Environment Committee on May 2nd, 2024

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

You're saying 2050, but aren't there already target dates for the projects being funded? For example, at the end of five, 10 or 15 years, is there no way of evaluating how well things are working? Are we just investing money and crossing our fingers in the hope that everything will be working by 2050?

[Mathieu Lequain]

Throughout the project, the various steps are monitored to check on the extent to which those companies receiving funds from the department are meeting their commitments in terms of lower GHG emissions, diversity, the place of women and so on. There are various criteria.

[The Chair, Liberal, Francis Scarpaleggia]

You've run out of time, Mr. Trudel.

Go ahead Ms. Collins. You have two and a half minutes.

[Laurel Collins, NDP, Victoria, BC]

Wonderful.

I wish I had more time. I want to ask both about the net-zero accelerator and about plastic pollution.

It's unclear whether the federal plastic waste reduction activities are actually going to meet Canada's goal of eliminating all plastic waste by 2030. This is really concerning, given how plastic pollution impacts our coasts and threatens our oceans, human health, wildlife and indigenous communities, in particular, along the coast.

I have some questions about the net-zero accelerator. Do you have precise numbers on it?

How much is given in funding to CCUS? Do you know how much of this went to the oil and gas industry?

[Jerry V. DeMarco]

Monsieur Lequain, can you help with that?

[Mathieu Lequain]

I don't have the number in front of me, and I don't know if the officials from the department have this information.

[Laurel Collins, NDP, Victoria, BC]

Could you follow up in writing to the committee with that information?

[Mathieu Lequain]

Sure.

[Jerry V. DeMarco]

Maybe the department is best placed to address that question or the follow-up.

[The Chair, Liberal, Francis Scarpaleggia]

Yes, could the department provide that information to the committee? That would be great. Thank you.

[Jerry V. DeMarco]

I am seeing nodding from the department, for the record.

[The Chair, Liberal, Francis Scarpaleggia]

That's a good sign.

[Laurel Collins, NDP, Victoria, BC]

Mr. DeMarco, can you elaborate on the impact of the lack of an industrial decarbonization policy on projects like the net-zero accelerator, and the impact of it?

[Jerry V. DeMarco]

Yes. Having a plan behind the individual decisions to create funds like this and then to administer funds like this.... There is definitely a framework that the department itself has for administering this particular program. However, we found that we could not understand what the grand plan was in terms of which sectors would be favoured, what the priorities would be, which regions would be prioritized and in which areas Canada has a competitive advantage in terms of workforce and resources, so that individual programs such as this, and then individual projects within programs, fit with that. That's the idea of policy coherence, right?

An industrial decarbonization policy that goes across government would help situate these programs and ensure that they are all rowing in the same direction, as opposed to just having a collection of programs and hoping that something comes out of it.

That is really a key recommendation here, and there is not a clear answer from the department on that recommendation.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you, Commissioner.

Mr. Deltell, we'll go to you now for five minutes.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Thank you very much, Mr. Chair.

Dear colleagues, Commissioner, ladies and gentlemen from the public service, welcome. Thank you very much for the work you are doing on behalf of Canada and Canadians.

Commissioner, I would naturally like to talk to you about the net zero accelerator initiative component of the Strategic Innovation Fund.

We're talking about $8 billion of taxpayer money. That's a lot of money. Is it effective? That's the question.

On page 7 of your report, there's a description of the system's lengthy and complex process. On page 12, it's clearly stated that difficulties are encountered in attracting large emitters, with only two of the 55 companies involved responding to the invitation. On page 17, we learn that of the 17 contribution agreements, only five companies signed up.

Commissioner, with a track record like that, which shows that the program is not very attractive, do you believe it's effective?

[Jerry V. DeMarco]

I'm not convinced it's effective. It might be if they're lucky, but it wouldn't be thanks to any grand plan like the one I just talked about.

If the contribution agreements lead to a reduction of only 6 megatonnes of greenhouse gas, at a cost of $8 billion, then indeed, that's not effective. However, we need to know the amounts of GHG emissions prevented under the other contribution agreements.

To date, the initial funding of over $3 billion has only led to a 6.2 megatonne reduction in GHG emissions, and that's not effective.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

It's hard to convince citizens to spend $8 billion on a program like that when you yourself don't think it's effective. However, beyond effectiveness, those who believe in it would like to know whether it's working.

On page 20 of your report, you say that “the department did not track the Net Zero Accelerator’s overall value for money in reducing greenhouse gas emissions.”

Once again, the obvious question is: If we can't track things, how can Canadians, and Quebeckers, of course, be sure that the program is worth funding?

[Jerry V. DeMarco]

It's true that it's taxpayer money. The government decided to share it with the biggest emitters so that they could help achieve the 2030 and 2050 targets. We would like them, as you would, to demonstrate the value of these investments, because they are being paid for by Canadian taxpayers.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Without tracking, how can there be concrete, tangible and convincing results?

[Jerry V. DeMarco]

I agree that we need tracking.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Also on page 20, just a little farther along, there's a reference to five companies which, having received $886 million, had managed to reduce their greenhouse gas emissions by 6.2 megatonnes, at a cost of $103 per tonne, and that this figure had almost quadrupled to $523 per tonne when it included all of the funds contributed to the net zero accelerator initiative.

Although that's not 750 times more expensive, it's still four times more than expected.

Are Canadians getting their money's worth?

[Jerry V. DeMarco]

This initiative doesn't really cost four times more than expected. It depends on which calculation is used—just the five GHG emissions projects in the contribution agreements, or all 17 projects. That explains the difference between the $143 and the $523 amounts.

Is that right, Mr. Lequain?

[Mathieu Lequain]

Yes.

The first figure, $143, is applicable only to those projects for which there is a contractual greenhouse gas reduction commitment. The $543 is for the entire program budget and all approved projects.

So the first figure is for five projects and totals $886 million, and the second figure is for all 14 projects.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Your analysis of the $8 billion program indicates that it has not attracted large emitters. There has also not been any careful tracking to concretely assess the actual repercussions of this $8 billion program on taxpayers.

What changes are needed to get everything working properly?