Great. Thank you.
My name is Mark Rudolph, and I'm the coordinator for the Clean Air Renewable Energy Coalition.
With me is Tim Weis, the director of renewable energy and energy efficiency at the Pembina Institute.
In the interests of time, I'm going to skip through the slides, especially the first two, just to point out a few quick things.
We're pleased to be here today, obviously. The coalition itself has been around for almost nine years. It was co-founded, interestingly, by Suncor Energy Inc. and the Pembina Institute. Indeed, we're made up of 17 different corporations and six environment organizations. As you can see from the slide that shows all the members, we're not your usual coalition, and frankly, we're quite proud of it.
Let me just jump into the meat of the matter here. For decades this country has invested, and invested heavily, in emerging technologies and specifically in emerging energy technologies. Since 2001, the federal government has had a number of support programs for the renewable power industry, and the current program, known as ecoEnergy for Renewable Power, ostensibly is almost dead. It probably will run out some time in late November or early December. At the moment, there is no commitment as to what is next, which is why we're here today.
We have two recommendations. One relates to expanding and extending the existing ecoEnergy program to support the deployment of an additional 8,000 megawatts of power. The current program that was announced by the Prime Minister and the former Minister of Natural Resources Canada, Minister Lunn, in late January of 2007, supported 4,000 megawatts, while in essence we're asking for an additional 8,000 megawatts of support.
The total cost over the four years when you would apply is $600 million, but at the same time we're looking at an investment by the private sector of approximately $7 billion—we're looking basically at a 10:1 ratio. Over the entire 14-year timeframe of the program, the total cost to the federal government would be $2.9 billion. That's at 1¢ per kilowatt hour.
People in the room should know that the U.S. tax credit program offers three times that amount. If you're looking at where to get the best return on the investment, there should be a flight of capital to the U.S., and indeed we're already beginning to see that.
Our second preferred option basically takes what is a 10-year program, or an operation-and-maintenance type of program, flow of money, and puts it all together. If you were to get, let's say, $70 million, you would get the net present value of that amount as an upfront capital grant. This we see as a program that would only run for four years, until 2014, and would cost the federal government approximately $1.8 billion. It's not at all dissimilar from the fact that in the U.S. recently they've taken their production tax credit and are allowing 30% of the money flow to be a capital grant as well.
There is, and probably will be in the not-too-distant future, a lot of talk about carbon offsets and carbon credits. We see that carbon offsets in no way, shape, or form are a substitute for the federal government providing some form of support, as it has in the past.
Last but not least is sort of the whole question as to why we'd like to see this. For many, many years, we've come to this committee and presented. For many, many years, the committee has listened to us and passed on recommendations to the finance minister of the day. The original program started in 2001, with a couple of other programs in 2005, and another one that came about in 2007. Indeed, we've always argued for the fact that we're trying to build an industry. What we've seen is that things have indeed started to take off, but with the demise of the ecoEnergy for Renewable Power program, we'd prefer not to see them crash and burn.
At the moment, the program will be fully allocated literally within a month, which is one and a half years earlier than had been expected. The U.S. government under the Obama administration has taken some very decisive measures. Indeed, they're outspending us 14:1 on a per capita basis. Basically because of that, we're seeing a situation where, at the end of the day, money goes where money should go based on return on investment. We're seeing a flow of money.
There is no certainty left for the industry in this regard. To that end, we are calling for a renewed and intensified commitment by the federal government to adopt one of these two options for the future.
Thank you kindly.