In continuation of the series of publications on the legislative and regulatory framework being developed for the tidal energy industry in Nova Scotia (Part I and Part II can be accessed on our website), this article highlights some important considerations for tidal energy project developers that arise out of the recently promulgated Marine Renewable-energy General Regulations (the “Regulations”) under the Marine Renewable-energy Act (the “Act”) that came into force on January 23, 2018.

Application requirements for Licenses and Permits

The Regulations elaborate on the requirements for applications submitted by project developers for licenses and permits. While the nature and scope of the rights granted under the licenses and the permits differ, with licenses being issued primarily to commercial projects and the permitting regime focused on supporting demonstration and piloting technologies, the application requirements are similar and require that the project developer submit to the Minister of Energy (the “Minister”) detailed information regarding the proposed project, including, the following:

• a schedule of and description of the activities to be carried on, including, but not limited to, technical and financial information on generators, cables and other components involved, expected location of the facilities, date of commencement of operation, expected date of decommissioning etc.;
• a survey of the proposed license/permit area undertaken by a professional land surveyor in Nova Scotia;
• a draft environmental monitoring plan which must cover a baseline description of the environment in the permit/license area, analyse any potential impacts of the project on the environment and provide a plan to address such impacts;
• a risk management plan which must describe the methods used to identify risks, list the identified risks along with their probabilities and impacts, as well as the risk monitoring and mitigation strategies; and
• a description of the steps taken to identify any concerns of the aboriginal people and public along with the list of issues so identified and steps taken to address such concerns.

In respect of an application for demonstration permit, considering that the Minister also renders a tariff determination for the electricity produced under such permit, project developers are required to provide extensive disclosures about the financial aspects of the proposed project, including information on:

• Projects costs for designing, constructing and installing generators/equipment;
• Source of funds, including, listing of investors, loans, grants etc.;
• Projected revenues; and
• Cost of decommissioning and rehabilitation.

The Decommissioning, Abandonment and Rehabilitation Plan

The Regulations place particular emphasis on ensuring that the project developers are committed to certain decommissioning and abandonment obligations prior to commencement of operations under a permit or a license. Therefore, the Regulations provide that before commencement of any physical activity in the license/permit area, the project developer must obtain approval of the Minister on a decommissioning, abandonment and rehabilitation plan. This plan should include details of the steps and procedures to be used to dismantle and decommission the generators/facilities and rehabilitate the area of operation.

Access to Records of the Project Developer

The Regulations provide that the records of the project developer in respect of the tidal project authorized under a licence or a permit, must be accessible from an office of the project developer located in Nova Scotia. Upon the written request of the Minster, a licence or permit holder must make such records available for review and inspection by any person authorized by the Minister. In addition, the project developer must ensure that the records and information remain accessible until at least 5 years after the date the licence or permit expires or is revoked.

Other Regulations

Some of the other important provisions in the Regulations include, regulations on:

• Rental payments on the acreage covered under the license/permit;
• Reporting requirements on license/permit holders;
• License/Permit Durations;
• Procedures for undertaking a strategic environmental assessment process under the Act.

Striking the right balance between discretion and prescription is the key for success in regulating infant industries and the various tidal energy projects being undertaken currently in Nova Scotia will certainly provide an opportunity to test this balance in the practical application of the Regulations.

Cox & Palmer has extensive experience of working in the tidal energy industry and is pleased to be engaged in providing legal and regulatory advice to the leading tidal technology developers working in Nova Scotia. For any queries, please contact Mohammad Ali Raza, who is a lawyer in the Halifax office of Cox & Palmer. He practices in the areas of corporate & commercial, mergers & acquisitions, defence, security & marine, shipbuilding, energy & natural resources, construction, and small & medium sized enterprises. He can be reached at 902-491-6845 or e-mail at mraza@coxandpalmer.com.