Finance Committee on Oct. 5th, 2016

[John Hopkins]

Our view is this. What we need, first and foremost, is an economy that is moving straight ahead and gaining momentum. We need to develop a plan to deal with carbon. I'm not saying we don't. There is no climate change denier here, but the way we should fund our climate change agenda is through an economy that's moving. We should take revenue from whatever it is, perhaps the economy itself in general, and develop these centres of excellence across the country.

[Steven MacKinnon, Liberal, Gatineau, QC]

Would it not be within the purview, for example, of the Government of Nova Scotia to take the revenues that would be derived from a taxation plan on carbon pollution, or the Government of Saskatchewan to take the revenues garnered in-province from a similar system, and devote those revenues to the kinds of things you are proposing?

[John Hopkins]

I hear exactly what you're saying, and I come at it a little differently. Our view would be that we need to become centres of excellence, and not just for the country. That's not the point, as far as we're concerned. Our point would be that things like clean coal, which have global impacts, need to be our focus, because we generate 1.6% or 2% of emissions.

What we really need to do.... I'm glad you asked this question. I saw the technology yesterday, where they're working in Beijing and taking the carbon from the atmosphere there and turning it into diamonds, of all things. It's unbelievable. It's hard to know if it's true, or not true, because it seems too good to be true. My research didn't land me where I found out how much that costs, and I'm not sure. Usually those things are too good to be true, but to go back to the point, we think we should develop these centres of excellence to have an impact globally, as opposed to just focusing provincially and, a lot of times, just locally.

[Steven MacKinnon, Liberal, Gatineau, QC]

What would limit such efforts to Saskatchewan only, or Canada only? Could the Government of Saskatchewan not choose to take some portion, or all, or some part of those revenues and devote them to becoming a global leader in CCFs, in diamonds from carbon, in solar, whatever. Would you support that?

[John Hopkins]

We could. Right now, without any carbon tax, I would say we are a leader locally on clean coal.

[The Chair, Liberal, Wayne Easter]

Is that it?

[Steven MacKinnon, Liberal, Gatineau, QC]

We could probably continue because it's a very—

[The Chair, Liberal, Wayne Easter]

All right, we don't want to go down this road too much further.

I have a couple of questions before we adjourn.

Kyle, in your presentation, in recommendation 5, there is one point I really don't understand. It says that the continuation of the maximum revenue entitlement, which is commonly known as the revenue cap, for the two railways is critical to prairie agriculture. It also says that the MRE must include any expansion of interswitching distances. Can you explain the latter sentence?

[Kyle Korneychuk]

Yes, I'll try. There are a few places in Saskatchewan and Alberta, and I believe two places in Manitoba, where you can go from one railway to another, but you have to traverse the other province's railway. It's like a capital monopoly, but the railways didn't allow it because it's their tracks. We're saying that for any expansion of that, the MRE should also cover it, because if I allow you to come on my railway line, but I charge you 10 times what the rate should be, I've effectively stopped you from doing that.

[The Chair, Liberal, Wayne Easter]

I understand interswitching, but I see your point. The revenue cap has to apply to the interswitch as well.

[Kyle Korneychuk]

Correct.

[The Chair, Liberal, Wayne Easter]

Okay.

On the transportation end, when I used to first come to Saskatchewan, there were a heck of a lot of rail lines. An awful lot of them are gone now. Several of you mentioned transportation. What would be the key recommendation that could be made in transportation that would help economic growth from your point of view, whether it's moving potash, or moving grain, or whatever it might be. What would be the key recommendation?

[Kyle Korneychuk]

The key recommendation from my point of view for grain is that you'd have to clean house at the CTA. The place is too polluted with the railways views. I'll give you a very simple example. We had our little elevator, and we shipped about 25 to 30 cars. We were not big enough to get the railway's attention, and so we got producers in the area together and we said, “Okay we'll do about 1,000 cars”. That's roughly $30 million to $40 million of economic activity. We approached the railways again, and they said, “Yes, now we're interested, but we're not interested in your site. If you move it 100 miles to another spot, then we'll pick them up there.” For us, that wasn't the point. We were trying to keep money in our local communities. When we approached the CTA—I approached two individuals, a man and a woman—the woman didn't have the time of day for me, but the man said, “It sounds like a reasonable compromise to me.”

What people don't understand is that moving grain is not like sending an email. It costs at minimum $5 a tonne to load the grain, and at least $2 to $3 a tonne per mile to move it. It's an expensive adventure, and we're forced to do it because we have no market power. The grain companies and the railways understand that. We move it further for them, and they get the gravy. It's just that simple.

[The Chair, Liberal, Wayne Easter]

Are there any last comments anybody wants to make?

John, and then Stewart.

[John Hopkins]

Our recommendation on the transportation side is to approve the pipelines, and we'll free up some cars.

[The Chair, Liberal, Wayne Easter]

We hear you, it's been said a lot.

Stewart.

[Stewart Wells]

I want to go back to the previous question asked by Ms. O'Connell. I'm a farmer as well. What would you do in agriculture to try to make it more efficient or less carbon intensive? The first thing that Mr. Korneychuk said about rail is that it stands, but farming has become an incredibly energy-intensive business at the moment. The majority of farming and agriculture have been moving that way. Tremendous amounts of fertilizer and herbicides are being used. Huge machinery, which is replacing human resources in most cases, is being manufactured, and farmers are using it. There are a lot of ways that farming could be less energy intensive. Looking at a big picture view, government should be doing some research on that. Federal research stations, such as the ones in Swift Current, Indian Head, and across the country have gone through some really tough times in the last 10 years. They've had libraries destroyed by the previous government, with all sorts of research that had been done in the past decades when farmers were using less energy-intensive types of farming. All that research was very valuable, and there should be attention paid to how to do things better.

For all the discussion about the carbon tax, it's going to open up a lot of space for people to talk about how they should be doing things in energy- intensive industries like farming. There are ways now that farmers can grow legumes crops, for instance, to produce a lot of the nitrogen that they'll need for the following year. There are different production methods that deserve some research and attention.

[The Chair, Liberal, Wayne Easter]

Kyle, you wanted to make one more point, and then we'll adjourn.

[Kyle Korneychuk]

I'd just like to add a small point. There's been a lot of criticism of the railways for not moving the grain in 2013 and 2014. I'd just like to make the point that they moved 18% more grain than the previous year. It wasn't so much a transportation issue. It was a logistical issue where the grain companies couldn't deliver and they decided to gouge. It's in our report, and it's on the web page so you can read it further.

[The Chair, Liberal, Wayne Easter]

Okay. We thank the panel for their presentations.

There are two people registered for the open mike. We will suspend for a minute so we can officially get their names, and then we'll go to their statements.

Thanks to the presenters for this presentation, and all the best.

The meeting is suspended.

[The Chair, Liberal, Wayne Easter]

We'll go to the open mike session. We have two presentations. As you know, you can come up to the mike. We'll start with Ms. Raedeke.

[Anne Raedeke Mackenzie, As an Individual]

I'm Ms. Raedeke, and my fellow presenter is Ms. Aman.

[The Chair, Liberal, Wayne Easter]

Okay Ms. Raedeke and Ms. Aman, go ahead.

Seeing that you're making it jointly, we'll not hold you to just the two minutes. You can go for three or four.

Go ahead, Ms. Aman.

[Maria Aman, As an Individual]

We're here to represent Engineers Without Borders, the Canadian NGO that invests in people and ventures to create a thriving and sustainable world.

[The Chair, Liberal, Wayne Easter]

I'll get you to slow down, or the translators will be coming and be tapping you on the shoulder.