Evidence of meeting #14 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 report.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Jerry V. DeMarco  Commissioner of the Environment and Sustainable Development, Office of the Auditor General
Kimberley Leach  Principal, Office of the Auditor General
Sébastien Labelle  Director General, Clean Fuels Branch, Department of Natural Resources
John Moffet  Assistant Deputy Minister, Environmental Protection Branch, Department of the Environment
Philippe Le Goff  Principal, Office of the Auditor General
Derek Hermanutz  Director General, Economic Analysis Directorate, Strategic Policy Branch, Department of the Environment
Andrew Brown  Senior Assistant Deputy Minister, Skills and Employment Branch, Department of Employment and Social Development
Chris Bates  Director General, Apprenticeship and Sectoral Initiatives Directorate, Department of Employment and Social Development

12:50 p.m.

Commissioner of the Environment and Sustainable Development, Office of the Auditor General

12:50 p.m.

Conservative

Dan Mazier Conservative Dauphin—Swan River—Neepawa, MB

Canadians living in rural and remote communities are already experiencing the unfairness of the carbon tax to date, never mind about when it reaches $170, so if the government hasn't bothered to analyze the impacts of the significantly higher carbon tax, don't you think that Canadians will continue to be disproportionately impacted by the government?

12:50 p.m.

Commissioner of the Environment and Sustainable Development, Office of the Auditor General

Jerry V. DeMarco

That's one of the concerns we have as well, because I believe their next review is in 2026, which is quite a ways from now. Our recommendation is that they speed that up, both from a fairness and an effectiveness point of view, but also to not unnecessarily create debate over something that, if done well, should work. If they can bring people along on this by demonstrating the effectiveness and the fairness, why wait until 2026 to do that?

12:50 p.m.

Conservative

Dan Mazier Conservative Dauphin—Swan River—Neepawa, MB

Yes. Good.

You mentioned in your report that measures such as “targeted exemptions” could be used to mitigate and navigate effects of the carbon tax. Do you believe that the government should consider this?

12:50 p.m.

Commissioner of the Environment and Sustainable Development, Office of the Auditor General

Jerry V. DeMarco

They already do have several, and maybe too many on the large emitter side, but we'll talk about that another time, perhaps.

Yes, there are other exemptions too, for certain types of agricultural fuels, but not all of them. I think someone was talking about propane for drying grain, but on the diesel side there are.... You could get the full list from the department, but there have been some exemptions already, and exemptions as well for certain remote communities in terms of energy sources.

12:55 p.m.

Conservative

Dan Mazier Conservative Dauphin—Swan River—Neepawa, MB

Thank you very much.

12:55 p.m.

Liberal

The Chair Liberal Francis Scarpaleggia

Mr. Longfield is next.

12:55 p.m.

Liberal

Lloyd Longfield Liberal Guelph, ON

Thank you, Chair. Thanks to all the witnesses for being here from the departments, as well as Mr. DeMarco. It's great to see you again.

In terms of your processes from the commissioner's office, how frequently are you going to be doing audits like this? What's your next audit in this area, and how would that interact with the audits that you'll be doing on the act that we passed last June on climate change accountability?

12:55 p.m.

Commissioner of the Environment and Sustainable Development, Office of the Auditor General

Jerry V. DeMarco

That's a good question. It's one that we and the commissioner are thinking about as part of the Office of the Auditor General, so it's a whole-of-office approach. Many of the principles here also work on other audits for the Auditor General. I just wanted to make it clear that it's one office.

We have the new mandate from the net-zero act to look at a very specific aspect of climate change mitigation. Obviously we do audits on climate change regardless of that having passed in June, and we've been doing that for 20 years, but we are now assessing what we should do differently in order to implement that new directive, which I believe is in around section 24 or section 23 of the net-zero act. I don't have the act in front of me, but hopefully I'm in the ballpark. We'll assess our options on whether we will report perhaps even more frequently than the minimum required under that legislation.

April 28th, 2022 / 12:55 p.m.

Liberal

Lloyd Longfield Liberal Guelph, ON

Thank you.

The 2026 number you just mentioned was one that stood out to me. I know we're changing or moving forward some of our accountability pieces on getting to a net-zero electric grid. Things are going to be happening within a shorter time frame now.

Maybe I could ask the department whether Environment and Climate Change is looking at 2026 as a negotiable date.

12:55 p.m.

Liberal

The Chair Liberal Francis Scarpaleggia

Who would like to answer?

12:55 p.m.

Liberal

Lloyd Longfield Liberal Guelph, ON

Mr. Moffett, could you comment?

