Environment Committee on Nov. 5th, 2009

[Don McCabe]

So far we can agree.

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

So if the American climate change plan includes massive subsidies or offsets that benefit American agriculture, and the Canadian climate change plan doesn't have something equivalent, are we not going to run into even more serious problems with the Canadian agriculture industry?

[Don McCabe]

Allow me to be clear. On October 6, 2009, I believe Minister Prentice was speaking to the Canadian Council of Chief Executives. On that day he stated that North American economic integration requires harmonization and that Canada would set up its own cap-and-trade market, and that this government would phase in measures in alignment with the development of the proposed U.S. system. For that reason, the Soil Conservation Council of Canada is a member of the industry provincial offset group and working with folks like TransAlta, Shell, and whoever else. We're currently on a conference call. A North American working group proposal is being looked at, because the 49th parallel really only matters to Rand McNally. He needs to know where to draw it. The glaciers didn't recognize it.

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

That's right. Do you agree with Mr. Prentice's comments that you just quoted?

[Don McCabe]

If I didn't, I wouldn't put them in the record, sir.

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

Thank you.

[The Chair, Conservative, James Bezan]

Mr. Woodworth, your time has expired.

Mr. Ouellet, you have five minutes.

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

Thank you, Mr. Chair.

I want to thank both of our witnesses for being here today. I think it is important to talk about forests and agriculture.

Mr. McCabe, in Quebec, agriculture is responsible for 9% of greenhouse gas emissions, and I would imagine that the figure is probably similar for Ontario. So, greenhouse gas emissions from agriculture make up a pretty big chunk. If you had the support you wanted.... I think we all agree that such support would create new jobs. If you had more digesters and could better manage manure and biomass, which produce greenhouse gases on farmland, you could do it.

With the proper support, could you achieve the objectives set out in Bill C-311, which is currently on the table? Under that bill, emission reductions would have to hit 25% in 2020 and 80% in 2050, using 1990 as the base year.

[Don McCabe]

To be clear here, sir, my definition of adequate support is one of policy support first and foremost, that I know where the lines are drawn to work from. From that policy then come the other initiatives that we can draw upon to make the targets that you have proposed in this bill a reality. To make those targets a reality for agriculture means that we remain a non-regulated sector due to our biological nature.

If you really want to hit those targets hard, start giving us the recognition of what we've already done on behalf of the Canadian population and the world population within the agriculture and forestry sectors, because we've been leading on this initiative for a long time. We have processes in place to further that extension, and within that mindset then we need to look at the issue of stackable credits. There's the fact that when I reduce carbon and store it in soils, I have now sequestered that carbon, but I'm going to offer you greater environmental benefits as I move forward. If I do an anaerobic digester, yes, I've destroyed methane, but now I am also reducing the issue of fuel that would have been exhausted in hauling waste out to the field. I've now turned waste into a feedstock. That is the core of what agriculture can do underneath this initiative, and assist in getting to those targets.

But we cannot tolerate further regulation. We just need clear policy direction to reward us for where we've been and where we want to go.

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

In the past, the lack of regulations really took a financial toll on farmers, as everyone knows. Mr. Lazar has a very clear idea of greenhouse gas reductions in the forest sector. What level of greenhouse gas reductions has Canada's agricultural sector achieved since 1990?

[Don McCabe]

I believe a check of the national inventory by Environment Canada will illustrate that we've essentially been holding our own in emissions levels across this country, but I immediately would then factor in the increased production that we have put out underneath that same level of emissions. So that would turn it into an intensity target, which I know is a contentious issue, but the bottom line here is that agriculture again has been leading in finding manoeuvres to cut back. But without proper support as we move forward, we're also at risk of seeing some of these gains lost because we will have no-till soils that may have to be worked in the future just to gain back fertilizer opportunities. Because we have seen such a rapid increase in costs on some of our other fronts, farmers are going to maybe have to do things that they've never contemplated before.

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

According to a source here, between 1990 and 2004, greenhouse gas emissions rose in the agricultural sector throughout Canada, and that includes a 23% increase in fertilizer use.

