Case Brief: AltaLink Management Ltd v Alberta (Utilities Commission),

2021 ABCA 342

By Courtney Jacklin and John Gailus

On October 15, 2021, the Court of Appeal of Alberta released its decision in AltaLink Management Ltd v Alberta (Utilities Commission). The court considered whether the Alberta Utilities Commission (the Commission) must take into account the economic interests of Indigenous peoples when making decisions in the public interest.

What this case is about

AltaLink owns and operates a transmission system in Alberta. In 2007, AltaLink applied for permission to construct and operate a new transmission line. AltaLink’s preferred route, which was both the shortest and lowest cost route, crossed the reserve lands of both the Piikani Nation and the Blood Tribe.

Both the Piikani Nation and the Blood Tribe passed resolutions approving the proposed route across their reserves and consented to the issuance of a permit. They agreed to the construction of the transmission lines on their reserve lands in exchange for an opportunity to obtain ownership interests in the transmission lines and participate in the energy transmission industry. Both the Piikani Nation and the Blood Tribe entered into agreements with AltaLink that granted them the option to purchase up to a 51% interest in the transmission line located on their reserve lands. Both the Piikani Nation and the Blood Tribe later exercised this option and entered into limited partnership agreements with AltaLink.

AltaLink then asked the Commission to approve the sale of the segments of the transmission line located on reserve to new limited partnerships controlled by the Piikani Nation and the Blood Tribe. The Commission approved the sale, but on the condition that the new limited partnerships could not recover audit and hearing costs from ratepayers as part of their tariffs.

In making this decision, the Commission applied a “no-harm test”, which (i) weighed the positive and negative impacts of the transaction on ratepayers to determine whether the transaction was in the public interest and (ii) if the Commission determined that ratepayers may be harmed, considered whether the harm can be mitigated by making the approval subject to conditions.

The Commission concluded that the sale would result in incremental costs to ratepayers because the additional annual audit fees and hearing costs would not arise if the sale did not take place. The Commission then rejected two potential offsetting benefits. The Commission determined (i) that it could not consider cost savings from routing the transmission line through reserve land because the no-harm test is a forward-looking exercise and (ii) that any intangible benefits arising from partnerships with First Nations were too speculative.

AltaLink appealed the Commission’s decision to the Court of Appeal of Alberta.

What the Court found

The Court of Appeal of Alberta held that the new limited partnerships controlled by the Piikani Nation and the Blood Tribe should be allowed to include their audit and hearing costs in their respective tariffs and recover these costs from ratepayers. The Commission erred considering only forward-looking benefits. The context of the proposed transfer and the cost savings from the initial construction phases were relevant factors that should have been considered. Further, the majority noted that the Commission has previously recognized the benefits and values of fostering relationships between utility providers and First Nations. The Commission should have taken a broader view of the no-harm test.

The majority decision focused on the benefits of education and employment, noting that projects that increase the likelihood of economic activity on reserve are in the public interest. In a concurring decision, Justice Feehan stressed that the Commission must consider the honour of the Crown and reconciliation in exercising its statutory powers and responsibilities whenever the Commission engages with Indigenous collectives or governments. Further, if the decision affects Aboriginal rights, the relationship and responsibility of the Crown to Indigenous peoples should be the Commission’s primary consideration in determining whether a decision is justified in light of the honour of the Crown. Justice Feehan also discussed the legal and social dimensions of reconciliation, noting that as an administrative tribunal with a broad public interest mandate, the Commission should have addressed reconciliation in the context of rebuilding relationships between Indigenous peoples and the Crown. This involves consideration of the interests of Indigenous peoples in participating freely in the economy and having sufficient resources for effective self-governance.

Why this case is important

This decision confirms that when the Commission considers whether a decision is in the public interest, it should take a broad view of the public interest that considers both the benefits to Indigenous communities and to Indigenous economic activity. The concurring decision also provides guidance on how statutory powers and responsibilities can be exercised consistently with the honour of the Crown and the goal of reconciliation. Justice Feehan’s reasoning adds to an expanding body of case law that affirms there is deep and broad public interest in reconciliation. It will be interesting to see if his decision receives traction in future cases.