Bill C-30 (39th Parliament, 1st Session) Committee on Feb. 6th, 2007

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

So we have both experience and success in legislating targets in this country.

I have one final question to you, as my time is about to end.

With respect to the 43% improvement you talked about, if that number was shown to Canadians, many of them would say, well, that's remarkable. But even under a 43% improvement, which you noted with large final emitters, the overall impact of Canada's footprint on the planet has been disastrous. Is that not true, that even with a seemingly strong number like that, Canada's obligation to the world community would still not be met? Is the intensity target that has been suggested around this place a red herring? Does it give false hope?

[David Boyd]

Of course, it's a red herring, and it's inherently fraudulent. I mean, Canada's absolute greenhouse gas emissions, which are what matters, have risen 27% between 1990 and 2004. But if you applied an intensity-based lens to that period of time, our emissions intensity improved by 43%. That just shows what a pile of rubbish the intensity-based system is.

[The Chair, Conservative, Laurie Hawn]

Professor Boyd, we have Mr. Paradis.

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

Good morning. My question is for Mr. Villeneuve.

Your record speaks for itself. I'm pleased to be questioning you this morning, and I thank you for providing us with some clarification.

First of all, from what I understand, Canada has taken no measures since 1997 to achieve the Kyoto objectives. In the present situation, it's as though I was asking you to leave Chicoutimi and come and meet with us on Parliament Hill in the next hour. We have to put this back on the rails.

The public of course reacts when they hear about a restrictive approach and targets set for 2050. Some people tell us that a lot of things can happen between now and 2050. You mentioned some concrete measures that can be taken to achieve more short-term objectives, but I'd like to know how you think we can ensure, and assure people, that we're headed in the right direction. As Mr. Castonguay said, citizens have to change behaviour and take more concrete action in their everyday lives.

You've also talked about a national carbon limit. I'd like you to give us some more details on that subject.

Lastly, time permitting, I'd like us to discuss one aspect of Bill C-30 that we didn't address today, the fight against atmospheric pollutants in order to combat smog. I believe that's unheard of, and I'd like to hear your comments on that subject.

Thank you.

[Claude Villeneuve]

Thank you.

The year 2050 is tomorrow morning. When you establish a power station, whether it's a gas-fired or coal-fired station or something else, you have to know that it will have an economic life of at least 50 years. So current decisions already have an impact on the situation that will prevail in 2050.

Moreover, as regards the absolute emissions limit, it must evolve. When Canada committed... [Technical Difficulties —Editor].

[The Chair, Conservative, Laurie Hawn]

Professor Villeneuve, can you hear me?

[Claude Villeneuve]

Yes, I can.

[The Chair, Conservative, Laurie Hawn]

Okay. I'm sorry, we lost the feed--both ways. We'll have to ask you to start your answer again, if we could, and to be brief.

[Claude Villeneuve]

I can continue in English, very fast.

The year 2050 is a very short period of time when we speak about energy, because if you are installing a facility today, it will still emit greenhouse gases in 2050. As for the cars for which it's a ten-year period, for the electrical facilities it's a fifty-year period. That's not a long period.

Second, the cap has to begin by stabilizing. Stability is the first target we have to have, followed by reductions progressively from year to year.

And the third one is air pollutants. Actually, there is a direct relationship between combustion and air pollutants. Reducing greenhouse gas outputs will reduce the other air pollutants, but take care. One of the factors affecting smog is pollution coming from south of the border. As long as the United States does not reduce its own air pollutants, the Canadian efforts will be less than efficient.

This is one of the main failures of Bill C-30, in my understanding. It does not address the real problem. There are three or four factors affecting smog that are not addressed by Bill C-30, so it will probably be inefficient in that way also.

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

Earlier you discussed the national carbon emissions limit. I'd like you to give us more details on that subject.

