Danielle Smith hails court triumph. But Alberta's control over development is hardly supreme

The "No More Pipelines Act" nickname was Jason Kenney's way to galvanize the public mood, but it was always a misnomer of sorts.

The legal fight Alberta and its former premier actually waged against Ottawa's environmental project review regime and on Friday effectively won didn't have much to do with oil and gas conduits.

The Supreme Court's decision stands to rein in some of the Trudeau government's broad ambition and scope for its Impact Assessment Act, especially as it applies to developments like power plants, highways or deep oilsands wells.

Pipelines? The big interprovincial bitumen tubes were always subject to federal assessments, well before Justin Trudeau's Bill C-69, and nothing the high court has now stated affects that.

"We have never attempted to override or suggest that they don't have the right to make those kinds of decisions," Premier Danielle Smith, Kenney's successor, told reporters.

She's lately tried to distance herself from the old "No More Pipelines" name-calling, even if old habits and popular sobriquets are hard to shrug off. It conveys she's clear on one thing the Supreme Court's decision won't do.

But what it does mean still appears quite murky both in how Ottawa ultimately responds to its legal setback, and in Smith's own interpretations of the decision.

Assessing the legal impact

Federal ministers Steven Guilbeault and Jonathan Wilkinson conceded Friday they'll have to amend the law, although they wouldn't say how. However, they expressed confidence it will not significantly alter their approach on project reviews.

With this ruling, federal regulators are within their rights to weigh the elements of any project that directly impacts water bodies, migratory birds, Indigenous communities or other clearly federal concerns same as it ever was.

However, a 5-2 court majority of Supreme Court justices opined that the government cannot use the legislation as a pretence to broadly consider a sweeping array of environmental and social impacts, "in situations where the activity itself does not fall under federal jurisdiction." Decision-makers must consider specific consequences where federal law applies, rather than "evaluating the wisdom of proceeding with the project as a whole."

Business groups, energy advocates and some premiers had argued the legislation gave regulators too much latitude and breadth, creating more uncertainty in the government assessments that so often breed risk for business ventures.

WATCH| Former premier reacts to Supreme Court decision:

'A historic day:' Jason Kenney reacts to Impact Assessment Act decision

11 months ago

Duration 1:19

The Impact Assessment Act has long been controversial among conservative politicians in Alberta, including former premier Jason Kenney. In an interview with CBC, Kenney says the Supreme Court ruling is a reminder that provinces do have important powers.

The ruling still lets regulators demand a wide range of information and data on a project, but will likely have to alter the way they weigh all those concerns in deciding whether to approve a project, said Martin Olszynski, an environmental law professor at University of Calgary.

"They've sort of short-circuited the cost-benefit analysis," said Olszynski, who represented World Wildlife Fund Canada as an intervenor in the case.

Smith's own term for the law is the "Don't Build Anything Anywhere Act." That's in the spirit of her arguments that green-minded Ottawa is bent on crushing energy developments, and that it routinely tramples over areas of provincial jurisdiction.

Triumphant on Friday, Smith declared she'll tell companies who delayed putting forth project proposals: "Start now, because we're going to approve them. We have the constitutional authority to do it."

Aside from the perils of pre-supposing approval of all projects before the Alberta regulators, there are limits to the authority she now claims.

"The fact that a project involves activities primarily regulated by the provincial legislatures does not create an enclave of exclusivity," the Supreme Court decision states.

Consider, in this light, some of the examples cited by Alberta's premier.

"I would say that if I want to build the highway between Grande Prairie and Fort McMurray ... that's within our exclusive jurisdiction," Smith told reporters. "I would say that if Teck Frontier Mine wants to put in another application; that's also within our exclusive jurisdiction to approve."

It's true that the Supreme Court decision might change how provincial highways get scrutinized, and could have direct bearing on a major expressway planned north of Toronto. But a highway that likely cuts through northern Alberta Indigenous communities and crosses the Peace River would fall more squarely into the scope of federal review just as Calgary's ring road sections needed reviews under the pre-Trudeau assessment systems because they traverse the Tsuu T'ina Nation and the Bow River.

As for the $20-billion Frontier oilsands project that mining giant Teck abandoned in 2020, it was also subject to federal assessment. In 2012, then-prime minister Stephen Harper's environment minister ordered it, on account of the potential impact on waterways. Regulators approved the mine with conditions, but under the Harper-era system, the federal cabinet still had the right to reject the project and Teck pulled out before Trudeau's inner circle rendered that judgment.

Even an amended, more modest version of the Impact Assessment Act could well mandate scrutiny of that oilsands mine, although that might be an academic consideration, as Teck has since exited the oilsands sector altogether.

The next turf wars

Smith has also said that she expected natural gas plants would be protected from federal assessment after the Supreme Court opinion, and she has expanded that to mean Ottawa has no right applying its controversial Clean Electricity Regulations and target for a national net-zero grid by 2035.

However, the court's assessment of jurisdictional overreach in one situation doesn't necessarily apply to all instances. Ottawa is applying its electricity rules under very different justification its ability to regulate emissions as toxins and govern them under the Canadian Environmental Protection Act and criminal law, Olszynski said.

While Smith argues against one-size-fits-all for federal-provincial environmental policies, she may not find jurisdictional rights are always considered or applied the same way, either.

Kenney and Alberta had, after all, argued that Ottawa was trampling on provincial jurisdiction with the federal carbon tax. In that case, the Supreme Court didn't see it his way.

Smith, perhaps more so than Kenney, has taken to branding various federal bills or policies as unconstitutional, without back-up from the country's top court. Now that the Supreme Court has indeed found Ottawa's landmark environmental review legislation to be largely unconstitutional, will the premier feel free to continue applying her own assessments of law?