Environment Committee on April 2nd, 2009

[The Chair, Conservative, James Bezan]

I call this meeting to order. We're going to study the estimates today, as well as continue on our work on Bill C-16 while we have the minister here.

We do appreciate that Minister Jim Prentice, who's the Minister of the Environment, is joining us today and taking time out of his busy schedule. He's joined by Deputy Minister Ian Shugart. Welcome to the committee.

With that, Minister, would you bring us your opening comments?

[Jim Prentice, Conservative, Minister of the Environment]

Thank you very much, Mr. Chairman.

Ladies and gentlemen, it's a pleasure to be here. I always enjoy the opportunity to meet with the committee to discuss your agenda, the government's environmental agenda, and legislation that is before us.

Once again, thank you for affording me the opportunity to be here to discuss the main estimates for my portfolio, which includes Environment Canada, the Parks Canada Agency, the Canadian Environmental Assessment Agency, and the National Round Table on the Environment and the Economy.

As mentioned, I'm joined by my able deputy, Mr. Ian Shugart. Along with us are a number of other departmental officials, who will be pleased to respond should any of your questions require any additional discussion.

It's been just under two months since I last appeared before you, but in those eight weeks, much has transpired to push our government's environmental agenda forward down the path toward reduced greenhouse gas emissions and toward a more secure energy future, in keeping with our overall responsibilities as stewards of the environment.

About a week after I was last here, President Obama travelled to Ottawa for meetings with the Prime Minister, from which emerged the foundational beginnings of a North American partnership on questions of continental energy security and environmental integrity.

I was fortunate enough to be included in those meetings. I met with both the President and Carol Browner, his adviser. I can attest that our conversations with the American representatives were healthy and productive, and that all of us have come away with an optimistic outlook in terms of how our countries can best address the challenges that lie before us.

While it's true that the clean energy dialogue is at this point in its infancy, the commitment made by the American and Canadian federal governments is clear, and it is a demonstration of the renewed appetite for cross-border collaboration on both environmental and energy issues. In fact, since President Obama's visit, I've travelled to Washington a number of times. For instance, just days after the dialogue, I met with senior White House environmental advisers and key members of Congress to begin addressing the clean energy dialogue in its main elements.

As you know, the principal stated elements of that dialogue include what I would essentially refer to as three working groups. Expanding clean energy research and development is the first of those. The second is the development and deployment of clean energy technology, including, but not limited to, carbon capture and storage. The third is the design and construction of a smart electricity grid in a North American context, based on clean and renewable energy availability.

Since my first visit to Washington, I've continued the conversation with my key American colleagues, both to maintain the clean energy dialogue momentum and to discuss other issues that are of environmental significance both continentally and globally. As was the case with the President's first visit, my discussions in Washington have been fruitful, and I think they provide a sound basis for proceeding forward on a continental approach to matters.

The same can be said of our similar pursuits on a domestic and international front. The 2008-09 fiscal year was a busy one for my department, but also a productive and successful one. I'm confident that we can again meet the expectations of Canadians.

I look forward to the discussion with you about climate change. As I will outline, our intent is to proceed on three parallel pathways--domestic, continental, and international--all of which intersect, in a sense, through the year, culminating in Copenhagen in December.

In terms of environmental accomplishments, ours have run the gamut from progress on climate change, both at home and abroad, to better-protected waters, to additional enforcement capacities, to cleaner air, and so on. I'd like to give more detail on a few of the accomplishments to demonstrate our environmental commitment. You may wish to relate this to the estimates themselves.

We have been making progress on our clean water agenda with the Great Lakes, the St. Lawrence, Lake Simcoe, and Lake Winnipeg, to name some of our more visible initiatives. We will take future actions with respect to municipal waste water regulation.

We have tabled a new environmental enforcement bill that cracks down on polluters, poachers, and wildlife smugglers through increased fines, stronger sentencing provisions, and new enforcement tools. I know you wish to discuss that today.

This legislation builds upon the combined $43 million in funding, from budgets 2007 and 2008, that is being used to put more enforcement officers on the ground and ensure that strong cases are pursued by way of successful prosecution.

We launched a vehicle scrappage program that offers incentives to Canadians who turn in their older, higher-polluting vehicles and promotes sustainable transportation.

We hosted an important polar bear round table to set the scene for consultations related to listing the polar bear under the federal Species at Risk Act.

