The AER’s governance structure achieves benefits of both strong corporate oversight and independent adjudication; the corporate, operational, and governance responsibilities are separate from adjudicative functions (i.e., hearings on energy applications).
A chair heads the AER and leads a board of directors; none are involved in the AER’s day-to-day operations and decisions. Rather, these directors set the general direction of the regulator’s business affairs and are charged with approving regulatory change and setting performance expectations for the AER and its chief executive officer. In this way, the AER’s board operates as a truly “corporate style” board.
The CEO, who reports directly to the chair, is accountable for day-to-day operations, which include receiving and making decisions on applications, monitoring and investigating energy resource activities for compliance, and closure of energy developments, including remediation and reclamation.
Hearing commissioners represent another important part of the AER’s structure. Reporting to a chief hearing commissioner, these commissioners are responsible for conducting all hearings into energy applications and regulatory appeals. The hearing commissioners are also involved in developing the organization’s hearing procedures, rules, and processes for Alternate Dispute Resolution by hearing commissioner. Hearing commissioners are independent adjudicators, and their decisions may only be reviewed by the Court of Appeal of Alberta.
AER Board of Directors, Hearing Commissioners, and employees are bound by a code of conduct and ethics.
Energy regulation in Alberta spans more than 75 years and has evolved over time. This evolution continued in 2013 when the AER became a new organization and began taking on regulatory functions related to energy development that were previously held by Alberta Environment and Sustainable Resource Development (ESRD). This transition is now complete, and the AER is now the single regulator of energy development in Alberta—from application and exploration, to construction and development, to abandonment, reclamation, and remediation.
The AER is 100 per cent funded by industry and is authorized to collect funds through an administrative fee levied on oil and gas wells, oil sands mines, and coal mines. The industry-funded model is commonly used by regulatory agencies from various sectors across North America.