[Claude Villeneuve]

All right. The first step must be a stabilization limit. Emissions are still increasing year after year, and that's definitely not a good sign. The government will therefore first have to set a limit in the context of which we will recognize the need not to exceed the emissions level achieved in 2005. It's too late to do any more. Moreover, we have to be able to establish a direct connection between the effectiveness of measures taken and pollutant levels.

For example, we could set an objective of stabilizing emissions at the 2003 level between 2008 and 2012. That would be the first objective. That would probably require us to achieve an average reduction of approximately 10%. That would be too low to enable us to achieve the Kyoto objectives, but it would be within the Canadian government's reach.

A very large portion of our emissions is associated with exports. As Canadians, our responsibility with regard to increased emissions is fairly limited. In the case of emissions attributable to oil and aluminum exports, for example, these are imports designed to meet the needs outside the country. In Canada, our domestic market is much too small for us to be able to consume all our exports.

We therefore have to negotiate, in the context of a second stage of the Kyoto Protocol, measures that take this specific situation into account. With the exception of Russia, Canada is the only Kyoto partner that is what is called an empty country, that is to say that exports far more resources than its own population can consume.

[The Chair, Conservative, Laurie Hawn]

Mr. Villeneuve, pardon me for interrupting you, but your time is up.

Mr. Godfrey, please, for five minutes.

[John Godfrey, Liberal, Don Valley West, ON]

Mr. Boyd, that was a very interesting presentation on carbon tax. I just want, for all of our sakes, to better understand the relationship between that and possible cap and trade systems, and also the international implications.

I think I heard you say Norway also has a cap and trade system and also does international trading in an emissions market. Of the five countries we've talked about—Norway, Switzerland, Sweden, Finland, and Denmark—how many of them actually achieve part of their goals through international trading of carbon credits?

[David Boyd]

Just to be clear, Mr. Godfrey, those European countries do not have domestic permit trading systems. They're participating in the European emissions trading system and participating in the emissions trading under the Kyoto Protocol. I don't have numbers for you in terms of the extent to which those countries are relying on the purchase of international credits to achieve their Kyoto commitments.

[John Godfrey, Liberal, Don Valley West, ON]

But on the fact that they do this even though they have a carbon tax system, is that an ineffective thing, in your view? Is it that they ought not to participate in the European emissions trading scheme or a Kyoto trading scheme through the clean development mechanism?

[David Boyd]

No, not at all. I should clarify. I certainly didn't mean to portray a carbon tax as a one-size-fits-all or say that all we need is a carbon tax and we're away to the races. A carbon tax is a powerful tool, but it needs to be part of a suite of programs and policies that Canada puts in place in the short term to begin driving our emissions down.

A carbon tax is compatible with a permit trading system. There are economists who have looked at the possibility of using those two mechanisms jointly, and that's something that could be explored in Canada. But it's really important to understand that there are both pros and cons with all of the policies and tools we're talking about. What we really need to do is put these things in place and start using them, and then we can make adjustments as time goes by.

[John Godfrey, Liberal, Don Valley West, ON]

If there are, broadly, six big slices of carbon emissions in Canada—electricity generation, upstream oil and gas, industry, vehicles, residential, agriculture and forestry—are there any obvious places where a carbon tax is more appropriate in one of those sectors than in another, yet in another one cap and trade might work? Are there obvious divisions? If you're going to have a mix and match system, which you've talked about, or a suite of instruments, are there places where you'd have one in one case and one for another?

[David Boyd]

A cap and trade system is probably something that's going to be more useful in a situation in which you have a limited number of emitters. I don't think you'd want to create a national cap and trade system whereby individual Canadians would have a carbon cap and they'd be able to trade their allowances back and forth. I think that would be, from an administrative perspective, completely unworkable.

The cap and trade system is better suited to where there's a smaller number. For example, in the situation of industry, electricity generation, and oil and gas producers, those would be potentially more suitable for a cap and trade system.

