Environment Committee on May 20th, 2021

[Denis Bolduc, General Secretary, Fédération des travailleurs et travailleuses du Québec]

Thank you, Mr. Chair.

My name is Denis Bolduc. I'm the general secretary of the Fédération des travailleurs et travailleuses du Québec, or FTQ. I'm joined by Mr. Rondeau, a union advisor for the Environment and Just Transition. I'll be giving the presentation.

I want to acknowledge all the committee members.

The FTQ has 600,000 members spread across all economic sectors and all regions of Quebec. Our members work in some of the most carbon-intensive industries, including cement, steel and mining. A number of them work directly in the energy sector.

I can say without bragging that the FTQ is the union organization in Quebec most committed to the fight against climate change. In 2013, we started a process of reflecting on climate change. We've had a standing committee on the environment in place for several years. We've also taken part in a number of parliamentary proceedings in Quebec City and in several key events on climate change and the just transition. Since 2015, a FTQ delegation has attended the COP meetings. We'll be there again this year, in Scotland, for the COP26.

Canada is committed to achieving carbon neutrality by 2050 and is also committed to taking action to limit global warming to 1.5 degrees Celsius. The FTQ is pleased with the federal government's willingness to take serious action to fulfill its commitments. We understand that this is at least the intention behind Bill C-12. However, we doubt that the measures in this bill will achieve the carbon neutrality goals. A change in direction is needed.

The International Energy Agency released a very good report this week. This report shows that we can achieve the goal of keeping global warming below 1.5 degrees Celsius without compromising the economy—which is important—if governments commit to moving away from new hydrocarbon production projects.

In our opinion, the energy transition and the achievement of the carbon neutrality sought by Bill C-12 systematically require a transformation of our economy, but also of our jobs. The transition must be planned and it must include the people directly affected. We must ensure respect for the economic and social rights of workers, the sustainability and viability of jobs and the sustainability of communities in the transition. Governments must put in place just transition mechanisms in all workplaces involved. Carbon neutrality legislation must be accompanied by just transition mechanisms based on social dialogue. In our view, they go hand in hand.

In terms of provincial jurisdictions, the issues of respect for jurisdiction, engagement and constraints with provinces are often complex. We can easily assume that things will be no different this time around. Canada must address this issue quickly, while respecting provincial jurisdictions. Above all, the implementation mustn't be delayed because of constitutional wrangling. We suggest that you begin discussions with the provinces now.

I'll talk about the advisory committee proposed in the bill. The government must receive decision-making advice from a credible and competent advisory committee that's free of conflict of interest.

In Quebec, the advisory committee on climate change is composed of 12 people, nine of whom are from the scientific community. That's nine out of twelve people, so three-quarters of the committee. This is totally different from the proposal in Bill C-12. The bill proposes that only one person out of 14 would come from the scientific community, while four people would come from fossil fuel companies. We're concerned about this.

We believe that science should guide government decisions, not corporate interests. The current composition of the committee opens the door to conflicts of interest. Solid rules will be needed to guard against this possibility.

With respect to accountability, the bill calls for evaluation milestones every five years. We're wondering about the date of the first milestone. In our view, a first report card in 2030 is much too far in the future.

I will conclude by telling you that what worries the FTQ most is the complete lack of transition planning. We see this as an indication that carbon neutrality will happen without workers and their communities. Without them, it cannot work. We need to include just transition mechanisms in the bill now.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you, Mr. Bolduc.

We now turn to Professor Normand Mousseau, Department of Physics, Université de Montréal.

[Normand Mousseau, Professor, Departrment of Physics, Université de Montréal, Scientific Director, Trottier Energy Institute]

Hello. I am a professor of physics and the scientific director of the Trottier Energy Institute, or TEI. It is truly an honour for me to be here. Good afternoon to all the members of this committee and its chair.

