Fisheries Committee on Nov. 17th, 2011

[Dr. Andrew Wright]

I would be delighted to. I've actually walked Peter through our discussions and we have spent time going over his paper. I wouldn't say they're discrepancies. I think it's an area of focus.

Our electricity in British Columbia is largely fossil fuel-free: it comes from hydro dams. The work that Peter Tyedmers did was specifically focused on central Canada, where the energy is predominantly coal-powered, so that was a huge discrepancy straight out of the gate.

The other area that he did not account for.... It's not really a case of accounting for, as we both accounted for it similarly, but we're doing it now in the context of British Columbia. That makes a very important difference. Our numbers are pretty much the same in terms of utilization of various factors, whether it be tugs to move barges of feed or whether it be trucks. We all come out as a wash there. It's just the hydro component that makes a big difference.

The other factor that was not and has not yet been accurately accounted for--and I want to stress that it's not accurately being accounted for--is that we have no data on how much of the benthic fouling does methane off-gases. That is really important. If we argue from a societal perspective, we should be making decisions from a scientific, fact-based perspective, where we get the details and make the right decision. We don't yet have the data to clarify.

What I can tell you is that if you don't account for methane off-gassing, net pens and land-based farms are equivalent in their GHG footprint. If there is even just 10% of off-gassing from the benthic fouling, there is a revenue stream from the Pacific Carbon Trust to be had to facilitate the transition from net pens to closed containment. I think that's a very exciting opportunity. We just need to be able to audit the exact improvement.

[Jonathan Tremblay, NDP, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Thank you.

Let's stick with your analysis and the energy cost. In your analysis, Dr. Wright, you say that even if we don't consider the emissions created from the waste stream, land-based closed-containment aquaculture still produces less GHG emissions than open-net aquaculture facilities. As closed-containment aquaculture facilities have higher energy needs, I would like to know why they still produce less GHG emissions than open-net facilities.

[Dr. Andrew Wright]

Let me be very clear. The land-based farms are significantly lower in GHGs and energy consumption.

Net-pen farms are not free. They run generators to run the lighting systems that illuminate the nets for photoperiod manipulation. They run generators to blow feed into the nets, and they run generators to support the services of the residential areas on the farms. They're all diesel-powered, low-efficiency generators in the middle of nowhere.

We, on the land-based side, will be using hydro, which is GHG-free. Only 5% of electricity in British Columbia is produced from fossil fuel. It is 95% dam hydro power. When you do a fair, accurate audit of a closed-containment farm in British Columbia versus a net-pen farm in the Broughton Archipelago, using the comparative analysis work that we showed, the farms have identical...with 200 metric tonnes in the favour of land-based, not including methane production. If you include methane production from the ocean floor, then the net-pen becomes appropriately worse, by the amount that you would apportion to being methane off-gas.

Let me be very clear. Using modern technology with a modern design, land-based farms have a lower footprint, period. How much lower needs to be accurately assessed.

[The Vice-Chair, NDP, Fin Donnelly]

Thank you.

Mr. Sopuck.

[Robert Sopuck, Conservative, Dauphin—Swan River—Marquette, MB]

Thank you, Mr. Chairman.

I have a comment regarding the rural issue. While closed-containment aquaculture will likely remain a rural enterprise, I think you will definitely see a migration--if it went far enough--to other rural areas that have lower hydroelectric costs. Indeed, I was just informed that in Montana, two Hutterite colonies are already using closed containment to raise coho stocks. Where I come from in Manitoba, we have the lowest hydroelectric rates in North America. Once closed containment becomes really viable and if it were ever mandated, I think you would see a migration away from coastal communities.

Regarding the comment about production via closed containment for a niche market, there is the notion that you will be getting higher prices for this niche product, as my colleague Mr. Kamp called it, based on a report. What you're basically doing with closed containment is producing a luxury item for high-income consumers. Is that correct?

[Dr. Andrew Wright]

That is where we will essentially start our business so that we're profitable from the beginning.

There's also another market pressure. Again, I encourage you to call Kelly Roebuck, from Living Oceans, who studied the marketing perspectives deeply. By 2015, market pressure will be demanding that the Safeways of the world.... In fact, Safeway has committed to removing Atlantic salmon, as currently produced, from their shelves. We have another pressure point on the industry that is forcing the change to a higher standard of production. I think that is a global initiative. I think you will see that, sir, become ubiquitous.

Again, we can get ahead of the curve by moving to closed containment earlier rather than later, because we'll begin to command more of that end market as that market shift rolls through.

But please don't take my testimony here too accurately; I believe that to be the case. I know Kelly Roebuck to be the market expert, and perhaps David might have a--

[Robert Sopuck, Conservative, Dauphin—Swan River—Marquette, MB]

I would just like to continue. My time is very limited and I have a number of areas I'd like to cover.

