Environment Committee on May 26th, 2009

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you, Mr. Chair, and welcome back. It's great to see you here.

Thank you very much, Mr. Commissioner, for your appearance here today and for another very thorough report.

I'll start with an easy question. In your estimation, were the requirements under the Kyoto Protocol ever or are they now realistic, in terms of emissions reduction targets?

[Scott Vaughan]

That was the easy question?

[Voices]

Oh, oh!

[Scott Vaughan]

I don't think it would be for me to comment on that.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

I had anticipated that this might be your answer. I just wanted to see whether my colleagues around the table were paying attention.

I understand there were improvements in the 2008 report over the 2007 report. Could you touch on what some of those improvements were?

[Scott Vaughan]

Yes, I'll give you two examples. One is that there is a requirement under subparagraph (v), which the previous honourable member mentioned, that obliges the government to give the date of entry into force of each measure. In 2007, there was one of 19 dates; in 2008 there were eight of 19.

As a second point, there was an improvement in coordination among interdepartmental communications led by deputy ministers for different departments submitting their information to Environment Canada.

Those are two concrete examples. I'd be glad to share others, if the honourable member is interested.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you very much.

I understand that the national round table also has a responsibility to provide a report on the Kyoto Protocol Implementation Act. They've also observed improvements, I believe, in 2008 versus 2007. Could you help me understand what the differences in responsibility are between the reports from the national round table and reports from you?

[Scott Vaughan]

I'm familiar with our responsibility, but I'll ask my colleague, Monsieur Arseneault. My understanding is that the round table, when the draft climate change plan is submitted to Parliament, has 120 days to do an assessment, essentially of the work related to the estimates, the assumptions related to the forward projections.

I'm not sure whether there's anything else besides that.

[Richard Arseneault]

I think it's 60 days they have to comment on the likelihood of the government achieving its targets in the plans, while we do audits and so have more than 60 days to do our work. We dig into the files, go into departments, interview people, analyze the information, and then submit a report to Parliament. There's a big difference in the role we do, but obviously some of what we said in our report has been said by the national round table about the unlikeliness of meeting the targets within the Kyoto period.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Very good.

There seem to be some indications of promise with respect to the ecoENERGY for renewable power program. Can you share with us what's working well with respect to the impact of that program, and in addition tell us whether there are specific types of renewable energy that are perhaps showing some promise, in terms of both take-up and impact upon reducing greenhouse gas emissions?

[Richard Arseneault]

We looked at this in 2006. Actually, we looked at a number of programs in Natural Resources Canada, which has the departmental lead on these files. We said good things about it in 2006 and we have said good things about it again now, concerning wind energy and the types of energy they're promoting. They are actually providing funding for this to happen in Canada, which is a good thing. It's generating greenhouse gas emissions reductions over time. This has been a “good news” story for a number of years over a number of governments, in terms of that department's activities.

Is it perfect? No, it's not. We made some recommendations back in 2006. We didn't have any recommendations this time. We were only looking to see whether there is an adequate rationale in coming up with their targets. We said they can demonstrate to us that there is an adequate rationale. We had a problem with the approach the government used of a “business as usual” scenario, which wasn't clear, we said, and wasn't really transparent about how it all works together.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Fourteen sectors were looked at in your report. Were there any varied results across sectors, or was it fairly consistent?

[Scott Vaughan]

We didn't go through the analysis. There are 14 sectors. We noted there were several hundred industrial installations—it's probably closer to 2,000. Given the complexity, in this audit we didn't ask what the variations would be. I think it's safe to say there are significant differences between the manufacturing sector and electrical utilities. The variation is within the emissions profiles per industrial sector and then certainly at the installation level. One of the observations we make is that this is a complex system and it's a complex problem.

[The Chair, Conservative, James Bezan]

Thank you.

We'll kick off our third round with Mr. McGuinty.

[David McGuinty, Liberal, Ottawa South, ON]

Thanks, Mr. Chair.

I want to begin by reading into the record, particularly for the benefit of Mr. Woodworth, who wouldn't have been here and may not know better than was shown by some of the questions he raised, which I found unfortunate.... Canada signed the Kyoto protocol in 1998 and, after a parliamentary debate, ratified it in December 2002. The Kyoto Protocol came into effect in 2004 because two conditions were met.

This is important, Mr. Woodworth. It's an international public law issue. Number one—

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

On a point of order, Chair, I'm not sure whether Mr. McGuinty is speaking directly to me or to the chair. He seems to be directing his comments at me specifically.

[The Chair, Conservative, James Bezan]

Could you direct your comments to the chair?

