Environment Committee on May 29th, 2007

[David McGuinty, Liberal, Ottawa South, ON]

Could we see the $9.1 billion broken down?

[John Baird, Conservative, Ottawa West—Nepean, ON]

I'll be happy to get as much as we can for you.

[The Chair, Conservative, Bob Mills]

Thank you. You can give it to the clerk and then we'll circulate it to members.

You're looking at two and a half minutes.

[David McGuinty, Liberal, Ottawa South, ON]

Minister, two weeks ago officials from your department, Natural Resources, Health Canada, and Finance Canada gave evidence that key components of your plan had not yet been developed or analyzed—in fact, quite a bit of it.

They admitted that no one can accurately predict emissions levels under your plan because the plan's rules aren't set yet. For example, we have no details on domestic offset systems, no details on the clean fuel standard for new facilities, no details on how much greenhouse gases will be exempt in your 36-month new market entrant exemption. These are all expected to play major roles in your so-called 20% cut by 2020.

Just yesterday the Pembina Institute released a report that listed 18 other major loopholes in the plan. They say you're short on the science. They say you're short compared to leading countries' commitments. They say you're short on our legal obligations under Kyoto.

Can you tell us when, for example, you plan to announce the details for the domestic offset system and the clean fuel standard? Just give us an idea of when, so Canadians can expect it.

[John Baird, Conservative, Ottawa West—Nepean, ON]

I'd like to explain that. I think we came forward with the architecture of a regulatory regime when we announced our “Turning the Corner” document. We talked about the short term, the medium term, the long term, and various compliance options. What the provinces asked us, what industry asked us, what environmental groups asked us, and what health groups asked us was to work with them in putting the meat on the bone.

I'll speak directly about the domestic offset system. We would like to develop a domestic offset system in collaboration with all the groups I've mentioned, with municipalities. It will be a hard system. We will be coming forward with further details, as we committed to do.

I guess you are either blamed for not having all of the details from day one or you're criticized for not having enough consultation. I think the consultation with the provinces is absolutely imperative. All of the provinces have asked to actively participate in those consultations. I think a domestic offset system can have great advantages, whether it's capping the methane at municipal dumps or working cooperatively with real, hard, and tangible offsets. We'll be working on that in the days and months to come.

I do know the Pembina Institute is a very well-respected group with a lot of very smart people. I also know that they helped write the Liberal plan. They're naturally going to defer to the plan they helped author.

[David McGuinty, Liberal, Ottawa South, ON]

Minister, could you disclose whether any independent third party has fully assessed your plan?

[The Chair, Conservative, Bob Mills]

Mr. McGuinty, your time is up. You'll have to do it in the second round.

We'll go to Mr. Bigras, please.

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

Thank you very much, Mr. Chairman.

Welcome, minister, and thank you for coming to testify before the committee on the main estimates and the Climate Change Action Plan that you presented.

Over the past few weeks and months, we have heard criticism on the part of scientists, environmentalists and members of Parliament, and yesterday we heard more from the provincial environment ministers who said they were disappointed with their meeting with you. To say the least, things may be looking up for the Ottawa Senators but they are certainly not looking up right now for the Canadian Minister of the Environment.

In a few days an important G8 summit will be held in Germany. The positions of the participating countries are quite clear. On one hand, the United States does not wish to have clear greenhouse gas reduction targets nor does it want a timeline; on the other hand, Germany and Europe want firm commitments for 2020. Then there is Canada in between the two, which just continues to waffle.

My question is simple. What will your position be at the summit in Germany next week? Do you support binding greenhouse gas reduction targets? If so, are you on Europe's side or George Bush's side?

[John Baird, Conservative, Ottawa West—Nepean, ON]

If ever there was an example, Mr. Bigras, of someone who hadn't read our regulatory framework for emissions, it's in the question you just asked. It's very clear in here that we support short-term, medium-term, and long-term absolute reduction targets. It's right in our plan that we would like to see a 60% to 70% reduction in greenhouse gases by 2050. It's right there. I'd encourage you to read the plan, because it's very clear.

We also support a 20% reduction--an absolute 20% reduction--by 2020. We'll be cooperatively working with all members of the G-8 on that. We also would like to work with the “plus five” members, including China and India, to get them on board. I think it would be a tremendous failure for the G-8 and for the planet if we weren't able to develop long-term measures that include the United States, China, and India. We'll continue to work as a bridge--

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

Of course there are long-term measures. I heard your speech. You want a commitment for 2050. That is clear and we have known that for a long time. What you are less clear on are targets for 2020 and a clear timeframe. You have been silent on that.

