Government of Canada Reduces the Scope of the Project List under the Impact Assessment Act

Background

On September 9, 2026, the Government of Canada announced amendments to the Physical Activities Regulations (the Regulations). The Regulations list the designated physical activities (commonly known as the Project List) that are prima facie subject to the federal Impact Assessment Act (IAA) framework. In practice, inclusion on the Project List means that proponents are subject to IAA prohibitions on project development activities, an obligation to provide information to the Impact Assessment Agency of Canada (IAAC) during the early stages of project development (including in an Initial Project Description), and exposure to potentially lengthy federal impact assessment review and decision-making processes. As a result of the Regulations, such prohibitions and obligations no longer apply for certain intraprovincial energy projects, and facilities regulated by the Canada Energy Regulator (described further below).

These amendments remove a layer of federal regulatory review for certain projects, and are expected to reduce regulatory timelines and costs for those projects.

Intraprovincial Energy Projects

Pursuant to the amendments, the Government of Canada has removed the following project types from the Project List:

• Fossil fuel-fired power generating facilities; and
• In situ oil sands extraction facilities with a bitumen production capacity of 2 000 m3/day or more, in a province without provincial legislation to limit greenhouse gas emissions from oil sands.

The removal of "fossil fuel-fired power generating facilities" from the Project List has immediate implications for the power sector across Canada. In particular, in the context of increased demand for power generation in Alberta in connection with data centre projects and the provincial "bring your own generation" policy (summarized here), project developers should be aware that the amended Project List removes the automatic application of federal oversight over power generation projects linked to data centres. Although few natural gas-fired power plants were required to undergo a full impact assessment under the IAA, particularly since the 2023 Supreme Court of Canada opinion in the IAA Reference (summarized here), this amendment to the Project List enhances regulatory certainty about the scope of the impact assessment framework that applies to such projects.

Proponents should note, however, that the removal of these project types from the Project List does not eliminate all federal regulatory touchpoints. In particular, fossil fuel-fired power generating facilities remain subject to federal emissions regulations, including the Clean Electricity Regulations and the Output-Based Pricing System under the Greenhouse Gas Pollution Pricing Act. The practical effect of the amended Project List is therefore to remove the automatic application of the IAA assessment layer, while leaving other federal environmental and emissions requirements in place.

The amended Project List similarly provides enhanced regulatory certainty for developers ofin situ oil sands projects, though such projects have avoided the IAA process to date given Alberta's legislated cap on oil sands emissions. It is worth noting, however, that several other intraprovincial activities remain on the Project List, including, for example, oil refineries, notwithstanding such projects are subject to comprehensive provincial assessment and approval processes.

Facilities Regulated by the Canada Energy Regulator

The amended Regulations also remove facilities that are regulated by the Canada Energy Regulator from the Project List. This means that assessments of such projects will be led by the Canada Energy Regulator under the Canadian Energy Regulator Act (CERA) rather than being subject to a review panel assessment under the IAA

This change restores the Canada Energy Regulator's role as the principal federal regulatory agency that is responsible for federal assessment of projects regulated under the CERA. The Government of Canada has indicated that this amendment to the Project List is connected to broader initiatives to streamline regulatory processes, and to provide "one project decision" on major projects within two years (see this blog for further background on the policy and regulatory context).

Specifically, the Government of Canada has removed the following project types from the Project List:

• International and interprovincial pipelines;
• International and interprovincial electrical transmission lines;
• Offshore renewable energy projects that are regulated under the CERA;
• Oil and gas pipelines and facilities in national parks and protected areas that are regulated under the CERA; and
• Oil and gas facilities that are functionally integrated into a federal work or undertaking that is regulated under the CERA.

Context and Key Takeaways

The amended Project List is the latest in a series of recent changes to the impact assessment framework for major projects in Canada. In October 2023, following an opinion from the Alberta Court of Appeal, the SCC issued its IAA Reference, concluding that the IAA was largely unconstitutional. You can read about the IAA Reference decisions here and here. In April 2024, the Government of Canada enacted several changes to the IAA (summarized here), purporting to respond to the SCC criticism in the IAA Reference. The Government of Canada then launched a consultation initiative to gather input on potential changes to the Project List, and that initiative culminated in the amended Regulations. Relatedly, the Government of Canada enacted the Building Canada Act in 2025, introducing a fast-tracked regulatory review process for designated projects of national interest.

Notwithstanding the newly reduced scope of the Project List, several key issues remain outstanding with respect to the IAA framework, and the Government of Alberta continues to advance its constitutional challenge of the IAA (as amended in April 2024). Argument occurred before the Alberta Court of Appeal in February 2026, and the outcome of that process is pending a decision from the Court.

The amended Regulations are also connected to Canada's broader policy objective to enhance the efficiency of federal and provincial regulatory and permitting processes for major projects, and to provide certainty to proponents, Indigenous partners, investors and stakeholders. The Government of Canada, in collaboration with provincial governments (including the Government of Alberta), has recently taken steps to streamline regulatory processes and avoid duplication in regulatory approval processes (for further background, see our blog post here). Bennett Jones is actively monitoring how the amended Project List connects to other ongoing policy and regulatory initiatives that affect energy sector proponents in Canada.

Bennett Jones is Canada's premier energy law firm, with the largest dedicated energy group in the country, active in all sectors of the industry. Our Energy Regulatory and Energy practice groups help clients develop major energy, infrastructure and construction projects through strategic and business-focused legal advice. To discuss the implications of the amended Project List for project developers across Canada, please contact a member of our team.