Environment Committee on June 7th, 2022

[Kendal Hembroff]

Mr. Chair, I can certainly update the committee that Canada has adopted a whole-of-government approach, led by ISED, NRCan, and other government departments, in developing a robust mines-to-mobility battery supply chain. That is really aimed at establishing a new manufacturing sector in Canada to support our overall climate change and industrial goals.

We have seen a number of leading battery and automotive manufacturers that have moved very quickly to establish production hubs in Europe and North America. We have been very actively engaging foreign investments in the battery supply chain for electric vehicles, using programs such as the strategic innovation fund's net-zero accelerator, which is aimed at supporting this industrial transformation mandate.

[Colin Carrie, Conservative, Oshawa, ON]

I understand that there's money being put into it. My concern is that the auto industry said there's a challenge with battery supply, especially with 2024 approaching, and the scarcity.

Understanding the requirement to have these supply chains consistent and available for Canadian manufacturers, have there been any new mines opened up since we've moved forward?

[The Chair, Liberal, Francis Scarpaleggia]

Go ahead briefly, please, Ms. Hembroff.

[Kendal Hembroff]

In this case, on the question of mines, I'm going to defer to my colleague, Mr. Leyburne.

[The Chair, Liberal, Francis Scarpaleggia]

Go ahead briefly, please, Mr. Leyburne.

[Drew Leyburne]

On the question of mines, we can get back to you with a specific list of mines that are opening or have opened and the pace at which those mines are being created. Many of those are within provincial jurisdiction.

As part of budget 2022, we proposed $3.8 billion over eight years to implement Canada's critical minerals strategy. That will obviously help create the critical minerals value chain for the processing and battery precursors industry, which is essential to seeing some of those electric vehicle batteries produced.

[The Chair, Liberal, Francis Scarpaleggia]

That's perfect.

We'll have Mr. Duguid for five minutes.

[Terry Duguid, Liberal, Winnipeg South, MB]

Thank you, Mr. Chair.

This question will be for Industry. It relates to innovation, which is the source of clean tech, of course.

We have a very robust and aggressive emissions reduction plan. There are targets for emissions and very detailed plans for getting to our minus 40% to 45% targets, but, to my knowledge, there are no targets for market share of clean technology or a plan on how to get there. Our Industry colleagues will know, through budget 2022, that there was a pretty stark admission by the finance minister on our having work to do on the productivity and innovation front.

I wonder if Mr. Leyburne or Ms. Hembroff might comment on this.

How do we overcome the barriers in the innovation space? We have great research. We have the $15-billion growth fund, an AI strategy, quantum computing, genomics, and the Canada Infrastructure Bank, yet we don't seem able to put all of this together to create growth and wealth. As our Prime Minister and others are fond of saying, the environment and the economy go hand in hand. As Ms. Collins pointed out, there are a lot of jobs to be gained for our country if we excel in this space and set some goals and targets for ourselves.

I'd like a comment from either of you.

[Kendal Hembroff]

I'm not sure who should start, Mr. Chair, but I can start by discussing the fact that there are, indeed, a number of challenges faced by Canadian clean-tech companies, the majority of which are small and medium-sized enterprises. That really presents some fairly unique challenges in terms of accessing available financing, commercialization and scaling up.

We are also very aware of the fact that many clean-tech companies need to be able to demonstrate their technologies, either domestically here in Canada, in order to encourage adoption, or internationally, if they're pursuing international markets. There are a number of federal programs in place designed to address these types of unique challenges. I can speak about a few of these programs on the ISED side, and perhaps other departments, including NRCan, can talk about some of the other programs available.

One of these is Sustainable Development Technology Canada, or SDTC, which supports Canadian companies with the potential to become world leaders in their efforts to develop and demonstrate new environmental technologies. We also have the strategic innovation fund, which is an $8-billion initiative to support large-scale, transformative and collaborative projects. We have programs for the earlier, innovation stage of things, including the National Research Council's industrial research assistance program, or IRAP, which provides assistance in building innovation capacity.

These are just a few examples of programs designed to boost the competitiveness of our Canadian clean-tech sector.

