Natural Resources Committee on Nov. 27th, 2013

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Zimmer.

Mr. Allen, I think, has a question.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

I have just one follow-up question, Mr. Dupont, on the clean energy fund. You mentioned there weren't enough proponents putting in proposals so that afforded the opportunity to achieve some savings to apply toward the additional costs.

Can you comment as to why there were no proponents? Is it because of a lack of credible business cases or just fewer applicants to the technology fund?

[Serge Dupont]

One, for example, that was well known is the TransAlta Project Pioneer in Alberta, which would have been a large-scale carbon capture storage project.

The government had undertaken to fund that project in an amount of up to $315 million. It would have been a major scientific and infrastructure project to test technology on a very large scale.

As we know, we already have virtually a world first in Saskatchewan now for a clean coal unit with Boundary Dam coming on stream in the spring. I think it will be an element of pride for Saskatchewan and for Canada.

In Alberta, TransAlta ultimately decided that the economics did not work for it at this time. These were moneys earmarked in the clean energy fund that were actually profiled over a number of years and that provide, in some instances...there are some moneys basically that had already been approved, that Natural Resources Canada does not need because of such projects.

Other projects have also had some of those challenges, but we have funded, for example, 17 small-scale demonstration projects and two large-scale demonstration projects, the Shell Quest project and the enhanced Alberta Carbon Trunk Line project. So there are a number of projects that have been going forward—R and D projects, carbon capture storage projects—but some unfortunately did not move forward.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you very much.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Allen.

Thank you, Mr. Dupont.

We go now to Ms. Duncan, followed by Ms. Crockatt, and then we'll have the votes on the estimates. Go ahead, please, Ms. Duncan, for about five minutes.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Thanks.

Could I follow up on Mr. Allen's question? I'm from Alberta. I know that Capital Power initially undertook to do carbon capture and storage, and committed to the Alberta energy board that they would reduce greenhouse gases, then reneged on that, but the board required that they still move forward.

On all of the coal-fired power testing of CCS in Alberta, the companies have pulled out. My understanding is the main reason they pulled out is absolutely no incentive because there is no requirement to reduce greenhouse gases from thermal electric until 40 to 50 years from now.

Can you tell me what other measures are in place that might incent any thermal electric company in Alberta to actually invest in CCS now?

[Serge Dupont]

At this time all I could say is that perhaps we, for example, look at the Saskatchewan context; Boundary Dam obviously had some financial assistance. The experiment, which is expected to come on stream very soon, is teaching SaskPower quite a few lessons about how to do this, and how to do this better. They're growing more and more confident that, should they undertake another unit, they can be very close or even at commercial level without government assistance. That is at least what they are indicating to us at this time.

Part of the requirement, Mr. Chair, is that there is a buyer for the CO₂ that is basically taken from the coal facility.

In Saskatchewan that is working well because there is enhanced oil recovery.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Right. I'm aware of that, but I'm wondering what the incentive is for Alberta?

[Serge Dupont]

That is where the power utility can derive some revenue for the CO₂, and that creates the market incentive.

I gather in the case of TransAlta there was not the same demand for the CO₂ for enhanced total recovery, and that damaged the prospect for that project, notwithstanding the fact that the Government of Canada was willing to pay $316 million and the Government of Alberta was also willing to fund the project considerably.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Okay, thank you.

It's of interest that the minister is claiming that the department's outcomes are all based on what is called responsible development. He seems to be equating that with sustainable development. The strategic outcomes in plans and priorities for 2011-12 specified dollars for clean energy. Interestingly, that outcome was related to cumulative greenhouse gas reductions.

In other words, that means over time and for the last two years, including this one, we see nothing whatsoever in place, any kind of dedicated resources toward clean energy. Can you explain how you can then claim to be pursuing an agenda of responsible development, sustainable development, and assigning zero dollars to clean energy?

[Serge Dupont]

I'd like to understand what document you are working from, because we are.... I also didn't mean to cause a surprise for others.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

I'm working from the plans and priorities report.

[Serge Dupont]

We're already conducting a range of research, and I would have to look at how this is presented and categorized, but we are doing work to support research and development in various forms of clean energy, energy efficiency, and next generation transportation. We have funded projects with respect to, say, tidal energy in Atlantic Canada. We are engaged in a range of clean energy initiatives.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Can you tell me the percentage of the budget that's been dedicated to that as opposed to promoting exploitation of oil and gas resources?

[Serge Dupont]

I would suggest that the overwhelming majority of the work of the department, certainly science and technology, is dedicated to improving the economic and environmental performance of our energy in one form or another.

Where we work on the conventional side of energy, it is essentially to try to find ways to improve that economic performance. We have a research centre in Devon, Alberta, which is devoting itself to ensuring we're developing that resource in the most environmentally responsible way.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

I'm not questioning that you may feel dedicated. I'm simply raising the question that there are no line items. Maybe you can get back to me on the line item where this alleged work on cleaning the—

[Serge Dupont]

The work is not alleged, and we do not have a line item for the Ring of Fire. We may not have a line item for clean energy—

[Linda Duncan, NDP, Edmonton Strathcona, AB]

You used to have one.

[Serge Dupont]

—but we can certainly provide you some information as to the kind of expenditures and the kind of investments and commitments that we are allocating to clean energy.

[The Chair, Conservative, Leon Benoit]

Thank you, Ms. Duncan.

We go finally to Ms. Crockatt for up to five minutes.

[Joan Crockatt, Conservative, Calgary Centre, AB]

Thank you very much.

I appreciate your being here and your wide range of knowledge on a wide range of different topics that we've addressed here today and your sense of humour while covering it all.

I wanted to go back to Port Hope, because I think what the department is doing in Port Hope is quite interesting. It appears to me as though this is a case where we're doing the right thing in an era where we're attempting to save money and see if we can balance the books.

The government has decided to spend money to help the folks of Port Hope. I wonder if you could let us know in a more fulsome way what exactly is going on there. This has to do with the cleanup of low-level radioactive waste and helping the economy of the town recover too, I understand. Is that right?

[Serge Dupont]

Essentially, as Natural Resources Canada we are engaged in working with Public Works and Government Services Canada and with the low-level radioactive waste management office of Atomic Energy of Canada Limited in a historical cleanup in the town of Port Hope.

The numbers you see in the supplementary estimates pale in relation to the actual scale and scope of that endeavour. This is going to be one of the largest historic cleanups in Canada.

[Joan Crockatt, Conservative, Calgary Centre, AB]

I was wondering—

[Serge Dupont]

Essentially, around $1.2 billion has already been recognized as a liability in the books of Canada related to the historic waste going back to, I think, the 1930s or 1940s that has accumulated in different parts of Port Hope and Port Granby; and having to recover that waste from waste management facilities or other parts of town that were not really suited to long-term safety and security in bringing that into new, modern facilities. Two new waste management facilities will provide full environmental integrity for the long term.

As I say with my folks, that means moving a lot of dirt from these areas in Port Hope where the waste is now to the new waste sites, constructing the waste sites and the water treatment facilities, and also some of the access roads and whatnot. Some of the moneys you see here are moneys that are intended to compensate homeowners or the municipalities for losses they may incur as this traffic and activity is taking place.

[Joan Crockatt, Conservative, Calgary Centre, AB]

Where are we in terms of that project? How far along is it right now?