Environment Committee on Oct. 8th, 2009

[The Chair, Conservative, James Bezan]

Order.

We do apologize to our witness for running late for the first part of our public meeting.

I want to welcome Mr. Bob Page, chair of the National Round Table on the Environment and the Economy, who's going to help us with our study of Bill C-311, an act to ensure Canada assumes its responsibilities in preventing dangerous climate change.

In light of the time left, Mr. Page, if you could limit your opening remarks to ten minutes or less, it would be greatly appreciated.

[Dr. Bob Page, Chair, National Round Table on the Environment and the Economy]

Thank you very much, Mr. Chairman.

It's a pleasure for me this morning to contribute to the committee's consideration of Bill C-311.

In opening my statement, I just want to emphasize two points. First, I want to talk about the situation with regard to the round table's mandate and the new obligations you wish from us; and second, I want to discuss some of the questions on the research and the perspective it gives on Canadian public policy and sustainable development.

As most of you are aware, I'm sure, the national round table is an arm's-length, independent federal public policy advisory agency, whose purpose is to play the role of catalyst in identifying and explaining to Canadian society and all regions of the country the principles and practices of sustainable development. We have a broad mandate to develop and promote and act as an advocate for policy ideas that advance sustainable development. We try to build useful consensus solutions for government on public policy questions.

Our role, therefore, is fundamentally an advisory one to government, not an audit or accountability one of government. Evaluating government policies and programs is not something that was ever really envisaged as part of the original act and the establishment of the round table. While it is not explicitly precluded under the 1993 National Round Table on the Environment and the Economy Act, such a role does not fit well within our governance structure and purpose. Three years ago, when we were assigned a similar obligation under Bill C-288, the Kyoto Protocol Implementation Act, we stated our first response under that act as cited in my deposition today. I won't read that whole section, but you can see it in my deposition.

Bill C-311 actually goes further in assigning new audit and evaluation roles for the round table. Section 13.2 appears to require us to perform even more stringent and extensive accountability oversights of government policies and programs. We respectfully submit this is typically a role for the Auditor General or the Commissioner of the Environment and Sustainable Development, and the Parliament itself. As an arm's-length public policy advisory organization, we have no desire to be perceived in a light that could in any way colour or compromise our core policy advisory role.

Furthermore, this bill will add significant new burdens on the national round table and its staff without any compensatory funding. While subsection 13(1) appears simply to replicate the additional obligations we were given under Bill C-288, it does in fact double the obligations because it does not supersede Bill C-288. We therefore perform two accountability and evaluation functions each year, one for the Kyoto targets, and one for these new targets, both of which would have to take place within the same timeframe. On top of that were added new and more extensive audit and evaluation functions under this bill.

We are certainly not seeking additional funding to carry out our policy agenda and work plan, which I don't believe is possible under this bill. However, meeting these new obligations under Bill C-311 would require the redirection of resources from current projects and would affect the timing and delivery of the ambitious policy agenda we have. I want to emphasize, however, that we will of course strive to fill any obligations given to us with the passage of this bill by Parliament.

The second issue I wish to address touches on our own climate change research and advice, especially as it relates to sustainable development. Over the past several years we have published extensive and well-researched advisory reports on climate change, which have contained original economic modelling and analysis and broad stakeholder consultation. I would just hold up to you our Achieving 2050 report, which came out last March and was circulated to your committee. It has detailed information on a variety of the comments I'm going to be making.

Our role has been to examine some of these top issues, like carbon pricing, from both an environmental and an economic perspective. In developing consensus solutions, we have acquired a certain expertise that we feel is useful to you when considering the core of this bill.

As the round table, we have consistently said that Canadian climate policy is most effectively approached as a long-term problem requiring long-term solutions, not short-term fixes or top-down target-setting.

As we wrote in Achieving 2050, climate change policy should be developed by the federal government in collaboration with the provinces and territories in order to move away from the current patchwork or fragmentation of climate policies across the country.

Greenhouse gas emission reduction targets also need to be underpinned by relevant and rigorous economic analysis and assessment to show whether the proposed targets can be achieved within the regulatory timeframes; to show whether the appropriate technology required to reduce emissions in the energy sector can be deployed quickly enough; and to establish the financial, sectoral, regional, and consumer impacts in so doing. This type of approach is essential to ensure economy-environmental integration so that Canadians understand the consequences of acts.

Our reports demonstrate the massive scale of the energy and technology transformation needed to meet the government's current targets of cutting greenhouse gas levels by 20% from 2006 levels by the year 2020. The NRTEE has shown that meeting this target will be quite challenging in itself for Canada. The target is equal to a 3% reduction from the 1990 baseline, which should be compared to your 25% cut from that 1990 baseline.

