Bill C-33 (Historical)

An Act to amend the Canadian Environmental Protection Act, 1999

This enactment amends the Canadian Environmental Protection Act, 1999 to provide for the efficient regulation of fuels.
It also provides for a periodic and comprehensive review of the environmental and economic aspects of biofuel production in Canada by a committee of Parliament.

Canadian Environmental Protection Act, 1999

[Paul Dewar, NDP, Ottawa Centre, ON]

Duly noted, Mr. Speaker. I want to ask my colleague from Western Arctic if he could explain why we need to have the amendment he just put forward embraced by the House and what the benefits of the amendment would be in terms of this legislation?

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, really and truly the report that we received from the agricultural committee was that the bill moved along much too fast. It did not take into consideration all the types of things that needed to be looked at. The purpose of the motion is to get a stronger scientific policy position from the agriculture committee and--

[The Acting Speaker, Royal Galipeau]

It is with regret that I must interrupt the hon. member.

I thank the member for Richmond—Arthabaska for his patience and courtesy. He now has the floor.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Thank you, Mr. Speaker. I understand. Things like that can happen in the House; it is called democracy. I was waiting patiently.

I am pleased to participate once again in the debate on Bill C-33, An Act to amend the Canadian Environmental Protection Act, 1999. I have already made two or three speeches on this subject. To avoid repeating what I have said, I will focus in this speech on the need to reduce our dependency on oil, which obviously also has to do with the use of biofuels.

The bill itself does not contain any standards. It authorizes the government to adopt regulations, which is basically how biofuels would be monitored, with respect to standards and their impact. In the medium term, this bill can help us reduce our dependency on oil and significantly decrease greenhouse gas emissions from automobiles, depending on the type of biofuel used and, of course, the type of transportation used with these biofuels.

The vast majority of greenhouse gas emissions are produced when petroleum products are burned. To reduce these emissions and fight climate change, naturally, we also have to reduce our oil consumption.

Of course, Bill C-33 is not a binding instrument for reducing greenhouse gas emissions; it is a measure to promote the development of alternative fuels. The best instrument for reducing greenhouse gas emissions, and the only binding one, is the Kyoto protocol, which the Conservative government unfortunately rejected out of hand. Instead, this government is helping the oil companies, which have responded with a price at the pump that is close to $1.40 in the Montreal area. The other day, I saw $1.37. A litre of regular gasoline is selling for nearly $1.50.

In Canada, the oil companies, which recently again announced profits in the billions of dollars, pay less tax than in Texas. When we see that, we wonder what this government's real intentions and real priorities are.

Between 1970 and 2000, the hydrocarbon industry received $66 billion in direct subsidies from the federal government. For your information, Quebec developed hydroelectricity all on its own, without the federal government's help.

The Bloc Québécois suggests that the government stop giving special treatment to the oil industry, which has no need of government tax breaks. It is not a matter of shutting down the oil industry. We all understand that we need oil, but the idea behind this sort of policy or concern is to stop giving tax breaks to companies that do not need them in the least.

I have a few figures that prove this. Petro-Canada's net profit for the first quarter of this year was $1.1 billion, an 82% increase over the same period last year. This is no laughing matter. In 2007, Shell, the second-largest oil company in the world, had a net profit of over $30 billion. A net profit of more than $30 billion for a single oil company, even one that operates all over the world, is quite something.

Instead of helping the oil industry, the federal government needs to levy a surtax on oil extraction and production industry profits. The revenues from this surtax should go toward measures to promote reduced consumption of petroleum products. This would be a smart policy if we really want to reduce our oil use.

One of the ways we could be less dependent on oil is by improving energy efficiency and using cleaner modes of transportation to move goods. Take trains and ships for example—these two types of transportation account for 8% of oil consumption, compared to trucks, which account for 92%. This is an absolutely incredible difference.

The benefits of increasing our use of trains and ships include reducing our consumption of oil products and reducing greenhouse gas emissions, which we will come back to. What is more, when we take greater advantage of our seaways and rail system, we scale down traffic by reducing the number of trucks. We have all been stuck in traffic. I am not saying that the problem will be fixed immediately, but cutting down on the use of trucks will certainly improve the situation.

We must also move away from fuel oil and favour cleaner energy sources, for individuals as well as businesses. We have been looking at all kinds of alternative fuels and alternative energy sources. Now we must promote the use of these products in order to keep reducing our use of fuel oil, a serious pollutant.

In Parliament, the Bloc Québécois is actively trying to minimize the impact of the rising price of gasoline. This is not the first time we have done so. We are once again on the attack. For instance, this week, we moved forward with deliberations at second reading of Bill C-454, introduced by my colleague from Montcalm. The bill made its way to second reading this week and was the topic of debate. The bill aims to give greater powers to the Competition Bureau.

