Thank you, Mr. Chair.
Founded in 1891, the Canadian Electricity Association is the voice of Canadian electricity. Every day, CEA members generate, transmit, and distribute electrical energy to industrial, commercial, residential, and institutional customers across Canada. From vertically integrated electric utilities to power marketers, to the manufacturers and suppliers of materials, technology, and services that keep the industry running smoothly, our members ensure that Canadians have safe, reliable, and sustainable electricity service. And Canadians have a high level of confidence that Canada's electricity system will continue to provide electricity when they need it. They are proud of the fact that over 75% of Canada's electricity is generated from non- or low-emitting sources. By comparison, approximately 30% of electricity in the United States is generated from non- or low-emitting sources.
The electricity system is the backbone of our economy. CEA members provide Canadians with some of the most competitively priced electricity in the world. While recently there's been much parliamentary debate about Canada's corporate tax rates, often missing in that discussion is the tremendous competitive advantage that safe, reliable, low-cost electricity continues to provide to Canadian business.
Ensuring that the Canadian economy remains competitive and that Canadians will continue to enjoy a superior quality of life—one that includes a clean environment—requires action by the federal government on electricity sector challenges. The federal government has made an international commitment that Canada will reduce its GHG emissions by 17% from 2005 levels by 2020 and a national objective of generating 90% of its electricity from non- or low-emitting sources by the same year. Achieving these targets and continuing to meet increasing demand for electricity, while simultaneously replacing aging infrastructure, is no small task.
CEA's pre-budget submission proposes three high-level recommendations that, if implemented, will help achieve these goals. The first, amending the renewable energy classes in the Income Tax Act to improve capital cost allowance rates, would facilitate capital upgrades for existing and new transmission infrastructure, which would enable more intermittent renewable energy sources such as wind, solar, hydro, biomass, tidal, and other emerging renewables to flow into the grid.
Our second recommendation relates to energy storage technologies. With the exception of large hydro, most sources of bulk electricity cannot justify the added costs of developing and implementing utility-scale storage technologies to save surplus energy production to fulfill peak periods of demand. In addition to saving otherwise lost power, energy storage technology can provide a cost-effective solution to the widespread integration of the intermittent renewable energy technologies I mentioned a moment ago, such as wind, solar, and tidal.
There are numerous emerging energy storage technologies that have the potential to form a large part of the electricity grid of the future, from the generating station all the way down to the potential for customers to plug in an electric vehicle. CEA proposes the establishment of an energy storage grant program to fund electric utility energy storage pilot projects to assist in bringing these technologies into the mainstream.
Our third recommendation addresses the need for regulatory reform at the federal level, a necessary precursor to building tomorrow's electricity system and enabling more effective operations today. Electricity infrastructure projects and existing facilities are subject to multiple pieces of legislation and regulation falling under the jurisdictions of various agencies and orders of government, each of which may have a different mandate and jurisdictional obligation. At the federal level, these include the Canadian Environmental Assessment Act, the Canadian Environmental Protection Act, the Fisheries Act, the Migratory Birds Convention Act, the Navigable Waters Protection Act, the Nuclear Safety and Control Act, and the Species at Risk Act. This regulatory structure has resulted in unnecessary complexity, increased uncertain or absent timelines for project approvals, and a lack of process clarity for all stakeholders, including project proponents, regulators, and the public. Regulations often overlap and conflict, and there's a lack of a strategic framework or vision for how these regulations should work together to meet Canada's environmental, economic, and social objectives.
Let me be clear. CEA members do not seek the watering down of these acts to evade compliance. They seek regulatory predictability, consistency of application, and, in every instance, positive environmental outcomes. We would welcome the inclusion of changes to the aforementioned acts in budget legislation and would be very pleased to share more detailed recommendations at your request.
On behalf of CEA members, thank you for the opportunity to share our association's view on how electricity can continue to play a central role in an environmentally sustainable, competitive, and prosperous Canadian future.