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FRACKING AND IRON TRIANGLES: Who makes it into the policy process?
Leah Johnson
#1212541 Dr. Lars Hallstrom & Dr. Dittmar Mundel
POL 424 & IDS 390 Fall 2012
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Introduction
The issue of hydraulic fracturing has slowly been gaining public attention in recent years
with two prevalent discourses framing the issue. Hydraulic fracturing has either commonly been
depicted as a technological savior that will provide oil and gas sources for years to come, or as
an environmentally disastrous procedure that will allow us to continue to contribute to the
destruction of our water and land. Hydraulic fracturing, herein referred to as fracking, is a
controversial procedure of drilling for and extracting unconventional oil and gas sources. Many
landowners, environmentalists, and scientists alike make the argument that fracking
contaminates ground water; is even more environmentally unfriendly than conventional drilling;
uses an enormous amount of fresh water that Albertans cannot afford to waste or lose; and, uses
chemicals in the ‘frac fluid’ that cause myriad health problems. Although not all research studies
have been completed in Canada, comparable studies completed in the United States are able to
provide us with many examples where the concerns linked with fracking have been proven valid
(Bamberger and Oswald, 2012; Kerner, 2012; Rahm and Riha, 2012; Tilley and Muehlenbachs,
2011). However, despite these research findings, research on fracking is often treated as
inconclusive or not definitive enough to put a moratorium on fracking for industry and policy
makers because of the failure to do baseline testing on factors such as water and air quality
(Kerner, 2012; Bamberger and Oswald, 2012). Although there are studies proving the inherent
risks and dangers of fracking, Alberta oil and gas industries have capitalized on fracking
procedures to continue oil and gas exploration, so much so that there are currently 171,000
fracked wells in Alberta (Alberta Energy 2012, Shale Gas) with no foreseeable stop to fracking
procedures in sight.
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Many questions arise concerning fracking and public policy, given the degree of
controversy that surrounds the issue. For example, if the potential dangers have not been
adequately researched through baseline testing, why does the the oil and gas industry continue to
drill at the risk of public and environmental health? Has the Alberta government responded
diligently enough to address the concerns raised about public health and Alberta’s environment?
Although the Energy Resources Conservation Board (ERCB) is in charge of monitoring oil and
gas activities and also investigating public concerns, why has baseline testing not been
implemented and why have landowners been left with little support when their water has been
contaminated? In this paper I will investigate the relationship that exists between the Alberta
government, the ERCB, and the oil and gas industry, in the attempt to understand how public
policy on fracking has been formed and how it also fails to address the concerns present in public
opinion, such as water contamination, water use, and environmental impacts.
When analyzing the formation of public policy, it is important to note that inaction, or the
act of ignoring an issue, is indeed considered a marked policy action. Governments make the
conscious decision when and when not to act or pay attention to public concern. Furthermore,
surrounding the substantive issue of fracking in Alberta, the public constitutes an additional
group, a group which feels powerless in protecting themselves and their environment in the face
of fracking and the dangers it may have. I propose that an iron triangle of public policy exists in
Alberta. This policy structure implies that our democratic system is weak if the government is
failing to represent all its citizens, including those that are unable to penetrate into the iron
triangle in Alberta.
To begin exploring the issue of fracking and public policy, I will first explain what
exactly fracking is and explore some the concerns surrounding this method of extracting oil and
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gas. Secondly, I will describe the theory of iron triangles in public policy and what their
implications are for inclusivity in the policy process. Third, I will address the roles of the four
actors surrounding the issue of fracking in Alberta: the concerned public, the Alberta
government, the ERCB, and the oil and gas industry. Fourth, I will analyze whether or not an
iron triangle exists in Alberta. Finally, I will discuss the implications of such an arrangement in
our policies specifically. I argue that an iron triangle exists in Alberta public policy which is a
significant issue because it implies an impermeability of actors outside of the iron triangle in
affecting public policy which means that there is an inherent weakness in our democratic system
in Alberta as well as the inability to adequately react and address risk.
What is fracking?
Fracking is an industrial process for extracting unconventional, shale, oil and gas in a
well drilled first vertically, ‘typically’ from 800-3000 meters and then horizontally breaking
through the shale stone or coal seams. Unconventional oil refers to the method in which the oil or
gas is obtained, because we can no longer rely on conventional sources, considering they are
continually decreasing in productivity. Conventional oil refers to wells where little energy is
expended to extract oil and gas out of the ground; a well is drilled and the oil or gas either comes
out naturally or can be pumped out quite easily (ERCB 2011, brochure). Although fracking is not
a new method for extracting oil and gas, the first well having been fracked in Kansas in 1947,
there is a large window for error and complication given the complexity, magnitude, and scale of
the procedure that is being used today (Adachi, J., Siebrits, E., Peirce, A., Desroches, J. 2006,
740). Even in its simplest form, fracking is a complex procedure, in comparison to conventional
drilling, because it involves the use of at least three processes: breaking through underground
rock formations with fluid or small scale explosions to create the well, pumping fluid into the
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well at high pressure, and the use of a “fracture propagation”, such as sand, which is used to hold
the fractures open to allow the gas to escape (Adachi, J., Siebrits, E., Peirce, A., Desroches, J.