I would also like to touch briefly on the objective of Bill C-454. It is absolutely crucial that the government strengthen the Competition Act in order to better combat the exorbitant increases in gas prices that average Canadians must face every time they fill up. To achieve this, the government must give greater powers to the Competition Bureau so that it may conduct a real investigation, particularly of the refining sector.

At present, the Competition Bureau does not have the power to launch an investigation on its own initiative. The legislation must therefore be changed. When it does conduct a review, its mandate does not allow it to discipline the industry, but simply to determine how it generally operates. Furthermore, it cannot force the disclosure of documents or protect witnesses during such a review. Thus, clearly, it is very broad and above all very fluid. This does not impose many restrictions.

In short, the Competition Bureau has its hands tied and is in no position to fight the oil companies, which are unscrupulously fleecing consumers. I have more examples. Profit margins in refining can reach 20¢ per litre of gas, which represents $10 for an average fill-up of 50 litres. And 50 litres is exactly the capacity of my car's gas tank. That is definitely excessive—not my gas tank, but the profit margins in refining as high as 20¢ per litre of gas. I would like to reiterate that this means as much as $10 for the average fill-up.

Generally, it is businesses, taxi drivers, farmers—since we are talking about the bill studied by the Standing Committee on Agriculture and Agri-Food—and consumers who pay the price. Oil companies already benefit from preferential tax treatment.

Obviously, in light of all this, oil company executives are laughing merrily. In fact, the Competition Bureau does not have the tools to ensure that prices are not artificially inflated. When a very few companies almost completely control a market as large as the gasoline market, someone has to keep an eye on them. You see the same signs when travelling through cities, villages, or almost anywhere. There are only so many oil companies. We are referring primarily to the major oil companies that control the market.

Oil refining comes under the jurisdiction of the federal government. Thus, it is up to the House of Commons to ensure that the Bloc Québécois' Bill C-454 is passed as quickly as possible in order for the Commissioner of Competition to take the necessary steps to prevent excessive gas price increases and oil company practices that are contrary to the public interest.

With the approach of summer it is possible that consumers will once again suffer because of the inordinate price of gas. Our bill must proceed quickly and unimpeded if we want it to be in force before the summer holidays. Not that we are in a hurry for them to arrive—but they are coming. We know that gas prices escalate suddenly and mysteriously in the summer.

Our dependence on oil is also a contributing factor to Quebec's trade deficit. Between 2003 and 2007, Quebec exports rose from $64 billion to $70 billion compared to imports, which rose from $64 billion to $81 billion. We therefore have a trade deficit of $11 billion.

What is Quebec's largest import? Of course, it is oil. In 1998, Quebec imported $2.5 billion worth of oil and last year it imported $14 billion worth, which is an increase of 457%. The price per barrel of oil explains the astronomical increase. Last year, in 2007, not long ago, the price per barrel was roughly $70 and now it is over $100. It was $119 last time I checked. Unfortunately the price goes up more often than it goes down.

Quebec has a policy goal that all fuel sold will include 5% ethanol by 2012. It has already invested $6.5 million in building two cellulosic ethanol production plants in the Eastern Townships, one in Westbury and the other in Sherbrooke. That is not so far from my riding. Cellulosic ethanol is the way of the future. I have already talked about this, as have a number of my colleagues in this House. The process promotes the use of agricultural residues, such as straw, and forestry residues, such as wood chips, along with trees and fast growing grasses, such as switchgrass. Bill C-33 will allow the emergence of this new generation of biofuels.

Biodiesel is another type of preferred biofuels. There is a biodiesel plant in Sainte-Catherine, Quebec.

Beef producers currently have to dispose of their specified risk materials. That is a Canadian standard beef producers have to comply with. We are not against it, but we would like to see reciprocity with U.S. standards. But that is for another debate. One thing is certain for now, producers have to get rid of these materials, which end up in the landfill. Often, unfortunately, producers have to pay out of their own pockets to get rid of these animal materials that can no longer be used, not even to make feed for other animals.

If we gave these materials added value by turning them into biodiesel, we could kill two birds with one stone. We could turn these materials into fuel. That is what sustainable development is all about. Instead of throwing out the material, burying it or paying to have it removed, we could pay for it once it has value and turn it into biodiesel. The technology already exists and this is already being done. Biodiesel is currently being made out of animal fats.

The Fédération des producteurs de bovins du Québec has studied the feasibility of setting up a plant to process animal carcasses and slaughterhouse byproducts into biofuel. Strategic partnerships and help from the government are needed to get that kind of project of the ground.

We have Bill C-33, but we will have to go much farther than that in developing a policy to promote biofuels that have few negative environmental impacts, or at least far fewer than petroleum and fewer than the foods we could use to make biofuels.

