The rights and claims of Aboriginal people are critical considerations for wind energy projects in Canada. The term “Aboriginal” is used in Canada to refer to Canada’s indigenous peoples (First Nations and Inuit), as well as its Métis people.

It is essential for project stakeholders, such as developers, investors and lenders, to properly understand how Aboriginal rights and claims may affect a project. This is clearly demonstrated in the exponential growth of court cases in Canada on the constitutional "duty to consult" with respect to natural resource projects such as wind energy projects.

Aboriginal and Treaty Rights and Claims

Claims of Aboriginal peoples include comprehensive and specific claims made to government, assertions of Aboriginal rights raised in negotiations with government as well as those raised in legal proceedings.   

Treaty rights of Aboriginal peoples include those related to both historic treaties and modern-day treaties between Aboriginal groups, the Government of Canada and the relevant province or territory.  Modern treaties are also known as Aboriginal land claims agreements. 

Vast tracts of land in Canada are subject to historic treaties, modern Aboriginal land claims agreements or some form of claim by Aboriginal peoples. For instance, 26 modern land claims agreements, covering approximately 40% of Canada’s land mass, have come into effect in the last 40 years. There are also numerous Aboriginal claims negotiations currently underway across Canada. 

It is crucial for project developers, lenders and investors to understand that the existing Aboriginal and treaty rights of Aboriginal peoples in Canada benefit from constitutional protection (under the Constitution Act, 1982), and how this can impact a given wind energy project.

The Law of the Duty to Consult

The law in Canada is clear that the constitutional duty of the Crown (federal or provincial government) to consult Aboriginal peoples arises when the Crown:

1)                  has real or constructive knowledge of established or asserted Aboriginal or treaty rights such as hunting, fishing, trapping and plant harvesting rights; and,

2)                  contemplates conduct, such as issuing a permit or other authorization, that has the potential to affect these rights or claims adversely.

This duty is not dependent on Aboriginal communities obtaining a court declaration of their Aboriginal rights. Knowledge of the claim may be sufficient to trigger the duty. There must be a causal connection between the proposed new Crown action and a new potential adverse impact on the Aboriginal claim or right. 

The scope or content of the duty is proportionate to a preliminary assessment of: 1)  the strength of the asserted Aboriginal right or interest; and 2) the seriousness of the potentially adverse effect upon the right or interest claimed. The required level of consultation and if applicable, accommodation, is understood as a spectrum and will vary according to the particular circumstances of each case.

Critical Considerations for Wind Energy Projects

Due to the constitutional protection afforded to the rights and claims of Aboriginal peoples in Canada, it is critical for project developers, investors and lenders to determine whether or not an Aboriginal community’s rights and claims may be affected by a wind energy project and its infrastructure as part of their respective due diligence processes. This due diligence will assist in determining certain project risks, and will inform ways of addressing them.

The federal and certain provincial and territorial governments have also instituted Aboriginal consultation guidelines or policies for proposed projects within their jurisdictions. Both federal and provincial levels of government are increasingly seeking to involve private sector actors in consultation and accommodation processes with Aboriginal peoples.

Project-related Risks

The duty to consult ultimately rests with the Crown, not project proponents, investors or lenders. However, wind projects may be exposed to the risk of judicial or extra-judicial action where these issues have not been adequately addressed. From a practical perspective, project stakeholders bear an important share of these risks.  In the case of successful judicial action, these risks may include:

  • a court order suspending or rescinding a governmental permit or other authorization relating to the project;
  • a court declaration confirming the existence of treaty or Aboriginal rights that intersect with the project, and possibly confirming the infringement of such rights;
  • a court order to safeguard the rights of the Aboriginal peoples, including injunctions and other remedies which, in certain cases, have involved the court mandating government and private parties to engage in consultation processes with affected Aboriginal communities under the supervision of the court.

The consequences of such court orders are significant, resulting in delays to critical project timelines or to contractual delivery obligations. In certain cases, there may also be significant legal costs for a developer drawn into legal challenges against a project and its approvals by Aboriginal peoples.

Practical Means of Reducing Risk

Project proponents are well advised to engage early with potentially affected Aboriginal communities. This may entail funding or otherwise supporting their participation in the consultation process early in the project development cycle. Such early involvement may allow for more efficient adjustments to project planning, by identifying and addressing areas of specific concern to relevant Aboriginal communities relating to the construction and operation of a wind farm early in the development process. In relevant cases, such an approach may reduce the likelihood of opposition to the project.       

As a practical means of reducing the risk of opposition to a project by Aboriginal communities, private-sector proponents may enter into agreements (sometimes known as “Impact and Benefits Agreements” or “Collaboration Agreements”). These types of agreements typically include:

  • training, employment and business opportunities for Aboriginal communities and their members;
  • specific project mitigation measures, including environmental protection and monitoring;
  • coordination measures between the Aboriginal community and the project proponent;
  • undertakings of the Aboriginal Community to support project approvals and authorizations, or at least, not to oppose them; and
  • in some cases, financial arrangements