We read your plan. I'll prove it to you minister. On page 15 you tell us that you now believe in clean development mechanisms. We, on this side of the committee, also believe in it.

How can you explain, then, that United Nations documents show once again, as your predecessor had indicated to this committee, that on May 4, 2007, you still had not paid the sum of $1.5 million required for using the clean development mechanism. How can you claim to believe in a mechanism and include it in your plan when you refuse to pay the money required to make it work?

[John Baird, Conservative, Ottawa West—Nepean, ON]

I've certainly indicated very clearly to Yvo de Boer, the executive secretary of the United Nations framework group, that we have budgeted and are paying fully our contributions toward that. I think it's important. It's something that had fallen behind. As I said previously before the committee, we're committed to paying both our voluntary and our assessed contributions to the UN framework. I don't think there's any concern. I don't know whether the cheque has cleared or whether it's arrived. It's something we strongly support. We think it is important, obviously, from the fact that we have come forward with a clean development mechanism and have said we want to participate in it.

You asked me about our policy for 2020. Our regulatory framework for air emissions states clearly that we want to achieve absolute greenhouse gas reduction of 20% by 2020 in Canada.

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

Minister, how can you mislead the public by solemnly stating before this committee and before the cameras that there will be a 20%-reduction in greenhouse gas emissions when you know perfectly well that your plan includes a series of loopholes for polluters, thereby making it impossible for Canada to achieve its Kyoto target?

Intensity base targets is the first factor and using 2006 as the base year and the technology fund that will undermine the creation of a future carbon market are two others. Mr. Chairman, can we ask the minister to be clear and honest, to look into the cameras and to say that if oil sands production is going to triple in Canada, then our 2020 target is unachievable? As Mr. de Boer said last week, not only will Canada be considered to be at the bottom of the class, but its plan will also be a failure.

This plan is an absolute failure. Not only will it prevent us from meeting the Kyoto targets but it also compromises the targets set out by the plan. How can there be a 20%-reduction when Canadian oil sands production is forecast to increase three-fold, if not five-fold?

[John Baird, Conservative, Ottawa West—Nepean, ON]

We were very clear and honest when we stated that it will be almost impossible to meet the Kyoto targets within the same timeframe if we were to begin in seven months. If you read our plan, you will see that investments for technology funds go down to zero by 2020. Our plan clearly states that technologies are a way of encouraging industry to make real investments. We won't get a 20%-reduction through industrial regulations alone. Our plan includes several other initiatives.

to find the 20% reduction. We've been very clear on that. A 20% intensity cut would not deliver that. In fact, there will be a third intensity cut by 2020. In that, we've looked at significant economic growth. We've also looked at, for the first time, involving the provinces.

Frankly, I think the Bloc Québécois has sold Quebec short. When it only asked for $330 million, we came up with more than that in the Conservative Party to support Quebec in its efforts to reduce greenhouse gases. With great respect, I think we've been very clear. I can appreciate that the Bloc, for political reasons, doesn't agree, and that's fair game.

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

Mr. Chairman, it's not the Bloc Québécois that doesn't agree, it's all of Quebec. Minister, did you hear the Quebec Minister of the Environment, Ms. Beauchamp, state yesterday that she refuses to use 2006 as a base year because that will penalize businesses that took early action in the past? Have you been deaf to the message that the Quebec Minister of the Environment has been sending you, that we do not accept this plan because it contains rules that have several unacceptable loopholes and that will penalize Quebec?

Will you accept what the Bloc Québécois has been asking for since 1997 in the House, that is to use 1990 as a base year, as set out in the Kyoto Protocol, in order to reduce greenhouse gas emissions? Will you not admit that using 2006 as a base year will not lead to true greenhouse gas emissions reductions, and that all you're doing is benefiting your oil friends, who are the economic basis of Canada?

[John Baird, Conservative, Ottawa West—Nepean, ON]

The Quebec Liberal Party obviously has a good spokesperson on Parliament Hill. I agree with you that the Premier of Quebec, Mr. Jean Charest, has a good spokesperson in Ms. Beauchamp, who has also said that she does not support independence. Do you also agree with her on that?

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

I put the question back to you. Independence would probably be the best solution under the circumstances. We would probably be able to achieve our Kyoto targets without punishing Quebec businesses in the way you are.

