Report says Alberta environmental monitoring a failed experiment

EDMONTON -- An arm's-length agency created as a world-class monitor of the environmental impacts of Alberta's oilsands is instead a "failed experiment" that should be rolled back up into the government, a review has concluded.

A report done for Alberta's environment minister says the Alberta Environmental Monitoring, Evaluation and Reporting Agency is needlessly expensive, poorly co-ordinated and split by bureaucratic infighting.

"It is hard to escape the conclusion that AEMERA is a failed experiment in outsourcing a core responsibility of government to an arm's-length body," wrote report author Paul Boothe, director of the Lawrence National Centre for Policy and Management at Western University's Ivey School of Business.

"Three years and tens of millions of dollars later, the results are an organization that is still struggling to get established, dysfunctional relationships with its two key partners ... and a failure of all three parties to realize the promise of the ... plan to bring critically needed, world-class environmental monitoring to Alberta's oilsands."

The agency was founded in 2012 after years of criticism over how Alberta was keeping track of the environmental impacts of the then-rapidly expanding oilsands.

The plan was to bring provincial scientists together with resources from Environment Canada to jointly co-ordinate the study of how the industry was affecting the region's air, land and water. The resulting agency was funded by $50 million from industry and another $28 million from the province, which was to fund the expansion of environmental monitoring across the province.

The agency's research plans have been hailed as a dramatic improvement and numerous scientific papers have been published from its work. But Boothe, a former Environment Canada deputy minister, said the organization itself never gelled.

Boothe's report, obtained by The Canadian Press, points out the funding agreement between government and industry expired a year ago and has never been renewed, "in part because of AEMERA's unwillingness to accept (Environment Canada) as an equal partner in oilsands monitoring."

How the agency was supposed to work with the provincial Environment Department and who it was accountable to was never made clear, he writes.

The transfer of provincial scientists to the agency made it hard for the government to fulfil its other environmental responsibilities. The agency's reluctance to allow for a federal role restricted its use of Environment Canada resources.

It also costs more than it should.

"In part, the higher costs come because its governance and administrative structures duplicate structures that already exist, at lower cost, in the public sector," wrote Boothe.

"In addition, costs are higher because AEMERA has chosen private rather than public sector salary and benefit comparators."

Boothe outlined several options for Alberta Environment Minister Shannon Phillips. But his preferred path is to return the agency's work to her department with clear lines of accountability to the minister.

"This option has the benefit of consolidating scarce scientific expertise in one location in Alberta," he wrote. "The administrative structure of this option is likely to be the least costly to operate."

His concerns were presaged in February by a scientific peer review, which found the agency's work was poorly focused and co-ordinated. The Canadian Association of Petroleum Producers also expressed concerns about the need for more integration, analysis and coherence.

Boothe concluded the agency failed because it was based on a false belief that the public didn't trust Alberta's environmental monitoring because it was done by government. Instead, he said, the public didn't trust it because it was bad monitoring.