Thank you, Mr. Chairman, and good morning to all the members of the committee. Thank you for having us.
Again, as the chairman said, my name is Gordon Quaiattini. I am the president of the Canadian Renewable Fuels Association. The CRFA represents the full value chain of stakeholders committed to building a robust and dynamic renewable fuels industry here in Canada.
I am pleased to be joined by Jeff Passmore, the chairman of the board of the Canadian Renewable Fuels Association. Jeff is also the executive vice-president of Iogen Corporation, a global leader in the development of next-generation cellulosic ethanol. Also with me is Tim Haig, the chief executive officer of BIOX Corporation, Canada's largest biodiesel producer. Tim is also the immediate past chair of the CRFA.
Ladies and gentlemen, in these difficult times, I appear before you today with a message of new opportunity, new hope, and new growth. Renewable fuels are now and in the coming years a story of new economic opportunity for Canadian farmers and rural Canada. Renewable fuels are creating new markets for agricultural producers, revitalizing communities, reducing harmful greenhouse gases, and offering consumers new choice at the pump. Every year, new advances in technologies for making renewable fuels like ethanol and biodiesel are opening up even more opportunities, and offer more economic and social benefits. Next-generation biofuels are rapidly coming to market, and thanks to the hard work of many members and parties in the House of Commons, Canada stands to benefit even further.
Let me first give you a sense of our industry on some key metrics. Renewable fuels in Canada today, including current and planned projects, will create some 14,000 new jobs and generate $1.5 billion in new economic investment in Canada. Even if we don't grow beyond what's on the books now—and I believe we will—renewable fuels will be responsible for 10,000 direct and indirect permanent jobs, and roughly $600 million in annual economic activity, much of that rooted in rural Canada, close to the feedstock sources we require to make biofuels.
The demand our plants create will amount to a 240-million-bushel new domestic market for Canadian-grown oilseeds and grains, which will help keep commodity prices at a fair level, thus lowering government support payments, and will assist in making more farms across Canada financially viable again.
Having new markets and value-added processing here at home are especially important on the prairies, where wheat growers have seen the price of that commodity drop in real dollars for over a century. Yet they still rely overwhelmingly on export markets. The biofuels option finally gives them some choice.
The good news about these numbers is that Canadians overwhelmingly agree that we as a nation are on the right track. The CRFA just completed an independent nationwide survey of Canadians, and the results were clear: 69% of Canadians support the move to replace fossil fuels in part with renewable fuels; 76% of Canadians approve of the new law to introduce a national renewable fuel standard, which boosts ethanol and biodiesel content at the pump and, by extension, guarantees market share for our agriculture producers; and 87% of Canadians support federal and provincial government policies and programs that would invest in the development of next-generation biofuels made from non-food feedstocks, such as agricultural biomass, waste materials, and algae.
The renewable fuels sector is in the infancy of a transformation, a bio-revolution that will be every bit as far-reaching as the information revolution in the 1980s. It is most apparent in our industry--that is, in the creation of renewable fuels that draw on what we harvest rather than what we extract. But we are only at the beginning, the cornerstone upon which this vast new opportunity is being built. Soon the full potential of the bio-economy will be plain to see, as all kinds of biomass, grown and harvested, will also be the feedstock for plastics, chemicals, pharmaceuticals, and many other materials. New jobs will be created, industrial policy will adapt, and agriculture can again become a truly growth industry.
Obviously, the bio-economy will not wipe away the need for other resources. The correct precedent to consider, quite frankly, is our own. Renewable fuels will not supplant oil—at least not in any of our lifetimes—but we are able to supplement and add to the energy mix, and by doing so we moderate the price. Renewable fuels such as ethanol and biodiesel are the only viable, real, and accessible alternatives to oil for transportation fuels today and in the foreseeable future.
These are some of the broad benefits that are felt by all, but there are specific benefits as well, most notably for Canadian agricultural producers and rural communities. Canadian growers will become suppliers to not just the food and fuel sectors, but also to industries of all sorts. Consequently, rural communities stand to gain from rising farm incomes and major investments in infrastructure. All of this will place a premium on the issue of sustainability, which is one of the core questions included in your work. Indeed, sustainability is fundamental to secure both the required environmental and productivity achievements of our sector.
