Environment Committee on Sept. 22nd, 2025

[Alison McDermott]

One of the Prime Minister's actions was to remove the carbon price burden on consumers. We feel that it doesn't have an overly significant impact, since their contribution to reducing emissions is only 1% or 2% compared to 2005.

[Patrick Bonin, Bloc, Repentigny, QC]

Can you tell us what that represents in megatonnes?

[Alison McDermott]

I believe it's between eight and 11 megatonnes.

[Megan Nichols]

In terms of the consumer carbon price, I believe it's three megatonnes for the year 2030.

[Alison McDermott]

I think those estimates vary somewhat depending on the model.

[Patrick Bonin, Bloc, Repentigny, QC]

What about zero-emission standards? The coming into force of the zero-emission vehicle regulations, which were scheduled for 2026, has been postponed for manufacturers.

[Megan Nichols]

For the electric vehicle, the impact of the removal of the target in 2026 has not yet been calculated, given that the government has also announced its intent to review that regulation in more detail to make sure that industry will continue to achieve the goals and also that prices for consumers are affordable. We are currently conducting a 60-day review of the full regulation. At the end of that time, once we finalize potential changes, we will be able to assess the full impact of all changes, including the removal of the 2026 target.

[Patrick Bonin, Bloc, Repentigny, QC]

Mr. Carney has repeatedly refused to reiterate his commitment to meeting the 2030 greenhouse gas emissions reduction target.

To your knowledge, apart from the United States under Mr. Trump, is there any other signatory to the Paris Agreement that would back down on its reduction targets? Does the Paris Agreement allow a country to reduce its emissions reduction targets or ambitions? Would the Canadian Net-Zero Emissions Accountability Act allow Canada to do that?

[Alison McDermott]

International rules were not created to make it easier for countries to back away from their ambitions, but rather to encourage them to increase their ambitions. So we don't really expect nations to scale back their ambitions.

[Patrick Bonin, Bloc, Repentigny, QC]

Do you know of any other signatory to the Paris Agreement, apart from the United States under Mr. Trump, that has backed down on its targets or intends to do so? Does the text of the Paris Agreement allow a signatory country to set less ambitious targets?

[The Chair, Liberal, Angelo Iacono]

Please provide a brief answer.

[Alison McDermott]

[Inaudible—Editor] very much part of the agreement, and there is no contemplation of nations backing away from their objectives.

[The Chair, Liberal, Angelo Iacono]

Thank you.

We now go to Ms. Anstey for five minutes.

[Carol Anstey, Conservative, Long Range Mountains, NL]

Thank you, Chair, and thank you to the witnesses for being here today.

I'd like to ask some questions about an industry that is extremely important to the province that I come from, Newfoundland and Labrador, and that's the offshore oil and gas sector.

Given that we have a new government with new objectives, I want to discuss more specifically not only how this sector relates to trade diversification but also, within that context, the impact that the emissions cap has on investor certainty.

First, given the Prime Minister's clear mandate to diversify Canada's trade and the fact that offshore oil in Newfoundland and Labrador is one of the few resources with direct access to tidewater, I'm curious to know whether the witnesses might agree or disagree that this sector could be an important part of the Prime Minister's mandate.

[Megan Nichols]

I can start, and if my colleague wants to add....

Certainly, the government has recognized the importance of Canada's leveraging its energy resources to be an energy superpower in both conventional and clean energies and is committed to leveraging that advantage that we have.

In terms of the emissions cap, which you mentioned, indeed, draft regulations for that were published back in fall 2024. We received significant feedback from provinces, territories and stakeholders on this proposal, so we are considering the way forward based on all of that. Certainly, the cap is not meant to be a cap on production; it's only meant to be a cap on emissions. The draft regulations were carefully designed to ensure that they would not have a significant impact on the potential growth of the sector.

[Carol Anstey, Conservative, Long Range Mountains, NL]

Thank you.

It's interesting that you point out that it's not a cap on production, because industry reports a 60% drop in offshore capital spending since 2016 and zero exploration wells in 2025. It's interesting that you would say there's no cap on production when we're currently seeing that there is a big drop. I'm curious to know how you square that with the regulatory framework. I'm wondering what your position is with respect to this potentially causing a negative impact on that industry.

[Megan Nichols]

I can really only speak to the Environment Canada role, which is really limited to that regulatory function. I can't speak to what other factors might be affecting investment in the offshore sector.

Again, I would just say that we did receive significant feedback from provinces and from industry and are taking that into consideration in determining the way forward on this particular proposal.

[Alison McDermott]

Yes, and keep in mind that the cap is not in place at this point in time.

[Carol Anstey, Conservative, Long Range Mountains, NL]

Just on this point once again, other offshore jurisdictions like Norway and Brazil are attracting billions in new investment. The government now has introduced this new legislation, Bill C-5, the national projects list, which, in our understanding of it all, is clearly designed to streamline major infrastructure projects and to reduce the regulatory burden.

Can you acknowledge that this legislation was intended to address the regulatory hurdles that currently are driving this investment from places like Newfoundland and Labrador to other areas such as Norway and Brazil? What's your position on that?

[The Chair, Liberal, Angelo Iacono]

You have one minute to go.

[Megan Nichols]

I can't speak to the extent to which any changes in investment patterns may be directly due to a regulatory suite, but certainly Bill C-5 is intended to streamline regulatory processes so that rather than a project having to seek approvals from many departments, they are combined in one document and provided up front, subject to conditions that then would be enforced by individual departments.

[Carol Anstey, Conservative, Long Range Mountains, NL]

Given that it's streamlined, then, it would acknowledge that up until this point, the regulatory burden would have caused delays and bottlenecks.

[Megan Nichols]

I can't pronounce on that cause and effect.

[Carol Anstey, Conservative, Long Range Mountains, NL]

Currently, there are media reports—and the industry is watching this very closely—that there might be some walking back on the proposed oil and gas emissions cap and that it might be replaced with some investment-based measures. Do you feel that this policy that you referred to earlier would have been an effective policy? Can you speak to that, given that we're hearing some rumblings that they may be walking back on this?

[The Chair, Liberal, Angelo Iacono]

Thank you. We will have a short answer, please.