Evidence of meeting #12 for Environment and Sustainable Development in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was sector.
A recording is available from Parliament.
12:30 p.m.
Bloc
Monique Pauzé Bloc Repentigny, QC
Precisely.
I have another brief question, because we don't have much time left.
12:30 p.m.
Professor, President of the Scientific Committee, Institute of Environmental Sciences, Université du Québec à Montréal, As an Individual
Yes.
12:30 p.m.
Bloc
Monique Pauzé Bloc Repentigny, QC
Could you summarize for us what happens economically when a technological innovation reduces the carbon emissions of a good or service?
Can we expect this to lower global emissions?
12:30 p.m.
Professor, President of the Scientific Committee, Institute of Environmental Sciences, Université du Québec à Montréal, As an Individual
It depends.
For petroleum products, reduced carbon emissions can lead to increased use of the resource, which in the end will increase our emissions. It really depends on what is done.
What's clear is that electrification eliminates carbon emissions, unlike every other form of innovation in the fossil energy sector. The latter will be necessary, of course, and I agree on that with the other witnesses. We will still need oil and natural gas but only up to the 22nd century.
12:30 p.m.
Professor, President of the Scientific Committee, Institute of Environmental Sciences, Université du Québec à Montréal, As an Individual
The determining factors will be the extent to which we need fossil fuels, and what we do with them.
12:30 p.m.
Liberal
12:30 p.m.
NDP
Laurel Collins NDP Victoria, BC
Thank you so much, Mr. Chair.
My first question is for Dr. Hoicka.
In your opening statement, you talked a little about the imbalance in supports to the fossil fuel industry in comparison to renewable energy: $14 billion per year from governments for the fossil fuel industry, whereas renewable energy has been receiving less than $1 billion in funding over the past four years.
You also mentioned that Canada is not supporting these proven technologies to the extent that's needed to meet our climate goals.
Do you think that fossil fuel subsidies are diverting funds away from market-ready and scalable renewable solutions?
12:35 p.m.
Canada Research Chair in Urban Planning for Climate Change, Associate Professor in Geography and Civil Engineering, University of Victoria, As an Individual
Yes. I think a lot of attention is being paid to fossil fuels and to technologies that are not necessarily market-ready, and I find that concerning. I have actually reviewed the new climate change plan that came out after I submitted my briefing, and the spending is up by about $850 million, so maybe $1.7 billion or $1.8 billion is what the spending is over several years.
Some of the spending on fossil fuels has been estimated at $8 billion a year to $14 billion a year, and there's $50 billion a year for the tax credit for carbon capture, utilization and storage. They aren't particularly similar in terms of level of support, but the other types of supports that are also really important are regulatory supports and knowledge and training supports.
Patrick Weiler asked me about whether the government is doing all of these things. They are doing some of the things. I've reviewed the clean electricity standard and I've reviewed the climate change emissions report. What I'm finding is that there is not enough spending on renewables. There could be a lot more, particularly in comparison to fossil fuels.
I also put into my briefing note that over the course of about 50 years, spending on nuclear and fossil fuels from both the public and private sectors outpaced by orders of magnitude the spending that's been given to renewables and energy efficiency. For example, I think it's wonderful that the energy efficiency program is targeting deep energy reductions, but it's targeting only 700,000 homes, and it hasn't gotten terribly far in terms of the number of homes that have been addressed in Canada. I think that with more administrative support, it could roll out a whole lot faster.
12:35 p.m.
NDP
Laurel Collins NDP Victoria, BC
Dr. Hoicka, can you talk a bit about how much the cost of renewables has decreased over the last decade? Wouldn't it be a more effective use of scarce financial resources to be investing in this clean energy transition?
12:35 p.m.
