Evidence of meeting #13 for Environment and Sustainable Development in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was standards.
A recording is available from Parliament.
9:35 a.m.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
Thank you, Mr. Chair.
It's nice to see you again, Mr. Minister. I don't run into you in the elevator anymore.
9:35 a.m.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
I haven't left. I think it's a ghost.
I welcome the policy you seem to be adopting, which is to harmonize with the new U.S. administration. That would be consistent with the North American Agreement on Environmental Cooperation.But that agreement also commits Canada and the provinces that have signed on, including my province of Alberta, to not downgrade environmental standards for any kind of economic benefit. I would encourage you, if you are not yet briefed on that, to become apprised of that agreement. I have a couple of questions I want to ask you about that agreement.
First, is your government anticipating tabling a clean energy and security act similar to the one being considered in the United States? It is dedicated to creating new clean energy jobs, saving energy costs for consumers, enhancing energy independence, and cutting global warming. And it actually sets specific targets for retrofits and renewable energy. I'm wondering if you are considering that. I notice that the Canada West Foundation, in the south of Alberta, has proposed the same act. I'm wondering if your government is giving consideration to that.
9:40 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
Let me respond, first, with respect to the environmental cooperation agreement. As you know, that agreement is an important agreement. It is a parallel agreement, if you will, to NAFTA. It was executed in 1993. It is, strictly speaking, outside the four square corners of the NAFTA agreement, but it is essentially a parallel environmental accord.
I will tell you that at this point in time there is dissatisfaction with where that agreement currently sits and with what has been achieved under the terms of that agreement in the time since it was created. There have been discussions between me and representatives of the American government and representatives of the Mexican government about the possibility of evaluating that agreement and about how we are going to address it in the future. There are concerns on the part of all three levels of government as to whether the efforts since 1993 fulfill the promise of that agreement.
9:40 a.m.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
I am pleased to hear that.
Are you supportive of the proposal we've heard President Obama suggest, that in fact the side agreement on the environment should become binding and actually part of NAFTA so that the environmental conditions would be binding and there would be penalties?
9:40 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
To be clear, there have been no specific discussions about that with any representatives of the United States. Certainly I'm aware that publicly that has been a stated issue in the United States. Presumably it would form part of any discourse about the agreement, but that is currently not something under consideration.
With respect to the second agreement that you're referring to--
9:40 a.m.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
I'm wondering if you are suggesting to your colleagues that it would be a good idea to also adopt a Canadian clean energy and security act.
9:40 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
Let's leave aside the question of the legislative mechanism that would be employed. To be very clear, and I don't want to reiterate my earlier comments, we are moving domestically, continentally, and internationally in a year that is both demanding and complex. It is our intention to proceed with respect to the appropriate legislative or regulatory action with respect to each major source of Canada's greenhouse gas emissions.
We moved yesterday with respect to transportation. Transportation accounts for 28% of Canada's greenhouse gas emissions. As of yesterday, in terms of passenger vehicles, at least, we have harmonized our environmental approach and our industrial approach with the United States.
A second major source of emissions is the industrial sector, which accounts, as I recall, for 35% of Canada's greenhouse gas emissions, of which half comes from the oil and gas industry. Turning the Corner provides the fundamental basis for regulating that industry. I've explained that we will be moving ahead to fine-tune Turning the Corner.
9:40 a.m.
NDP
9:40 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
Certainly. Let me just finish one last point.
A third major source of greenhouse gas emissions is thermal coal, which you and I have previously discussed. Those emissions account for 17% of Canada's greenhouse gas emissions. I anticipate taking a very specific approach with respect to coal-burning thermal plants in Canada.
9:40 a.m.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
Unlike the U.S. approach, which has put a lot of attention on moving forward on renewables, why, in both Turning the Corner and in your budget, do you not at all include renewables? You only talk about clean energy, coal-fired, and nuclear.
9:40 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
I think the short answer to the question is that our economic action plan is responsive to Canadian circumstances. The approach that has been put forward by President Obama is responsive to U.S. circumstances.
One fact that is often lost in this discussion is that in Canada, although we are a large per capita emitter of greenhouse gases, we actually have one of the cleaner electricity systems in the world. It's rated as sixth or seventh in the world in terms of emissions.
We have approximately only 25 coal-burning thermal plants in Canada. We set out, in the last throne speech, an objective of trying to arrive at 90% non-emitting sources by 2020 from our thermal electricity sector. At this point, Canada actually sits at 73%, so 73% of Canada's electricity is produced from non-emitting sources.
It is the opposite situation in the United States, where, as I recall, less than 25% is non-emitting. They have a much different challenge than we do. Not surprisingly, the focus is different in the terms of the budgetary instruments.
