Inspection Guidance for Regulated Parties - Compliance Operations, Office of Energy Efficiency
1. Purpose
The purpose of this guidance document is to inform stakeholders about Natural Resources Canada’s inspection strategy for regulated energy-using products regulated under the Energy Efficiency Act (Act) and Energy Efficiency Regulations (Regulations).
This document briefly describes the inspection process used to assess whether products and dealers comply with the Act and Regulations.
Refer to the Glossary for definitions of terms.
2. Scope
This guidance applies to you if you are a dealer of regulated energy-using products.
A dealer is defined in the Energy Efficiency Act as a person engaged in the business of
- manufacturing energy-using products in Canada
- importing energy-using products into Canada or
- selling or leasing energy-using products obtained directly or indirectly from a person engaged in a business described in a) or b) or an agent thereof.
The Regulations establish that the dealer has the overall responsibility of complying with the Regulations. Locations that contain regulated products that are owned by or on the premises of a dealer or a consignee, may be inspected.
3. Background
The Act and Regulations are administered by Natural Resources Canada (NRCan). The Regulations apply to prescribed energy-using products that must meet federal energy efficiency standards, testing, marking, and labelling requirements.
Regulatory activities conducted by NRCan’s Compliance Operations include inspections and other monitoring and surveillance strategies to assess compliance. Inspection activities are conducted by NRCan under the authority of section 10 of the Act and inspectors are designated under section 9.
4. Compliance and enforcement activities
The Compliance and enforcement policy provides information about NRCan’s approach to compliance and enforcement. As part of its regulatory responsibilities, NRCan promotes and monitors compliance and undertakes enforcement activities.
4.1 Inspections
The main objective of inspections is to verify compliance with the Act and Regulations. This includes, but is not limited to, the verification of:
- compliance with energy efficiency verification mark requirements;
- compliance with required labels, if applicable;
- compliance with energy efficiency standards.
Inspections may be initiated as part of scheduled monitoring activities or in response to information obtained by Compliance Operations.
4.1.1. Responsibilities of the regulated party
Dealers are expected to:
- understand the Act and Regulations and their obligations
- ensure their products comply with the requirements
- keep records about energy-using products for six years
- provide models of a product for examination and testing
During an inspection, it is the duty of the owner or the person in charge, and any person found in a place entered by an inspector, to provide NRCan inspectors with all reasonable assistance to enable them to carry out their duties and provide such information the inspector may reasonably require.
Preventing an inspector from inspecting, or knowingly making any false or misleading statements orally or in writing while the inspector is engaged in carrying out their duties or functions under the Act or the Regulations is a violation of section 12(2) of the Act.
4.1.2 Site selection
Compliance Operations takes a risk-based approach that considers a variety of criteria when selecting a site for inspection:
- Presence and quantity of regulated products
- Products identified as high risk or identified for routine inspection
- Compliance and inspection history
- Import data and energy efficiency report data
- Tips and complaints
They can be planned (proactive) or in response to a complaint or information (reactive), and they provide feedback to the regulated party in the documentation of inspection results. The frequency of inspection may change if information is received about potential non-compliance.
4.1.3 Inspection activity
Inspections of different categories of regulated products are conducted each year in Canada and may include follow-up inspections. Their main function is to verify compliance. Compliance promotion can occur as inspections may provide opportunities for education.
For the purposes of compliance inspections by NRCan, an inspection site is a place in which an inspector believes on reasonable grounds there is a regulated energy-using product, or documents or records pertaining to energy-using products.
4.1.4 Before an inspection
Inspectors may choose to provide advance notice of a planned or scheduled inspection in order to request documents be made available, or if the inspector has concerns about access that may impact safety. At the discretion of the inspector, a request for changing the date for a scheduled inspection may be acceptable, with a reasonable justification from the regulated party.
Inspectors may not give advance notice for an inspection if this approach will better assess compliance with the Act and the Regulations.
