Thank you, Mr. Chair.
I will spare you the company commercial. You can read about it in the presentation. But I'd like to start off basically by outlining some of the things we've been doing and how we've approached the issue of clean air and greenhouse gas.
I'll begin by talking about Alcan and greenhouse gas emissions. To us, climate change represents both a commercial challenge and a business opportunity. Our strategic approach has been driven by a win-win philosophy based on both environmental and economic benefits. The energy measures Alcan instituted in the early 1990s showed that it was indeed possible to reduce GHG emissions significantly, while maintaining economic growth. Our experience in Quebec has shown that governments and industries can work together in order to achieve voluntary reductions.
Concerning Alcan's early actions, the record will speak for itself. Total smelter GHG emissions from 1990 to 2005 were reduced by an actual 25%; smelter GHG emissions by intensity—and we measure both—were reduced by 45%; there was an 80% reduction in PFC emissions, which has a high concentration of greenhouse gases; and there were production increases of up to 40%. That's worldwide.
In Canada, from 1990 to 2005, total smelter GHG emissions were reduced by more than 30% and smelter GHG emissions intensity was reduced by 50%, while we increased production by 50%.
So we've established, I think, the bona fides of our approach to the issue of clean air. We have another 10% further in targets that were announced in Montreal at the beginning of this week, between now and 2010.
The next slides from the deck that you will see are merely proof points showing the trend lines on PFC emissions, on reducing emissions of air pollutants—fluoride emissions in particular—on polyaromatic hydrocarbons, and on total emission reduction by installation over the years.
Now, let's take a look at what we are doing today.
Process-related improvements to older technologies are continuing, and Alcan is intensively modernizing its Canadian assets with new technologies. Those efforts are leading to significant positive impacts in energy efficiency and reductions in GHG emissions. Alcan's AP35 series electrolysis technology is the most energy and GHG efficient technology in use today. And, while we continue to enhance that technology platform, we are also investing in its future, namely AP50, by building a US$550 million pilot plant in Jonquière, Quebec.
To give you an idea of the potential convergence of this technology and other technologies, we believe that in five years, GHGs will have dropped and energy efficiency will have improved by 20%.
We are aggressively pursuing win-win opportunities in the downstream applications of products and their inherent energy and GHG benefits, through development, promotion and sales of a range of aluminum products, including a focus on end-of-life recycling benefits.
These efforts and their results are proving that economic growth and competitiveness, and responding to environmental challenges, can be mutually supportive objectives.
On slide 17 in the long deck you'll find a chart on the cost of abatement that is very complicated, but I'll simplify it for you. Everything below the line shows things that we can achieve today, and if you look above the line, for nuclear, wind, forest, solar, coal-to-gas shifts, and avoiding deforestation, you have a series of technologies that can be invested in and that will yield results.
On policy and regulations—slide 18 in the longer deck—to leverage existing solutions and encourage future solutions and build on early action to date, Canada and companies like mine need a smart policy framework. We need smart regulations and we need pragmatism in terms of the tool kit at our disposal that we can use.
The strategic combination of policy, regulations, and tax as an incentive to strongly encourage investment in technologies and energy efficiency will assist companies in leveraging business plans and investment cycles and we believe will contribute to win-win solutions.
We need a suite of approaches that recognizes what companies have already done. We need these approaches to be flexible, in the sense that all sectors deal with different realities, and while we need incentives on the technology front to do more, there's much that we can do and have already done. Sectoral approaches within Canada can be effective to build on, where provinces have already taken a lead, as they have done with the aluminum industry in Quebec, including voluntary measures within the tool box used by regulators.
Let's talk about our coordinated approach.
Federal-provincial cooperation is critical if we are to effectively regulate GHG emissions and emissions of air pollutants. Provisions on equivalency in Bill C-30 need to be passed to facilitate the avoidance of overlapping or conflicting regulations. Equivalency of effect will achieve the same results as equivalency of regulation in meeting overall policy objectives.
We support the federal government's power to regulate directly, when necessary, but advise caution in revisiting standards for a sector such as aluminum when it is already being well-covered provincially on both air pollutants and GHGs with significant results to date, and concrete plans moving forward.
On policy and regulations, slide 21, mandatory targets need to be an important part of the tool box, as they set clear, transparent, and consistent long-term objectives and represent a strategic intent regarding where we want to be. Long-term targets set clear mandates along the way to unleash competitive market forces. But we also need short- and medium-term targets that provide the foundation for an immediate call to action. Some of us have already started to act.
Finally, on market tools, the government needs to establish the rules and regulations of the market aimed at ensuring proper market functioning, including emissions trading and offsets, and then pull back to let the market forces operate effectively.
As for targets in the aluminum industry, for some industries like aluminum it will be important to measure both the actual and the intensity level of emissions to know where we are, until reductions from downstream applications are also recognized. To put the context around intensity targets, they merely allow us on an efficiency basis to continually improve and to set the benchmarks. That's why they're important. However, absolute reduction targets that don't take into account consideration of growth, capital stock turnover for product, and recycling opportunities can severely handicap the ability to leverage the inherent energy- and GHG-saving qualities of any material.
In conclusion, Mr. Chair, Alcan has been taking this challenge on both air pollutants and greenhouse gases, and the general challenge on environmental performance, seriously since 1990, and we've demonstrated many successful actions to date. If we want to be competitive—and there is an issue of competitiveness here—we will all have to take action and we will need smart, pragmatic approaches that foster environmental performance improvement while enhancing Canada's economic competitiveness.
Our message is that we've had that belief for some time and we believe that now is the time to act.
Merci beaucoup. Thank you.