Minister, Quebec businesses have reduced their greenhouse gas emissions at home by 7% since 1990. These businesses want their efforts recognized and they are asking for a carbon market in order to make greenhouse gas reductions more competitive.

Are you willing to support us in developing our own approach in Quebec, in order to have a common approach in Canada but one that is unique to each province? That is my question.

[John Baird, Conservative, Ottawa West—Nepean, ON]

Our plan recognizes industry efforts to reduce greenhouse gas emissions. I told my colleague from Quebec that I would send her the list of the 700 businesses in Quebec that fall under the regulations. When she is ready, we will be able to look together at action taken by those businesses to reduce emissions.

I will explain this in English.

What I've said to my friend from Quebec is that we'll give the list of the companies in Quebec that we'll be regulating. I'm happy to go over it with her, one by one, and look at the decisions they've made to reduce greenhouse gases. Alcan is an example, which has been a tremendous leader. But I think it would be unfair to say categorically that the global number on industry was all made for reductions. For example, if decisions were made between 1990 and 1992 before there was any global action even proposed, I would be prepared to look at it, but I would be skeptical, let alone actions before 1997.

If a number of pulp and paper mills closed in Quebec for economic reasons that had nothing to do with the environment, surely you wouldn't want to suggest that they were done for environmental reasons. I have said I'm prepared to go over the numbers, company by company, in Quebec, as I am in other areas.

I know one company well in my province where someone talks about how they've reduced their greenhouse gases and should get all sorts of credits. It's because they closed plants that had finished their useful life. They closed the coal-fired generating station at Lakeview. If we think we're going to give the Ontario government credit for closing that environmentally, they're wrong. It was a plant that was supposed to last 40 years and was open for 51. We're not going to give anyone credit for doing anything environmental when an asset has reached the end of its life.

If in Quebec enterprises make meaningful reductions for environmental reasons, we are more than prepared to work with each and every one of them to ensure that those successes are acknowledged and recognized within our regulatory regime. We want to reward people who act well for the environment, but we're not going to create some accounting scheme so that every time an industry closed, they think they're going to get a big fat cheque from the government. That's not the way.

We do envisage credit for early action, something that was absent from Project Green.

[The Chair, Conservative, Bob Mills]

Thank you, Mr. Baird.

Thank you, Mr. Bigras. We did go over time.

We'll go to Mr. Cullen, please.

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

Thank you, Chair.

Thank you, Minister, for being here.

I have a series of detailed policy questions for you, but there's one that strikes me in watching your performance this morning as perhaps a place to start. How would you assess your performance in the portfolio of environment minister, to this point?

[John Baird, Conservative, Ottawa West—Nepean, ON]

I'll leave that for others.

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

The Federation of Canadian Municipalities has told some of their members that they should get on with doing their own plans in the absence of federal leadership. The provinces are contesting your intensity-based targets over a hard cap. Environmental groups are suing you in court. The plan you put forward has been called a fraud. You've won more “fossil” awards at the last international meeting. These awards are given out to the country that is working against the efforts of the international community on climate change. Canada won more of those awards than all other countries combined.

I think the assessments are being made in terms of your performance, but more generally your government's performance on this most critical issue.

You mentioned in your opening statements that you're bringing in the best of the world's standards and also that this issue is one of the greatest threats facing Canada today, if not the greatest threat. It's often put on par with the threats of terrorism globally, threats to our economy and to our societies. How can your government then justify an increase of more than 45% in defence spending and less than a 3% increase in your efforts towards the environment?

[John Baird, Conservative, Ottawa West—Nepean, ON]

I believe in a “polluter pays” approach. I don't believe we should ask hard-working, middle-class taxpayers to subsidize big business to reduce their pollution. That's why we're going to require industry to make billions of dollars in investments to reduce greenhouse gases to make the air cleaner. I think they should properly take that leadership role.

We did come forward with support for provincial governments, something that had never happened before. Premier Doer—

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

Let's take a moment with this “polluter pays” principle. Do you support the initiative of the tripling of the tar sands in northern Alberta as both an economic...and part of Canada's environmental performance?

[John Baird, Conservative, Ottawa West—Nepean, ON]

I want to complete the comment I was making about Premier Gary Doer, an NDP premier.

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

Premier Doer, as successful again in his election, is someone to look to, but my question to you is this. If you believe in the “polluter pays” principle....

Here's a very specific one. Your departments have figured out that in the plan that's quoted here, on page 27, you'll save $6.4 billion a year in health benefits. Is that true?