On this point, allow me to pause and offer the committee a concrete example drawn from our own experience. A year ago, when crude oil prices were skyrocketing on their way to nearly $150 per barrel, there was a season of intense debate—a misleading and deeply unfortunate debate—with respect to fuel and food. The accusation was that demand for biofuels was leading farmers to divert their grains. Corn was the most prominent example. Indeed, notwithstanding the obvious hyper-inflationary effect of record oil prices, biofuels were also tagged for rising crop prices, leading to the additional suggestion that we were making it more expensive for cattlemen to feed their livestock, thus leading to higher prices at the grocery store.
None of that was true. After exports, North America generated a two-billion-bushel surplus in corn, far outstripping the combined demand of food, feed, and biofuels. Moreover, the inflationary effect was sparked by oil prices, not biofuels. As the price of oil has dropped, so too have prices for commodities right across the board—not always to their pre-spike levels, but certainly down to far more sustainable standards. Simply said, high oil prices were the culprit.
If there was one positive factor to emerge from that entire discussion, it was the spotlight it shone on sustainability and the outstanding performance of Canadian growers. It merits mention because the record of our agriculture sector is poorly understood, which means it is poorly promoted.
This means we are making too little of a global competitive advantage that Canada should be proudly consolidating and sharing around the world. For example, yields are increasing dramatically, even with fewer inputs. In the 1980s, farmers could generate roughly 70 bushels of corn per acre. Now that is up to 150 bushels per acre. And recent predictions see yields growing within five to ten years to 300 bushels per acre. Advances in all areas of crop science are occurring.
Canadian growers are world leaders in keeping direct soil emissions low. Our performance outstrips that of nearly every major European and Eurasian competitor, and by as much as 500% in some cases. And Canadian agriculture leads in areas of finding efficiencies and using new technologies in farming, such as no-till usage. More needs to be done, but we are in a position to lead from the front.
Environmentally, the International Energy Agency recently published a report that made clear that grain ethanol enjoys a 55% advantage over traditional gasoline when it comes to reducing harmful greenhouse gas emissions. Similarly, the energy balance for ethanol was determined to far outpace that of fossil fuels.
So when it comes to the future and fashioning policies that support this sector, we urge the committee to place sustainability at the core of your efforts. This is how we get more from less, and how we do so in a way that nurtures our relationship with croplands, and how we respect and increase environmental performance.
Let me close by making a few broad recommendations in that respect.
First, maintain and expand, as time unfolds, support for renewable fuels. That will undoubtedly sound quite self-interested, but let me give you the publicly interested rationale. The bio-economy is coming, but so far it is largely anchored in biofuels. That is where the action is. The tools, experience, and expertise are being developed by way of supporting renewable fuels. So pressing our advantage in this area only serves to reinforce the leadership Canadian farmers are developing in the bio-economy.
Second, help producers finance the costs of transitioning to sustainable practices. Often the price of adopting sustainable farming practices is felt in short-term revenue forgone. And for farm families struggling to get by, that's a tough price to pay. Government can help by expanding its support for that transition.
Third, do not slow down the stampede toward sustainability by asking our farmers to meet a series of onerous bureaucratic tests that will only increase the cost of transformation. Government should assume the burden of collecting data, measuring change, and reporting success.
Fourth, the government should combine forces with provincial counterparts and other relevant agencies to create an international promotion campaign to support the sustainability success of our agricultural producers. To coin a phrase, we've been hiding our light under a bushel, and it's well past time we told our story.
Finally, we are calling on this committee and the federal government to support an accelerated process to put in place the required regulations to implement and enforce the national renewable fuels standard. Canada's Parliament passed Bill C-33 in June of 2008. The environmental and economic development opportunities that we have outlined will only be realized by ensuring that the 2010 commitment to implement the RFS is kept. The renewable fuels industry stands ready to work cooperatively with all stakeholders in a transparent and accelerated consultative process to get the job done.
In closing, let me thank the House of Commons for its leadership, and simply reiterate that Canada, and rural Canada in particular, is uniquely positioned to grow and prosper from the further development of renewable fuels and next-generation renewable fuels. We are only beginning to realize the true value of this new and promising industry.
Thank you.
Thank you, Mr. Chairman.