I have been working on energy and climate governance issues for over 15 years. I was co-chair of the Commission on Energy Issues in Quebec in 2013-2014. I co-authored the proposal that led to the founding of the Canadian Institute for Climate Choices, and I actually sit on its board of directors.

The TEI is leading the Energy Modelling Initiative at the federal level with support from Natural Resources Canada. This initiative aims to structure the modelling capacity in Canada to support decision-makers. I work a lot on all kinds of initiatives that try to build structure into Canada's ability to move forward.

The TEI also publishes the Canadian Energy Outlook. We are currently working on our second edition, which models carbon-neutral scenarios. These reports will be available in a few weeks. What emerges is the immense challenges of meeting carbon neutrality targets and the absolute inadequacy of the measures in place, both federally and provincially. Basically, it is impossible to move in this direction with the measures in place today. I would also say that carbon neutrality is a big game changer in terms of how we do transformation in terms of intermediate goals. We absolutely have to keep the end goal in mind: zero emissions. Any trajectory and any decision has to be consistent with that end.

A few years ago, I piloted the Le climat, l'État et nous initiative, which aimed to transform environmental governance in Quebec. Rest assured, I failed completely. Environmental governance in Quebec is unfortunately not on track to achieve its goals either.

I worked with several stakeholders, among others. We looked at several models abroad, so you won't be surprised to find some similarities with the statement that Corinne Le Quéré presented earlier. Indeed, I have worked with her on several occasions over the years.

Bill C-12 is essential, but clearly insufficient. There are significant gaps in it that make it impossible for us to achieve our goals or get where we want to go, even though those things are important. I don't want to go back to that, so I'm going to talk about a few other issues.

The first issue is data. It's important to prepare progress reports to indicate where we are. Yet data in Canada on greenhouse gas emissions are published at least two years after the fact. It is absolutely impossible to manage a transition and assessment with data that is consistently too old. It is imperative that this bill include a requirement to produce data on a monthly or quarterly basis, at most, as is done with employment data and other essential data in Canada. Without this, we are working in the dark. There's no way to assess the quality of the measures that are put in place. We're going to mess up completely.

We also need a clearer horizon. I completely agree with Professor Le Quéré that we need to set intermediate milestones in the longer term—5, 10, 15 years in advance. This will allow industry and investors to understand where we are in terms of regulatory transformation. These milestones need to include sectoral targets that will facilitate guidance. Thirty years is really too far away for many policy-makers, investors and industries.

In addition, we absolutely need to have better accountability. If this bill has a major flaw, it is this. Indeed, if we can assess neither the capacity nor where we are going, nor what we have done so far, we cannot get there.

The next issue is similar to one of the recommendations we made at the Quebec level a few years ago. It is imperative to elevate the status of the Commissioner of the Environment and Sustainable Development to that of a senior official who answers directly to Parliament. This will allow the commissioner to use different approaches and tools than the Office of the Auditor General, including the ability to evaluate not only programs, but their relevance to the achievement of objectives. He would be able to conduct a much more integrated evaluation of environmental actions, not just based on an accounting approach such as that developed in the Office of the Auditor General.

Annual progress reports are also needed. Again, five years is not enough. We see that abroad. When we just have 30 years left to achieve our goals, we need to make sure that the billions spent year after year are really moving us in the direction we want to go. These reports need to include not only progress at the federal level, but the full picture of what is happening from a Canadian perspective.

We need more independent and responsive boards. Currently, in Canada, there is the Canadian Institute for Climate Choices. There is also the Net-Zero Advisory Body. These two bodies could work together, but they are both insufficient at present. The Canadian Institute for Climate Choices does not have enough flexibility or teeth. It has no legislated existence and no direct access to Parliament.

I think my time is up.

[The Chair, Liberal, Francis Scarpaleggia]

You are not the only one who goes over your allotted time. You will be able to continue the conversation during the question and answer period.

We are beginning the first round.

Mr. Albas, you have the floor.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Thank you, Mr. Chair.