An inspection can be expected to take approximately two to four (2-4) hours and will be conducted by teams of two designated inspectors.
4.1.5 During an inspection
At the beginning of an inspection the Inspector will show their certification of designation, state who they are and the purpose of the inspection. They will explain what gives them the authority to conduct inspections and may provide guidance documents to the person in charge. If needed, they will inform the person in charge of their obligation to provide assistance.
The inspector will examine products and records and may take photos. They may ask for import records, information about the quantity of product imported or sold, and information that confirms the product meets the energy efficiency standard.
Additional guidance on how to comply with the requirements of the Energy Efficiency Regulations may be found here: Introduction to the Regulations.
Designated inspectors have the authority to do, among other things, the following:
- Enter any place that has regulated energy-using products
- Examine products, open packages, and examine documents or records
- Make copies of records
- Conduct tests or take measurements
- Use computer systems and request printouts of records
4.1.6 Completion of the inspection
Inspectors will notify the regulated party that the inspection is concluded and invite questions. There will be a follow-up communication and report from the inspector to present the results of the inspection and any corrective actions that are required. If there are any corrective actions prescribed they must occur by the deadline provided in the report to avoid further compliance actions.
All records obtained by inspectors during inspection activities are handled in accordance with applicable NRCan policies on the collection and retention of records.
4.1.7 Review of inspection results
If the regulated party disagrees with the inspection results, they should contact the lead inspector named on the inspection report. If the concern is not resolved, the Manager of Compliance Operations may subsequently be contacted.
4.2 Enforcement
NRCan emphasizes self-monitoring, reporting, and collaboration. However, enforcement measures can be used if regulatees violate the law. The choice of enforcement measures depends on the following:
- the nature of the violation (including factors such as the circumstances, the gravity of the violation and tolerance levels in the manufacturing and testing process);
- culpability (including the degree of intent to violate the law, compliance history, the motive for the violation and attempts to conceal or falsify information);
- effectiveness of the enforcement measure in achieving compliance; and
- consistency in the application of enforcement approaches.
Refer to NRCan’s Compliance and Enforcement Policy for more information about enforcement.
Disclaimer
This document does not constitute legislation. In the event of any inconsistency or conflict between the legislation and this document, the legislation takes precedence. This document is an administrative document that is intended to facilitate compliance by the regulated party with the legislation and the applicable administrative policies.
Glossary
Compliance: The state of conformity of a regulated party or a product with a legislative or regulatory requirement.
Dealer: A dealer is defined in the Energy Efficiency Act as a person engaged in the business of
- manufacturing energy-using products in Canada
- importing energy-using products into Canada or
- selling or leasing energy-using products obtained directly or indirectly from a person engaged in a business described in a) or b) or an agent thereof.
Inspection: To enter and inspect a place, for the purpose of verifying compliance with the Energy Efficiency Act and Regulations, by examining regulated energy-using products, opening packages, and examining documents, making copies, conducting tests or taking measurements, and using computer systems.
Inspection site: A place in which an inspector believes on reasonable grounds there is an energy-using product for which an energy efficiency standard or a label has been prescribed and that is owned by or is on the premises of a dealer or a consignee of imported energy-using products. The place may be where there is any document or record required to be kept by a dealer.
Inspector: A person designated as an inspector under section 9(1) of the Energy Efficiency Act.
Resources
Legislation
Energy Efficiency Act
https://laws-lois.justice.gc.ca/eng/acts/E-6.4/index.html
Energy Efficiency Regulations
https://laws-lois.justice.gc.ca/eng/regulations/SOR-2016-311/index.html
Guidance
Guide to Canada's Energy Efficiency Regulations
Compliance and Enforcement Policy
Contact
Compliance Operations
Office of Energy Efficiency
Natural Resources Canada
complianceops-opsconformite@nrcan-rncan.gc.ca
580 Booth St, Ottawa, ON K1A 0E4
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