Energy companies can face financial penalties when things go wrong
Alberta - September 19, 2016When companies don’t follow the AER’s rules, they face enforcement. Our enforcement tools can include shutting in operations, more frequent and detailed inspections, more stringent planning requirements, and even prosecution.
Another tool is the administrative penalty.
The AER can impose this financial penalty under more than 10 pieces of provincial legislation. The amounts differ under each one, but all are based on the seriousness of the offence—which we refer to as a “contravention”—and how it impacts public safety, the environment, or production of the energy resource.
In short, the more serious the contravention and the greater the impact, the higher the penalty.
How Contraventions are Assessed
Major: release of a substance to the environment with the potential to cause an impact; failure to report a release; threat to public safety; activity is unauthorized and wouldn’t have been approved; failure to conserve an energy resource; or intentional disregard of requirements.
Moderate: failure to meet performance requirements, immediately report a contravention of the conditions of an approval, submit a required report, or perform required tasks in authorization or legislation; or activity is unauthorized but might have been approved.
Minor to none: administrative issues related to documentation (e.g., late submission of a required report).
A Few Examples
Many different situations will result in a penalty. However, to help put things into context, here are a few examples of what actions could result in a penalty if an oil spill occurred. These are only examples, and the AER evaluates each situation individually when deciding how to classify a contravention.
John Ludwick, Writer