Environment Committee on Oct. 21st, 2022

[Ivette Vera-Perez]

Thank you very much for the question. It's a two-part question, so if you see that I don't answer one portion, please let me know.

First, on the policy side, there isn't one single industrial policy that will achieve all of the objectives that we as a country have, for example. Something I have observed in this role, and in previous roles, is that oftentimes we have a general direction—an overarching goal. Let's call net zero by 2050 an overarching goal. We have developed road maps for a number of technologies and industries, and in this space, I'm focusing on hydrogen. I'm thinking of that as an overarching goal for Canada.

Now, when we develop policies and funding mechanisms, sometimes we forget about looking at the big picture. I can give you a couple of examples. The green buildings strategy, for example, doesn't account for what we call power-to-X or blending of hydrogen. Meanwhile, Nova Scotia has just made amendments to the Electricity Act and to other acts that allow it to expand the hydrocarbons act, for example, and to include hydrogen and hydrogen blends as part of the Pipeline Act.

We need to think about the big picture. What is the overarching goal for Canada? How do the policies help to meet these goals, and how do the policies help each other? There is also the CCUS policy as well.

Do a little bit of a scan. With regard to big goals for the country and new policies or new funding mechanisms, how do they enable the goal? Not all of them will participate in this particular strategy or goal, but for those that do, how do they help that goal and, again, how do they match each other? It's like a little puzzle, and piece by piece, we put the puzzle together.

That's on the policy side. On the IRA side, it's only been a couple of months since August 16. There are lots and lots of discussions on IRA. I've been on many webinars, panels and discussions. The day before yesterday, the Canadian embassy in the U.S. gave a very good presentation for Canadian companies in general, not only hydrogen companies.

There are a number of components. There are the components for costing projects, of which the ITC, the investment tax credit, is important. What is included in the ITC? It's only equipment. Projects have costs beyond equipment. One example is the cost of electricity, of course. Is that going to be included in the ITC?

There is the production tax credit that provides a stimulus of up to $3 a kilogram of hydrogen produced—which is not an absolute number and depends on the pathway and a number of indicators. There are all kinds of other potentials for improving the economics of a project, depending on training opportunities and domestically built components, etc. The overall envelope is very attractive.

There are also resources for those communities—municipalities, local jurisdictions—that need to develop permitting. There are resources for those groups to staff themselves so that they can help streamline the regulatory and permitting side.

[Terry Duguid, Liberal, Winnipeg South, MB]

Thank you very much. I think I have time for one more question.

Mr. Robertson, I had the good fortune of sitting down with Mayor Helps and talking about the port and shoreside power production.

I wonder if you could amplify on what power you are using. Is that renewable, solar, wind or electricity? Maybe comment on the transferability of the kind of knowledge that you're developing to other ports of call like Halifax or the Great Lakes, because I am sure they are hungry for that kind of information.

[Ian Robertson]

Yes, we're very blessed, obviously, out here on the west coast that the technology and the source would be hydroelectric. There is an abundance of that.

What we're seeing is that the cruise lines are making great advances in terms of their technology and their ability to plug into ports. I think by 2040 95% of all the cruise ships that will be calling in Victoria will be capable.... I am just reading a statistic that 85% of all cruise lines will be shore power-capable by 2028. We're seeing good advances on the cruise line side. I think as a country and certainly as a destination, we're not seeing us catching up, so there's an opportunity for us to do that.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you.

Ms. Pauzé, you have the floor.

[Monique Pauzé, Bloc, Repentigny, QC]

Thank you, Mr. Chair.

I'd like to begin by thanking the witnesses for being with us today and especially for sending us their briefs in time for us to read them, which isn't always the case. As a former school teacher, I give them a 10 out of 10.

Ms. Vera‑Perez, I'd like to come back to the topic of hydrogen. I've taken note of your concerns. You aren't the only one to say that it's very difficult to access the Canada Infrastructure Bank and get funding.

You also mentioned the United States and the rapid development there. In Texas, one company has set up facilities that are on track to being the largest in the world. It's the fast-growing Green Hydrogen International. While Canada is stagnating, other countries are making progress.

I think that if hydrogen is to be part of the mix of energy sources that will be used to achieve net-zero emissions, it must be green hydrogen. You can produce hydrogen from hydrocarbons, but it wouldn't be green hydrogen.

Also, my understanding of the industry is that the problem isn't the water, but the electrolyzers, which are expensive and require special expertise and strategic minerals.

You say that Canada has already been at the forefront in this area. If it wants to stay ahead of the curve, what does it need to look at to really be a global producer of clean green hydrogen?