According to the Fédération des producteurs de bovins du Québec, we have to ensure that the life cycle of renewable fuels offers true environmental and energy benefits compared to oil products. That is why we should support the federation's project.

I have also talked about the training and recycling centre, CFER, in Victoriaville in my riding. In cooperation with 10 restaurants, this organization recycles used oil, the kind used for french fries, among other things. They are recycling it to make fuel. A pharmacy in Victoriaville even uses this kind of fuel in its delivery vehicle. Here in the House, I joked about how when one is driving behind the delivery vehicle, one does not necessarily get a smell of french fries.

Obviously, that is an important way to use it, a way that will not necessarily consume more energy in transportation. If the vehicle that collects this used oil goes to each of the restaurants and runs on used oil, itself, and if they manage to sell that oil at the pumps one day, that will be a huge energy gain. They are not yet at that point. It is still experimental, but the vehicle works very well.

Let us take this one step further. For example, sludge from sewage treatment plants can also be transformed into ethanol. Quebec's national scientific research institute came—once again—to Victoriaville.

I do not know if they did a very exhaustive study, but one thing is sure: the institute said that sludge from the Victoriaville sewage treatment plant could be transformed into ethanol. This is the kind of project we should be encouraging if we really want to reduce our oil dependency.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Speaker, earlier today we heard a comprehensive speech from the member for Ottawa Centre, another one from the member for Western Arctic and now we have the addition of our good friend from the Bloc with his comments around Bill C-33. A common thread that appears to be travelling through the remarks I am hearing in the House today is that we should err on the side of caution.

I would refer back to a quote I have here:

Biofuels have many advantages, but we have to look at all our options and make sure we make the best choices to ensure a more sustainable future.

...attempting to save the planet by wholesale switching to biofuels like ethanol and biodiesel may unintentionally have the opposite effect.

That quote was from David Suzuki. In this country we all know that he is very highly regarded when it comes to environmental matters.

I would add one thing. Yesterday, in the Toronto Star, there was an editorial which read:

And while biofuels may be doing little for the environment, they are doing the world a great deal of harm by diverting food from hungry people to the feeding of automobiles.

In the final closing remark, it states:

Parliament should heed NDP Leader...and take more time to consider the implications of Bill C-33 before passing it.

Some of these folks are non-traditional supporters of the NDP, I would go so far as to say, but would the Bloc not agree that we should err on the side of caution and take our time to ensure that when we set this up that we do it properly?

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, that is why in committee we introduced amendments to make sure there are environmental studies, or studies on the environmental impacts as well as the social impacts related to the use of biofuels.

It is important to note that there are many kinds of biofuels. That is why I focused on biofuels made from cellulosic ethanol. There is biodiesel made from canola, which the NDP member for Western Arctic spoke about earlier, but as I was saying, there are also animal oils, animal carcasses and other waste materials that can be used to produce biodiesel.

We have a simple choice to make. We can continue to use oil and deal with steeply rising oil prices. Many people, for example those in the agricultural sector and those affected by the food crisis, will suffer huge consequences. We can keep going as we are and hope that one day oil prices will drop. Except that oil is a non-renewable resource.

Do we decide to develop new fuel sources made from renewable materials—and I agree with the member here—materials that will not be worse than oil in their effects on the environment? It is clear. One day, we will have to get with the times and find an alternative to decrease our dependence on oil.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Mr. Speaker, this is a concern that I raised yesterday in the report stage debate in the sense that too often when we debate these kinds of issues here in the House it becomes very polarized. Again today we heard the statement about a wholesale change to biofuels.

The government is not proposing a wholesale change to biofuel. We are talking about a very minimal biofuel content in our fuel. We also recognize that only about 5% of our land is used to produce crops that will be used for biofuel.

Does my hon. colleague think that, as our minister pointed out not too long ago, the weather pattern changes can actually have a greater impact than just the 5% of land use that is used for ethanol production?

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, in fact, to answer my colleague's question, the Government of Quebec has established a policy on the use of biofuels. It is quite similar, since Quebec hopes to increase the use of ethanol in fuel to 5% by 2012. Once again, Quebec has made a choice. The government, and probably a vast majority of the population, decided that this ethanol should be cellulosic ethanol.

There are pilot plants, as I mentioned earlier. We must therefore encourage the development of this new ethanol production. If we simply say that this is how it is, that it is in the works, nothing will get done. I therefore hope that the Conservative government, which has established its own policy for the use of ethanol in fuel, will allocate the funds needed to ensure that these new alternatives can be developed and that it does not simply say that it will change the crops in our fields, as is the case in some countries, to make fuel. That is where the danger lies.

