Agriculture Committee on Feb. 25th, 2008

[Ian Thomson]

There are two levels. One is technology and one is feedstock. There are different types of technologies that it can employ. One is a lipid, which is an oil or a fat, and then there is a more advanced type of technology by which it can take a cellulosic material or a bio-oil that can be made from a broader range of cellulosic carbohydrate materials.

Then on feedstocks—and I can talk specifically about what's going on in Canada right now—we have rendered fats, so recycled greases from restaurants, and we have tallow from rendering plants and packing plants. Those form about 200 million litres of supply right now, and the balance of maybe 1.3 million litres, going out to 2015, would come from oils.

Of those oils, right now vegetable oils, canola, would be it, but people are doing research on camelina sativa, which is more drought resistant. It requires less pesticide, less nitrogen. It has yields that are comparable to canola if grown well.

People are looking also at different kinds of oilseeds. They're looking at micro-algae as a source that would not compete for arable land as a lipid feedstock. There's mustard seed, again, and there's another one that's a relative of canola seed.

Some of them are closer than others, but it all comes down to the economics. Your colleague was asking about the economics of a production plant. Well, if you have expensive feedstocks, they become the majority cost of production, and the focus becomes on feedstock.

So we see a great deal of potential coming out of future research. But you don't jump to those future feedstocks. You have to have a base of industry in which to test them, to support them, to build them.

Then there's a whole other conversation about future technologies and renewable diesel. In Canada, in the British Columbia government, in the federal government, the support is for renewable diesel. It doesn't pick winners or losers. It simply says, we want to have it be renewable; you pick the technology and you find the feedstock that is most suitable.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

It's really quite exciting when you start talking about it.

I assume you would agree that it's critically important that we not only pass this legislation but continue to enhance the funding for research and development in all of these fields. Does that apply to you as well?

[Benoit Legault]

In Quebec, we concentrate more on starch and carbohydrates rather than on oil, even though we do produce soya. We are interested in biodiesel. A lot of research has been done in cooperation with Ontario. Corn works very well in terms of water and energy use. Corn grain produces seven times the crude energy that it consumes. Currently, we are trying to use fermentable sugars that are found not only in corn grain but in the entire plant. Given the productivity of a field of corn, the recovery of fermentable sugars from the entire plant is a project that has a great deal of potential.

In Ontario, we are trying to develop varieties with a high sugar percentage in the overall plant, that is in the stem, the leaves and the cob. The idea is to have ethanol production from an acre of corn that one day will be as efficient as if it was made using only the cob or the corn grain starch. There is a lot of research being done on that at this time. We are also testing other plants, like sweet sorghum for example, a grain plant that produces a lot of sugar. We would use the entire plant in order to achieve a high rate of sugar production per cultivated acre.

[The Chair, Conservative, James Bezan]

Thank you. Your time has expired, Mr. Storseth.

I want to thank all the witnesses for coming in today and for your presentations and input on Bill C-33. I'm going to ask that you leave the table as quickly as possible, and we'll suspend.

I want to call all the witnesses for five o'clock to come to the table as quickly as they can as well.

Thank you. We are suspended.

[The Chair, Conservative, James Bezan]

I call this meeting back to order.

We welcome to the table now, from the Conseil québécois du biodiésel, Monsieur Camil Lagacé; from EcoNovo Consulting Experts, Dr. Simon Barnabé; from Canadian Biotechnology Action Network, Lucy Sharratt; from the Western Canadian Wheat Growers Association, Blair Rutter and Kevin Bender. We also have, from Centre de formation en entreprise et récupération de Victoriaville, Yves Couture.

Welcome, all of you.

Opening comments will be 10 minutes or less. We're going to kick it off with you, Mr. Lagacé.

[Camil Lagacé, President and Chief Executive Officer, Conseil québécois du biodiésel]

Good afternoon. My name is Camil Lagacé and I am the President and Chief Executive Officer of the Conseil québécois du biodiésel.

First of all, I would like to thank you for inviting us here today to comment on Bill C-33.

Generally speaking, we support the proposed amendments to the act. We support the overarching principle. In that regard, we are not here to challenge the exercise that is underway. However, we would like to make a few points that, in our opinion, could be beneficial when the time comes to provide guidance for the actions that will come from making these changes to the act.