We've continued to collaborate with Canadians, and Health Canada in particular, on the national air quality health index. It helps Canadians make decisions to protect their health by limiting their short-term exposure to pollution and adjusting their activity levels during periods of heavier pollution.

Finally, our environmental action continues with the introduction of Canada's economic action plan, which includes more than $2 billion of specific items relating to green investments designed to protect the environment, stimulate our economy, and transform our technologies.

Some of the most noteworthy investments include: $1 billion over five years for clean energy research development and demonstration projects, including carbon capture and storage; a new $1 billion Green Infrastructure Fund over five years to support projects like public transit, sustainable energy and waste management; and $300 million over two years to the ecoENERGY Retrofit Program to support additional energy-saving home retrofits.

Specific environment Canada and Parks Canada-led investments in the Economic Action Plan include: $97.5 million over the next two years to manage and access federal contaminated sites; more than $30 million to support the Mackenzie Gas Pipeline Project; and $10 million to improve the government annual reporting on key environmental indicators, such as clean air, clean water and greenhouse gas emissions; and more than $200 million from Parks Canada to improve highways and roadways in our national parks and make them safer for visitors.

In addition, Environment Canada is submitting proposals to access funding in two items led by other government departments, including $85 million over two years to maintain and upgrade key existing Arctic research facilities, which falls under the purview of Indian and Northern Affairs Canada; and more than $200 million over two years to maintain federal laboratories, which the Treasury Board Secretariat will oversee.

Mr. Chairman, the year 2009 signals a key milestone for international efforts to reduce greenhouse gas and better protect the earth from harmful emissions.

I am interested in the views of the committee and your cooperation in working together. As you may recall, I actually included the critics in our discussions at Poznan, in the most recent COP conference.

At the United Nations climate change conference in Copenhagen next December, the world is expected to agree on the post-2012 way forward to address the challenges of a warming plant. In Copenhagen we will build on the progress made at the previous Poznan conference, the Bonn conference, which is currently going on, and a number of other conferences that will take place in the time before December.

Last December, I led the Canadian delegation at Poznan, where we urged the international community to adopt a post-2012 vision that places the world on the path to a low-carbon future. There is no doubt that Copenhagen will be an important conference in the fight against climate change. Canada fully intends to once again play a lead role in moving the world towards action.

However, what we do prepare for in Copenhagen is equally important, which is why I'm here today to clarify my department's 2009 and 2010 main estimates. During the next fiscal year, Environment Canada plans to spend a little over $1 billion to meet the expected results of program activities and contribute to its strategic operations and outcomes. These include restoring, conserving, and enhancing Canada's natural capital; reducing risks and contributing to the well-being of Canadians through environmental predictions and services; and protecting Canadians and their environment from the effects of pollution and waste.

Meeting these strategic outcomes would mean that we were successful in addressing our key priorities. Those include reducing greenhouse gas emissions through domestic action and through international agreement; second, protecting Canadians from air pollution and the toxic substances by continuing to implement the chemicals management plan; and third, strengthening the meteorological and environmental services our department provides to Canadians.

Additionally, we intend to take action to improve biodiversity and water quality by implementing the Species at Risk Act and carrying out work under the action plan for clean water.

We intend to enhance the enforcement program to improve the environmental outcomes and the environmental legislation of activities.

We have continued to take leadership on environmental initiatives for the clean air agenda, the federal contaminated sites action plan, and sustainable development legislation.

And finally, we will strengthen the support to program activities by enhancing the enabling functions in the department.

Of our $1.081 billion forecast spending, Net Main Estimates amount to over $900 million, all of which will go towards internal services and meeting our objectives in clean air, chemical management, water, environmental science and monitoring, weather and environmental prediction, biodiversity and wildlife, legislation and information, and ecosystems initiatives.

Cast against last year's main estimates, you will see a $35.2 million increase in our forecast spending. This increase occurred despite a decrease in planned spending of $91.7 million associated with the transfer of responsibility for the Toronto Waterfront Revitalization Initiative and the Harbourfront Centre to the Minister of Finance—two initiatives not considered to be core Environment Canada functions.

This represents an over-$100-million increase to our core business activities, growth that is principally attributable to key initiatives like the National Vehicle Scrappage Program, Environmental Law Enforcement, the Clean Air Regulatory Agenda and the National Water Strategy.

As I mentioned when I began, my portfolio also includes the Canadian Environmental Assessment Agency, the National Round Table on the Environment and the Economy, and the Parks Canada Agency. Let me briefly speak on each of these areas and outline their priorities for the coming year.