The current food crisis was not brought about exclusively by the use of biofuels, or agrofuels as some people are now calling them, for there are many other factors involved. Consider the stock market speculation concerning food, the droughts there have been, especially in Australia, which is a major wheat producer and has been suffering drought conditions for years, which cause productivity problems. Consider also China and India, where there are more and more people who now have the means to feed themselves a little better.

Another thing that concerns me is the rising price of food products. We cannot blame biofuels alone, given that rice is the product that has risen the most in cost in recent months. It has gone up nearly 100%. To my knowledge, there is not a single grain of rice fueling any vehicles. The price of milk has also gone up rather outrageously and I am pretty sure that no one is putting milk in their gas tanks.

I am not saying that biofuels have no impact. They do. We must be extremely vigilant about this, but many other factors are also at play.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, it is an honour to speak to the bill and to the amendments that our party has put forward.

I will begin by assuring those who are concerned about our party's position on biofuels in general that this is something that needs to be part of the mix to deal with the catastrophic climate change that is in front of us. However, we also need to be cautious. The do no harm principle should be invoked, the precautionary principle, which is why our party has taken the stand it has.

As we have noted recently, both in the House and in the debate that has occurred in Canadian society and, indeed, globally on the issue, if we look at the advantages of ethanol and biofuels, ethanol being part of the biofuel mix, we have to ascertain what the cost benefits are.

When we take a look at ethanol as an example, which seems to be the one that is the most popular, and certainly the supports are fairly strong within the government, we need to look at the costs in terms of the production of the corn for the ethanol as part of the mix for gas.

I recall years ago, when ethanol first became an option, that many said that we should be careful in what we were doing and that we should look at it both in terms of the cost of transporting the goods to production, in other words, the corn from the farmer's field that goes to the plant to mix the ethanol, and the effects on the environment there. We were also told to drill down deeper and look at the actual costs in terms of the production costs.

It has emerged, if we use ethanol as an example because that is the one that has the most production, focus and support, that there is a huge amount of investment in fertilizer, for instance.

There is an important aspect to fertilizer that we should be dealing with. Fertilizer, as we know, comes from natural gas. If we are disproportionately using things like fertilizer, which is a fuel and one that is not renewable, and we are using that to help with the production of corn for ethanol, it should be part of the cost benefit analysis.

I would also add that when we are looking at the other resources that are required for growing corn, certainly for ethanol purposes, there is a fairly substantive use of water as a resource. Again, if we look at the whole mix and what is required in the recipe for ethanol, that is something that should be taken into account.

The use of fertilizer is not something that has been fully analyzed, in other words, the degree to which it will be using the fuel that is required to make fertilizer. Many have pointed to this as a concern, notwithstanding the use of water.

When we look at the tar sands as an example and the science around the tar sands, what was contemplated first in the science that was pushed was how to get oil out of the sands. That is fair enough and innovative. Some work was done on that. What I do not think was contemplated was what happens with the waste.

We have seen this not just with the tar sands but also with nuclear energy. What I think most of us want to see is a very genuine, thorough analysis of the effects and costs in the production of any new energy source.

In the case of the tar sands, Alberta is about to become a have not province, not in terms of fiscal capacity but in water capacity. Australia was mentioned earlier regarding some of the problems it is having with drought. Water is a resource we take for granted but we should be very careful in how we use it, especially in relation to agricultural production.

We have new technologies such as ethanol. I mentioned nuclear power. We still have not figured out what to do with spent nuclear waste in a safe way into which everyone can buy. I mentioned the tar sands. However, when we deal with ethanol, we have to ensure we have done the proper analysis and due diligence. That is the thrust of our amendments and our concerns about the bill.

A member of Liberal Party, in statements to the press, was trying to convince his colleagues to slow down on the bill and not support it to the degree that we see with the official opposition, and that perhaps it would make sense to amend the bill with some of the amendments we brought forward, to have the oversight and to send it back to committee to do the cost benefit analysis, as I just made. He said that we should admit that things have changed, that since we made assumptions when we looked to ethanol as the way to deal with catastrophic climate change, new evidence had appeared. I suggest that would be the right notion and probably good advice for his caucus colleagues.

I do not assume the governing party will change its direction. It has been noted for going ahead regardless. However, I would plead with the opposition, and certainly with the Bloc, to take a reasoned and sensible analysis of the bill and the concerns we have with it.

The question is, why rush into it? Why not have amendments put forward, as we have done, to do due diligence? If we find 10 years hence that we have in fact gone in the wrong direction, the question will be, why were we in a rush to do this?

It will be difficult for government members and other members of Parliament to get a satisfactory answer when we put amendments forward at committee to have due diligence done. We put forward amendments at report stage. We put forward an amendment today to ensure we were careful with this and due diligence was done. That is important to note.