As far as establishing a minimum average biofuel content, it is not enough to create a biofuel market that is real, that can quickly and easily be integrated into the existing distribution infrastructure of petroleum products and that will readily convince users to choose biofuels.

In the case of biodiesel, the proposal for minimum average content is contingent on its being proven feasible. This being the case, it is important that this be demonstrated as quickly as possible, for every segment of the market in which biofuels might be used, whether it be in the transport sector, for roads, and for other applications such as rail, shipping, agriculture and heating. Moreover, this demonstration must be made with the participation of a greater number of partners representing various potential users. Current conditions and regional differences must also be taken into account.

The use of petroleum products and the logistics regarding their distribution vary considerably from region to region in Canada. As far as introducing a national biofuels strategy is concerned, such a uniform approach could run into problems at the regional level that would slow down deployment. Market conditions must be promoted that would truly contribute to the sustainable development of the biofuels industry or the renewable fuels industry, that is to say that rules must be put into effect that will allow the Canadian industry to compete with products from elsewhere.

I will give you an example. Currently, the mechanisms in place in the United States ensure that all of the Canadian biodiesel production goes through that country, in order to take advantage of tax incentives, such as the blender's credit, which allows those making blends to bring a subsidized product to market, which is therefore cheaper and more attractive to the customer. Parameters must be defined for the development of biofuels production subsidiaries between the first, second and third generations using quotas for suppliers and feedstock, as the Americans are currently doing, and as are some European countries including England, France and the European Union.

I will give you an example. We want to implement regulations in Canada. If we are discussing corn ethanol versus cellulosic ethanol, it must be decided which regulations will deal with the biofuel production subsidiaries. In the case of biodiesel, it will be a question of determining what proportion of the biofuel will be produced from dedicated crops, on the one hand, and residual feedstock on the other.

As far as non-compliant products are concerned, it is critical that within the framework of the implementation of biofuels regulations, we ensure that only products that meet quality standards will be used, and not product substitutes that do not meet any standard.

I will now address the issue of aid programs for biofuels, whether they are aimed at developing markets or creating demand. In the United States, biofuel plants are currently working at only 40% capacity because they are having difficulty getting a foothold in the distribution system and connecting with users. In this context, the Conseil québécois du biodiésel wants to organize a project called BioRoute-BioHighway next spring in the Quebec-Windsor corridor. The objective is to actively work on creating a market for biodiesel by connecting users to producers and to biodiesel distributors in Quebec and in Ontario. We are running into obstacles in terms of funding the project because it does not fit into programs set up by the federal government under regulations intended to impose a minimum average content for biodiesel by 2012.

In other words, we like the idea of the project, which closes the production and product-use loop, except that there is no program to help make this a reality. Today, several departments believe that imposing a minimum content will be sufficient to automatically create demand.

Following a study on the distribution of biodiesel in Canada, it will be important to adapt in an intensive way the biodiesel distribution network throughout the industry. To achieve this, we will need different types of support. The U.S. Biodiesel Blender Federal Excise Tax Credit is an eloquent example. It combines products, but it also benefits from accelerated depreciation to help absorb the costs to adapt infrastructure.

The two last points deal with regional development and the production of biofuels. Though seemingly interesting at first glance, small-scale production of biofuels with a production capacity of less than 5 million litres per year is risky, because production plants may not be viable. This is partly due to the cost of quality assurance, as well as the minimum amount of biofuel which the distributors of oil products would want to purchase. A smaller production plant will not necessarily be profitable in the long term.

Lastly, with regard to the providers of raw materials, particularly in regions where volumes are generally smaller, such as canola production in Quebec, we should not rush any decision to invest in the production of biodiesel because it is a hot issue or because it can benefit from government support, especially if we are talking about small-scale production. It would be much wiser to wait and consider the use of this biomass in combination with other available biomasses in the region which could potentially be processed into value-added materials at the biorefinery.

Thank you.

[The Chair, Conservative, James Bezan]

Thank you very much.

Dr. Barnabé, you have the floor.

[Simon Barnabé, Scientific researcher, Added value production from waste materials, EcoNovo Consulting Experts]

Thank you, Mr. Chair.