[John Godfrey, Liberal, Don Valley West, ON]

For large final emitters—let's say there are 700 of them—what are the virtues of cap and trade for large final emitters, versus a carbon tax?

[David Boyd]

As I said, I think a carbon tax offers certain advantages in the sense that it's less easily manipulated by the participants. The reason the European trading system is having problems is that businesses convinced governments that they needed more permits than they actually did, and that created an opportunity for windfall profits because companies were able to sell permits they never were going to need. Now it has also created a system in which permits under the European system are almost without value, because the number of permits exceeds the amount of emissions.

When Canada, under the previous Liberal government, was developing the large final emitters system, I would say we were on the brink of falling prey to that same problem. Government was having to rely on industry to provide business as usual projections for the year 2012, and those projections were inflated. If that system had gone ahead, we would have been in the same situation as Europe. Companies, including oil sands operators, would have been selling their credits and making money by selling emissions credits. At the end of the day, that system would not have resulted in an absolute reduction in greenhouse gas emissions.

[The Chair, Conservative, Laurie Hawn]

Thank you, Professor Boyd. We'll have to stop there.

Mr. Jean.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Thank you, Mr. Chair.

My first set of questions is to Chief Erasmus.

I'm from northern Alberta and I've been there since 1967, actually travelling up to Yellowknife. I've seen a change in many things in the north since my time there.

You made some comments about Bill C-30 and talked about Kyoto. I'm wondering if you'd change your mind if you heard a couple of things.

First, did you realize that the Clean Air Act, Bill C-30, regulates indoor air, which causes a lot of health problems to Canadians? It actually regulates stoves and fireplaces, which are very important to aboriginal communities in my area, because of course right now there's no way to regulate the quality of air that comes out of those, and that causes a lot of health problems. Most reserves have that kind of heating, at least partially.

Air pollution now includes smog and acid rain—which wasn't included under Kyoto—and not just climate change. Under Bill C-30 there will be a national environmental monitoring system to monitor air we breath wherever we may be, in the north or different areas. That air, of course, changes dramatically with wind patterns from plant sites, and all over Canada from industries. It will not just monitor, but will also research and publish that information for the Canadian public. It also includes the ability to monitor air and human bodies to see what kinds of toxins we've taken in.

Bill C-30 also requires large final emitters to have a pollution prevention plan on greenhouse gases, also on air pollutants and toxic substances, which of course are not included in Kyoto, which has no reference at all to the problems to human health that result from consumption of bad particles in the air. It also allows government to regulate the blending of fuels so we can have more efficient vehicles, and the fuel components, which of course Kyoto does nothing for.

Kyoto does nothing to address clean or healthy air. I think that's my main point, that Bill C-30 does that. It helps Canadians wherever they may be, because we're a vast country.

Indeed, I know you weren't at the testimony yesterday, but you mentioned the short-term targets. We heard yesterday from government officials that indeed the short- and medium-term targets were going to be set in the regulations, and that we're going to be able to address those. The long-term target was dealt with in the Clean Air Act, but we are going to have short- and medium-term targets that are going to be regulated, and regulated efficiently.

I'm wondering if you would change your mind if you understood the impact to your own people and to all Canadians from coast to coast on clean and healthy air.

[Chief Bill Erasmus]

Thank you.

I don't think we're saying that the bill is not good at all. We're saying there are some areas that need to be strengthened and definitely need our input. That was the point we were making.

My question to you is, do you feel our people ought to be consulted as the courts are demonstrating? The last case was in northern Alberta with the Dene Tha', dealing with the proposed Mackenzie pipeline. The courts made it clear that they needed to be consulted.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

I think it's very important. In fact, a large component of my family is aboriginal, even treaty. I can assure you I think it's very important that all Canadians be consulted on all issues that affect them, and certainly aboriginal Canadians.

I want to turn to Mr. Boyd now, if I may. Quickly, Professor, as I don't have much time left, you are an adjunct professor, is that correct?

[David Boyd]

That's correct.