2006, 739). According to Adachi, et al., there are myriad complications involved with fracking
because of the ‘on the ground conditions’ that cannot always be foreseen in ‘ideal type’
situations in laboratories and studies. It is difficult to foresee all possible complications that can
take place on a job site while in a laboratory or in the planning stage of a job. These
complications can include:
the presence of layers of different types of rock; changes in magnitude and/or orientation of the in situ confining stresses; the presence of a nearby free surface; the leak-off of fracturing fluid from the fracture to the surrounding rock, which is a history-dependent process; the effects of shear and temperature on the fracturing fluid rheology; the transport of suspended proppant particles within the fracture, and modeling of fracture recession and closure (Adachi, J., Siebrits, E., Peirce, A., Desroches, J. 2006, 740).
Fracking is more resource intensive than traditional oil and gas extraction methods and it also
has a higher risk of complication, such as those complications listed above, given the complex
nature of the procedure.
In a 2011 report, the ERCB list the extensive number of challenges associated with
unconventional gas, all of which we can apply specifically to fracking. The cited common
regulatory challenges, which I feel are also included in the public’s concern, include: well
spacing requirements, real or perceived danger to ground water, intra-well communication, water
management (large volumes are necessary and are unsafe to return to the water cycle for human
consumption due to extreme contamination), transportation of water (either fresh or
contaminated), potential spills of fracturing fluid and contaminated water, continuous damage to
the surface environment due to the need for “multiwell pad sites”, poorly constructed well
casings, and air emissions including “nitrogen oxides, hydrocarbons, carbon dioxide” (ERCB
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2011 Report, 5-7). This paper will focus on the issues of water contamination, water use, well
casings, the toxicity of frac fluid and interwell communication.
The challenge in determining the risks associated with fracking, for citizens and policy
makers, is accessing adequate information to allow for educated assessment, understanding, and
judgements. For example, while the standard response of the government, industry, and ERCB is
that there are no documented cases of water contamination due to fracking (ERCB 2011,
brochure; Alberta Energy 2012, Shale Gas; CAPP 2012), there is also unarguably evidence from
landowners in rural Albertan areas that would prove otherwise (Ernst 2012, Ernst vs. Encana;
Cameron and Richards, 2011; Campbell and Campbell, 2012; Tilley and Muehlenbachs, 2011).
However, the evidence provided by landowners is often considered incomplete because they lack
baseline studies of their water or air quality to prove that there has indeed been a change in
quality. According to Bamberger and Oswald, industry and regulators fail to implement baseline
testing, which is the “complete testing of air and water prior to drilling and at regular intervals
after drilling has commenced” (Bamberger and Oswald 2012, 68). The term ‘adequate’ here is
quite ambiguous because while there are studies completed proving the risks and dangers of
fracking, they are still viewed as insufficient by industry and policy makers to make policy
changes, such as implementing baseline testing or requiring that companies publicly disclose all
chemicals used in their fracturing fluids (Bamberger and Oswald 2012, 68; Tilley and
Muehlenbachs 2011, 10). However, as this paper will prove, the failure to do baseline testing is
simply an example of regulators allowing the industry to carry on with their activities without
having to pay for the added costs of such testing that would also hold them accountable if
accidents were to happen.
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It is extremely difficult for landowners and farmers to prove that their water has been
contaminated without baseline testing on water and air quality. Although they are able to
noticeably tell their water is contaminated, through factors such the obvious presence of high
levels of gas, odor, or it is causing skin eye irritation, to list a few, they are unable to prove that
their water has actually changed if they do not have records of their water being clean prior to
drilling. Furthermore, often there are multiple wells on one piece of property or wells that have
“communicated” underground making it extremely difficult to determine which wells
specifically are causing damage to water. Often landowners are unable to know which exact well
is the culprit, therefore they are unable to hold industry accountable (Tilley and Muehlenbachs,
2011). Another problem landowners face is that, after lab results determine that their water has
been contaminated, they are again unable to prove a particular company as the cause, because
industry does not fully disclose what chemicals they use in their frac fluid because it is protected
as a “trade secret” (Ernst, Ernst vs. Encana; Cameron and Richards, 2011; Campbell and
Campbell, 2012).
For example, Shawn and Ronalie Campbell, a couple living in the Ponoka, Alberta area,
had their water first tested in 2005 after “gas began burping from [their] water taps”. They had it
tested and “identified by isotopic comparison with energy gas samples and found it to be
thermogenic in nature, meaning coming from a deep formation”. The water contained methane,
ethane, propane, butane and sour gas (Campbell and Campbell, 2012). Therefore, their water
contained contaminants, natural and industrial, that it previously had not. Although the ERCB
has been involved, they have never definitively drawn a link to contaminants in the Campbells’
water or any particular well, although the Campbell’s land is riddled with oil and gas wells. They
have been left to themselves, without the help of Alberta Environment or the ERCB, to
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determine “why the water started accumulating gas from over 1700 meters below”, which is the
approximate distance where industry had completed horizontal fractures (Campbell and
Campbell, 2012). The standard industry, government, and ERCB response they receive is that
any gas in their water well is naturally occurring.