Mr. Lazar, I want to ask you a question that I got from the Canadian Council of Chief Executives, of which you are a member, as a major lumber producer. And I quote:

While intensity targets make sense as a means of encouraging Canadian firms to become more efficient without being penalized for growing, the ultimate goal must be to achieve a substantial absolute reduction in emissions of GHGs, in Canada [...].

Do you agree that intensity targets cannot address a structure as large as the lumber industry and that absolute targets are needed?

[The Chair, Conservative, James Bezan]

Thank you very much. Your time is up, Mr. Ouellet.

If you could just give a brief response, Mr. Lazar, I'd appreciate that.

[Avrim Lazar]

Technically, you can get to where we have to go with intensity targets or with absolute targets. It depends on how big they are. So if you have an intensity target that's veryexigent, we will have an absolute reduction. If you have an absolute reduction target, of course you'll get an absolute reduction. The difference is on the impact: intensity targets give more room for sectors that have growth; absolute targets give more room for sectors that aren't growing. Both can get you to the same place if they're done right, but you can get an absolute reduction if you have large enough intensity. Technically, there is no difference. The impact on who pays for the change is different. We can live with either. Our reductions are pretty well similar under an intensity or an absolute basis. They're slightly better under intensity.

[The Chair, Conservative, James Bezan]

Thank you very much.

Mr. Watson, you have the floor.

[Jeff Watson, Conservative, Essex, ON]

Thank you, Mr. Chair.

Thank you to our witnesses for appearing today.

I want to start with you, Mr. McCabe. You said in your opening statement that agriculture broadly, as a sector, with respect to greenhouse gases, has “held our own”, I think is the term you used, since 1990. Can you quantify what that means, using 1990 as a base year for your sector? Are you flat, are you above 1990 still, or are you below 1990 at this point? You talked about early action. I'm interested in knowing, in terms of a measurement, where you'd peg your sector right now.

[Don McCabe]

I would refer the committee to the national inventory for the absolute figures because I do not have them in front of me today.

But my personal reaction to this is that we've been holding our own. Contrary to the comment I just heard about a 23% increase in greenhouse gas emissions from 1990 to 2004, I would argue that that is possibly the case if you look strictly at nitrous oxide emissions. But if we look at the aggregate of carbon dioxide being sequestered in the soils and methane reductions from livestock, the issue of nitrous oxide may have gone up. But when I do the complete addition across the board, I would state for the record that agriculture is holding its own, if not decreasing.

[Jeff Watson, Conservative, Essex, ON]

Do you want the sector to have a target of 25% below 1990 or not?

[Don McCabe]

I want the opportunity to participate in reaching a target that has finally been set, that is clearly defined, and that provides agriculture the opportunity to be an offset provider to a target with clear rules, such that we can introduce market mechanisms to meet that target and put funds into the hands of producers. And Alberta is your prime example of a pilot.

[Jeff Watson, Conservative, Essex, ON]

With due respect, Mr. McCabe, we're conducting hearings on a bill that has a specific target, which is 25% below a 1990 baseline by 2020.

You said you want good policy. Is this the good starting point for policy? Does your sector want 25% below 1990 or should it be something else?

[Don McCabe]

When I am not regulated and therefore am not directly impacted by that target, it's very easy for me to offer a statement to that effect.

But I will tell you directly that when you regulate the other sectors, I'm going to feel it, and therefore if you offer me policy direction to recognize what I've done, I'm certainly going to be able to help reach whatever reductions from whatever target level you start from.

I am not going to offer a direct yes or no to your question, sir, because I'm just not knowledgeable enough to do that. But then again, I'm sure there are enough computer models out there that we can play with and then have somebody come in who doesn't have any feel for the natural society in which I work, but can probably run to the CBC and have an article written on what they've just offered.

[Jeff Watson, Conservative, Essex, ON]

Just to close off, if I can capture the sentiment from the farm field, you feel overregulated without having been properly compensated for all the changes that have been asked of the sector through regulation over recent years. Is that fair enough?

[Don McCabe]

That would be a statement that applies probably in the broader sense than toward this particular issue before us. But at this point we just need a proper playing field, so I know where to turn to offer Canadians what I can do.

[Jeff Watson, Conservative, Essex, ON]

It's why you're cost sensitive to any potential further regulations.

[Don McCabe]

Thank you.