[David McGuinty, Liberal, Ottawa South, ON]

To correct Mr. Woodworth's inaccurate depiction, which I know was involuntary, number one, at least 55 countries ratified the protocol; two, the countries that ratified represented 55% of the world's greenhouse gas emissions. Although 144 countries had signed before Russia, Mr. Chair, they collectively only accounted for 44% of global emissions. When Russia ratified, on September 30, 2004, bringing their 17.4% of global GHGs to the table, both of the conditions were met and the treaty became official. Now more than 160 countries have signed. The only countries that have not signed are Croatia, Kazakhstan, Australia, and the United States.

This follows up on the question asked by the parliamentary secretary to the commissioner, which I found astonishing, asking the commissioner to tell Canadians what our position is with respect to the Kyoto Protocol.

Mr. Commissioner, I want to go back to energy prices. Just before doing that, I want to remind Canadians that it was the Progressive Conservative government of Brian Mulroney that, from 1988 to 1992, negotiated the United Nations Framework Convention on Climate Change. It was the former ministers of the environment, Jean Charest and Tom McMillan, two strong Progressive Conservatives, one of whom has become a Liberal in Quebec, who negotiated the UNFCCC, laying down the track for the Kyoto Protocol. The global community has been behind this for 21 years, except for the new government in Canada since 2006.

Mr. Commissioner, I asked you a specific question about energy prices. You said there wasn't enough information on energy prices. Did you find anything at all to substantiate or to measure how high energy prices will go with the admitted increase being put forward by the new government here in Canada? How high will energy prices go under any of plans 1, 2, or 3, which you examined?

[Scott Vaughan]

Well, first of all, I have to say that the relationship, obviously, between the price of energy and then the costs of reductions are closely linked, so one of the observations we've made related to the transparency of the models the government ran. If you run any model, its test is whether you can run it again, and that's a basis of scientific observations, of scientific inquiry. Based on the information that was provided, nobody could run the model again, so we basically have asked them to show us their homework, show us the assumptions of energy prices, volatility, sensitivity analysis, and uncertainties.

[David McGuinty, Liberal, Ottawa South, ON]

Is the Government of Canada breaking the law right now, Commissioner? Has your office examined the KPIA and the extent to which the government may be in breach of a domestic law?

[Scott Vaughan]

No. In any audit, we look at a standing law and whether the government has fulfilled what is required in the law. What we've said is within this, the government has fulfilled much of what KPIA required. There was some information that is still missing. We would expect there will be, based on the responses of the department, improvements next time around.

[David McGuinty, Liberal, Ottawa South, ON]

Commissioner, in your work in examining KPIA, it speaks directly to Canada's international reputation, our having ratified a major international treaty. Can you tell the Canadian people, from your examination, your work, what Canada's status is right now with the UNFCCC and the Kyoto Protocol?

[Scott Vaughan]

Well, this is going to be the subject of the debate in Copenhagen. We haven't looked at Canada's status in relation to the UNFCCC or the Kyoto Protocol. For example, we've said in the chapter that the national inventory Canada submits as required under the Kyoto Protocol is in conformity and in compliance with the UN expectations on inventory. I think more generally, although we didn't look at this in the audit, Canada is an active participant in various systems related to Kyoto—sharing of scientific information, exchange of information. On those systems, Canada is a signatory. I think Copenhagen will be determining what will be the next steps, generally as well as specifically, on issues related to compliance and non-compliance. I think that's no secret; it's going to be one of the key issues that's going to be addressed in six months.

[The Chair, Conservative, James Bezan]

Thank you very much.

Monsieur Bigras, s'il vous plaît.

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

Thank you, Mr. Chair.

I have read your report, and I am trying to make a projection for the future. I must admit that I am at a loss. Our neighbours to the south are poised to make important decisions and will be putting a cap on greenhouse gas emissions.

On this side of the border, you have tabled your report and are telling us that, even though it contains a certain number of options, including a domestic emissions credit trading system, the government anticipates that businesses will use the technology fund because it will cost them less.

I am trying to consider the options that are still available, including the domestic emissions credit trading system. I wonder how you will be able to conduct your audit. At a time when the U.S. is setting a cap on emissions and on the eve of the implementation of an emissions credit trading system in North America, the Canadian government seems to be promoting a technology fund instead.

I wonder how you will be able to conduct your audit despite the existing act. We run the risk of having an accountability problem. It is as if we had a plan that was practically obsolete. Rather than participate in the North American credit trading system, businesses seeking to reduce their greenhouse gas emissions will choose to invest in the technology fund, a $15 fund, which may very well weaken the North American greenhouse gas emission trading system.

I am trying to understand how you will be able to evaluate and audit the situation in the future, given the changes that are underway in North America. The current plan is practically obsolete in that more progress is being made south of us.

Looking ahead, how do you see your audit of compliance with reductions in greenhouse gas emissions?