Environment Committee on Dec. 9th, 2024

[Dan Mazier, Conservative, Dauphin—Swan River—Neepawa, MB]

There was definitely information in there, to rip out 360 pages. Is there any information they should be adding in there? I think you explained that intellectual property and things like that are sensitive. Meanwhile, what are the $8 billion doing and how are they reducing emissions?

Obviously, that's a pretty narrow scope and you should be able to see some kind of benefit for that.

[The Chair, Liberal, Francis Scarpaleggia]

We're going to go to Ms. Taylor Roy now.

Thank you.

[Leah Taylor Roy, Liberal, Aurora—Oak Ridges—Richmond Hill, ON]

Thank you very much, Mr. Chair.

Thank you, Mr. DeMarco, Ms. Da Costa and Ms. Leach, for being here.

I read through some of the lessons learned that you put in here regarding the things we should be asking about.

You've done so much work on this. I would like to ask you some of the questions that you posed to the government because I think you may have some answers and ideas on this.

One thing I want to talk about is lesson 2. You started by saying that no government since 1990 has met its targets for emissions reductions. Governments, obviously of both parties, over time have failed to do this.

It now seems, and this is something you point out, that our economies depend on emission-intensive industries and sectors such as oil and gas. In this, you talk about what we can do to deliver on its promise...for this oil and gas sector to actually meet the targets. You talked about the levers as well.

Can you talk about the cap on pollution that we've put in place for the oil and gas industry?

The oil and gas industry has set its own targets. This cap is basically enforcing that and ensuring that it will meet those targets. There's a lot of controversy about putting in place a cap on pollution. Is this the kind of lever you're talking about that we need or is it something like this?

What else would you suggest to ensure that the oil and gas sector actually follows through on its commitments to reduce emissions?

[Jerry V. DeMarco]

Thank you for the question.

Lesson 2 in our 2021 report is “Canada's economy is still dependent on emission-intensive sectors”. We posed several questions for parliamentarians to consider. As I indicated to this committee in prior appearances, because over half of all emissions in Canada are from just two sectors, oil and gas and transportation, Canada needs to get a handle on those sectors. It's a choice for the government and parliamentarians to determine which measures to use, to the extent that some measures are set out in legislation.

However, the fact remains that all sectors need to abate their emissions to meet the target, especially oil and gas, because it's the largest one, accounting for over 30%. The oil and gas emissions cap is the current choice by the current government. Whatever the measure is, there needs to be something to bring that curve down in the oil and gas industry, which electricity, as I mentioned in my opening statement, has been able to do, even with an increase in production over the last 30 years.

[Leah Taylor Roy, Liberal, Aurora—Oak Ridges—Richmond Hill, ON]

The oil and gas sector is the only sector that has increased. We've seen a 7% decrease since 2005, but the oil and gas sector continues to increase.

Do you think this lever, a cap on pollution, enforcing what they said they're going to do, will be effective and can help the oil and gas sector actually meet its emissions targets?

[Jerry V. DeMarco]

Well, it's only a draft regulation at this stage, and the accompanying explanation for it was just released a couple of weeks ago. Obviously, we haven't audited that measure. We've audited about 40 measures, but we wait until they're actually measures, as opposed to just hoped-for measures. I therefore can't say anything about my view on the efficacy of that particular measure, but I agree with the proposition that, if Canada has a total emissions reduction target, it needs to get a handle on the largest sector's emissions in order for it to add up to the total.

[Leah Taylor Roy, Liberal, Aurora—Oak Ridges—Richmond Hill, ON]

We see that transportation is coming down and, as you say, electricity, which is fantastic.

I want to turn to the Canadian Climate Institute. We've also heard a lot about measures not working because we're not seeing emissions drop quickly enough. However, the Canadian Climate Institute said:

Impacts of policies will increase over time: some will only have been in effect for a few years, and others will increase in stringency after 2030—the zero-emission vehicle sales standards are a good example.

They give other ones.

You mentioned that the net zero accelerator fund should have at least qualitative descriptions of how we will reduce, if we can't have specific quantitative ones. We also know the department only felt comfortable asking for those when they were meeting our 2030 goals, not our 2050 goals.

Do you agree that we're not going to see the benefits of a lot of these policies and investments we're making right now before 2030, but that we will see them longer term, for example, between 2030 and 2050?

[Jerry V. DeMarco]

If the benefits are realized, then yes. Many of them are longer term. The same conclusion could be reached in our analysis of the two billion trees program, which we did a couple of years ago.

It's actually not a bad thing to be looking far out. In fact, lesson 8 from that same report we just talked about is about taking a long-term perspective. The longer term the perspective, the harder it is to be specific about the reductions associated with it. However, there can still be some transparency about the anticipated benefits, even if they aren't going to be credibly estimated to a level where you could call them bankable reductions.