I'd like to say thank you to all of our witnesses for your testimony and expertise. We certainly appreciate your sharing it with us, and with all Canadians.

I'm going to direct most of my questions toward Dr. Henry from the Canadian Chamber of Commerce.

Dr. Henry, you seem to be saying a number of things.

We've heard Peter Drucker in various quotations that we're paraphrasing here that, ultimately, what gets measured matters.

When you were talking about how the plans right now only look at the emissions side and not necessarily at the social or the economic impact side, that creates a bit of a blind spot, because not all plans are equal, I would imagine. A plan could lower emissions but seriously hurt the economy. A plan could meet our emissions targets and grow the economy.

Having that balance is an important factor. Would you not agree?

[Dr. Aaron Henry]

Yes. That would be our position. I think there is definitely consensus that's where we want to go. We want to get to net zero by 2050.

There certainly are better ways to do it, and there are more cost-effective ways to do it. One of our concerns is making sure that those considerations are integrated into the bill.

One thing that's very clear from the IEA's report, and from other accounting firms and others who have weighed in on this, is that while the costs of not transitioning are incredibly high and we need to make that transition, the reality is that the upfront capital needed to make an economic transition is also considerable. We're talking $5 trillion over the period. Some estimates are about $15 trillion in terms of new energy capacity and another $14 trillion in upgrades for grid modernization globally by 2030 alone.

The key component to that, of course, is that you need to be able to develop policy that allows for the investment in all of those projects. In many cases, it's upfront capital that gets realized later. It's sensitive to interest rates. There is a whole series of considerations that need to go into play to actually mobilize that capital.

I think that's what we're looking for, that policy certainty, to make sure the ambition is there but we're actually getting below 60,000 feet, down to the level that allows us to realize how we're going to create the momentum for that. There are going to be some net-zero pathways that are going to leave us positioned to do so, and others that I think won't.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

You mentioned the necessity of having the private sector invest. I think the orders or scale of magnitude that I've heard, for example, in our EV study, are that we would require 7.5 Site C equivalents to be able to electrify our transportation grid.

Would you be in favour of having some sort of assessment of the electric grid in Canada and what steps it can do to manage the increased demand?

[Dr. Aaron Henry]

I think that kind of study is important. Those are going to be the types of inquiries that I think are going to have to be made throughout the different sectors of this bill.

When we're thinking about decarbonization strategies, that relates to the resource sector; it relates to buildings, to manufacturing. All of those sectors are going to need to have the kinds of reports that ensure we're positioning those sectors to be economically strong to help carry the burden of that transition. It's going to come down to private sector capital to move the needle on these things.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Thank you very much.

Along the theme that not all plans are equal, I would say that not all teams are equal; maybe because I've watched too many Hollywood movies where sudden action needs to be taken.

It's usually a team of diverse views that are able to come together with a better result. That might be pipe dreams here, but at the same token, to have one minister that is going to put 15 individuals forward doesn't seem to me to be a proper thing. I would much prefer a whole-of-government approach.

Would you much rather see with the advisory board that perhaps you would have, as was suggested yesterday, different ministers suggesting some participants on it, so that we have a cross-disciplinary viewpoint from a whole-of-government approach?

[Dr. Aaron Henry]

That's not a recommendation that we formally made, but I think that having different ministers put forward appointees on the advisory board is a good measure to make sure that you really do get the diversity of perspectives. As said, the transition to net zero is going to have social dimensions. It's going to have economic dimensions and, of course, environmental dimensions. It's going to have health dimensions as well. You basically do need to make sure that you have the views in place that allow you to articulate those dimensions in a plan.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

My colleague, Cathy McLeod, has raised the subject of indigenous consultation a number of times during this study. The government apparently didn't consult with any indigenous groups, yet there are many first nation communities that have economic reconciliation agreements and who are putting forward their own projects. Do you believe that one of those groups—perhaps the Minister of Crown-Indigenous Relations—might also be able to contribute names towards the panel?