Canada Research Chair in Urban Planning for Climate Change, Associate Professor in Geography and Civil Engineering, University of Victoria, As an Individual
Absolutely. The cost of fossil fuel alternatives has decreased extremely rapidly in the past few years. For example, the cost of solar power has decreased by something like 80% and wind energy by 26%, year on year. If you look at the International Energy Agency's tech readiness scale, we're also finding they are quite high on the tech readiness scale, with 11 being top marks: they're in the nines and 10s for that.
They are technologically ready. The cost has come down. A paper came out recently in Nature, which is the world's top journal, with the finding that renewable energy is actually more cost-effective and cheaper than coal.
One of the ways to bring down the costs and increase reliability is by combining clusters of innovations, and this is what's happening in the newest legislation in Europe, under the renewable energy communities and energy communities legislation, where they're combining a range of innovations that would support more reliability. Also, when you cluster renewables, you can bring down the costs of things like storage, which I can explain in more detail to anybody who wants to have a meeting with me about that.
Yes, technology is moving really rapidly, but so is regulation in places like Europe, and that regulation is ready to be adapted to Canada. I think this is the area where we should really be focusing our efforts, our attention and our spending.
12:35 p.m.
NDP
Laurel Collins NDP Victoria, BC
Could you talk a little about the opportunities you see for rural, remote and indigenous communities when it comes to investing in renewable energy?
12:35 p.m.
Canada Research Chair in Urban Planning for Climate Change, Associate Professor in Geography and Civil Engineering, University of Victoria, As an Individual
I think there's a huge opportunity for all of these communities.
The thing about a renewable energy transition or any kind of energy transition is that it's a really large landscape change and it's a geographic change. For example, if we were to set up partnerships with indigenous communities to develop renewable energy on traditional lands and provide equity ownership in those, it's been shown that these could provide really large financial benefits to indigenous communities.
I'm also working on research right now about how renewables can become an effective source of benefits and local economic development for rural communities. If we roll it out well, if we work with communities and if we have legislation that focuses on communities being involved and having financial benefits and looking at particular areas of labour force transition within something that I call renewable energy clusters, then I think that will get us a lot closer to a just transition.
12:40 p.m.
Liberal
The Chair Liberal Francis Scarpaleggia
That's perfect. Thank you.
We'll go to Mr. Mazier now for five minutes.
12:40 p.m.
Conservative
Dan Mazier Conservative Dauphin—Swan River—Neepawa, MB
Thank you, Chair, and thank you to the witnesses for coming out this afternoon.
Mr. McTeague, we heard from a witness during this study, who stated, “Limiting access to capital or increasing taxes will only have negative effects on Canada's economy, energy affordability, emissions reduction progress and global energy security.”
Earlier we heard from another witness, who cautioned us, this committee, with respect to how we define fossil fuel subsidies, because of the impacts that elimination could have on low-income Canadians.
Mr. McTeague, energy affordability is a top concern for many Canadians, especially in rural Canada. If the government were to eliminate all the so-called fossil fuel subsidies, how would this impact energy affordability for Canadians?
12:40 p.m.
President, Canadians for Affordable Energy
It's a very good question, Mr. Mazier. Thank you very much for posing it.
I spent a career as a member of Parliament on finding ways to help Canadians in difficult times, such as through two energy rebates with my Liberal colleagues, back in 2000 and 2002, designed to offset the cost and the impact on consumers. Ultimately, at the end of the day, we can have all these rarefied discussions about what's right, what's wrong and what kind of energy we use. The reality is that as Canadians, in a cold climate, in a country that has to attract capital but has not been doing a very good job at it, save and except for residential housing, we cannot look a gift horse in the mouth.
The oil and gas sector, like it or not—and I have fought them—is 10% of our GDP. It represents $20 billion to $30 billion in revenues to pay my pension, and to pay your fees and your costs as a member of Parliament, as well as to support social programs from coast to coast. Most countries at this time would give their right arm to have what Canada has and its ability to send energy to the rest of the world.
