Environment Committee on April 28th, 2022

[The Chair, Liberal, Francis Scarpaleggia]

Thank you.

Mr. Duguid is next.

[Terry Duguid, Liberal, Winnipeg South, MB]

Mr. Chair, most of my questions have been answered, but I wonder if I could give both the Environment and Climate Change Canada and the Natural Resources Canada staff who are here an opportunity to comment on the $9.1-billion emissions reduction plan we just introduced through the budget and through the ERP that was released by the minister a few weeks ago.

Perhaps this will give them an opportunity to highlight some of the things in the ERP that have shored up some of the shortfalls that have been pointed out by the commissioner. I asked a similar question of the commissioner, but perhaps it's more appropriate to ask the departments.

We have made some progress. What is that progress on, again, in shoring up some of these shortfalls that the commissioner has pointed out?

[The Chair, Liberal, Francis Scarpaleggia]

Who would like to take that? Would someone from ECCC like to take that?

[John Moffet]

Perhaps I could start, Mr. Chair.

Without getting into all the details that are provided in the “2030 Emissions Reduction Plan”, I think the key point is that it represents the current plan and it does indeed take some steps to address at least some of the recommendations made by the commissioner. I would address two, and maybe I can turn to my colleagues from other departments to talk about the others.

In terms of the modelling, the modelling projections in the “2030 Emissions Reduction Plan” represent a much more detailed set of inputs and rely less on some background assumptions, as was the case in the earlier plan, including the assumptions that we needed to make about the likely impact of the forthcoming hydrogen strategy, for example. The annex is available for everybody to read. If the committee is interested, we'd be happy to come to talk about the modelling annex and the assumptions in it at a later date.

On carbon pricing, we agree with the findings of the review of the audit and the four recommendations, and indeed, are committed to developing and publishing a written plan to respond to those four recommendations. It's our view that we've already started to respond to those recommendations primarily through the new benchmark criteria. The basic approach to carbon pricing has been to develop criteria for provinces for all pricing systems, federal, provincial and territorial. Inherent in the development of those criteria is the inevitability that there will be differences among systems. If there was a desire to have one system, then we would only have one system, but we've acknowledged that provinces were early movers and we've acknowledged that provinces need to have the ability to take action in ways that address their own circumstances.

The bottom line is that these criteria are significantly tighter, provide longer-term certainty and should go a long way to addressing some of the discrepancies that the commissioner pointed to. In addition, we published input on our advice to all jurisdictions about revenue use so that revenue return can be used to, among other things, offset some of the potential impacts on vulnerable communities.

[Terry Duguid, Liberal, Winnipeg South, MB]

Thank you.

[The Chair, Liberal, Francis Scarpaleggia]

We'll have to stop there and go on to our last round. Here I will reduce the time for each member to three and a half minutes. That way we'll end on time.

Go ahead, Mr. Mazier.

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

Thank you, Chair.

Commissioner, as you know, the federal government provides a 10% tax rebate supplement for Canadians living in rural communities. Are you aware if the government has conducted an analysis to determine if the 10% supplement fairly covers the increased costs of living for Canadians in rural and remote communities?

[Jerry V. DeMarco]

I'm going to turn to Ms. Leach for that.

It's an example of an initiative to address the potential for disproportionate—

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

You are aware?

[Jerry V. DeMarco]

Yes, of course.

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

I'm on reduced time here.

The government admitted at this committee that no study or assessment was conducted to determine whether the 10% supplement was fair for rural Canadians. I'll read the words of the Department of Finance official: “It is not based on any scientific assessment. The government has decided that 10% is appropriate in this context.”

Isn't that concerning to you? Why haven't you considered this in the current carbon pricing audit?

[Jerry V. DeMarco]

The question “Have they addressed it at all?” is one, but I think your question is, “Is it effective to actually level the playing field?”. You could say we have this 10%, but is that in any way proportionate to the burden that would be there? I think that's what you're asking.

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

It's not based on scientific data. That is probably the more concerning thing. This is supposed to be a scientifically proven plan to reduce emissions. We know we have a problem, yet there's no data to prove this scientifically for these communities or for anybody having other questions about this plan.

[Jerry V. DeMarco]

That's what we're hoping will occur with recommendation 5.79. We have listed every type of group that could be disproportionately impacted, but we're asking Environment Canada to assess the burden of carbon pricing systems on certain groups, including indigenous people. Just because you have an initiative like the 10% doesn't mean that it reflects the reality of the disproportion, so they have to calibrate it—not just put in a program, but calibrate it to the affected population. Hopefully we will see that in the action plan arising from recommendation 5.79.

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

You mean calibrate it from scientific data, not just pull it from the air.

[Jerry V. DeMarco]

It's not just science, but also demographics. There are a bunch of things there, but yes.

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

This is going back to report 1 on page 23. Could you provide the committee with the documentation on how you determined the number of communities and jobs dependent on emission-intensive sectors?

That's in report 1.

[Jerry V. DeMarco]

Yes. We have two sets of numbers, one for coal specifically and then one for direct jobs in fossil fuel. I believe that was from a study—

Pardon me?

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

Is that in the documentation you just presented to the committee?

[The Chair, Liberal, Francis Scarpaleggia]

If you could send it to the clerk for distribution, that would be great.

[Jerry V. DeMarco]

Okay, we'll send it.

[The Chair, Liberal, Francis Scarpaleggia]

We'll go now to Mr. Weiler for three and a half minutes.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you, Mr. Chair.

I want to pick up on the hydrogen report again.

Commissioner, I'm wondering if in your modelling here you looked at the impact of the clean fuels fund, the net-zero accelerator fund, the clean fuel standard or the zero-emission vehicle mandates, including for medium- and heavy-duty vehicles when we're looking at the overall emissions reduction potential for hydrogen by 2030.

[Jerry V. DeMarco]

Thank you. I'll turn to Mr. Le Goff for the answer to that question.

[Philippe Le Goff, Principal, Office of the Auditor General]

The plan will be to do a follow-up on this audit and to look at those programs.