[Dr. Aaron Henry]

Yes, absolutely. I think that's a really good suggestion.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Okay.

You've mentioned some of the impacts that would happen because not all provinces have the same energy footprint, so you believe that there should be more reporting of some of the impacts on certain regions. Do you also think that there should be a fair summary of all provincial actions towards net zero, given that the federal government doesn't have exclusive jurisdiction in this area?

[The Chair, Liberal, Francis Scarpaleggia]

I would ask you to answer the question quickly.

[Dr. Aaron Henry]

Coming to that second component, I think the interaction with provincial governments is crucially important, and I think we've heard different recommendations on what that could look like.

From a business-side perspective, one thing that we're hearing repeatedly and that I think is being put forward is that carbon pricing and the creation of carbon offsets is something that is going to draw in capital for these projects and draw in that interest. It's really important to have close collaboration with the provinces simply because, if there's a shift, you might jeopardize the additionality of those carbon credits. Therefore, being able to actually make sure that net-zero strategies and what gets declared business as usual are actually—

[The Chair, Liberal, Francis Scarpaleggia]

Okay, we'll have to stop there.

Ms. Saks, you have six minutes, please.

[Ya'ara Saks, Liberal, York Centre, ON]

Thank you, Mr. Chair.

Thank you to all of the witnesses who have joined us this afternoon. There is much to be discussed and much to learn as we go through this process, so thank you for your interventions today.

I was very interested in the comments by both Dr. Burch and Dr. Anand with regard to the societal buy-in—if you want to call it that—or collaboration as we move towards net-zero emissions and the impacts that we have to consider in getting societal change to take part in reaching net zero. We are creatures of habit, as I've said many times during this study, and it takes all levels, from the individual up to the federal government, to make sure that we all work together towards reaching net zero.

Bill C-12 certainly answers the urgency that Canadians have put forward to us on climate change, and we certainly hope that Bill C-12 displays the ambition that we want to put forward. We appreciate all of your contributions to making sure that we do have the ambition of Canadians as we do this.

Dr. Anand, I'd like to ask you about the impacts we're already seeing on the environment and the ecosystems from climate change. What will be the ecological consequences if we don't achieve net zero?

[Dr. Madhur Anand]

These impacts have been extremely well reported and articulated in a number of reports that the IPCC has put out over the years. In Canada, there's virtually no ecosystem that has not already been affected by climate change over the past decades. I'm not going to give you a big lecture, but I will just quickly tell you a few points.

Our northern ecosystems are the ecosystems that are most rapidly changing because the effects of warming on those systems are most extreme, acute effects, so our peatlands.... We've seen the melting of permafrost. Our boreal forests are also seeing and increased frequency and intensity of insect outbreaks, which are often exacerbated by stressors related to climate change. Our aquatic systems are seeing stresses in terms of productivity and water quality. Yes, the list can go on and on. Essentially, we're losing species. We're losing productivity. We are losing carbon sinks that many of these ecosystems provide, which, of course, comes into this equation.

One of the arguments that I would have made in my comments is that it's really, really important to consider the changes that we're already seeing, the effects that we're already seeing, in terms of the urgency, but we're there now. We're there now. We have an act, so that's good, but it will be really important in the development of the plans to ensure that we continue to conserve and restore [Technical difficulty—Editor] degradation of those ecosystems, the least of which is because they contribute to carbon sinks. However, of course, they provide a lot of other ecosystem services to humanity.

[Ya'ara Saks, Liberal, York Centre, ON]

Thank you for your answer. It's very clear that in this entire process we're going through, so many levels are interrelated. We can't look at just one piece of the puzzle. We need to look at all of the pieces.

Dr. Burch, I'm a former small business owner. Businesses try to plan ahead and are often faced with challenges, such as how well do we plan when there are transitions happening on the table? I know how rewarding it can be to have a business and want to grow—and also want to be part of this transition that we're proposing with Bill C-12. As we transition to net zero, how can we support small businesses in the transition and empower them to take advantage of economic opportunities?