You are no doubt aware that this is a major change from existing policy that would likely require more difficult and expensive measures than currently contemplated, including a higher carbon price, which we've estimated to be, for the government's program, $100 per tonne to achieve its targets in 2020.

Finally, choosing our baselines and targets cannot, of course, be done in isolation from any future global agreements. Our research shows that acting in concert with the world is more cost-effective for Canada. Even though a post-Kyoto agreement is not yet in place and may be years away, nonetheless, we do not wish to see this used as a reason for delay in terms of action by Canada.

None of this should be interpreted, then, as an excuse for delay. The round table has been very clear on this. Rather, it means that we need to consider environmental and economic impacts and implications of emission reductions together, not separately, to achieve our joint environmental and economic goals.

We appreciate very much that the spirit of this bill is to improve the environment and help address climate change, but as the national round table's mandate explicitly provides, we need to do so while considering the environment and economy together in an integrated fashion. In our view, that is what lies behind the words “sustainable development”.

I'd be happy to answer any questions, Mr. Chairman.

Thank you again for inviting me to appear at this time.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Page.

We'll start our seven-minute round with Mr. McGuinty.

[David McGuinty, Liberal, Ottawa South, ON]

Thank you, Mr. Chair.

How are you, Mr. Page? It's good to see you again, even though it is through a television screen.

[Dr. Bob Page]

Thank you, David.

My apologies to the committee. I knew about this for certain only two days ago. I apologize for not being there in person.

[David McGuinty, Liberal, Ottawa South, ON]

It's good to see you. Thank you for being here on short notice.

Mr. Page, we are debating Bill C-311. As I've just said in the House of Commons in a speech, frankly, we're debating this private member's bill because the government has prepared and presented no plan to the Parliament of Canada to debate otherwise. So we are now dealing with Bill C-311, as we should, in a timely fashion.

I know that you have a lot of experience. I'm not quite sure how long you've been chair of the round table, but you have laid out quite thoroughly those elements of a plan, and targets, that should be addressed. You talked about relevant and rigorous economic analysis, about whether the proposed targets can be achieved within the timeframes, about appropriate technology, and so on.

Mr. Page, our problem now, as the official opposition, is that it's been almost four years and we've had three ministers of the environment, and we've had apparently three plans, we've had regulations promised by January 2010 now delayed indefinitely.

Have you, in your capacity as chair of Canada's advisory panel....? It used to be the Prime Minister's advisory panel; in my humble submission, you have been demoted, now, to report directly to the Minister of the Environment. But that's another issue.

Have you seen, as chair of the round table, or have any of your members seen, with of all the work you've done, a plan, a domestic plan, for the climate change crisis in Canada today?

[Dr. Bob Page]

First of all, Mr. McGuinty, thank you for that question.

Part of this is factual and part of this is interpretive. I'm not presuming to take any stand, which is really the right of the Parliament of Canada in determining the nature of the plan or the plans that have been presented by the government.

I have to come back to the details in terms of our own report and our work from that, and our response from the minister. I understand that earlier this year..... I understand there was another announcement yesterday and that there are series of announcements coming forward at this time.

The minister has assured us that the work we have done, both in our policy report and our technical report, is being very carefully assessed by the government. For instance, we argued very strongly in our report for the importance of an offset system for cap and trade. The government is proceeding on that. There were announcements earlier this year with regard to part of what that offset system would look like. We see this as an ongoing process in which leading up to Copenhagen and beyond, and with the negotiations with the United States, the government will be proceeding.

I'm trying to select my words carefully, sir, because I'm very cognizant that we don't operate in a political context.

[David McGuinty, Liberal, Ottawa South, ON]

I'm going to interpret it for you, because I do operate in the political context. I think what I heard you say, Dr. Page, is that you've never seen a plan from the federal government. I think that's becoming eminently clear now to Canadians.

Can I ask you a more specific question, then, based on your own research and advice?

Have we just lost you? Mr. Page...?

[The Chair, Conservative, James Bezan]

Can you hear us, Mr. Page?

[Dr. Bob Page]

Yes. I apologize to the members. I lost transmission there.

[The Chair, Conservative, James Bezan]

Mr. McGuinty, the floor is yours.

[David McGuinty, Liberal, Ottawa South, ON]

How's my time, Mr. Chair?

[The Chair, Conservative, James Bezan]

You have three minutes.

[David McGuinty, Liberal, Ottawa South, ON]

Three minutes? I thought it was four, but I'll take three.