[Leah Taylor Roy, Liberal, Aurora—Oak Ridges—Richmond Hill, ON]

Thank you.

Regarding the net zero accelerator fund documents, I looked through all of the contracts. There is that qualitative...which says how it would happen. It just isn't specific amounts.

The last thing I want to go to is lesson 4.

We did lesson 2 and lesson 8. Now it's lesson 4, “Canada risks falling behind other countries on investing in a climate-resilient future”. We just finished a study on sustainable finance. We're trying to get that report out. Actually, a colleague who's not here today, Madam Pauzé, suggested a letter to try to expedite that.

Do you think the government's work on sustainable finance and getting the taxonomy and some of the reporting requirements in place will be helpful for us in terms of getting more investments in a climate-resilient future?

[The Chair, Liberal, Francis Scarpaleggia]

Unfortunately, you'll have to give the answer in response to someone else when you have a chance. I'm sorry about that.

Mr. Fortin, the floor is yours.

[Rhéal Fortin, Bloc, Rivière-du-Nord, QC]

How much time do I have, Mr. Chair?

[The Chair, Liberal, Francis Scarpaleggia]

You have six minutes.

[Rhéal Fortin, Bloc, Rivière-du-Nord, QC]

Thank you, Mr. Chair.

Welcome, Mr. DeMarco. It's good to see you here. I myself am a "new kid" here. You probably have more experience with this committee than I do. This is my first time on the committee. I'm replacing my colleague, Ms. Pauzé, who is much more familiar with this type of subject than I am. If you'll bear with me, I'm going to risk a couple of questions.

Report 7 indicates that "no significant new federal measures have been included in the modelling" since the 2022 projections. My understanding is that the targets aren't being met, and it's hard to imagine that they'll be met within a reasonable time.

Do you think the government should implement new measures to meet greenhouse gas emission reduction targets? Or is it that the current measures are sufficient, but not properly applied? How do you see that issue? In your opinion, should new measures be implemented or not?

[Jerry V. DeMarco]

Yes, new measures are needed because there is a gap between the 36% reduction rate and that of 40%, which is the minimum. The current measures must therefore be improved or new ones added.

[Rhéal Fortin, Bloc, Rivière-du-Nord, QC]

Under those conditions, what measures do you think should be added? What more should be done?

[Jerry V. DeMarco]

The choice of policies is up to the government. In 2021, in Report 5—Lessons Learned from Canada's Record on Climate Change, we identified a gap of four percentage points, which is to say, between 36% and 40%. I'm disappointed that three years later, the same sentence indicating that there's still a 4% gap may appear in our report. This means that new measures or improvements to existing ones are needed.

[Rhéal Fortin, Bloc, Rivière-du-Nord, QC]

Let me just reinforce that. I could be wrong, but you're sort of the expert on this within government. Your role is impartial, but you serve the government in power and you have a fairly good grasp of these subjects.

I'd like to know what measures should be taken, in your opinion, if we're seriously trying to achieve the objectives that we've set.

[Jerry V. DeMarco]

We have to stay within our mandate. At the Office of the Auditor General of Canada, we assess measures and performance, meaning value for money and government performance. The choice of measures and policies rests with the government.

Under the Canadian Net-Zero Emissions Accountability Act, another organization, the Net-Zero Advisory Body, has a mandate to make policy recommendations. You could invite those people to testify before you, if you wish.

[Rhéal Fortin, Bloc, Rivière-du-Nord, QC]

It's certainly a good idea, but I won't be here.

In your opinion, what are the factors that slow down the implementation of planned reduction measures?

[Jerry V. DeMarco]

We've identified a few in our report this year and in the 2023 report. Negotiations with the provinces are an example. On many issues related to the environment and sustainable development, there is a division of powers between the provinces and the federal government. That is one of the factors slowing down the federal government's work. There is no consensus on many of those measures, which slows progress. When some provinces oppose a measure that others support, the federal government tries to find a consensus, but that's often impossible. In those circumstances, it can take a long time to reach a decision.

[Rhéal Fortin, Bloc, Rivière-du-Nord, QC]

In your opinion, is the difficulty experienced by the federal and provincial governments in reaching agreement the only reason for the slowdown, or are there other factors slowing down implementation of the provisions?

[Jerry V. DeMarco]

I was giving you an example, but that isn't the only factor.

In paragraph 11, I believe, we provide a summary of the various criteria that we used to assess the measures.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you.

We have to stop now, unfortunately.

[Jerry V. DeMarco]

We see that there are other reasons as well.

[The Chair, Liberal, Francis Scarpaleggia]

Ms. Collins, you have the floor.