First, on the Canadian Environmental Assessment Agency, environmental assessments will be a key element in ensuring that the environment is protected. Since the Canadian Environmental Assessment Act came into force in 1995, Canada's environmental economy has benefited from better-designed projects where adverse environmental effects are avoided and are minimized.

Over time we have experienced significant challenges in implementing the act. For example, delays in initiating the federal environmental assessment process make coordination with provincial processes difficult and can cause duplication. Delays also add to proponent costs, create confusion with public participants, and do little to add to environmental protection efforts.

Just last month I announced that we have taken targeted action to streamline overreaching and duplicative federal environmental assessment requirements for infrastructure projects. We now have two regulations that will help focus our resources by eliminating unnecessary environmental assessments for public projects where we know, from our accumulated experience, that there are no significant adverse environmental consequences, and where, in fact, there are often net environmental gains.

We'll also avoid unnecessary duplication with provincial processes when a project requires both a federal and a provincial environmental assessment and the end result will be the creation of jobs and projects that begin sooner.

Over the coming months, we will look at additional options to ensure timely assessments and to focus federal resources on environmental assessments where they will have the greatest benefit. Protecting the environment will continue to be a priority, and environmental assessment for projects that entail environmental risks will continue to be rigorous.

With respect to Parks Canada, Mr. Chairman, in light of the time, I would suggest that I come back to those points in the context of the question and answer period, and similarly with respect to the national round table.

As I wrap up, I want to remind the committee that my one fundamental principle as Minister of the Environment is to protect and improve our environment. The funds represented by these main estimates enable Environment Canada and its portfolio agencies to do their part to make our country and our world greener.

Together, the main estimates and the budget 2009 commitments will promote real action on the issues that matter most to Canadians--environmentally healthy and sustainable communities, energy efficiency, and continued economic growth.

Mr. Chairman, I hope this summary of where we are headed with respect to the environment and this clarification of our main estimates provide the committee with the insight that we need to begin today's discussion. I'd be pleased to respond to any questions that you may have.

Thank you, Mr. Chairman.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Minister. I appreciate your respecting our time limit as well.

With that, we'll go to seven-minute rounds.

Mr. McGuinty, perhaps you'd kick us off, please.

[David McGuinty, Liberal, Ottawa South, ON]

Thanks, Mr. Chairman.

Thank you, Minister, for showing up.

We have 37 minutes left in committee, Mr. Chair, to go through $1.5 billion of expenditures, so that's unfortunate. It's too bad we didn't have the two hours we originally assumed we were going to have this morning.

Minister, I want to go right to part one of your three-point plan. You said there's a domestic, continental, and international approach to climate change, I think I heard you say, and you said it yesterday as well. Because there's such little time, I really would implore you to be brief, if you could. And if you don't know, it's okay to say you don't know. Is Turning the Corner still Canada's climate change plan?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

Thank you for your question.

Turning the Corner continues to be the basis on which the industrial emissions of greenhouse gases will be regulated. That plan is currently being fine-tuned in response to as I've said, three factors. First, the stakeholder consultation and the provincial harmonization efforts with respect to that plan were never completed. Secondly, the economic circumstances currently faced by our country require a reassessment of the level of targets and so on that are set out in the plan, although it fundamentally remains our approach. Thirdly, the election of President Obama in the United States has essentially changed the approach of our major trading partner to these issues. That continues to play out in the United States, even over the course of this week.

In light of those three exigencies, Turning the Corner will be fine-tuned essentially as the basis upon which industrial emissions are regulated. There are, however, beyond that, other initiatives relating to transport emissions. I announced yesterday a harmonization of motor vehicle standards, and with respect to other emissions such as coal-burning thermal emissions, there are other initiatives under way.

In conclusion, we will be addressing all of the sources of greenhouse gas emissions in our country over the time between now and Copenhagen.

[David McGuinty, Liberal, Ottawa South, ON]

Let's go back to the plan, Minister. I know that things have changed, and there are some new factors in play. But I want to go back to your plan and your timelines and your targets.

Your government has said repeatedly, including at committee here with your senior officials, that you're forecasting 18% emission reductions in the industrial sector by 2010. This would result in absolute terms, you said—and maybe it might have been your predecessor—in a 49-megatonne reduction from the 2006 baseline.

Furthermore, your plan claims it will reduce emissions from the industrial sector by 165 megatonnes from 2006 to 2020. This 49-megatonne reduction by 2010 is over 30% of the target.