Barbara Tilley and Karlis Muehlenbachs, both professors at the University of Alberta in
the Department of Earth and Atmospheric Sciences, claim that “methane in an aquifer can come
from microbial sources such as reduction of carbon dioxide or by fermentation, but can also be
thermogenic gas which has migrated from oil, gas, or coal bed methane wells (Tilley and
Muehlenbachs 2011, 1). Therefore, the methane, specifically, in the Campbells’ water could be
naturally occurring. However, Tilley and Muehlenbachs also state that “microbes do not add
ethane, propane and butane to aquifers” therefore “gas in an aquifer may be a mixture of local
microbial gas and a migrating gas from a nearby oil or gas well” because apart from the methane,
the other gases present are not naturally occurring (Tilley and Muehlenbachs 2011, 1-2). They
conclude their study by stating that, although some water wells produce natural gas through CO2
reduction or fermentation, there are also sources of gas that are not naturally occurring:
Years of intensive resource exploitation in agricultural areas have left an impact on some domestic water wells in Alberta. The source of contaminants in groundwater can be best identified by carbon isotope values of ethane which is diagnostic of deeper gas bearing formations beneath the aquifer. Because drilling and completion of resource wells at any given region occurred at multiple depths in different decades, it is often difficult to differentiate between specific putative sources. It is possible to identify specific sources of contaminants in problem water wells if enough isotopic background is available (Tilley and Muehlenbachs 2011, 10).
Again, they argue that having proper baseline data is imperative in completing proper scientific
investigations into the sources of contamination. Without baseline data it is difficult for
landowners, like the Campbells, to determine the sources of the gas in their water wells.
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Another obvious problem, like in the Campbells’ case, is that when there are multiple
wells on a property, drilled by multiple companies varying distances apart, it also becomes a
challenge to hold any one company responsible. A problem associated with fracking specifically
is “intra well communication” (ERCB 2011 Report, 5). When listing concerns associated with
fracking, the ERCB states that “there have been occurrences of intra-zone communication
between wellbores that are being hydraulically fractured and adjacent wellbores, that are either
producing or being drilled, sometimes considerable distances away” (ERCB 2011 Report, 5). As
previously stated, fracking includes physically breaking apart the shale or coal seam through the
use of high pressure fluid or small explosions. This part of the procedure cannot be controlled
because we cannot control how exactly the rock will break, because of “the presence of layers of
different types of rock” and the “changes in magnitude and/or orientation of the in situ confining
stresses” (Adachi, J., Siebrits, E., Peirce, A., Desroches, J. 2006, 740). Intra-zone
communication means that often the fractures underground can end up meeting one another and
a transfer of fluids and gases can take place. Again, this ‘communication’ makes it difficult for
landowners to determine which exact well is causing problems for their water. If they are unable
to determine which well is responsible, they are also unable to hold industry accountable,
considering different companies may own different wells on one piece of property.
However, regardless of the fact that a landowner may not be able to prove which well
specifically to hold accountable, it does not mean that industry is not responsible for
contaminating their ground water. Therefore, fracking can be responsible for contamination
although the standard industry response is that there are no proven cases of groundwater
contamination. That simply means that nobody has been proven to be responsible. It does not
mean that it is not caused by industrial activities as industry would like the public to believe.
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The ERCB also includes casing as one of the known concerns about fracking, stating that
“potential conduits are existing wellbores (or the new well being fractured) with inadequately
cemented casing” (ERCB 2011 Report, 10). Apart from not being able to prove which wells may
be causing contamination, another common tactic the oil and gas industry uses to avoid
responsibility is claiming that fracking does not cause contamination to ground water although
the culprit could be poorly cemented well casings (Kerner 2012, 244). However, casing
construction is an integral step in the fracking process therefore inadequate casings cannot be
seen as a separate issue from fracking because every fracked well must also have a casing.
Furthermore, if improperly constructed casings is the reason for land or water contamination, the
public should be questioning the construction of all oil and gas wells because they all have a
well casing, conventional and unconventional.
Another concern is the amount of water fracking requires and the amount of
contaminants that the water ends up being laced with (Kerner, 2012; Rahm and Riha, 2012). On
average, 5.5 million gallons of water are used to hydraulically fracture one shale gas well,
although it should also be kept in mind that industry often treats and reuses contaminated water
on different drilling sites (Bamberger and Oswald 2012, 52). However, water remains an issue of
concern because once water has been contaminated with frac fluid, it cannot be purified or
returned back to the water cycle for human consumption. To dispose of contaminated water,
industry has to inject the water deep below the ground to ensure that it cannot be re-introduced
into our groundwater, lakes, and rivers (Kerner 2012, 242). Therefore, once industry uses water
to hydraulically fracture a well, the water is considered completely eliminated from natural
hydrological systems and no longer has the possibility of future human consumption.
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According to Bamberger and Oswald, substances in frac fluids range from “the relatively
benign to the highly toxic” (Bamber and Oswald 2012, 52). Furthermore, the following results
were listed in a study of 353 chemicals found in fluids used for natural gas production:
More than 75% of the chemicals could affect the skin, eyes, and other sensory organs, and the respiratory and gastrointestinal systems. Approximately 40–50% could affect the brain/nervous system, immune and cardiovascular systems, and the kidneys; 37% could affect the endocrine system; and 25% could cause cancer and mutations (Colborn, Kwiatkowski, Schultz and Bachran 2011, 1039).
In one particularly extreme example proving the chemicals’ toxicity, a worker was recorded to
have turned off a chemical blender during the fracturing procedure, which caused the fracturing
fluids to spill into the adjacent cow pasture. Within one hour 17 cows were dead after suffering
fatal gastrointestinal, neurological, and respiratory problems (Bamberger and Oswald 2012, 55-
59). Although this example of contamination highlights immediate damage to livestock, there
remains to be limited data proving the cumulative effects of frac fluid contamination on both
human and environmental systems.