Dear committee members, you have invited me today to speak to Bill C-33. As a young researcher, I believe I represent the new generation of scientists and professionals, particularly those working in the vast areas of the environment and biotechnology.

First, I noted that under Bill C-33, there will be new regulations on biofuel production; these regulations have not yet been drafted or passed. If the bill encourages the Canadian production of biofuels from green biomass rather than from other sources, there might be serious environmental and socio-economic repercussions, the possibility of which have already been raised by the scientific community, or played down by certain governments, but which strike fear in the heart of environmentalists. Here then are my positions with regard to your bill.

First, the production of biofuels calls for the use of tons of biomass, and one can easily justify using abundant and diversified raw materials such as waste materials. Bill C-33 should be presented to Canadians as encouraging the use of waste materials, and not of green biomass.

Second, the production of biofuels must not supersede the production of other bioproducts. Bill C-33 is currently being presented as supporting the production of biofuel, but what about other bioproducts for which there are potential and growing markets? Does the future of producers only lie with biofuels, or with a greater diversification of agricultural bioproducts?

Third, Bill C-33 is being presented to Canadians as a solution for agricultural producers looking for new markets. However, in my view, the bill is also a solution for the diversification of bioproducts for other industries, and even for municipalities, which have at their disposal a vast variety of waste materials which can be bioprocessed with or without being treated first.

As for my first position, many of us strongly believe that the production of biofuels and other bioproducts must be based, whenever possible, on waste, pretreated or non pretreated biomass which is available locally. Each region, municipality, town or village generates its own diversified waste, such as straw, wood residue, used oils, subproducts or agrifood waste waters. All these waste materials could be potentially biotransformed into biofuels and other bioproducts, including even enzyme cocktails, for instance, which can be used to pretreat lignocellulosic materials to biotransform them.

By making the right technological choices, you can considerably reduce your production costs and the price of bioproducts. You can even save on the treatment and management of waste by using it in value added production. The combination of waste and/or local residues, and the application of mechanical, physical-chemical or enzymatic pretreatments are two great examples of technological choices which widen the scope of possibilities for bioprocessing and increase production performance.

It is even possible to use the scrubbing sludge of waste water. Waste water treatment plans generate a fantastic raw material which the public and some governments still perceive as waste because of its origin and smell. The nutritional potential of sludge is under estimated, but it can support the growth of industrial microorganisms, and the formation of these microbioproducts has potential commercial applications. Scientific research has also shown that it is cost effective to produce biopesticides and enzymes, and eventually bioplastics. The production of biofuels, or of enzymes for the production of biofuels, certainly holds a lot of potential.

As for my second position, I believe that the Canadian government wants Bill C-33 to help agricultural producers. Indeed, the bill in part addresses the need to diversify agricultural bioproducts in Canada. But it is important that future regulations, and any investment made under Bill C-33, not draw our attention away from the production of other bioproducts, such as microbial enzymes and biochemical products for which there are potentials and promising markets. There are so many niches which can be developed, especially giving the diversity of fermentable residues which can be transformed into economic raw materials.

As for my third position, Bill C-33 is presented as a solution to agricultural producers looking for new markets. However, Bill C-33 should also be presented as a solution for every producer of waste wanting to transform it into bioproducts and to benefit from this process. Future regulations and investments made under Bill C-33 will also have to apply to the forest industry, the agrifood industry, and even to municipalities. In my opinion, it is important to encourage the production of first, second or third generation biofuels which are made entirely from agricultural, forest or municipal residues, or even based on materials which are not grown from the soil.

I would like to underscore the fact that Bill C-33 reflects the government's willingness to create biorefineries, and that plants to produce biofuels, bioenergy and other biochemical products would be located in a rural environment. However, I think that we should go further than to simply build biorefineries; we should also build eco-refineries, which would be located in different regions and which would meet the particular needs in biofuels and other bioproducts of that region, based on the availability of waste materials.