Now, we haven't seen a single greenhouse gas regulation in three and a half years. Are you telling the country now, and telling large final emitters, that we're on track right now to meet this absolute reduction?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

What I'm telling you is that this is a critical year in terms of climate change and that we are proceeding domestically, continentally, and internationally. We will calibrate our efforts to be part of the international efforts to deal with climate change consistent with what is agreed through the UN process and the major emitters process, which the new U.S. administration has begun.

Secondly, we will calibrate our industrial emissions and those emissions that relate to thermal coal generation in specific response to what is happening continentally, what is taking place in our economy. And I intend to finalize those regulations when I'm satisfied that the path forward is perfectly clear in terms of the international process, the continental process, and what we're going to do domestically.

[David McGuinty, Liberal, Ottawa South, ON]

I hear you, Minister. So basically you're not able to tell us whether we're on track or not. I understand that.

[Jim Prentice, Conservative, Calgary Centre-North, AB]

I believe we are firmly on track, as a matter of fact.

[David McGuinty, Liberal, Ottawa South, ON]

Minister, has a single independent analysis—in three and a half years—confirmed your government's plan that it will in fact see Canada achieve its 2020 and 2050 targets? And in that answer, could you tell us if you have seen the Tyndall Centre's report?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

Sorry, which report?

[David McGuinty, Liberal, Ottawa South, ON]

The Tyndall Centre for Climate Change Research report. Have you seen C.D. Howe's report, or the Deutsche Bank's report?

Let me quote from your National Round Table on the Environment and the Economy. They say in their conclusion that not only are your targets inconsistent with the objective of stabilization of emissions, but they are inconsistent with the wider commitment set out in your regulatory framework for air emissions to reduce Canada's total emissions relative to 2006 by 20% by 2020 and to 60% to 70% by 2050.

There are 11 independent groups, Minister, who have examined your plan. Not a single one substantiates or warrants your numbers.

Do you have a single third-party group independent analysis that substantiates your government's continuing claims—you've just said the Turning the Corner plan is your continuing plan—that you're going to achieve these targets?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

The targets that we are proceeding with in terms of the mid-term are minus 20% by 2020. I'm satisfied that we are working towards those targets.

I'm familiar with most of the reports you have referred to. I haven't specifically seen the Tyndall Centre report. I'm happy to look at that.

The process at this point requires us to finalize our approach with reference to where we are in terms of the economy, where we are now that the United States has engaged in the battle against climate change. Given the deep integration between our economy and the United States', it is critical we get this right. It's extremely important on all aspects of energy production and consumption with environmental consequences in our society that we calibrate this properly. We will do so.

All the independent organizations you refer to will be at liberty, over the course of this year, to evaluate the specific plans I'm bringing forward.

[David McGuinty, Liberal, Ottawa South, ON]

Okay, so it's a moving target, Minister. I think that's a fair conclusion for Canadians to draw. It's a moving target.

I want to go back to your dialogue for a second, Minister. I asked you in the House of Commons two days ago about the 2001-struck North American energy working group, which the previous Liberal government struck between Canada, the United States, and Mexico. We confirmed with Mexican and American officials that the North American energy working group is still working, still meeting, because we couldn't confirm it with your government.

Minister, they've been working on issues like expanding clean energy, clean energy technology, and the design and construction of smart grid for eight years. Why is it you had to reproduce what had already been in existence for five years when you became a government? A dialogue was already well under way with not just the United States but also, yes, our continental neighbours. Why is that?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

Well, I don't think it's appropriate to compare something that was struck in 2001 with Mexico, the United States, and Canada. It has a different basis than the clean energy dialogue struck with incoming President Obama. I'm sure it's not lost on you or anyone else that President Obama has spoken about his plans on the environment with considerable clarity and determination. In many respects, his approach matches precisely what our Prime Minister has previously set out in terms of our approach to this internationally and domestically.

The focus of the clean energy dialogue is to begin the process between Canada and the United States to work together on all the issues relating to environment and energy. The basis of Mexico's participation is entirely different. Mexico is not a signatory to the agreement between Canada and the United States relative to the North American energy marketplace. The principal agreement signed in 1970 between Canada and the United States does not apply to Mexico. Mexico has not agreed to the free-flowing energy marketplace we have as the basis of international agreement between Canada and the United States. So the situation is quite different and will remain different.