According to Kathleen Kerner, speaking about hydraulic fracturing and new methods for
extracting natural gas specifically, “the potential environmental and health cost of mass-
extraction of natural gas seems to outweigh the benefits of the energy resource” (Kerner 2012,
245). She claims that the risks to environmental and human health are too high to try and
outweigh them with economic benefits that accompany oil and gas exploitation (Kerner, 245). If
the risks outweigh the benefits, why is our government allowing the oil and gas industry to
pursue hydraulic fracturing as a means to produce unconventional oil and gas and what policy
theories can be applied to understand the relationships that exist between the different actors
involved in this issue?
Iron Triangles
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In an attempt to understand the relationships present in the issue of fracking, it is
necessary to discuss the different actors as well as the degree of dominance any one actor may
have in effecting the policy process. In Alberta, oil and gas is the primary industry therefore it
has the privileged position of determining and shaping the public discourse because it is such a
great source of the province’s wealth, although whether or not one sees that as individual or
collective wealth is debatable (Hunter, Chrapka, Dwarkin, McKenzie, Plourde, and Spanglet
2007; Mansell and Schlenker, 2006). According to the Alberta Royalty Review Panel, “about
30% of the Government of Alberta’s total revenue comes from oil and gas royalties, and about
one in six Albertans are directly or indirectly employed in the energy sector” which contributes
to about one half of Alberta’s GDP (Hunter, et all. 2007, 45). It is not uncommon to hear the
phrase “Alberta is oil”; this phrase rings true considering that one industry has had the power in a
forty to fifty year period of shaping the province’s economic, political, social, and cultural
systems (Dorow and Gozi, 2011). Howlett and Ramesh state that “in a situation where one idea
set is dominant and unchallenged - such as often is the case for extended periods of time in an
area such as fiscal policy - a form of monopolistic or hegemonic community may develop”
(Howlett M., and M. Ramesh 1998, 471). Therefore, it is important to understand the
implications of having this dominant idea set, here being the dominance of oil and gas in Alberta,
in our society, government, and public policies.
The theory of iron triangles in public policy help us to visualize the nature of the
hegemonic community Howlett and Ramesh speak of. The theory also helps to explain the extent
in which the dominant idea or goal, here being the control and continuance of the energy sector
of Alberta, is unchallenged and remains so.
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Grant Jordan analyzes iron triangles in contrast to other “images of the policy process”,
such as issue networks (Jordan 1981, 95). He claims that iron triangles in the American context
are simply a policy structure composed of three groups, those being interest groups, federal
administrative or bureaucratic bodies, and Congressional committees (Jordan 96). Iron triangles
form a closed network of policy actors because they are stable and have a limited or exclusive
membership. They are characterized by “a degree of stability and predictability over time,
fragmentation limited through departmental recognition of participants, effective decisions
within sectors, closed debate” (Jordan 107).
Jordan contrasts iron triangles with issue networks, which have an unlimited and
unpredictable list of members and lack the authoritative heads in decision making that iron
triangles have (Jordan 96). He claims that issue networks could be more accurate in
understanding the policy process and the actors involved because “iron triangle uses too rigid an
image” while issue networks acknowledge the diverse and constantly changing list of influences
to the policy process (Jordan 116). However, while I do agree that in some cases iron triangles
may be too rigid to accurately demonstrate how all of our policies are formed, I do not think they
are too rigid to describe what is taking place in Alberta regarding energy, which I will explain
later in my paper.
Daniel McCool describes four key characteristics of iron triangles, which enable them to
maintain their dominance in dictating public policy: they mainly concern “distributive policies,
the congressional norms of reciprocity and logrolling, an autonomous decision-making process,
and a high degree of program implementability” (McCool 1994, 8). Distributive policies mainly
concern tariffs, land policies, subsidies, resources, etc., and are characterized as being extremely
stable, containing few actors in the decision making process, and having a high level of
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logrolling (Lowi 1972, 300 and 304). First, McCool states that iron triangles exist around
distributive policies. Money and resources are heavily concentrated in a small number of actors.
Second, reciprocity and logrolling are common place, both terms implying that there is often a
system of favors and economic and political ‘back scratching’ that benefit a closed number of
actors. This system can be in quite obvious ways, through public partnerships or endorsements,
but is also exercised through backdoor deals, making any changes in policy even more invisible
through unspoken acts of incrementalism. McCool states that one of the major consequences of
reciprocity and logrolling specifically is that there becomes an “inability of the government to
plan projects adequately on a comprehensive basis”, which further emphasizes the closed
relationship present in decision making (McCool, 98). Third, iron triangles have an autonomous
and unchallenged decision making process, therefore there is more control, increased exclusivity,
and fewer people with which to share the pie (McCool, 7). Fourth, iron triangles have a high
degree of program implementability; nearly all or most changes to policy or projects are passed
through the system quickly and with little debate (McCool, 8). The lack of debate mentioned, as
well the unchallenged decision making process, is evident when studying industry regulators or
other bodies which appear to keep institutions in check but actually do not.
Another valuable point of McCool’s to note is that iron triangles often have various
subcommittees that are meant to give the impression that the government is dealing with the
issue at hand (McCool, 9). The creation of committees and subcommittees and panels is to boost
the public perception that whatever the topic or issue of concern may be - it is being dealt with.
The public is given the impression that they no longer need to worry about the issue, or they
need not to begin worrying, because an official and powerful body is taking care of it. However,
the subcommittees’ sole purpose is to reinforce the goals of the triangle, rather than change or
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monitor their activities, as we would be led to believe. For example, if the public is increasingly
voicing that we do not have proper regulatory bodies in the oil and gas sector, the government
will claim that they are investigating the issue, like consulting specialists to determine possible
policy actions, or that they have created a new panel to do so, although the panel will have a
number of loopholes that will prevent it from actually being useful. These loopholes can include
appointing scientists that are employed by oil and gas sector or setting a narrow agenda of what
the panel will actually investigate. I will later determine whether or not this is the case in
Alberta.