[Ivette Vera-Perez]

I am going to start with expertise. That's a very important topic.

Canada has a very highly qualified workforce. Canada has been a leader—I can elaborate on that—since the early 20th century in hydrogen. There is quite a lot of knowledge in Canada. There are very high-level universities, highly-qualified individuals. At the trade level, there's a lot of training that still remains to be done. Fortunately, a lot of the skills from workers in the oil and gas industry are very much transferable. There is an incremental amount of training for hydrogen technicians for tradespeople, but it's not that they come from a very low baseline. That in a way is a blessing.

There are a number of colleges already in Canada that are developing expertise. There is the College of the North Atlantic, Cambrian College and NAIT in Alberta. There is Red River College and BCIT. Every province has colleges that are very seriously looking at what that upskilling or re-skilling or retooling, if you will, looks like in hydrogen. I have a number of members, actually, who have taken it upon themselves to develop those skills—

[Monique Pauzé, Bloc, Repentigny, QC]

I'm afraid I have to interrupt you, Ms. Vera‑Perez.

What I understand from your testimony is that we have everything we need in Canada, but it's not being promoted. Something is missing, and Canada isn't putting the money needed into moving this forward.

Mr. Kakumanu, I have to say that I was quite impressed with all the information you provided in your document. It's a gold mine.

You said that your company is involved in several projects and partnerships.

First, where are the fuels produced?

Second, is your technology patented?

Third, are the fuels produced through the process presented on your website biofuels? In other words, do they emit greenhouse gases when burned?

[Swapan Kakumanu]

Thank you for the question.

Our technology is basically trying to get rid of landfills. The base technology is pyrolysis. That is the basic technology behind it. We're not going to be patenting pyrolysis, because that's a technology that's already out there. We have unique know-how in terms of how we use that technology without the segregation of waste up front. We would no longer need green bins, black bins and blue bins, especially with municipal waste. We would be able to take all the mixed waste, both solid and liquid, and process it through our system, our know-how technology.

The projects we're working on right now are mostly with municipalities. We're working with a lot of municipalities in Canada right now, especially in Alberta, where we are almost ready to.... We have signed MOUs and we have built our first prototype units, which are up and running here in Calgary. We are also looking at the private sector with private waste management companies, which actually have purchase orders with us so that we're building units for them.

We're also working with quite a few municipalities in the U.S. Actually, there's a lot of attraction from the U.S. From Oklahoma, we had a group of waste management companies travel up here to Calgary to see our demo unit. They're really excited, because they want to be able to share with us; they want to give us all their waste—

[Monique Pauzé, Bloc, Repentigny, QC]

I'm sorry to interrupt you, Mr. Kakumanu, but I don't have much time, and I'd like you to answer my last question.

Do the fuels produced through your process emit greenhouse gases when they are burned?

[The Chair, Liberal, Francis Scarpaleggia]

Please give a very short answer. It's a yes-or-no question, Mr. Kakumanu.

[Swapan Kakumanu]

Okay.

I would say yes, because basically what we're taking is plastic and tires and carbon-rich waste that will come back into some type of diesel. Yes, if you burn that, there will be greenhouse gases.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you very much.

You have the floor, Ms. Collins.

[Laurel Collins, NDP, Victoria, BC]

Thank you, Mr. Chair.

I want to thank all the witnesses for their testimony and for being here.

I have two questions for Ian Robertson.

Can you comment a bit more on how shore power is progressing in Victoria and in other ports? You also mentioned the commitment of the cruise industry to have the vast majority of their fleet shore power-ready—85% by 2028 and 95% by 2040. Will we be missing out on an opportunity to develop a cleaner cruise industry if the Greater Victoria Harbour Authority and others aren't able to get the funding they need for shore power?

[Ian Robertson]

Thank you for the question.

In Victoria, we do not have shore power. That's our main goal and our main priority right now. We're very close. We have funding commitments from the provincial government. We have funding commitments from the cruise lines themselves. We're just waiting on the federal government, and I'm hopeful that will happen.

As I mentioned, there are very few ports across Canada that are shore power-capable. On the west coast, there's Vancouver and then there's us, and we do not have shore power. I think there's an opportunity for us to catch up. It would be sad to see the cruise lines make their advancements and be shore power-capable and then we as an industry, specifically we as a port, not being able to provide the technology or the hookup with the capability for them to plug in and power down while they're in ports.

[Laurel Collins, NDP, Victoria, BC]

Thank you so much.