[The Chair, Conservative, James Bezan]

It was three minutes a minute ago.

[David McGuinty, Liberal, Ottawa South, ON]

Mr. Page, I want to go back to something in your brief. It was something you raised here.

You went as far in your own reports to refer to a price for a tonne of carbon dioxide or carbon dioxide equivalent. Two years ago the Prime Minister made a speech in London, England, about what he described as a green energy tour across Europe. He stood up and announced that Canada would be pricing carbon after a few years at $65 a tonne. Since then the government has never again spoken about pricing carbon. Now you say it's going to be closer to $100 a tonne, depending on what measures are brought forward.

Have you advised the government? Have you seen anything from the government to inform the Canadian people that if they do bring in, for example, a cap and trade system, as they purport to want to do, how high energy prices will go for average working Canadians under whatever is left of the Conservative plan? We can't find one, but in the past three iterations of plans have you come across anything to tell the Canadian people how high energy prices will go?

[Dr. Bob Page]

We in fact have had direct discussions with both the department and the minister's office with regard to that. They are very aware. In fact, they very carefully went through all the assessments we did for the modelling. Those figures are almost identical to other modelling that has been done, so I think there's a consensus with regard to modelling.

I'm not in a position to comment one way or the other with regard to whether the Prime Minister or the minister have made any public statement recently on the question of the carbon price.

[David McGuinty, Liberal, Ottawa South, ON]

How about the price, then? Have you advised the government on the ramifications of your research or their own plan, wherever that might be? And I think it keeps changing, depending on what happens in Washington. What will the implications be under this government's plan for energy prices for Canadians?

[The Chair, Conservative, James Bezan]

We have a point of order.

[Jeff Watson, Conservative, Essex, ON]

Yes, Mr. Chair. It's inconsistent to argue that there's a plan and no plan simultaneously.

[The Chair, Conservative, James Bezan]

That is not a point of order. That is debate.

You've asked your question, Mr. McGuinty--

[David McGuinty, Liberal, Ottawa South, ON]

Mr. Page, the implications, please, on energy prices for working Canadians: how high will energy prices go under the purported Conservative plan?

[The Chair, Conservative, James Bezan]

Dr. Page, you'll have to respond in 30 seconds or less.

[Dr. Bob Page]

Our work conclusively shows that in the year 2020 the price for carbon in Canada would have to be at approximately $100 per tonne for carbon dioxide or carbon dioxide equivalent in order for the government to meet its target of minus 20 of 2006 by 2020.

[The Chair, Conservative, James Bezan]

The time has expired, so we're going to move on.

Monsieur Bigras.

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

Thank you very much, Mr. Chairman. Welcome to you, Mr. Page, even if you are not right here with us.

Before I ask my first question, I would like you to tell the members and the committee about your roadmap. What has your institutional experience been in the private sector?

[Dr. Bob Page]

I see that as two different questions. One is the road map, which is actually outlined in our report in quite some detail. In that road map, we are looking at a variety of measures that have to be taken.

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

No, you did not understand. I would like to know about your professional experience before you became the chair of the national roundtable. Where did you work in the past?

[Dr. Bob Page]

My apologies, Monsieur Bigras.

I have spent about two-thirds of my working career in the academic world. I've spent ten years in the electricity sector here in Alberta and also internationally with a company called TransAlta. I've also served in a variety of capacities for the federal government over the years. I've served on one corporate board. I've served on one NGO board of directors.

Is that sufficient for you?

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

Yes, thank you very much.

To go back to your presentation this afternoon, a few statements in there are surprising. Let me mention a few. You think that the Canadian climate policy is most effectively approached as a long-term problem requiring long-term solutions, not short-term fixes or top-down target-setting. I am a bit surprised to read that.

You also mentioned in your report that greenhouse gas emission reduction targets need to be underpinned by relevant and rigorous economic analysis and assessment to show whether the proposed targets can be achieved within the regulatory timeframes, and so on.

Mr. Page, about your reports, how much do you take scientific evidence into consideration when you are making recommendations to the government? I find it a bit strange that the roundtable is putting proposals before the government without taking into account the scientific evidence to the effect that industrialized countries should set their targets so that the increase in temperature will be limited to 2 degrees Celsius compared to the preindustrial era. I am trying to find in you presentation this afternoon a statement that Canada should base its target setting on scientific evidence. I can understand economic analyses are needed, but should we not also take scientific evidence into account?