9:45 a.m.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
Are you planning to waive notice and consultation on your regulations on greenhouse gases, as you did with the CEAA regulation amendments?
9:45 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
Twenty seconds isn't very long.
We will proceed with the consultative process that we've set out. There will be--
9:45 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
No. There's no attempt to waive notice. I'm not sure where that suggestion comes from.
9:45 a.m.
Conservative
The Chair Conservative James Bezan
Thank you very much.
Mr. Watson, you can clean up the first round.
9:45 a.m.
Conservative
Jeff Watson Conservative Essex, ON
Thank you, Mr. Chair.
Thank you as well to the minister and to the officials for appearing.
Coming as I do from the auto industry, it's no surprise that my interest lies in how the auto industry and greenhouse gas emissions reduction come together.
Of course, Minister, as we all know, in your previous portfolio we did some work together with respect to Canada's auto action plan, which was announced in February 2008.
One of the pillars of that plan, of course, was the focus on automotive research and development, particularly green R and D, and the auto innovation fund, which is to help automakers retool their Canadian operations to produce fuel-efficient vehicles and fuel-efficient vehicle components. From that came the Essex engine announcement, back home in the neighbouring riding of Windsor, both to produce fuel-efficient engines and to have a green research and development centre as part of that investment.
Yesterday, though, you made some additional announcements in terms of moving the auto industry forward in the efforts to reduce greenhouse gases. I wonder if you can take us through that in a bit more detail. You gave us a glimpse of that earlier today. Obviously, there are Canadians who will be watching this as well and who may not have heard your announcement yesterday.
Of course, as you're going through your answer, it's with the knowledge in mind that President Obama has announced his intention to implement the U.S. reform to CAFE standard, which must be achieved in two product cycles for the auto industry and is actually a fairly aggressive target.
Can you can outline for us what we mean by a stringent, dominant North American standard; what that will be under the U.S. reformed CAFE; and the importance, in terms of the continental approach to harmonization, of improving our vehicle fuel-efficiency performance and what that means to greenhouse gas reductions? If you can walk us through that a bit, I'd love to hear details about how we intend to regulate through CEPA as well.
9:45 a.m.
Conservative
Jim Prentice Conservative Calgary Centre-North, AB
Thank you very much, and thank you for all the excellent work you've done with respect to the auto industry, both in my time as Minister of Industry and since, in my time as Minister of the Environment. We've had an opportunity to work together. It was interesting; I had the opportunity yesterday to meet the new president of Ford Canada, and he was very complimentary about the progress they're making with you in Windsor with respect to the Essex engine plant investment, which is so important there.
The essential challenge, and this has been on the table for a number of years, is how to fulfill our industrial and environmental objectives simultaneously with respect to the automobile industry. Obviously, the industry is in trying circumstances at this point. I won't get into that in all its detail, other than to say that our government is clearly working together with the U.S. administration to ensure that the steps we take are taken in concert and that they are oriented toward ensuring the industry is not only competitive domestically and internationally, but also achieves the highest possible environmental standards.
The announcement yesterday is an extremely important one, not only because it achieves that objective but it really sets the regulatory process in place to ensure that we will have harmonized fuel economy and carbon emission standards in North America. Every effort will be made, using the CEPA legislation year after year, to ensure complete congruity between the Canadian and the American standards. We will never again find ourselves in a circumstance where Canadian federal standards are discordant with North American standards in the North American marketplace.
There is an obvious rationale behind that--namely, in Canada we produce 20% of the automobiles in North America. More than 80% of the vehicles we produce are exported to the United States. They are sold into a different market than they are produced in, so this is a large integrated marketplace.
When I spoke yesterday, I reminded people that one of my first acts as Minister of Industry was to load myself into a Linamar truck, along with 18 rear-axle portions of the truck. We travelled across the border just to measure the time it takes to move auto parts back and forth in your neck of the woods. By the time a North American vehicle is produced, some parts in that vehicle have been back and forth across that border up to eight times.
We believe we are fulfilling our environmental promise going forward. We will be the first jurisdiction federally in North America with tailpipe emission standards. Henceforth, automobiles in Canada will be regulated in terms of the amount of carbon they emit, not in terms of fuel economy. We will harmonize those numbers with the United States.
9:50 a.m.
Conservative
Jeff Watson Conservative Essex, ON
You've entertained a bit of discussion or raised the issue of California emission standards. Clearly, the fleet mix in California that was contemplated in the California emission standards is significantly different from the vehicle fleet mix here in Canada. For example, we have a significantly higher proportion of trucks than they do in the California market.
Can you talk about the impact of the California standard in Canada with respect to the fleet mix? What would that mean, particularly for regulating emissions with respect to small vehicles?