[Dr. Sarah Burch]

Thank you so much for this question.

I get the sense that over the course of our conversations in this country around what to do about climate change, for the last decade or two, we tend to focus on what government can do. When we talk about the private sector, it's large corporations, for obvious reasons. Their greenhouse gas emissions are enormous and they are a really important piece of the puzzle. But when it comes to small and medium-sized enterprises in this country, individually their greenhouse gas emissions are small, but collectively they are enormous. If they are not supported in the process of the transition, we will have no hope of reaching these ambitious targets.

What we are seeing in our research is kind of exciting. We're finding from the small firms that do see social and environmental good as central to their purpose, alongside profit—and sometimes it ranks higher than growth and a dominant profit motive—that they are implementing greenhouse gas reduction strategies that are much more ambitious and creative than you might see in the larger firms. We're seeing reductions of 30% or 40% in a couple of years in small firms.

That's exciting. However, looking across the landscape of Canadian small businesses, they lack the capacity. They often have a very narrow profit margins. They might not have the technical skills outside their clear domain of the good or the service they provide. I think it's crucial to engage those small firms across the country by building capacity for sustainability transitions and decarbonization within small firms so that they don't fall by the wayside, as they have certainly over the last year and a half related to COVID. Technical skills building is really crucial among small firms, and I think that will help to accelerate the transition.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you.

Madame Pauzé.

[Kristina Michaud, Bloc, Avignon—La Mitis—Matane—Matapédia, QC]

I'll take it from here, Mr. Chair.

[The Chair, Liberal, Francis Scarpaleggia]

Very well.

Ms. Michaud, welcome to the committee. You have the floor.

[Kristina Michaud, Bloc, Avignon—La Mitis—Matane—Matapédia, QC]

Thank you, Mr. Chair.

I'd like to welcome the witnesses.

I thank you for being here.

I really enjoyed your opening remarks. It is refreshing to hear that the economy and the environment are intrinsically linked, especially when it comes from the economic sector. There is often a fear that the economic sector doesn't want to get involved, but you are proof that it does. As Mr. Henry said earlier, the cost of not doing the energy transition will be even higher than the cost of doing it. So I thank you for wanting to make the transition.

I'll address Mr. Bolduc to start.

Mr. Bolduc, you said that you had some doubts about our ability to meet the national GHG reduction targets. I totally agree with you. Achieving carbon neutrality is a pretty ambitious target. That doesn't mean we should drop that target. We absolutely need to have ambitious targets, but the way we act must go hand in hand with achieving those targets. You mentioned that, quite rightly. I feel I should mention it again. The study report released earlier this week by the International Energy Agency, or IEA, noted that it is commendable that countries want to be carbon neutral by 2050, but that this requires that we stop all oil and gas projects. We know that the gas industry in Canada will grow by at least 30% by 2040. So I have a hard time imagining how we're going to meet our targets if we continue on this path. Certainly, with Bill C-12, the government has a responsibility, but so does the industry.

How do you see this collaboration between the two, then? Do you think the government is taking the right approach in proposing this bill?

[Denis Bolduc]

Those who believe that the future is in hydrocarbons are definitely wrong, in my opinion. We shouldn't wait until we've pumped out all the oil on the planet before we start acting. The study report published by the IEA this week is interesting. We learned that the energy transition will create 14 million jobs, but that 5 million jobs will be lost in the fossil fuels sector. That's what I read. According to my calculations, 14 million minus 5 million equals 9 million. So 9 million jobs would be created if we go forward with the energy transition.

I shared this with you in my opening remarks. We at the FTQ are very concerned about accompanying all the players in the field in this energy transition, that is, the workers, first and foremost, of course, but also the companies and the communities in which they are located. It is therefore this just transition approach that must absolutely be put in place. That said, however, we do not find it in the bill.