Eco-refineries are in fact the logical extension of biorefineries and eco-parks. We will be able to build eco-refineries if we decide to diversify the production of waste-generated bioproducts. Farmers, beef, pork and chicken producers, various industries, recycling centres, municipal dumps and water treatment stations could foster bioproduction in their respective regions. Manufactured bioproducts, such as biofuels, should ideally meet the needs of citizens, farmers, and whatever industries are located in the region. Each town or village could manufacture and distribute to its citizens and to local industries a variety of cheap ecological bioproducts. These eco-refineries would be comprised of various “value added” subsidiaries, which would attract biotech companies to their respective areas and create high-tech jobs.

If you wish, I can provide you with the scientific literature to support what I am saying. I have a few concrete examples. In Quebec, the town of Victoriaville is currently doing a feasibility study on the implementation of a pretreatment and bioprocessing process of sludge into commercial bioproducts. You can also take a look at what my company, EcoNovo, is doing. Its mission is to turn waste into value-added production, and, in particular, to diversify the products we produce. In fact, my company did the feasibility study for the town of Victoriaville.

Lastly, there is the Institut national de la recherche scientifique, which is based in Quebec City, and which has received a grant from the Canadian Foundation for Innovation and the Government of Quebec to build the very first research and development laboratory in the area of bioconversion of urban, industrial and agricultural waste into value-added products. This is a research platform which will provide Canadian researchers and business startups state-of-the-art equipment to pre-commercialize bioconversion technologies.

In conclusion, I believe that Bill C-33 will promote the production of biofuels generated from waste and the enzyme cocktails which are necessary for the pretreatment process, while also maintaining the main objective, which is to diversify the bioproducts generated by all industries—recycling centres, municipal dumps and waste water treatment plants—across Canada. We have access to a vast variety of waste, the advantages of which are still being counted. That is why we must build bio-refineries and eco-refineries in Canada to add value to waste materials.

[The Chair, Conservative, James Bezan]

Merci beaucoup.

Ms. Sharratt, go ahead.

[Lucy Sharratt, Coordinator, Canadian Biotechnology Action Network]

Thank you very much.

I work in Ottawa as the coordinator of the Canadian Biotechnology Action Network. The network is a collaborative of 16 organizations across Canada, including international development organizations like InterPares and USC, farm associations and grassroots coalitions like the Society for a GE Free B.C., and the P.E.I. Coalition for a GMO-Free Province.

Our network is a testimony to the ongoing concerns of Canadians about the introduction of genetically engineered crops and foods. Our network is also highly concerned about the livelihoods of farmers in Canada. We want to make sure that consumer choices and government regulations support the ability of farmers to see a return on their investments and labour.

We are also, as are you, deeply concerned about finding a way to stop dangerous climate change. For example, we know that climate change already puts farmers at risk and threatens farmers' yields.

Finally, the Canadian Biotechnology Action Network is concerned about the welfare of farmers in other countries, particularly those small-scale farmers in the global south. We're also concerned about the impact of rising food prices on global hunger and malnutrition.

So it is that we come to the issue of biofuels. The same debate as we're having here this evening is currently happening in countries the world over. In the rush to see the creation of a biofuels industry, many of the true consequences have not been anticipated, and we're only now beginning to understand how dramatic some of these are.

Mandating the use of biofuels opens the possibility that we may be committing in the long term to support feedstocks and technologies that are not carbon neutral, but will in fact increase greenhouse gas emissions. A major problem is that in the biofuels equation agriculture itself is a major contributor to greenhouse gases. The hope was that biofuels could be a win-win scenario for farmers and for the climate. Unfortunately, this mandate could in fact be a lose-lose investment, one that will dramatically change land use across the globe and jeopardize the biodiversity that we in fact need to face climate change.

In the United States and Europe, civil society organizations are calling for a moratorium on incentives for agrifuels-- biofuels--including a suspension of all targets. In Quebec, we understand there is a suspension to the construction of new corn ethanol plants. The U.K. government announced last week that its Renewable Fuels Agency will study the so-called indirect effects of biofuels, which are a grave concern for countries that will rely on importing biofuels from developing countries. These effects include human rights concerns, labour rights abuses on plantations, and the displacement of indigenous peoples and farmers from their land. For example, there are already documented cases of forceable removal in Colombia for oil palm plantations; destruction of forests, including critical habitat; increased pesticide use; and overuse of water. These concerns are also our concerns.

