment equity outreach, a leadership competency model and development program, and a project management training program.

Business Continuity Plan

Treasury Board's Government Security Policy requires departments to establish a business continuity planning program to provide for the continued availability of critical services and assets, and of other services and assets when warranted by a threat and risk assessment.  Critical services and associated assets must remain available in order to assure the health, safety, security and economic well-being of Canadians, and the effective functioning of government. 

The NEB's Business Continuity Plan will be updated to meet organizational and policy requirements, enabling the allowing the NEB to recover and operate in an emergency situation.  The Business Recovery objectives and documentation will be updated, and training provided for staff who would be involved in carrying out the plan. 

Resource management

The NEB follows government-wide modern comptrollership practices, including sound risk management practices and integration of financial and non-financial information.  Over the next planning period, the NEB will introduce improvements to resource management processes to make them more value added and timely:

• Complete revitalized business planning process
• Establish a business plan quarterly review process
• Enhance accounting system for reporting purposes
• Develop NEB cost matrix to cost major processes and activities
• Revise Time Reporting System to reflect business plans
• Train NEB management in resource management
• Rebuild analytical structure and capacity in financial services
• Introduce improved forecasting and reporting process
• Document key processes for Quality Management System

Figure 6
NEB People Strategy Framework

Information Management Renewal

This initiative is a series of inter-related projects to update information management practices at the NEB.  The purpose of the renewal project is to manage our information assets in a way that improves their accuracy, availability, and ultimately value to the organization.   Effectiveness in information management will assist in improving the capacity of the organization in carrying out its business.

Outcomes

• Current recruitment and retention strategies that meet the business needs of the organization and labour market trends of the region / country
• The right people are in the right place at the right time
• Current Business Continuity Plan in place ready to be executed by trained staff
• Value added resource management process
• Staff have the tools and training to carry out their information management responsibilities

Objective 2:  The NEB lives a results-based culture of excellence

The NEB is committed to demonstrating excellence in all aspects of its work.  In addition to following the Government of Canada's management direction for accountable government that is responsive to the needs of Canadians, the NEB invests in people, processes, systems and information needs to improve results.  The NEB's focus is on supporting career management through development plans, mentoring and challenge opportunities.   Tools and processes related to performance will be further enhanced including other forms of formal recognition and awards.

Leadership and development programs

• The NEB is developing a Learning Framework which promotes NEB culture and proactively addresses NEB employee attraction, engagement and transition challenges.  
• The NEB's on-boarding program will be enhanced to actively uphold NEB culture and reduce new employee settling-in time requirements.
• Individual learning plans will develop fundamental skill for delivering service and for understanding NEB's unique work.
• Government-specific learning events will be delivered to ensure that employees and leaders fully understand their legal responsibilities and unique roles as public servants. This includes a NEB specific management tools training course currently under development.
• The NEB's Leadership Development program will be expanded to include criteria for evaluating high potential employees into the leadership stream and for communicating these Board-wide.
• Activities for facilitating the proactive transfer of knowledge will be implemented (e.g. formal mentoring program). 

Recognition and reward programs

With the current labour market in Alberta and more particularly, Calgary, the importance of recognition as a means of increasing employee retention has been recognized.  The leadership of the NEB has identified a revised rewards and recognition program as a priority.  The NEB Rewards and Recognition Policy will be updated, incorporating new means of recognizing our employees and their achievements that support our strategic plan.   

Corporate performance measures

The NEB will review its suite of corporate measures to consolidate and establish clear linkages between the NEB's regulatory program and strategic outcomes.   Appropriate measures at every level will enable all to see the line of sight along the results chain between their work, their program outcomes, and the Board's strategic goals (Figure 7).  This process ultimately enables the NEB to make continuous improvements toward efficient and effective regulatory processes.  The NEB's regulatory framework will form the basis for the suite of corporate performance measures.

Outcomes

• Skilled and well-trained workforce; strengthened organizational leadership and culture
• Timely recognition for performance; support for innovation
• Organization able to implement results-based approach; increased value-added in regulatory processes

Objective 3:  The NEB has a fully operational quality management system

The NEB's Quality Management System (QMS) is the framework of processes and accountabilities by which we ensure we meet the needs of our stakeholders, today and in the future. The documentation of key business processes and associated performance measures assists our employees in delivering improved service on a consistent basis to our clients.  The NEB will be completing the basic building blocks of our QMS, including process documentation, updating internal communication processes, monitoring and measuring process performance, audits and continual improvement. 

Outcomes

• A firmly entrenched culture of quality

Figure 7
Results Chain and Measures

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