[The Chair, Conservative, James Bezan]

Thank you. Your time has expired.

Monsieur Bigras.

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

Thank you very much, Mr. Chair.

First, I want to say how disappointed I am that you have taken the time to make a statement that could have been more succinct, which would have enabled us to ask more questions and ensure greater participation from the committee members.

On page 6 of your presentation, you state: “[...] Canada fully intents to once again play a lead role in moving the world towards action.[...]” in regard to the fight against climate change.

I am little surprised to hear you tell the committee that Canada played a lead role in international circles when no later than the day before yesterday, the European Union criticized your position and said that you have failed to show leadership. Europe is pointing to the fact that no regulations have come into force in Canada in demonstrating that there is a lack of leadership on your part.

I am concerned about the Bonn Climate Change Talks, which are currently underway. Could you clearly indicate the position Canada has presented to date in Bonn? Would you commit to tabling the documents highlighting Canada's position in Bonn to date?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

Our position in Bonn is quite clear. We intend to play a constructive role in this process, in order to develop an international protocol for all nations. We had expressed a preference in investing in green technology and energy, and it's clear that we will continue with that approach.

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

Let's be serious, Mr. Minister. Do not tell me that this is Canada's position at an international conference on climate change.

On the site of the European Union Commission, there is a 127-page document that presents that position. It is accessible to the public. What you are doing this morning is nothing less than implementing a policy of secrecy regarding international negotiations.

I am concerned. You told Mr. McGuinty that Canada's position and plan could be subject to change because the new economic situation needs to be taken into consideration.

Are you telling us that economic interests will take precedence over environmental interests, when the UN secretary general clearly indicated a few months ago that a crisis should not be a reason not to intervene in the context of another crisis?

Are you amending your Climate Change Action Plan, which is already weak, to make it even weaker for economic reasons?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

If you want an explanation about the 127-page document, I must...

In any case, I appreciate your comments concerning this committee's time.

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

Are you committing to tabling those documents?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

Given the current economic context, we need to ensure a proper balance between our environmental and our economic responsibilities. We will continue to do so and we are working in cooperation with the United States and other countries. The annual UN Conference on Climate Change in Copenhagen, which will be held next December, is a key event in this field.

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

I understand that you want to continue to work in cooperation with the United States in order to ensure a continental approach. However, you made an announcement yesterday about greenhouse gas emissions by vehicles. You said in this regard that a regulation would be forthcoming but you did not give any details about the standards that would apply. Ultimately, you didn't tell us anything.

In comparison, President Obama asked his administration on January 25, 2009, to speed up the process to ensure that 2007 legislation on fuel consumption would apply to vehicles starting in 2011. This legislation will ensure that American cars will get an average fuel consumption of 6.7 litres per 100 km, equal to the standard in California, by 2020 at the latest.

Could you also make an official commitment today with regard to the announcement you made yesterday to harmonize our vehicle standards with those in force in the United States, but in keeping with President Obama's approach, meaning in keeping with Californian standards?

[Jim Prentice, Conservative, Calgary Centre-North, AB]

That is incorrect. I am going to speak in English.

President Obama has not said that the California standard will be the national standard for the federal government of the United States of America. He has not said anything of the sort. He has directed the Environmental Protection Agency to reconsider the California waiver that precluded individual states from adopting their own standards. There's been no suggestion that the California standard will necessarily become the standard that applies in the United States in the time between 2012 and 2020.

What President Obama has also done is he has defined the fuel economy standards in the United States for the 2011 model year. He has not yet defined, nor has his administration defined, the standards from 2012 through to 2020. Those remain to be determined.

As we announced yesterday, we will be the first federal jurisdiction in North America to adopt tailpipe emission standards. We will be the first jurisdiction to regulate automobiles on the basis of the quantum of carbon they emit. This is not done in the United States at this point in time, so Canada will be leading the way in that respect.

We do, however, intend to harmonize those tailpipe emission standards with the very specific fuel economy standards that are developing between us and the United States in terms of the automobile industry. The rationale for doing that is clear. We want to have the highest possible environmental objectives. They need to be achievable. The automobile industry is deeply integrated across the border, and it is impractical to have differing fuel economy standards at the federal level in Canada and the federal level in the United States. So I've made the decision, with cabinet support, to exercise our jurisdiction under the CEPA legislation to introduce the first regulations of their kind.

[The Chair, Conservative, James Bezan]

Ms. Duncan, the floor is yours.