We're greatly concerned that government regulation to make biofuel content in fuels mandatory in Canada will have a number of immediate, but also long-term, effects and unintended consequences. A priority for the Canadian Biotechnology Action Network is our concern that biofuels will increase the acreage of genetically engineered crops. We're also concerned that the biofuels rush will be used to push open the door to new genetically engineered crops, including genetically engineered wheat and genetically engineered trees.

Increased acreage of genetically engineered canola, corn, soy, and now even possibly genetically engineered sugar beet will increase the contamination risk to organic and non-GE crops, as well as other environmental risks. Serious consequences for Canadian farmers have already been seen. For example, farmers have given up growing canola organically, except in very isolated geographical locations.

We're also concerned that the rush to establish a biofuels industry will be used to push through the introduction of genetically engineered wheat, despite the fact that Canadian consumers and our export markets have already rejected this product outright. And we do see that the Canadian Food Inspection Agency is preparing the way for faster approvals of genetically engineered crops through proposals to change seed regulations, the seed program modernization.

Already corporate power in the seed sector will only grow stronger as crops are dedicated for biofuel production. This corporate concentration will, as always, translate into higher input prices for farmers and less choice in the marketplace.

There is a new case that illustrates very clearly the way in which biofuels are being used to open up markets to otherwise unattractive or irrelevant genetically engineered crops. In Prince Edward Island there's a company seeking provincial government subsidies to set up a biofuels plant that would rely on sugar beet, and in this case the biofuels plant is expected to be fuelled by Monsanto's new genetically engineered sugar beet--entirely by this sugar beet.

Finally, the Canadian Biotechnology Action Network is extremely concerned about false promises for second- and third-generation biofuels that we see are propelling the industry forward. Like the unfulfilled promises for genetically engineered crops, the launch of government supports for the biofuels industry is predicated on faith and assumptions that new genetic engineering and synthetic biology technologies can make up for current shortcomings in feedstocks and the technologies to process them.

What we see is a pie-in-the-sky picture for a future that relies on technological fixes that do not yet exist. This is not a sound basis for moving ahead with expensive policy. These justifications are, we believe, dangerous because they rely on a promise that is unlikely to ever come to fruition. Instead, and more importantly, this reliance may actually lead to the release of genetically engineered crops and trees despite their extreme dangers.

This false and dangerous promise for the next generation, whatever generation that is, is why we now see a massive investment in the United States to genetically engineer poplar trees for cellulosic ethanol. In the U.S., universities and corporations and the United States Department of Energy are investing millions to genetically engineer poplar for biomass. Field tests in the United States of genetically engineered poplar, in particular, already post a clear and urgent threat to Canada's precious forest ecosystems.

There are already field tests in the United States of fast-growing trees genetically engineered to be low in lignin. These are engineered expressly to make the production of cellulosic ethanol cheaper and more efficient. Lignin is an important structural polymer. It's what holds the tree up. Lignin is significant in defending the tree from insects and disease. So while these genetically engineered trees may make processing wood for ethanol cheaper and easier, the environmental impacts of such a trait spreading through forests could be severe and would be irreversible.

The Canadian Forest Service is also conducting field tests of genetically engineered trees in Quebec. These Canadian government tests may feed directly into this project of genetically engineered trees for ethanol and they again pose immediately contamination threats.

Just last week a global protest of agrifuels, or biofuels, and genetically engineered trees was launched at a meeting of the United Nations Convention on Biological Diversity. The Canadian Biotechnology Action Network stands with these communities, and we hope that the desperate need to stop dangerous climate change does not translate into a dramatic misstep that would not only fail to stop climate change but would actually worsen various environmental problems, especially by opening the door to dangerous technologies, a door that should remain shut.

Thank you.

[The Chair, Conservative, James Bezan]

Thank you.

Mr. Rutter or Mr. Bender, who is making the presentation?

[Kevin Bender, Director, Western Canadian Wheat Growers Association]

Thank you, Mr. Chairman.

The Western Canadian Wheat Growers Association welcomes this opportunity to appear before you all today.

I'm a director of the association, and I farm near Red Deer, Alberta. I also sit on the board of directors of the Alberta Canola Producers Commission, and I recently completed a term in the Canadian Canola Growers Association. However, my views here today will be primarily from the wheat growers' perspective.

