Canadian energy regulators operate in an increasingly complex environment, marked by rapid technological change, high uncertainty, and confronted with unprecedented challenges, most notably, the need to drastically reduce national emissions. However, Canada’s current regulatory system is increasingly understood as a significant obstacle to innovation and the transition to a low carbon economy. In order to accelerate the transition to a low carbon economy — both to meet emission reduction targets and capture a larger portion of the clean growth market — Canada’s energy regulators must become more agile in nature. Integrating regulatory agility via improved stringency, flexibility and predictability in both instrument and institutional design can help drive innovation and foster improved performance towards Canada’s economic and environmental goals. The issue lies in a lack of understanding of how to do this in practice.
This working paper aims to start filling this knowledge gap by examining the early experience of two leading examples of agile regulatory institutions in Canada: the Ontario Energy Board Innovation Sandbox (est. 2019) and the Vancouver Zero Emission Building Exchange (est. 2018). We provide an in-depth account of the development of these current initiatives over their first years in operation to draw out preliminary insights into how the design and functions of these institutions are enabling (or are intended to enable) more agile regulatory practice. In these cases, we find capacity-building through co-learning represents the core crossover element that enabled increased regulatory agility.
The Clean Economy Working Paper Series disseminates findings of ongoing environmental and clean economy work conducted by researchers from a range of disciplines. These working papers are meant to make results of relevant scholarly work available in a preliminary form. Although these papers have not undergone a peer-review process, they meet general standards of scholarly excellence. The views expressed in these working papers are those of the authors and do not necessarily reflect the opinions of Smart Prosperity Institute.