As my colleagues have said, we are not talking about an ideological view. We are talking about scientists saying that we should be very careful in how we go forward with our biofuel policy. Many have suggested that this is the wrong way to go without the proper oversight, as I mentioned.

I find it interesting that in his comments this morning, the minister suggested that this was not about the global map right now, that we were only talking about Canada. That is fair enough. We are in the Parliament of Canada and we are discussing the Government of Canada's policy on biofuels.

The problem with that statement or that analysis by the minister is it denies we are in a global economy. I find it intriguing that I am making this statement for members of the party who suggest that they are the ones who understand the global economy. What we do with our biofuels policy matters to the rest of the world, as does our policy on the tar sands. I share that with the House because if the minister's suggestion is that our policy on biofuels in Canada does not affect the global economy or that we do not have a role to play, I would fundamentally disagree with him on that.

At one point, he said that we needed to deal with an issue because of climate change. He then mentioned that recently there was snow in his province and that the farmers were in the fields. He made a passing remark about it being global warming. It suggests to me that the Conservatives do not have a consensus yet in their caucus about whether global warming exists. I hope that is not the case. This has been a long learning curve for the governing party. I know at one point it denied climate change and the science of it. I hope it was a lightened remark as opposed to an unenlightened analysis.

It is about good policy, and the policy we form here does affect the global view and what happens in the world. The government has been very clear about Canada's role. I think the Prime Minister coined the phrase that he wanted Canada to be an energy superpower. If we are going to be, on the one hand, an energy superpower and, on the other hand, making policy on biofuels and suggesting this is only for Canada and it does not really affect the rest of the world, there is incongruity. What he is saying is that what we do here will not affect what happens around the world, and I could not disagree with him more.

Let us look at the analyses and studies that have been brought forward. The chief economist for the U.S. agriculture department is very critical of what is happening with biofuel policy. Gwyn Morgan, no close cousin of the NDP, has said that this is not the way to go. People have genuine questions about what the effects of this policy will be and we need to listen to them.

All our party is asking for is some reason, due diligence and to ensure when we are formulate our policy, we do not do it in a hurry or be too hasty. If we do that, there are unintended consequences and, some would say, irreversible effects that will occur. Once we build into our mix of energy supply, put in certain supports and have legislative underpinnings to it, it is very difficult to undo.

What that means for not only the environment but our economy is that we will then have our eggs distributed in the wrong basket. I will not say they would all be in one basket with this legislation, but it gives the nod to the economy and says, “This is where you should be investing”.

It was noted by the minister in his comments this morning that perhaps weather could have more of an effect on the supply of fuel, the cost of fuel, et cetera. Granted, I would concur with him on that. However, the same can be said about the supply, in terms of ethanol, that will be built in if there is a bad crop. What happens if there is a drought? What will happen then is we might have to look far afield, pardon the pun, to supply the mix that has been built into the system.

I would like to see the analysis on that. What is the last decade's analysis for the supply of some of these crops that we will be dependent upon, even with the minimum that we have established presently? Those kinds of things need to be understood.

The other thing I find interesting is the people who are lobbying for ethanol in particular. We know the person at the top of the association, who was running the lobby effort for this, was lobbying one day for the industry and the next day was working for the government. I find it that interesting.

We need to be absolutely clear as to the premise for which these policies are brought in. Is it the best direction for our country in terms of the economy, climate change and to ensure we have the right mix? Many people would be surprised that someone who lobbied for this policy one day, ended up the next day in the Conservative government, directing where that policy would go. Again, that is important to note.

If we look at what the legislation purports to do, and certainly the government will say it will do, and look at some of the concerns brought forward by scientists, there is no clarity. There is not enough clarity for my party and I think opposition members, because we have heard from some who are concerned about their party's position, to say that we should rush ahead and do this.

There has not been sufficient argument to say that we cannot hold back, that we have to go ahead immediately because the sky will fall. When we look at some of the arguments that have been made about concerns of bringing this policy forward, we can still slow down, take a look at the cost benefit and have this kind of policy put in place. It is a false premise for those who say we have to rush this through now. Those who have taken a look at the direction of ethanol and biofuels mix have argued the opposite, that we can still go in the right direction on this, but it is important we get the balance right.

We do not take this lightly. We have seen what happens once we start down this direction. We see the concerns in the United States. As I referenced, the chief economist for the Department of Agriculture in the United States has thrown up the cautionary flag and said that they have a problem, that have done too much in one area and that it is undermining the capacity for the United Stated in terms of agriculture. I do not want to be put a corner like the Americans.

As my colleague from Hamilton said, this is something we should rethink and be cautious about. It was interesting to note the editorial he referenced from The Toronto Star the other day. It states:

But in their rush to biofuels, the politicians have overlooked the drawbacks of turning food into fuel.