The underlying implication of iron triangles within public policy is that they promote
undemocratic actions, which are obviously reflected in every stage of the policy process by
restricting the process to a small number of groups or individuals who are “dominating the
process and repelling all outsiders” (Vernon, Spar and Tobin 1991, 4). From identifying
problems, setting policy priorities, formulating and adapting policies, to policy implementation
and evaluation, iron triangles exert their influence and control. Alternative voices from outside
the iron triangle are either silenced, ignored, or publicly humiliated. We cannot talk about the
strength of democracy in our province as long as there is truly only one body, that is the
collective body that creates the iron triangle, which is responsible for every aspect of the policy
process.
Actors
Although there are many actors involved in the issue of fracking, as it is a complex
problem, I choose to identify four: the oil and gas industry, the Alberta government, the ERCB,
and those concerned about the dangers of fracking, whom I have already discussed in the section
on fracking. In this section, I will primarily discuss the first three actors listed above, their roles
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within the topic of oil and gas more generally, and then conclude by discussing what
implications their roles have more specifically for fracking.
I considered eliminating the ERCB from my argument and including the media as a third
actor in its place. While Andrew Nikiforuk refers to the ERCB as the “de facto rubber stamp for
oil and gas development” (Nikiforuk 2012, 181), therefore not really having any role at all, I
thought it was important to include them in my argument because its essential role is to fulfill a
check and balance within our energy industry. Identifying its role and its failures highlights the
lack of accountability that the Alberta government and oil and gas industry would like us to
believe exists.
Jeff Gailus makes a similar argument to mine about information and public policy, but
describes it as a “modern-day Triple Alliance” throughout his book Little Black Lies. A
difference between his argument and mine, beside the obvious difference in vocabulary, is whom
he includes in his “Triple Alliance” (Gailus 2012, 5). While the Alberta government and oil and
gas form two legs of Gailus’ argument, he includes the Canadian federal government as the third
actor in his argument, differing from my choice in including the ERCB. Eugene Lee and Antony
Perl, authors of The Integrity Gap, also draw attention to our federal system’s inability to move
forward with adequate and effective environmental policies. They claim that our governments
are often unable to properly implement environmental policies because of the split in
jurisdictional authority and the conflict between the two levels of government (Lee and Perl
2004, 11). While I do think that identifying the Canadian federal government is a worthy topic of
discussion, I decided that identifying the pitfalls of federalism in topics such as environmental
policy do not sufficiently address the lack of checks and balances within our system in Alberta
specifically.
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In the case of my argument, it is necessary to identify the first actor concerning the issue
of fracking in Alberta which is the oil and gas industry. Oil and gas is a business therefore their
primary objectives are profit and growth. They are not concerned with the social wellbeing of
our communities, the health of environment, or that our democracy is inclusive and participatory.
As a money making endeavor, the oil and gas industry is concerned with making money, which is
clear when reading the goals and strategies that Canadian Association of Petroleum Producer
(CAPP) list on their website.
CAPP represents its members who are producing 90 per cent oil and gas in Canada with a
revenue of about $100 billion per year (CAPP 2012, CAPP’s Mission). They are an useful
organization to include in this study because of their active role in representing Canadian oil and
gas and their activity in the public sector. On the CAPP website they state that their mission is:
to enhance the economic sustainability of the Canadian upstream petroleum industry in a safe and environmentally and socially responsible manner, through constructive engagement and communication with governments, the public and stakeholders in the communities in which we operate (CAPP 2012, CAPP’s Mission).
They continue to elaborate on their mission by stating their goals and strategies, which include:
ongoing improvement of their stewardship of the environment, health and safety while
simultaneously growing a profitable industry; constantly opening access to markets, increasing
growth, and building producer networks; developing a fiscal regime that strengthens the
economic health and continuance of oil and gas exploration; streamline the timeliness and
decrease the cost in which companies can access land; develop a regulatory body that works with
industry goals and operated at the lowest possible cost; work at maintaining and continually
developing a relationship with the government and public to allow for the achievement of their
goals more easily (CAPP 2012, CAPP’s Mission).
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Many of these goals may seem reasonable or acceptable, especially considering that they
include the environment and communities in their mission statement. However, it is important to
recognize that an organization cannot simultaneously try to maximize profit, minimize costs and
care for land through proper regulations while also trying to weaken the regulatory process to
allow for them to meet their goals as quickly as possible. For example, if CAPP’s goal is to help
a member company gain access to land at the lowest possible cost, they cannot at the same time
be overly concerned with giving landowners the fairest price for operating on their land. They
also cannot claim that they are concerned with health of the environment while trying to
strengthen and continue oil and gas exploration, keeping in mind that oil and gas exploration is
inherently at odds with caring for the environment considering the threat of climate change and
the already dangerous levels of carbon in the atmosphere (Warnock 2006, 23-24). Furthermore,
CAPP claims that they are also concerned with the environment but one of its goals is to “build
an efficient regulatory framework that meets industry objectives and that can be effected at the
least cost” (CAPP 2012, CAPP’s Mission). This statement is the equivalent of saying that they
want a strong regulatory body to protect the environment as long as it does not regulate their
activities or increase the cost it takes them to operate. The job of a regulator is to protect the
environment, not to minimize costs. All of the goals and strategies listed by CAPP contradict
themselves in the same manner.