Joining me today is Blair Rutter, our executive director from Winnipeg.

The Western Canadian Wheat Growers are a prairie-wide voluntary farm organization. For 38 years we've been advocating forward-looking farm policies to improve the profitability and sustainability of our farms. Our board of directors consists of 12 farmers who have a passion for agriculture and the determination to make farming more profitable. It is our optimism about the future of our industry that keeps us energized.

Grain prices are currently strong in western Canada, so that's helping to fuel our optimism. We know, however, that good grain prices can be fleeting, so that's why we're always seeking policy solutions that will help make farming more profitable on a long-term basis. We see biofuels as an excellent opportunity in helping us to achieve that goal.

Bill C-33 makes provision for regulations that would require gasoline to contain a 5% average renewable content by 2010 and diesel and heating oil to contain 2% average renewable content by 2012. The wheat growers support this legislation and urge committee members to give it their full support as well.

Currently, there are five commercial ethanol plants in operation in western Canada and two more that will be opening soon this year. Combined capacity of these plants will be 500 million litres, which would, in total, consume about 1.4 million tonnes of wheat, or approximately 7% of the average wheat production in western Canada. Of course, these wouldn't use wheat exclusively; corn and other cereal grains would be part of that as well.

While ethanol has been produced on the Prairies for more than 25 years, we really are in the infancy stages of a large-scale biofuels industry in western Canada, so it's difficult to predict the full impact. In our view, biofuels and bioproducts represent a great opportunity to create a more sustainable future for our industry. Over the next few minutes, I'll talk to you more about the value of biofuels to prairie grain farmers.

First of all, increased ethanol production will help reduce our dependency on foreign grain markets. There are always a number of risks when you're exporting grain offshore. We're vulnerable to tariff and trade barriers, labour disputes, railway service disruptions, and high ocean freight rates. In the past year, the prairie grain business has been disrupted by two railway strikes and a trucker walkout at the Vancouver port. Having more grain processed domestically helps mitigate the impact of such disruptions.

Another benefit of the ethanol industry is that it would provide farmers with another local outlet for marketing their grain. As we've discovered in the canola, oats, and pulse sectors, local users of grain improve competition and help support local prices. The value of ethanol and biodiesel plants will be particularly evident when grain downgraded by weather or disease is able to be used for biofuel production.

Increased local processing also reduces our dependency on shipping grain by rail. In western Canada, our industry continues to be constrained by service and performance issues in the rail sector. In this regard, the wheat growers were very pleased to see transportation legislation, Bill C-8, passed by Parliament, and we thank all parties for their support of this legislation. It's my understanding that it has been passed by the Senate and is just awaiting royal assent.

The fact remains, however, that in western Canada the two main railways haul about 65% of the grain we produce. In our view, one way to improve rail service and increase competition in grain handling is to increase the amount of grain that is processed locally. Wheat varieties that are well suited to the ethanol industry often have agronomic advantages and so they represent a good rotational fit on many farms. Promoting a biofuel industry also creates more jobs and economic activity in rural areas. For those farmers who invest in these facilities, it also gives them an opportunity to capture a greater share of the value chain.

Finally, processing more of our grain locally helps ease the growing congestion on the rail lines and at ports. Rather than shipping our grain long distances, we think it makes more economic and environmental sense to process it closer to home.

In our view, there's no question biofuel plants provide tremendous value to grain farmers and communities across western Canada. We note that the renewable fuel standards contemplated in this legislation include provision for next-generation feedstocks, including straw and other biomass material. The wheat growers also support these forward-looking provisions.

We recognize and appreciate the concerns raised by the livestock sector with respect to the possible increase in feed grain prices resulting from the development of a biofuels industry. Many of our members also have livestock operations, so we take these concerns very seriously.

We note that studies in the U.S. have shown that livestock operations have flourished around ethanol plants. This is also the case in Canada. In fact, the oldest ethanol plant in western Canada—the Pound-Maker facility in Lanigan, Saskatchewan—is a fully integrated ethanol and feedlot operation. Other ethanol projects under development have a strong livestock component.