Although biofuels do emit less greenhouse gas than regular gasoline, environmentalists point out that this comparison does not take into account the emissions coming from the farm machinery and fertilizer required to “grow” these new fuels and the trucks for transporting them.

This is a reasonable question, and it should be put back to the committee to answer it. What is unreasonable about that question? If we are to do due diligence, if in fact this whole policy is to deal with the catastrophic climate change that is in front of us, then why would we not do our homework on this? Why would we not look at an impact, not just of when the fuel comes out the tailpipe, but look at the production of that fuel? We can do that. In fact scientists have done this, working with farmers.

There is a suggestion that if we are critical of this policy, that somehow we do not support farmers. It is unfortunate that some are using this argument to create a wedge between society in general, which wants to deal with that catastrophic climate change, and the challenges that confront farmers. Our party has been clear for decades about the way to support farmers. We believe in the Wheat Board and other institutions that have been built by farmers. We are not going to undermine them. I think this is something where the government is trying to create a wedge. I have talked to farmers locally and they do not buy that. They are as concerned as the rest of us on this rush to put in legislation that would tip the hat one way in terms of where agricultural direction is going.

I hope that reason will carry the day, that the government will take a second look at this and that the opposition will support our amendments. I hope we can look back 10 years from now and say that we did the right thing, that we did due diligence and we made sure that we did not rush into something that we had not thought through thoroughly.

[Jay Hill, Conservative, Secretary of State and Chief Government Whip]

Mr. Speaker, I hardly know where to begin after listening to that, but let me start with a phrase that I heard the NDP member use repeatedly throughout his dissertation: why rush into this?

I do not know how long the NDP would like to study this issue, but as a former farmer and someone who is proud to represent a large rural riding with a large agricultural component, which is unlike the riding the member represents, I have to tell him that a lot of farmers have been waiting a long, long time already for this type of option. They have been waiting for this option to see it impact favourably on commodity prices, even in a small way, so they can receive a better return from the marketplace, as opposed to taxpayers being forced to assist them in order to keep them afloat.

They are looking forward to this. I hope they are watching this debate today. I hope they are watching the NDP members stand in their places and vote against giving farmers this option, this alternative for which they already have been waiting years. They have been waiting for years for governments to catch up to the technology that farmers have known was out there.

What do we see now? Farmers are looking forward to this legislation. They would argue strenuously with the hon. member and would say that we are not rushing into this at all. They have already waited some time for this.

Never mind the environmental benefits, this change in policy could be of great advantage to the struggling forestry sector in my riding and the riding of my colleague from Cariboo—Prince George. We could start utilizing more of the wood waste from trees to produce biofuel. Never mind that advantage. Never mind the environmental advantage in reducing CO₂ emissions, which the member himself admitted.

These are all positive things, yet the NDP wants to vote against this legislation. They want to kill it. They want to stop. They want to wait for another 5, 10, 15 or 20 years while they study this some more. Rather than taking a positive step and moving forward, those members want to send the bill back to committee.

I want that member to stand up and express why he believes that farmers should not view the NDP as being against them when it wants to kill this bill that will help them so much.

[The Acting Speaker, Royal Galipeau]

I would like to advise the hon. member for Ottawa Centre that there are seven minutes left in the period for questions and comments, but only one of those minutes is today.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, there is no coincidence between the member's comments and the time remaining for my response. That is an old parlour trick, I suppose.

I will simply note for the member that there is farmland in my riding. He should know that very well. In fact, I am very proud to have the Experimental Farm in my riding, and it does research for farmers. He should know that it is part of where we are finding that there are concerns.

I will simply say that the member is actually helping me with my argument when he is trying to establish that there is a wedge between farmers and other Canadians. It is unfortunate that he is trying to drive a wedge between farmers on the one hand and everyday Canadians on the other. I do not think most Canadians would put up with that. I am happy that they will see through this as just wedge politics, not really about caring for farmers--

[The Acting Speaker, Royal Galipeau]

I regret that I must interrupt the hon. member for Ottawa Centre. It being 1:30 p.m., the House will now proceed to the consideration of private members' business as listed on today's order paper.

When we return to the study of Bill C-33, there will be six minutes left for the hon. member for Ottawa Centre for questions and comments.

The House resumed from May 2 consideration of the motion that Bill C-33, An Act to amend the Canadian Environmental Protection Act, 1999, be read the third time and passed, and of the amendment.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I am quite pleased to speak to Bill C-33 and the amendment, and I offer my support for the bill but not for the amendment.

I might say that it is important in this debate, regarding the amendment, because everything relates to the bill, so I will be fairly broad in my remarks.

It is interesting to see the reactions of some of the party leaders in this House since this bill was first debated at first reading and at committee.