12:55 p.m.

John Moffet Assistant Deputy Minister, Environmental Protection Branch, Department of the Environment

Perhaps I could ask what you mean by “negotiable”.

12:55 p.m.

Liberal

Lloyd Longfield Liberal Guelph, ON

I mean negotiable in the sense of whether it's a possibility to move 2026 forward. It was a recommendation in the audit itself. I know you'll be doing an action plan. I hope we'll see an action plan that might address this, but what's your initial reaction?

12:55 p.m.

Assistant Deputy Minister, Environmental Protection Branch, Department of the Environment

John Moffet

Sorry, there's a big echo. I wonder if somebody's not on mute.

12:55 p.m.

Liberal

The Chair Liberal Francis Scarpaleggia

Could you try again, Mr. Moffet?

12:55 p.m.

Assistant Deputy Minister, Environmental Protection Branch, Department of the Environment

John Moffet

Okay, the echo is gone.

The 2026 that I think you're referring to is our commitment to do an interim review of the new benchmark criteria. We don't plan to do that earlier than 2026. We plan to start it well before 2026, but the idea would be to....

We've established criteria for pricing systems for the period of 2023 to 2030, which is a much longer period than we had in place before for pricing. We're trying to provide as much certainty as possible, but we recognize that we're in a dynamic policy space and that things may change. There may be a need to provide an update at some point. However, we don't want to signal that a change may occur within the next couple of years, so we selected 2026 as a commitment. At the moment, we don't have any plans to accelerate that.

12:55 p.m.

Liberal

Lloyd Longfield Liberal Guelph, ON

The audit has pointed out that the benchmark system is in need of strengthening, especially on large emitters. That would be an interesting point for a longer discussion. It's a concern that I would have, looking at what we have in front of us.

12:55 p.m.

Assistant Deputy Minister, Environmental Protection Branch, Department of the Environment

John Moffet

Can I just respond to that?

The audit also acknowledges, however, that we have strengthened the benchmark criteria. What I'm referring to are the new benchmark criteria for 2023 to 2030 that were put in place after the audit was concluded.

1 p.m.

Liberal

Lloyd Longfield Liberal Guelph, ON

I'm looking at the benchmarking with the provinces to see whether their systems are robust enough. I know that we've had a lot of disagreements, even up to the Supreme Court, in terms of this legislation and whether we now have the right benchmarking with the provinces.

1 p.m.

Liberal

The Chair Liberal Francis Scarpaleggia

Maybe the answer could come a bit later.

We'll go now to Mr. Dreeshen for five minutes.

1 p.m.

Conservative

Earl Dreeshen Conservative Red Deer—Mountain View, AB

Thank you very much, Mr. Chair, and thanks to all of the witnesses.

Mr. DeMarco, earlier on you had said that this is an intergenerational crisis that we're dealing with. Since I've heard of it for the last 50 years, I agree with you that it has been an intergenerational crisis. Some of the doom and gloom, of course, is sort of on the Nostradamus level.

This is what I would like to talk about. We're trying to take a look at the full life cycle of some of these new types of technologies, such as solar, wind, hydrogen and so on. I know you may not have some of that information in front of you, but I certainly think it would be good to have a look at that later, We just take these little snapshots of what this technology will do, but we don't look at the mining requirements and we don't look at the infrastructure for electricity and we don't look at what would be required for batteries, and so on. There's no energy source that doesn't require that type of an analysis, whether it be hydro or whatever. They all require that. I'm hopeful that this will take place.

In report 1 on page 9 you have spoken about other countries, their governance structures and how we are to coordinate our activities. We deal with North American countries, so obviously Mexico and the U.S. are critical to what we're trying to do. They're our trading partners.

I'm curious about how you might consider the incorporation of carbon taxes into their national economic structure and how they are managing these costs when it comes to exports and imports, because they are both our competition and our partners in so many ways in the supply chain.

Was any of that put into your analysis on exhibit 1.2 when you were speaking of what others countries are doing, or was it strictly to describe the fact that they had carbon pricing?

1 p.m.

Commissioner of the Environment and Sustainable Development, Office of the Auditor General

Jerry V. DeMarco

Thank you.

Are you talking about 1.2, which is the just transition report?

1 p.m.

Conservative

Earl Dreeshen Conservative Red Deer—Mountain View, AB

Yes. I'm referring to report 1 and exhibit 1.2 on page 9.

1 p.m.

Commissioner of the Environment and Sustainable Development, Office of the Auditor General

Jerry V. DeMarco

It's exhibit 1.2. Okay.