We think it's worth noting that many of the wheat varieties that are well suited for ethanol plants are much higher yielding than varieties used in the milling industries. Often, yield per acre is substantially higher than that of milling varieties. If the ethanol industry expands significantly in western Canada, we could see higher production of wheat, corn, and other feed grains. The resulting distiller dried grains, or DDGs, produced from these plants will provide the livestock industry with a relatively lower-cost feed grain supply.

Admittedly, we don't know what the full impact of biofuels on the livestock industry will be. However, we believe that it's too early to assume that the growth of the biofuel industry will be negative for the livestock sector.

The wheat growers want to see the development of a biofuels industry that is sustainable, without the need for mandates or subsidies of any kind. We recognize that some argue that the biofuel industry will not be viable without government intervention or support. We do not share this view. Of course, economic viability will ultimately depend on the price of the oil and the feedstocks. However, we believe that technological improvements in processing and in variety development will be such that biofuel production will one day be economical and sustainable without government intervention.

Regarding wheat variety development, our association would be remiss if we did not comment on this committee's work in recommending the removal of kernel visual distinguishability, known as KVD, as a criterion for the registration of new wheat in western Canada. The removal of this constraint will lead to the development of wheat varieties that have yield and starch profiles that are well suited to the ethanol industry. We applaud your committee and the federal government for your foresight in bringing about this policy change.

Bill C-33 will also help spur the development of new markets and new uses for our crops. For example, the fractionation of wheat, barley, and other grains offers significant opportunity for the development of healthier food, pharmaceuticals, and industrial products.

In summary, the wheat growers support Bill C-33. The legislation will provide Canadian farmers with greater marketing opportunities and will lessen our dependence on export markets. The development of a biofuels industry will lead to greater investment in crop research and development and in processing technology. It also offers an excellent opportunity to create jobs and economic activity in many rural communities. We ask your committee to endorse this legislation and ensure that it is passed in the parliamentary session.

Thank you again for this opportunity to address you. We look forward to any questions you may have.

[The Chair, Conservative, James Bezan]

Thank you.

We'll go to Monsieur Couture.

[Yves Couture, Director, Centre de formation en entreprise et récupération de Victoriaville]

Thank you, Mr. Chairman.

I am pleased to be here today to present a rather modest project to you. But in Victoriaville it's a big project, of which we have many.

I represent a training centre which teaches recycling. We teach young people who don't do well in the regular school system. Since 1990, we have trained between 50 and 70 students who cannot follow the regular curriculum. We decided to provide these kids with a different learning environment, namely one which operates in the area of recycling, and innovation in recycling; we also create sectors which did not exist before.

Victoriaville began recycling at the source thanks to Mr. Normand Maurice, now deceased, who believed that this was very a very important thing. He also believed that underprivileged youth with learning disabilities could play a meaningful role in society. So the training centre focused on the areas I just mentioned and began by creating modest research incubators. The first one dealt mainly with the identification of the papers and cartons we received. Then, with the help of the students, we started to involve the community and began the selective removal process in Victoriaville. The removal process is very efficient and respects the objectives of the waste materials management plan. We are currently engaged in a five-pronged removal process.

We have also begun to collect paint. The removal of paint began in Victoriaville. It is the training centre of which I am the director today which first became involved with filtration on a small scale and with a small budget. Our objective was to create something we could demonstrate to others. Our initial project was to demonstrate that unused paint could be recycled. We began to operate a plant which collects nearly 5 million kilos of paint and dangerous domestic waste every year. We upgrade the paint, which is then sold.

We have also worked with Peintures Récupérées du Québec, which already has the know-how and technical data to filter paint. We decided to create a pilot project involving the filtration of used vegetable oils. The cooking oils which we receive at the plant come from within a network of 550 municipalities which have set up a process to collect paint and dangerous household waste. These oils arrive in bulk and we developed a very dynamic and modest research protocol. Our objective was to show that if Germany could do it, we could too. So we bought a vehicle which we adapted. We worked with young students who were in an applied program to improve the vehicle's combustion logistics and the way the vehicle runs in very cold temperatures, given our winter climate. We also tried to find solutions while working in a very cold environment. The vehicle was tested with a dynamometer, and with the help of our students and chemists, we were able to verify our filtration product.

