The provincial and federal governments have announced that they have started to work on an equivalency agreement that will reduce duplication and the need for two sets of regulations when it comes to coal-fired electrical greenhouse gas emissions.

An equivalency agreement would see the federal regulations stand down in favour of a provincial regulation, as long as the provincial regulation achieves equivalent or superior environmental outcomes.

“It's something that we've been hearing from industry, and we've been hearing from our consultations around the province that it would be beneficial for companies in Saskatchewan, and good for the province as a whole,” said provincial Environment Minister Ken Cheveldayoff.

About 500 consultations took place during a three-year span before the two levels of government announced their plans for an equivalency agreement on June 8.

"The governments of Canada and Saskatchewan are steadfast in their commitment to address climate change," said federal Environment Minister Peter Kent. "We remain focused on our mutual goal of reducing greenhouse gas emissions from coal-fired electricity, but want to ensure that Saskatchewan has the flexibility to choose an approach that best suits its circumstances."

An equivalency agreement would create flexibility for SaskPower to enable them to work with the province, and to come up with regulations that make sense for the electrical utility, he said.

Once it's fully implemented, Cheveldayoff said it should be able to reduce timelines, which should accelerate the regulatory process for projects. And it will provide regulatory certainty for companies like SaskPower, because they will know what the regulations are, and how they can be met on a fleet-wide basis.

“It works very well with the carbon capture and sequestration project that we're undertaking at Boundary 3 (Unit 3 at the Boundary Dam Power Station,” said Cheveldayoff.

The equivalency agreement won't actually impact the work underway at Unit 3, Cheveldayoff said, but it will allow the benefits of Unit 3 to be recognized, and to be spread out across SaskPower's entire fleet.

Coal-fired electrical generation will be the first industry in the province to have an equivalency agreement. Nova Scotia and the federal government announced plans for a similar agreement for coal-fired power plants earlier this year.

“We're going to be working on other industries as well,” said Cheveldayoff. “Right now this is the one we're focusing on. It's a very important one for us. We see it as the beginning of a very good relationship.”

The announcement comes as the federal government is finalizing new regulations for the electricity sector that will apply tougher standards for new coal-fired generating units and coal-fired units that have reached the end of their economic life. Final regulations are expected to be published later this summer.

Cheveldayoff said the provincial government will have to wait for the federal regulations, and establish their own regulations, before it can finalize the agreement. He couldn't pinpoint a date when a new equivalency agreement will be in place.