[Terry Duguid, Liberal, Winnipeg South, MB]

My time is running down, so perhaps Mr. Leyburne can provide a comment to the next question I'll be asking.

I'm very interested in the international dimension of reducing emissions, which Mr. Dreeshen mentioned in his opening remarks. Canada recently signed an MOU with India on renewable energy and climate change, and we have an organization that partners with China on environmental co-operation. It would seem to me that our technology transfer policy is something very important to consider. In particular, I'm thinking of technologies like CCUS; we know India and China will be dependent on coal for some time.

I wonder if you would have a comment on that. Have we thought deeply about technology transfer that doesn't just benefit ourselves, with 2% or 3% of the world's emissions—one of the highest rates per capita? Have we thought about technology transfer in a deep and important way?

[The Chair, Liberal, Francis Scarpaleggia]

Give a brief, 10-second response, please.

[Drew Leyburne]

The briefest answer is, yes.

[The Chair, Liberal, Francis Scarpaleggia]

Good. That's what we've been thinking.

[Drew Leyburne]

There's multilateral collaboration. We're doing it through climate finance and we're doing it through the UNFCCC.

[The Chair, Liberal, Francis Scarpaleggia]

Great. Thank you.

Ms. Pauzé, you have the floor for two and a half minutes.

[Monique Pauzé, Bloc, Repentigny, QC]

Thank you, Mr. Chair.

My question is for one of the NRCan officials.

The federal government has an objective of achieving a clean electricity standard with a net‑zero emissions electricity grid by 2035. That means the government is establishing a federal standard.

How will the clean electricity standard recognize provincial jurisdiction over electricity mix decisions?

[Drew Leyburne]

I'll defer to my colleagues at Environment Canada, who are responsible for the development of the standard.

[Vincent Ngan]

Absolutely. This is Vincent Ngan. Although I'm not the lead on the clean electricity standard, Environment and Climate Change Canada has launched a consultative process by sharing discussion papers with provinces, territories and stakeholders.

At this point, we are still gathering input from interested parties and our partners in all jurisdictions, so on the question about compatibility and the recognition of jurisdictional standards through the regulatory development process, we'll be able to dive into that a bit more.

At this point, we do not have a specific answer to that question.

[Monique Pauzé, Bloc, Repentigny, QC]

Jurisdiction is always a very tricky issue.

My next question is also for the NRCan officials.

NRCan is responsible for the clean growth hub, an initiative that is co-led by Innovation, Science and Economic Development Canada.

This question is similar to my last. How does the federal government ensure that the clean growth hub team works effectively with the provinces?

[Drew Leyburne]

Yes. On this one, the hub is a joint leadership between our department and the Department of Industry, but I'll turn to my colleague, Anna van der Kamp, to talk about the NRCan perspective on this, and then perhaps over to Kendal.

[Anna van der Kamp, Director, Policy Analysis and Coordination, Department of Natural Resources]

Thank you very much.

Certainly, I can turn to Kendal, but we do have MOUs in place with several of the provinces, including B.C. at this point. That is our way of being able to share data back and forth about programs and companies.

Kendal, I don't know if you want to add more there.

[The Chair, Liberal, Francis Scarpaleggia]

Be brief, please.

[Kendal Hembroff]

I don't have much to add. We have ongoing collaboration with the provinces and territories, including through the Clean Growth Hub and a number of other programs. I would say that collaboration is really quite high.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you.

Go ahead, Ms. Collins.

[Laurel Collins, NDP, Victoria, BC]

Thank you, Mr. Chair.

While some carbon capture or some carbon removal will be needed to reach net zero by 2050, the IPCC has said that carbon capture and storage is one of the least effective and most expensive options to address the climate crisis. This committee also heard in its last study on fossil fuel subsidies that carbon capture should be reserved as an option of last resort to reduce the emissions intensity of heavy industry sectors that are hard to decarbonize, such as concrete and steel. We heard that from a number of witnesses.

What rationale is there for the emissions reduction plan, released this spring, to rely so heavily on carbon capture, with relatively little investment in renewable energy in comparison?

What proportion of the $8-billion net-zero accelerator fund will go towards carbon capture technology?