An organization cannot operate through a cost-benefit analysis framework and also claim
to care for the environment and communities because they are not factors that can be quantified
fiscally, which also known as externalities. This point is extremely valuable to keep in mind
when viewing industry websites or advertisements. For example, on their More Facts. Less
Friction webpage, set up to counteract the public’s ‘misperceptions’ about the dangers of
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fracking, CAPP states that “the natural gas industry continues to work with regulators and policy
makers to ensure development is conducted in a responsible manner” (CAPP 2012, More Facts.
Less Friction). However, referring back to their goals and strategies previously mentioned, they
are primarily concerned with increasing profit and expansion and are continually trying to work
with government so that their activities are done as quickly as possible. Therefore, while they
claim that they are working with government and regulators to ensure responsible development,
they by nature of their goals and strategies will also continue to strive for less regulations
because they hamper the speed in which they develop.
The next actor that I will address is the Alberta government. It is not difficult to
understand the role of the Alberta government when looking at the Alberta royalty regime.
Understanding how royalties are being collected helps us understand the role of the government
in oil and gas because they highlight the difference in relationships between the government and
public and the government and industry. Oil and gas royalties are implemented through the
understanding of all actors that “resources belong to Albertans” and the government is merely
the public’s “agent and makes deals with developers to produce from those resources” (Hunter,
Chrapka, Dwarkin, McKenzie, Plourde, and Spanglet 2007, 22). The resources belong to all of us
and energy companies must pay us to exploit our resources, with the government being the
middle actor that must collect our payments. Therefore, we are able to use oil and gas royalties
as a clear example to understand if our government is doing its job in representing us by
determining if it is collecting adequate compensation for the resources that belong to us.
Ed Stelmach, as the new premier in 2007, set up an independent panel to review oil and
gas royalties in response to a growing number of Albertans questioning if we were receiving
adequate compensation for the exploitation of our resources (Nikiforuk 2010, 160). After
21
completing its mandate, the Alberta Royalty Review Panel concluded that “Albertans do not
receive their fair share from energy development and they have not, in fact, been receiving their
fair share for quite some time” (Hunter, et all. 2007, 4). Throughout their report the Panel argues
that through low royalties, tax breaks, and industry subsidies, the government has demonstrated
that they are not protecting the interests of Albertans but are merely enhancing the privileged
position of the oil and gas industry (Hunter, et all. 2007, 5).
According to the Panel, the royalty system in place today is outdated, the last major
changes happening in 1992, as well as unnecessarily complex (Hunter, et all. 2007, 64). The
system primarily only applies to conventional oil as well so it does not incorporate the added cost
to the environment by developing unconventional sources whose impact are more intensive on
the environment, nor has it been adjusted for the consequent rising cost of oil that is
accompanied by unconventional sources (Nikiforuk 2012, 165). That being said, the Panel also
claim that there have been “various tailorings over the years to adjust for particular resource
circumstances or spur different kinds of activity have added further layers of complication”.
These tailorings include: three different royalty tiers for oil and two tiers for gas, adjustments for
both natural gas and oil that account for low-productivity, four special programs for each oil at
the well level, and oil at the project level, and natural gas (Hunter, et all. 2007, 64).
The complexity of the system and number of adjustments and allowances the system
entails reflects the bending and tailoring of the government to maximize the profit margins of the
energy sector. Rather than tailoring the system to maximize the benefit Albertans receive
collectively for the exploitation of the resources that belong to them, the government has chosen
to privilege the oil and gas sector by allowing a complex system of cuts and breaks. The
complexity of the system also reflects a lack of transparency because the public is unable to
22
actually determine whether or not they are receiving their fair share of the profit being generated
by the oil and gas industry. The Panel draws attention to the fact that “the government of Alberta
is the trustee for the resource owners” and as the trustee it must “meet the highest standards of
performance” that come with that role (Hunter, et all. 2007, 93). The only way we can hold the
government accountable to their position “is if all stakeholders have access to the information
needed to assess standards of performance” and “without such information, ‘accountability’ is a
hallow and lifeless concept” (Hunter, et all. 2007, 93). Therefore, the Alberta government must
simplify the royalty regime to allow for full transparency so that Albertans can hold their
government accountable.
The next piece of the iron triangle in Alberta is the Energy Resources Conservation
Board (ERCB), who describe themselves as “an expert tribunal that has been regulating the
province’s energy resources for almost 75 years” (ERCB 2012, Who We Are). The ERCB lists
eight objectives on their webpage: achievement and maintenance of high industry regulatory
standards to ensure public safety, environmental protections, and energy resource conservation;
to be an active body in pinpointing and addressing issues that affect the oil and gas industry and
the stakeholders (including the public) who are affected by these issues; to improve decision
making processes that are just, efficient, and adaptable; to ensure that Albertans are not subject
to industry abandonment and decommission; improve relationships across organizations to allow
the ERCB to be in a position of success. They also list three objectives that relate to a high
standard of customer service and respect towards stakeholders (ERCB 2012, Who We Are).
Again, equal to CAPP, it is useful to understand the underlying implications and contradictions
present when reading the goals or objectives listed by the ERCB because they provide evidence
of the interlacing and reinforcing goals of all corners of the iron triangle.