[Dr. Bob Page]

First of all, in terms of the long versus the short term, we are very much in favour of both. But what we are trying to argue is that what you're talking about is a fundamental transformation of Canadian energy technology, and we're trying to emphasize that that technology change, which must begin immediately—and we've made that very clear both in my statement this morning and also in our reports—is not something you just suddenly turn around. This kind of fundamental technology change that we're talking about is something that will get started—we hope a series of projects will be in place by 2015—the results begin by 2020, the pick-up is in the 2030s. And this relates to renewables, things like carbon capture and storage, and a variety of things like that. They're short-term action but leading to a long-term strategy here.

Second, on the scientific recommendations, I really appreciate your raising that, because we've spent, as a round table, a great deal of time on the science and I've been at most of the COPs since Kyoto. I have contributed to the intergovernmental panel work in connection with it, and in my day-to-day work at the university I'm dealing mainly with science and engineering students who are trying to deal with things like your 2% Celsius.

So these are very much part of our background, but sustainable development is trying to find that balance. It's trying to find a way forward that we can actually achieve our goals here in Canada, having had a very long delay of over a decade now since Kyoto, where as a country we've had great difficulty in moving forward with a viable plan.

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

Yes.

[The Chair, Conservative, James Bezan]

You have one minute.

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

Let us go back to the fact that Canada is lagging behind other countries. Since you are talking about the importance of having a continental approach, let us compare both recovery plans that have been presented in Canada and in the United States. We realize that Canada's investments per capita in energy efficiency and renewable energy are six times lower than in the US, if we compare the Obama and Harper plans.

Is Canada not lagging behind not only the international community, but also behind our main partners to the south, something that is all the more important because Canada wishes to establish a continental policy?

[Dr. Bob Page]

Once again, I'm very glad you raised the Obama program here, because the Obama program is over 10 or 15 years, depending on the different parts of it. Most of the announcements in Canada then in terms of the dollar figures are dollars being invested by provinces or being invested by the Government of Canada in a shorter period of time, and certainly a number of the projects that I'm familiar with are looking at seeing at least initial investment in the next year or year and a half in connection with it. So I think it's very important for us to go back and look at the timeframe before we jump to conclusions with regard to the per capita.

I think you do have a very important point, though, that per capita in Canada, in terms of innovative new industrial research, the level of investment has consistently been lower than in the United States, and that is something I hope we can address with climate change. But the current situation is still one where on a per capita basis or on a per unit of production basis the amount of R and D investment going back in Canada is lower than in the United States.

[The Chair, Conservative, James Bezan]

Thank you. Time has expired.

Ms. Duncan, the floor is yours.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Thanks, Mr. Chair.

Hello, Dr. Page; it's nice to see you.

[Dr. Bob Page]

Hi, Linda.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

One of these times when I have a week off, it would be nice to stop by Calgary and see you.

Are you still in the TransAlta chair at the U of C?

[Dr. Bob Page]

I am.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Okay, great, so I'll know where to find you.

Mr. McGuinty asked you some questions earlier about the intended role for the national round table under Bill C-311. Regardless of whether or not that role is assigned to the national round table—you had suggested perhaps it might be more appropriate for the Auditor General—do you think the intent of that provision to provide for an independent body to review the targets the government brings forward on a regular basis would be a worthwhile exercise?

[Dr. Bob Page]

I think the exercise is very much a worthwhile one. I have just gone through two months of work in connection with the Kyoto Protocol Implementation Act. We had to draw up tools and address that, as we rightly should, for Parliament.

While the round table will fully accept whatever new obligations Parliament and your committee wish to see us fulfill, I wanted to stress this morning that our resources for doing the quality of job you people want in connection with all this are limited. The Auditor General, or the Commissioner of the Environment and Sustainable Development, has far larger resources than we do in connection with this. I was in no way trying to say that we're not prepared to take on these new tasks. I just wanted to show how we would have to share the burden within the department with our existing.... It means that we could bring forward fewer policy reports.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Dr. Page, if I can just intervene here, I'm actually not asking you to reiterate that, because I think we heard pretty clearly that you have stretched resources.

Regardless of whether you were assigned that role, do you think the process of having an independent, regular review, in intermittent periods, of the proposed targets by the government, would be a useful exercise? And do you think it would be worthwhile to hold that in an open and transparent manner?

[Dr. Bob Page]

I certainly do.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Okay, thank you very much.

Monsieur Bigras raised this issue with you, and I wanted to raise this as well. In your brief, which we unfortunately just received, and I was trying to go through it while you were presenting it, you mention that you thought it was very important to underpin any targets we come up with with rigorous economic analysis. The Clean Air Strategic Alliance, and you and I are on the board, always agreed to that. My question is whether you also think it's equally important that there be clear scientific analysis of any of those targets.