Victoria's port is a bit unique. It's located right beside the James Bay neighbourhood. Pollution from the cruise ships is a big concern for residents. Can you speak about the additional challenges that presents and how shore power could make a difference?

[Ian Robertson]

You're absolutely right, MP Collins. Our port is adjacent to a neighbourhood community. That also creates, I think, another level of responsibility and obligation: We have to do everything we can within our power to reduce the environmental impact upon the community. That's where this report has identified that the installation of shore power would reduce greenhouse gas emissions by 96% off the facility.

It's important that we move ahead with this project. As I said, we're very close. We just need the support from the federal government to be able to make this a reality.

[Laurel Collins, NDP, Victoria, BC]

Another thing that makes our harbour unique is that the Greater Victoria Harbour Authority is not part of the Canada Port Authorities.

Can you talk a bit about that, and how that impacts this issue?

[Ian Robertson]

You're absolutely right. We're a not-for-profit organization. What that means is that we do not have any ongoing access to operating funds from either the federal government or the provincial government, unlike other Canadian port authorities, such as Vancouver, Nanaimo, Port Alberni, and Prince Rupert here on the west coast. It's important that we do everything we can to seek support from the federal government.

I do note, and this is important for the work that you're doing, that about eight to 10 years ago, the federal government did have a shore power program that was available to all ports. I would urge this committee to reconsider making that available to not just Victoria but all ports across the country that would like to utilize the very clean technology that's available in order to put the technology in to allow cruise and other ocean-going vessels to power down while they're in port.

[Laurel Collins, NDP, Victoria, BC]

Thanks for that. I feel like that's a very important recommendation.

Can you talk a bit about the history of how the Greater Victoria Harbour Authority got to the place where it is, where it's not part of the Canada Port Authorities, and also the history of Vancouver, and how they got shore power?

[Ian Robertson]

The Greater Victoria Harbour Authority was created back in 2002 when the federal government of that day divested a number of smaller harbour properties, and that's how we were created. We were established as a not-for-profit organization governed by a number of local agencies.

The governance model is very good, very strong, and it supports local input. However, the downside is that we do not have access to federal funding, unlike other Canadian port authorities across the country.

Vancouver was one of the first ports in Canada to install shore power. That was done in 2010, leading up to the Olympics. That was done based on the program the federal government had at that time, which provided funding for ports to install that technology. We've seen a significant reduction in greenhouse gas emissions in Vancouver. It's our goal in Victoria to mirror that same result.

[Laurel Collins, NDP, Victoria, BC]

Another kind of unique piece of the Greater Victoria Harbour Authority is that you have a number of people on your board representing different stakeholders, including the Songhees and Esquimalt nations.

Can you talk a bit about the importance of having the nations as part of the governance structure of your organization?

[Ian Robertson]

Ever since we were created, we are honoured to have both nations as part of our board governance model, and that allows us to work with them very closely. We were one of the first ports in Canada to assign 1% of our operating revenue toward supporting reconciliation programs for the Esquimalt Nation and the Songhees Nation. We're very proud of that.

What it also means is that we're very mindful of our other stakeholders in order to receive their support. In order for us to continue to support the Songhees Nation and the Esquimalt Nation and the work they're doing, it's important that this technology be employed. About 72% of our revenues come from cruises. It's a very important sector for us, and it allows us to continue our very good work in the local area.

[The Chair, Liberal, Francis Scarpaleggia]

Unfortunately, we'll have to stop there.

We'll start the second round with Mr. McLean, for five minutes.

[Greg McLean, Conservative, Calgary Centre, AB]

Thank you very much, Mr. Chair.

I welcome all the witnesses. Thanks for coming today.

My questions today are for Ms. Vera-Perez.

Thank you so much for the briefing you gave me and my office a couple of weeks ago on hydrogen economy and its importance to our future. I have followed up with a lot of research after our meeting, and I want to ask you a few questions here.

We all know the world is going to demand more power going forward, more energy from all sources, and hydrogen is one of those sources. It's obviously pretty important for us. Leadership, of course, is often in blue hydrogen.

Can you tell me, when you look at our path forward...? Can you talk about green hydrogen, and the actual power consumption required to produce green hydrogen?

[Ivette Vera-Perez]

This is a question that comes up over and over. We're looking at, for example, five gigawatts out of the Newfoundland offshore wind capacity. The Province of Newfoundland has just allowed the production of five gigawatts of offshore wind. That's going to be new, and that would be, in principle, dedicated to hydrogen. I don't have a number right now in terms of gigawatts or tonnes and what that would be equivalent to—