23
Although they list the environment and the conservation of resources as one of their
objectives, as it essentially is the reason for their existence because their title as the Energy
Resources Conservation Board, they completely contradict this objective in their 2011
publication “Unconventional Gas Regulatory Framework—Jurisdictional Review” (ERCB 2011
Report, 16). They state that “of key importance to unconventional gas operators is efficiency of
development. Costs, delays, and uncertainty caused by regulatory processes will hinder
unconventional gas economics”, without defining what exactly ‘unconventional gas economics’
means (ERCB 2011 Report, 16). Specifically concerning fracking, they also state that “access to
large volumes of water from a variety of sources for hydraulic fracturing will be needed, so
timely assessment and approval of processes are required” (ERCB 2011 Report, 16). In these
statements, they make it clear that they are the same as industry, operating purely on a cost-
benefit analysis framework, rather than protecting and conserving the resources that their name
inherently would imply.
The ERCB’s only concern is that they allow for industry to operate at optimal speed,
efficiency, and with the lowest level of hindrance possible. They are not concerned with quality
assurance, or the protection of the environment, but that development is approved and proceeded
with as quickly as possible. Rather than discussing the environmental cost of using large
quantities of water and the need for strong regulations to ensure that our water is protected, the
ERCB demonstrates that their objective is the rapid approval of development projects. The word
‘conservation’ in their title would lead the public to believe that they are advocating for energy
and environmental conservation. It might even imply that it is concerned with lengthening the
time Alberta can prosper, and that it is operating with future generations in mind. This is
obviously not the case when they claim that additional “costs, delays and uncertainties caused by
24
regulatory processes” are a nuisance to the industry (ERCB 2011 Report, 16). In saying this, they
openly criticize their own existence, further reinforcing the goals that CAPP states on their
webpage.
Iron Triangle in Alberta?
It is now necessary to determine the existence of an iron triangle in Alberta. First,
following Grant’s definition of an iron triangle as a policy structure composed of interest groups,
administrative or bureaucratic bodies and Congressional committees, it is apparent that the oil
and gas industry is a powerful interest group within Alberta, the Alberta government is a
congressional or governmental group, and I am classifying the ERCB as the third actor within
Alberta’s iron triangle as fitting into the bureaucratic or administrative role as a regulator.
However, the groups’ existences alone do not necessarily imply a stable, exclusive policy
structure that form a monopolistic and hegemonic community.
According to McCool’s description of iron triangles, an iron triangle may exist if there is
a rigid policy structure that mainly concerns a distributive policy, a system of reciprocity and
logrolling, an unchallenged and streamlined decision making model, and easy program
implementability (McCool 1994, 8). It has been demonstrated that this is the case in Alberta.
It is apparent that the goals of the oil and gas industry, as illustrated by CAPP, are being
met. As previously stated, the oil and gas industry’s primary concern is with generating wealth
and ensuring the continuance, growth, and development of the oil and gas industry. The
government of Alberta’s role is as the trustee of Albertans’ best interests, which would also
include the health of Albertans’ bodies and in turn their environment. A healthy body cannot
exist if the environment that it is placed in and sustains it is being polluted and is unhealthy,
therefore in the case of this paper, the health of the environment and the health of the human
25
body are seen as being the same. The ERCB’s role is to regulate the oil and gas industry and
ensure the stewardship and protection of our environment. Although the goals of the Alberta
government and ERCB appear to both demonstrate a concern and responsibility for Albertans,
their actions depict that they are indeed working to reinforce the goals of the oil and gas industry.
According to McCool, “interest groups are critical to the success of an iron triangle”
because “they form the organizational nucleus” of the policy structure (McCool 1994, 25). The
oil and gas industry, as the interest group in Alberta’s iron triangle, are unarguably the
organizational nucleus that McCool speaks of because their mission, goals, and strategies have
largely been adopted by both the Alberta government and the ERCB. As previously stated,
CAPP’s mission is to ensure the oil and gas industry’s economic sustainability which can be met
by a fiscal regime that strengthens the economic health of the oil and gas industry and a
regulatory body that works with industry to ensure the timeliness and efficiency of development.
The Alberta royalty regime reinforces CAPP’s goals of a fiscal regime that ensures their
economic growth and sustainability. The ERCB also reinforces CAPP’s goals of having a
regulatory body that allows for rapid development and that strives to allow them to operate at
low cost. The ERCB also demonstrates McCool’s theory that iron triangles contain bodies or
committees that lead the public to believe that issues they are concerned about are being looked
after, while in reality they are only meant to reinforce the goals of the triangle rather than address
the problem. They work in a system of agreement with one another, rather than maintaining a
system of checks and balances to guarantee accountability and responsibility as they are
supposed to.
Implications
26
The first underlying implication of an iron triangle in Alberta is that it prevents our
democracy from functioning in the manner that it is meant to. According to D. F. Thompson,
“democracy itself affirms that the citizens bound by laws should have a voice in making them”
(Thompson 2010, 18). He continues by stating that “democratic government is supposed to be
responsive”, responsive implying that it acts to address to the danger and risks citizens are
subject to (Thompson, 18-19). Considering the evaluation in this paper of the presence of an iron
triangle in public policy, the citizens of Alberta are clearly not welcome participatory members
in their democratic system and or encouraged to help shape the public policy that directly affects
them. If citizens are not included in the policy process, or not heard when their water has been
polluted by industry or when risks to their basic health are ignored, than it is clear that our
democratic system is not working as it should or in the way that citizens are lead to believe.