We can have a debate about the long-term implications, but I think in the short term, for the sake of consumers and our economic viability, it's important to have a strong and viable oil and gas sector, yes, to pay for the subsidies that are going to go to renewables to make sure they become, at some point down the road, more viable. As it stands, they are not. Countries like Germany have spent 30 years ahead of us on all these renewables, and they're back to, as you mentioned earlier, burning coal. The reality is that we need to look at a mixture.
The diversity of our energy mix in this country is truly enviable. My former riding, Pickering, saw the first commercial nuclear reactors in North America. We've developed hydroelectric. We've developed natural gas. Guess what? The European Union agrees. It's time to refocus our efforts, not so much on whether we can get access to oil and gas but to actually reinforce the need to look at nuclear and natural gas as transitions.
When Canadians are not part of this discussion, Mr. Mazier, when they're left out and frozen out, as I think the debate is currently poised, is it any wonder that you're seeing a significant disconnection between Canadians who are frustrated and the people who represent them?
12:40 p.m.
Conservative
Dan Mazier Conservative Dauphin—Swan River—Neepawa, MB
That's excellent. Thank you for that.
This is for you again, Mr. McTeague. Do you believe tax deductions are subsidies?
12:40 p.m.
President, Canadians for Affordable Energy
Well, no, and with respect to the tax deductions in my limited years as a member of Parliament—17 or 18—if you're going to choose one sector over another, I think you have to be fair. There's something called equity as a principle in terms of taxation in this country. I'll leave it to, maybe, the finance committee to look at that.
If you're looking at an incentive, a carrot, if you will, to achieve a certain outcome, then I think it's in everyone's interest, whether that be a transition to hydrogen, a transition to natural gas, to provide the best practices, or better yet, to lead the world as Canada does, like it or not, on ESG. For those who are watching, who are looking, rather than sitting back and saying, “Canada is terrible,” which is the rhetoric we've heard, certainly from outside influences, maybe it's time for Canadians to begin to celebrate something that not only protects them but also.... The Minister of Finance will release the budget in the next 24 to 48 hours, and without a viable and strong oil and gas sector, you wouldn't be able to provide some of the programs and announcements that are about to be made. I think it's no secret that it will be a spending budget. Within that, it has to be funded, and it's funded by the oil and gas sector, to a large extent.
12:45 p.m.
Conservative
Dan Mazier Conservative Dauphin—Swan River—Neepawa, MB
Okay. I have another question for you. You wrote in a 2020 article, “Climate change needs to be addressed responsibly, but not presented as some monumental crisis justifying the abandonment of the economic order.”
Can you expand on what you meant by this? Do you believe that the current government has abandoned the economic order with its climate change policies?
12:45 p.m.
Liberal
The Chair Liberal Francis Scarpaleggia
I have no doubt that Mr. McTeague can expand, but we are out of time.
12:45 p.m.
Conservative
12:45 p.m.
Liberal
The Chair Liberal Francis Scarpaleggia
No. It was a five-minute round.
Mr. Longfield, you have five minutes.
12:45 p.m.
Liberal
Lloyd Longfield Liberal Guelph, ON
Thank you, Mr. Chair.
We're always fighting the clock. Mr. McTeague will know that well from his years of service, which I thank him for.
For my first question, I want to build on a theme that Mr. Carrie was working on in the last panel, which was around best practices.
Dr. Hoicka, in a paper you wrote back in November, you said that you “have yet to come across any jurisdictions in developed economies that have implemented policies that support the diffusion of complementary renewable energy sources”.
Reading that report, I was thinking of Energiewende in Germany, the 10-year program around transition. I was fortunate to visit Bottrop in Germany, and I saw their district energy system. It used to be a coal mining centre. The transition in Germany has really relied on government subsidies of different types.
Could you comment on Energiewende and how that might relate to Canada and the study that we're doing around subsidies? Have you come across that in your work? I'm going to assume you've looked at that.
12:45 p.m.
Canada Research Chair in Urban Planning for Climate Change, Associate Professor in Geography and Civil Engineering, University of Victoria, As an Individual
I have not come across that in my work.