At one point in time, all parties seemed to be in favour of increasing biofuel production for several reasons: one, to develop greater economic opportunities for rural Canada; two, to offer alternative crop opportunities and better returns for farmers in rural Canada; and three, to provide for a move away from fossil fuels, which would mean reduced greenhouse gas impacts on Canadian society. This is at a time when the environment is a huge issue.

However, now, because of changing circumstances in the global food supply and a few other issues, in an almost knee-jerk reaction, we are getting some saying that ethanol is almost solely responsible for the global food shortage and therefore some party positions are switching.

I will put it to members this way. Whether we pass or reject Bill C-33, it will, in neither case, impact the global food shortage or surplus to any great extent. Let us be realistic here. Regarding ethanol in Canada, in terms of this bill, will we be in the modern world or will we stay behind the times? It is time we get up to speed.

However, I can say that if we reject this bill we will send a very negative message to those investors who took all parties' words and who based their investment decisions on plants that are already being built and on farmers who will put crops in the ground on the basis of those initial discussions at committee which had basically all parties supporting Bill C-33.

If this bill is defeated, somebody had better take responsibility for that lost investment opportunity and that lost investment out there for those people who actually took the word of the various representatives of the parties that this bill would actually go through Parliament. They took our word that we would implement regulations and increase the content of ethanol and biodiesels in fuel by regulations.

Simply put, investments have been made both on the farm in terms of the production of alternative crops and in plant capacity to build plants for the current feedstocks and, in their minds as well, for future feedstocks for ethanol production from more cellulosic feedstock, et cetera.

If we reject this bill, we will have killed an economic opportunity for great numbers of Canadian and international investors and we will have certainly killed an economic opportunity for a great number of Canadian farmers.

For those who say that we will be using good quality wheat and other crops for fuels, that is not necessarily so. Yes, sometimes they will be but not always.

Sometimes there is frost. There is always a frost in some area. Sometimes there is too much rain and the quality of the grain goes down. Sometimes there is drought, which affects the quality. Sometimes there are surpluses.

It is those products, which are not always top quality bread wheat or top quality cereal grade corn, that are going into the production of these particular fuels. There are these other lower quality crops that are often used as well.

I say, especially to the leader of the NDP, who seems to have a knee-jerk reaction against ethanol now although he had it in his policy platform for the last election, for heaven's sake, that he must not kill that gleam and that spark in the eyes of those farmers out there. I ask him to allow economic opportunities to develop in rural Canada. I ask him not to hamper this investment in economic opportunities by the farm community.

This 5% really will not take a whole lot of crop, but it will make a huge difference in terms of price returns for primary producers. The interesting thing about farm production is that if we have a 2% or 3% surplus, especially in the potato industry, it is not just that 2% or 3% surplus for which we get paid low returns: it kills the price of the whole 102% and 103%. This will assist in terms of that economic development and economic opportunity for the farm community as well.

The Canadian Renewable Fuels Association has some information on this, and I will quote the association a little later, but I can say that by being a player, by having the production base taking place right now with the current feedstock, it will encourage research and development in the newer feedstocks that are not so much food for our consumers as others. That is where we have to get to.

We cannot jump over this step. We are not ready to go there yet in terms of the cellulosic and the research and development required in that area. This step cannot be jumped over. We have to go to this step with that production and fuel stock base right now.

Oh yes, there is a number out there, and this debate is rather interesting, but there is quite a debate by some who would blame the world's food shortage on the production of ethanol. Nothing could be further from the truth. Is there some impact? Yes, there is a marginal impact, but ethanol is not the cause. The real cause, in my view, is the speculation in the commodities market, which has no relationship to costs or real crises on the ground.

As well, certainly, global trade has an impact on the food shortage. The food for which there is greatest shortage at the moment is rice. Rice is not used in the production of ethanol. However, some countries that have become dependent on rice imports have seen the exports from some other countries frozen. We are seeing speculation, hoarding and all these kinds of things.

That is the real reason there is a problem in terms of global food supply. It is due more to market exploitation, market manipulation and market speculation than it is to the production of ethanol itself.

I have what I think is a very good paper that certainly opens up a good debate. It is a policy brief by the Oakland Institute and I believe it was written in April although it does not have the date on it. It has this to say at one point:

In fact, it is the traders and middlemen who stand to gain most. Speculation in world commodities is driving prices upward, from global futures commodity trading to traders and hoarders in West Africa, Thailand and the Philippines.

The institute goes on to say:

The payments made by the Canadian Wheat Board show--

And we know that the Canadian Wheat Board maximizes returns to primary producers.

