Environment Committee on Dec. 4th, 2024

[Francis Bilodeau]

I have no comment on that.

[Branden Leslie, Conservative, Portage—Lisgar, MB]

Okay. Well, I view it in many ways as a blank cheque for big companies, and I think many taxpayers do too.

As discussed earlier, the environment commissioner discovered that you did not conduct value-for-money audits. I'll continue in that space. Since you won't tell us what the target of the entirety of the program is and we have no credible data to ensure that emissions reductions actually take place and therefore can't measure the cost-effectiveness, how can you guarantee to the folks whom I represent that there has not been wasted money?

[Francis Bilodeau]

I could say that the projects were all individually reviewed in quite thorough ways for a number of factors, including job creation, technology development and, particularly for the ones that are in pillar 1, their megatonne reductions until 2030.

The due diligence process is actually fairly rigorous; hence, we were discussing the length of time it makes in the help to support the development of Canadian industry.

[Branden Leslie, Conservative, Portage—Lisgar, MB]

I would hope that it's rigorous. I think expecting anything less is simply insane.

However, there has also been a double-counting of emissions across various other programs, as reported by the commissioner, and a clear lack of focus, I think.

Going forward, will the department be doing value-for-money audits on future programs of this nature? Has the lesson been learned, or are we going to continue to provide vague responses back to the environment commissioner?

[The Chair, Liberal, Francis Scarpaleggia]

The time is up. We'll go now to Mr. Longfield.

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you, Mr. Chair.

Thank you to the witnesses.

I'm going to focus my questions with Mr. Bilodeau.

Thank you, Mr. DeMarco, for being here again at the committee.

When Mr. DeMarco was last at our committee, we talked about the gap between policies being launched and then getting results on the greenhouse gas reductions. I'm looking at this from two different angles.

First, I've worked on electric arc furnaces in steel mills. They're massive. When you shut down an electric arc furnace, you shut down the steel mill, so with regard to the timing to work on those furnaces, sometimes you have to wait years to get into the production schedule to work on a furnace. I've also worked on the dryer kilns in concrete plants, and it's very much the same: When the kiln goes down, the plant goes down, so when we're looking at the large emitters in pillar 1, we're actually talking about getting right to the heart of their operations, and that's not an easy thing to do.

The second part of my comments would be with regard to working with the board of directors. I've sat on the boards of international companies. The Canadian division has a Canadian managing director. It's a separate balance sheet within a larger organization. You have to ask for capital for your region. You have to get board approval for capital for your region, and then you have to expend the capital and implement the improvements that you've pitched to the board in order to get approvals.

Between getting things through boards of directors and through production, could you talk about the real-life challenge of businesses trying to implement net-zero programs that we've put forward?

[Francis Bilodeau]

I appreciate the question.

I think the decisions that face companies that are making very large investments with a view to decarbonizing are multiple. Obviously, they have shareholders and they have business imperatives.

I will actually ask Stephanie, who is more directly involved in the negotiation and the collaboration with the companies, to maybe provide a bit more—

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you.

I am not looking for excuses for the businesses; I'm looking at the real-life consequences of trying to get a program implemented.

[Stephanie Tanton, Assistant Deputy Minister, Strategic Innovation Fund, Department of Industry]

Mr. Chair, I would say that the member is correct. These are incredibly complex, large, high-risk projects that often require significant inputs into decisions for the companies to decide to make final investment decisions.

In the case of a lot of the projects under pillar 1, and as is the case in a number of the projects that we continue to have in our pipeline, we're often the first in with regard to providing a commitment towards a project—not disbursing funding, not signing a contribution agreement, but in sending a signal that this project is going to advance Canada's net-zero objectives—and we do that.

As the audit actually pointed out, I think six out of the 10 CTA projects at the time of the audit were in their feasibility studies. The companies need to take a look at a lot of things. They need to look at making sure that they have the full financial stack. They need to make sure that they're going to look at regulations. They're also going to look at risk—

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you. I'm on limited time.

At the same time, we're competing against other organizations in other countries that may also be seeking federal compensation for some of their large capital projects, so it is a global market we're competing against. Is that fair to say?

[The Chair, Liberal, Francis Scarpaleggia]

Thank you very much.

That concludes the first hour of our meeting.

Before we take a short break and begin the in camera portion of the meeting, I'd like to ask the committee a question. As we know, during the in camera portion, each member has the right to be accompanied by an assistant, as do the whips and House leaders. It's a well-established right.

Do I have the permission of the committee to invite the support staff who support the witnesses to stay in the room? Most of them are sitting in the front row behind the witnesses.

[Voices]

Agreed.

[The Chair, Liberal, Francis Scarpaleggia]

Perfect.

We will now take a break before we go in camera. The meeting is suspended.

[Proceedings continue in camera]