I can tell you today that Victoriaville has demonstrated that reused vegetable oil can, when correctly treated with a good filtration method, become a resource which performs better in terms of consumption and torque, as demonstrated by the dynamometer. I can provide you with the supporting statistics.

One year ago, I was in Tianjin, China, which is covered by smog 310 days a year. The use of pure vegetable oil eliminates odour and soot. This means that residues lose their fine particles.

We had questions about torque. When you use pure vegetable oil, it is 5.5% more effective, which represents a torque increase of 4%.

I like the idea that a network of 550 municipalities, which care about environmental recycling, recycle materials on an experimental basis. If the use of oil became widespread, it could be used to make some vehicles run more efficiently.

Our target is to develop vehicles which run on waste materials. We will create a vehicle prototype which runs on vegetable oil. Our objective is to exceed the threshold of 45% to 80%. Depending on the type of vehicle, we could use our vegetable oil at a threshold of over 80%. Our objective is not to commercialize this application, but rather to test it to see whether it is doable and mechanically possible. With the help of our mechanics, we are focusing on preventative maintenance to prevent mechanical breakdowns, and to reassure vehicle manufacturers. We then would be able to claim that our fuel can work at a threshold of 45%, 50% or 60%, and that it is very efficient and performs well.

My presentation was short, but I simply wanted to show you that getting young people, cities or municipalities involved, is the first step towards change. Studying a bill and amendments, as you are doing, can create a movement. The only way to provide security for our young people is to do little things on a daily basis and to give them hope that their lives have meaning. The more this is recognized by a community, the more it is fulfilling.

Thank you, Mr. Chairman.

[The Chair, Conservative, James Bezan]

Thank you very much.

Dr. Barnabé, you mentioned a couple of studies in your presentation. I don't expect you to have them with you, but if you could submit those to the committee, we would appreciate that very much. Since you referenced them, we would like to have them on file.

[Simon Barnabé]

Yes.

[The Chair, Conservative, James Bezan]

With that, we're going to stick with five-minute rounds.

Mr. Boshcoff.

[Ken Boshcoff, Liberal, Thunder Bay—Rainy River, ON]

Thank you very much.

Earlier, with the first group, I asked them what they thought of the bill as presented, and what constructive criticism they, as delegates, may have to either improve it or amend it. I would like you all to answer that first. I would ask that Ms. Sharratt answer last, please, because I have some additional questions for her.

[Kevin Bender]

The wheat growers fully support the bill as it is, without amendment.

[The Chair, Conservative, James Bezan]

Monsieur Couture.

[Yves Couture]

We believe it is very important to take concrete action. What I find particularly important is removing toxic and polluting substances. The bill clearly identifies which pollutants should be eliminated from the air.

[The Chair, Conservative, James Bezan]

Mr. Lagacé.

[Camil Lagacé]

As I said at the beginning, the Conseil québécois du biodiésel does not really have any problems with regard to the proposed amendments to the bill. What is important, however, is what we actually do to help every biofuel producer and to ensure there is sustainable development. In that regard, the bill is merely the beginning. But we will only succeed in developing renewable sources of fuel through technology if there is a will to do so.

[Simon Barnabé]

I believe that Bill C-33 is an excellent initiative to trigger the development of biofuels on the condition that waste materials be used as the base for production.

[Lucy Sharratt]

Generally we have the concerns that in setting up the mandate itself there's a support for an immature industry—or there are very many scenarios for what the industry will look like, and we don't yet know what the shape of the industry will be, even what feedstocks we will use and ultimately the impact on greenhouse gas emissions—and that the facts are contested at every point.

However, if we're then to look at the details of the bill, we would certainly be very happy to take a look. When it's time for the regulations to be set up and made, we'd be very interested to see what that looks like and, looking at Bill C-33, certainly to see if there was a way to incorporate, too, a stress not only on the adverse effects on the environment from the use of fuel or additives contained in the fuel—health effects, and so on—but that the feedstock also be considered and that this be integrated into those concerns.

Additionally, certainly we would want to see an outright prohibition on the use of genetically engineered trees as a feedstock. Also, of course, our concern is with other genetically engineered crops, but certainly the use of genetically engineered trees for cellulosic ethanol is a very serious concern for us.