--that the farmers were paid between $260-$284 a ton for various qualities of non-durum wheat, while the global price for wheat peaked to over $520 a ton. In India, farmers were paid Rs.850 [their currency] a quintal while wheat was imported at Rs.1,650 [their currency] a quintal.

What this is showing is that prices on the ground are one thing, but it is the market speculation and the middlemen that are really causing those prices to go through the roof. The farmers are not feeling the benefit of those prices on the ground to anywhere near the extent of what prices are in the marketplace.

The Oakland Institute paper goes on. I do not necessarily agree with everything that is said, but I think they are interesting points. It states:

Various causes for the current food price crisis are being cited by policy makers and the media--most common among them being the increased demand from China, India, and other emerging economies, whose increasing per capita growth has whetted appetites, as well as the oft-cited rising fuel and fertilizer costs, climate change, and impact of biofuels production. What is missing in the discourse is analysis of the failure of the free market, which made countries vulnerable in the first place; ironically, it is being promoted as a solution to the current crisis.

The Oakland Institute is saying that there are a lot of causes of the food crisis, and it is certainly not just the production of ethanol and biodiesel causing it, as some would portray.

I want to turn to a comment that I think is right on the mark. Larry Hill, now chair of the Canadian Wheat Board, stated in an article:

Commodity prices have risen dramatically in the last two years. There are many factors that have contributed to these increases. Supply-side issues have been the most dramatic, with...production problems plaguing all five of the world's top wheat-producing exporting regions over the past two years.

This ranged from drought in Australia to the heavy rains at harvest in Europe, poor winter wheat conditions in Kansas, frost in Argentina, and heat damage in western Canada.

He continued:

On the demand side, the world population continues to grow. In some of the world's most populous nations, improvements to living standards have created more demand for a wheat-based diet and for livestock fed with grain.

He went on to say:

Until this year, grain prices in real dollars were so low that they were on par with what farmers received in the Dirty Thirties. Not surprisingly, these values caused many farmers to rethink their future in agriculture. Some walked away, others tried to diversify into other types of enterprises, while still others were forced to subsidize their farms with one if not two off-farm jobs.

The fact of the matter is that if we bring it into real terms the price of the wheat in a loaf of bread now is about 16¢ for a 16-ounce loaf of bread. That is not a great deal when the price of a loaf of bread is $2 or thereabouts.

My point is that the farmer's share is still not really any more than what it should be. When we hear Mr. Hill's comments, we have to recognize, as I am certain this House does, the kinds of difficulties that producers have faced over the last eight years in Canada, when farm incomes were at record lows in this country.

This ethanol and biodiesel industry is creating a spark in the eye for many. It is creating economic opportunity.

Yes, we know there is price pressure on the livestock and hog industries, but we have to find a way of making one agricultural commodity complementary to the other. We cannot have one industry such as the hog and beef industry built on cheap feed grains, because those producers have to survive too. We must have policy done in a complementary fashion such that farmers can make a living off the land in this country regardless of the commodity produced.

If I may turn to the bill for a moment, I want to come to the fact that the protection is already in the bill in terms of what I think is being asked by the amendment. The bill allows the government to regulate renewable content in fuels. It allows the federal government to implement regulations requiring 5% average renewable content in gasoline by 2010.

Subsequent regulations will also require 2% average renewable content in diesel and heating oil by 2012 on successful demonstration of renewable diesel fuel use under the range of Canadian environmental conditions, meaning fuels made from renewable sources such as agriculture crops and other organic matter.

This gives the government the authority to make regulations. I believe that the government will be sensible in that. Perhaps the government will be sensible on this particular issue and make reasonable regulations. We cannot say the same for the government on all issues.

New subclause 2(8) amends the bill to add a provision for periodic and comprehensive reviews by a parliamentary committee of the environmental and economic aspects of biofuel production in Canada. That is important. The committee put that in there. Parliament is not going to be hamstrung, but this is sensible.

The amendment that we are talking about now is not sensible. It basically stops the ethanol and biodiesel proposal in its tracks.

This review allows us to monitor the situation, to determine the environmental and economic impacts of biofuel production in Canada, and to do it in a sensible way. It is extremely important.

I think the amendment that the members are calling for is already covered by the work of the committee itself.

I would encourage Parliament to pass this bill. Investments are already being made. Primary producers are looking to the future with the current crop regime, yes, but they are also looking for and hoping that the government will put in place the research and development.

I know that research and development is taking place south of the border into other alternative crops such as wheat and barley, straw, stalks and cobs from corn in Ontario and Quebec, and vegetable and fruit residues from across Canada. In Prince Edward Island, there is a very small cold press biodiesel operation in place using canola.

There is the possibility of using forest and wood waste and also municipal solid waste. There are other alternatives down the road, but we have to get there. In order to get there, I ask Parliament to support this bill and let this economic opportunity succeed.