[Dr. Bob Page]

I certainly do. There is no question about that.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Okay, great. I appreciate your answer.

Do you believe that the IPCC is a credible scientific body that could undertake some of that scientific review on behalf of Canada and other countries?

[Dr. Bob Page]

The IPCC is very important in terms of trying to develop, explain, and document the global trends that are under way. Whether they're capable of answering specific questions about Canadian circumstances I think is less clear.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Certainly there should be careful scientific scrutiny.

[Dr. Bob Page]

Oh, very definitely.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Okay.

My final question for you relates to the triggers to get the major emitters of greenhouse gases to take action to reduce using offsets or technology and so forth. There have been a number of empirical studies done. KPMG did one in the 1980s. Dr. Dianne Saxe did one. NESCAUM, which is an association of U.S. states, did an empirical study of what the key driver is to shift investment to cleaner energy technology. Across the board, CEOs identified the one key trigger being regulation. Interestingly, Shell Canada, out of Calgary, just yesterday announced that they are calling for regulatory triggers to make it clear so that they can start the investment.

How do you feel about that? Do you think it's really critical to get regulatory measures on the table to provide a clear message to start shifting investment towards...? We've had some shift of public resources.

Oops, we lost him. Isn't technology great?

[The Chair, Conservative, James Bezan]

Okay, I'll just suspend while we wait. If we do hit the top of the hour, we'll have to adjourn, though, committee, because the liaison committee is scheduled to be in here at one o'clock. We'll give him a couple of minutes to see if he can respond.

Dr. Page, you're back on. Could you give a quick response to the question Madam Duncan asked?

[Dr. Bob Page]

Very quickly, in our report in terms of the cap and trade system we're proposing, then you have to have regulated caps in order to drive the cost signal through the economy. So in answer to your question, yes, we are in favour of regulatory caps, hard caps, in terms of the delivery of the necessary regulated goals for 2020.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Thanks a lot.

[The Chair, Conservative, James Bezan]

Mr. Warawa, you can take us to the top of the hour.

[Mark Warawa, Conservative, Langley, BC]

Dr. Page, thank you so much for being here. It's a shame that we couldn't hear more from you.

Maybe we can hear from Dr. Page further, Mr. Chair.

Doctor, as you are well aware, Canada's clean energy dialogue has been ongoing with the United States starting at the beginning of the year and we are moving forward on a harmonized continental approach. On the costing of our commitment of a 20% reduction below 2006 levels by 2020, you said yourself it was quite challenging. Could you expand on the economic consequences of putting in place Bill C-311? What would it do to the economy to have emissions reduced by 25% below 1990 levels, and would it be possible to have a harmonized approach with the United States if we went in that direction?

[Dr. Bob Page]

Very quickly on this, first of all we have not modelled the targets that are set out in this bill, so I can't give you a dollar figure here in terms of what that might mean. It would certainly mean a higher cost, and that's what I said in my deposition, and that's as far as I'm prepared to go this morning until we have time to look at it more seriously.

I come back to just the difference between a 3% cut from a 1990 baseline and a 25% cut from 1990, and then go back to some of the sector-by-sector modelling and analysis we've done in our reports, and you could begin to see some of the direction in which we'd be going here. The cost would be significant in connection with it.

Canada probably has the highest costs in terms of compliance, for instance, with a Kyoto target, and that has to be taken into account. The differential with the United States is a serious competitive issue for a number of Ontario manufacturers, who certainly contacted us, as well as the western energy folks. So the competitiveness issues with regard to carbon costs are very clear, and they're added to by the protectionist measures that have been implicit in some of the U.S. proposed legislation.

[Mark Warawa, Conservative, Langley, BC]

You are saying, Doctor, that we should have a harmonized approach, a continental approach, with the United States?

[Dr. Bob Page]

We have said that in our report. The integration of the two economies is so close here, then operating costs become very clearly a factor in terms of investment and competitiveness.

[Mark Warawa, Conservative, Langley, BC]

Thank you so much, Doctor. Hopefully we can hear from you again.

[The Chair, Conservative, James Bezan]

I want to thank you too, Dr. Page. It is the top of the hour and we had originally scheduled this meeting until one o'clock eastern time. I appreciate your being patient with us earlier today.

And I apologize, Mr. Warawa, for not giving you your full seven minutes. We'll make up the other four minutes another day.

With that, I'll entertain a motion to adjourn.

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

I so move.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Braid.

We're out of here. The meeting is adjourned.