The key issue that D. F. Thompson discusses thoroughly is how democracy should also
work for future generations (Thompson, 2010). The iron triangle present in Alberta demonstrates
extreme presentism, which means a “bias in the laws in favor of present over future generations”
(Thompson, 17). Fracking demonstrates a clear example where present generations are the only
population being considered because the benefits are concentrated in the hands of a few
individuals which are living today. Although this paper has demonstrated that our democracy is
weak today, it also implies that it will only continue to weaken because our laws are built to
ignore and strip the rights of future generations. Future generations will have to bear the
cumulative effects of risky industrial activity, such as the impact on clean water. The current
policies concerning fracking, and the policy structure that make them, are shortsighted and lack
the institutional diversity to adapt and consider the myriad complications that are involved with
the issue.
27
Furthermore, it is not surprising that fracking is taking place at the risk and threat to
public health and the health of our environment because strong regulations and the guarantee of
public health are not a major concern, as demonstrated by the iron triangle’s collective focus on
the industry’s present growth and economic sustainability. The danger present here is that we
lack the institutional diversity to produce policies that protect us from risk. According to Klinke
and Renn, academics focussing on risk governance, institutional diversity is beneficial because it
can:
offer considerable advantages when complex, uncertain, and ambiguous risk problems need to be addressed because, first, risk problems with different scopes can be managed at different levels, second, an inherent degree of overlap and redundancy makes nonhierarchical adaptive and integrative risk governance systems more resilient and therefore less vulnerable, and third, the larger number of actors facilitates experimentation and learning (Klinke and Renn 2011, 274).
Not only are rigid policy structures, like those present in Alberta’s iron triangle, not reflective of
democracy because they are inherently authoritarian but they also put us at risk of vulnerability
generally. The presence of fracking is merely a reflection of overlap and redundancy within the
policy process because the three actors in the iron triangle reinforce and advance the same goals,
rather than bringing a diverse set of perspectives and knowledge. Considering the complexity of
the issue, an iron triangle does not have the ability to address all of the sub-issues associated with
fracking because it by definition is rigid and closed to actors with diverse experience and
knowledge.
As demonstrated, fracking is a complex and ambiguous policy problem. Complex
problems can be understood using complexity theory, which attempts to identify “systems or
processes that lack the order and stability required to produce universal rules about behaviour
and outcomes” (Cairney 2012, 347). Fracking can be seen as a complex policy problem for
28
multiple reasons. There are multiple stakeholders involved, which also include the actors who
make up Alberta’s iron triangle, the public whose water and land is being damaged, as well as
the scientists who have produced the information that I have used in this paper. Many
stakeholders involved have different values and world perspectives entirely, such as industry
viewing the world and environment in terms of profit and production which is contrasted with
landowners who see their land as the home of their families, their families’ past and future
histories, and communities more generally. There is the need to balance monetary and non-
monetary factors, meaning balancing the potential wealth fracking could generate and the
potential harm to environmental and human health which cannot be reduced to strictly economic
terms. There is also the added layer of known and unknown risks. There are examples of
immediate damage caused by fracking, such as the example of dead livestock, but the cumulative
damage the use of fracking could cause fifteen, twenty, or fifty years down the road is still
largely unknown. Furthermore, another point of analysis in understanding the complexity of
environmental problems is that human and non-human systems are interwoven and impact each
other, at which the theory of complex ecologism is presented. Cudworth and Hobden argue that
“rather than seeing a separation between the human and the non-human, complex ecologism sees
the human world as embedded within the natural world, with the variety of human social systems
intersecting with those of other natural systems” (Cudworth and Hobden 2011, 54). What is clear
is that how environmental issues are understood and how policy makers approach complex
problems, such as fracking, are not linear, clear, or static processes.
According to Thomas Homer-Dixon, a Canadian academic and author, our societies
generally are “becoming steadily more complex and often more rigid” (Homer-Dixon 2007, 6).
In the face of complex problems, like fracking, the present institutions are unable to adapt and
29
create solutions unless they “are comfortable with change, surprise, and the essential transience
of things” (Homer-Dixon, 282). Therefore, unless the policy structure in Alberta diversifies and
becomes more open to different perspectives and ideas, it will have the crippling inability to
adapt in the future if the cumulative effects of processes like fracking indeed have catastrophic
effects on our environment and health. The present shortsightedness of our institutions may not
only affect a few rural landowners, but could drastically and negatively alter the ways the entire
society operates.
Conclusion
This paper has discussed some of the risks associated with fracking, such as water
contamination, water use, leaking well casings, toxicity of frac fluid, and interwell
communication. It has answered how fracking continues to take place, at the risk of
environmental and human health, through the presence of a rigid policy structure that I have
identified as an iron triangle in Alberta. This iron triangle is composed of the oil and gas
industry, the Alberta government, and the ERCB. Through the discussion of CAPP, the Alberta
royalty regime, and the ERCB, it has been exemplified how the iron triangle in Alberta operates
and reinforces the power of the oil and gas industry in dictating public policy through a series of
mutually reinforcing goals and objects. Finally, this paper has identified how the existence of an
iron triangle the policy process undermines democracy, which also puts Albertans at risk when
faced with complex problems. The best approach for improving the responsiveness of our
institutions and strengthening our resiliency, in the face of dangerous industrial procedures such
as hydraulic fracturing, is increasing our institutional diversity in the policy process. Institutional
diversity is key to successful risk governance because it allows for diverse perspectives and
30
knowledge sets to permeate into the policy process, which in turn also allows a greater degree of
creativity, skill, and adaptability to be incorporated into our public policies.
31
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