In terms of calling people up, my recommendation is that you call up low-income people and ask them how they feel about higher food prices.

Regarding the issue of workers, net-pen aquaculture generates some 6,000 full-time jobs in coastal communities right now.

Mr. Lane, you made the comment about how inconvenient it must be for workers to travel to these remote sites, stay for a week, and then go back home. Have you spoken to any workers who are dissatisfied with that? Have you asked them why they chose that way of life?

[David Lane]

Those jobs certainly are creating employment right now in coastal communities, but I certainly have talked to people who would prefer to live in their own community and go home every night to their families.

It's not one or the other. What we're saying is that it could be produced on land, have more jobs than what there is currently for the same amount of production, and perhaps be better for communities and families.

[Robert Sopuck, Conservative, Dauphin—Swan River—Marquette, MB]

Well, again, that's a presumption, and I need to see data before I'll accept that.

Given that off the coast of British Columbia net-pen aquaculture has been going on for between 20 and 25 years, Mr. Lane, you made the comment—and I'm paraphrasing—that all scientific studies that have been done show an effect on wild stocks. You made the other point that when escapes happen, they--quote, unquote--breed and take over. Can you substantiate both those claims?

[David Lane]

What I was saying was about the weight of evidence of the science. There has always been quite a controversy on the B.C. coast with regard to the scientific studies, but when you look at the vast majority of studies--those looking at the impact of sea lice in particular, which has been most studied, while disease has had very little study--the weight of evidence to date shows that when there are more sea lice on farms, there are more sea lice on wild juvenile salmon. Small salmon are very susceptible to the effects of both pests and disease. That has been the big concern.

As far as escapes go, the evidence is not there at the moment to show that there is a major impact on wild streams; it's just that the escapes have happened and farmed salmon have gotten into streams.

[Robert Sopuck, Conservative, Dauphin—Swan River—Marquette, MB]

So your “breed and take over” statement is a bit of hyperbole.

[The Vice-Chair, NDP, Fin Donnelly]

Thank you. We've reached five minutes.

Ms. Murray.

[Joyce Murray, Liberal, Vancouver Quadra, BC]

Thank you, Mr. Chair.

I want to make a comment in this debate about the impact of the waste from salmon production on benthic organisms. It's certainly not my understanding that the impact on the benthic is a net positive just because there are more prawns. In fact, the industry has done a very good job of reducing the waste falling onto the benthic.

That was big, and it was due to a provincial regulation requiring that. That regulation was needed because some of the areas were being permanently damaged. There was essentially no life on the seabed floor in places where there was too much waste falling in areas that didn't have a strong current. This is something the industry has been working to manage over the last 10 years. They've been cooperating with the regulations of the provincial governments. That's just a note that this should not be dismissed as one of the costs, one of the prices, and one of the risk factors of net-pen salmon farming.

I'm interested in what you see as a potential transition towards land-based farming that would include the current investors and the companies producing salmon through open-net pen. I think that the British Columbians who have those 6,000 jobs, the business community, and certainly all of us who are interested in the economy of British Columbia are not looking to put out of business companies that are doing their best to manage, mitigate, and limit negative impacts.

At the same time, there are some factors that aren't priced in yet, and it looks as though an industry is developing that is going to show a real positive alternative.

Dr. Wright, you were saying that we need to get on this to have first-mover advantage, so how far behind are we now? What are you suggesting the government do to assist with the transition to a lower-risk means of raising our salmon in a way that can still be economically viable? How does one do that without subsidizing individual businesses? Also, have you thought to the next step about what you would be advising provincial and federal governments to have in terms of a regime in order to have a win-win transition?

[David Lane]

I could start with that.

First of all, most of the closed containment developers to date have been smaller companies that are not part of the traditional net-pen industry. We were very pleased to see that Marine Harvest Canada took a different route and did a full engineering study of a potential closed containment farm that they are considering. They don't have the financial arrangements to pursue that at the moment, but they're hoping with some change in the price of fish that it might be a possibility. We were very pleased to see the largest net-pen operator wanting to pursue this as an option.

As for what we believe the government could be doing, there are two good federal government programs that have been of assistance to a number of the closed containment developers that are moving forward with their plans. I think access to capital is a problem, so some kind of a loan program in addition to that would be helpful for those that are starting out and aren't huge companies.

[Dr. Andrew Wright]

I also think you could get very creative around a five-year migration window, for instance, from net-pen to on-land industry. I think you could be creative about how you use the first few farms, because instead of growing your smolts to 100 or 200 grams and placing them in the ocean, one closed-containment farm could grow the same amount of fish to just a simple one-kilogram mark, and then stock the farms in the ocean. This would allow big fallow windows during the out-migration of the wild salmon.

So you could get very clever about how you use your first investments to ease the pressure on the wild salmon and develop the technology to a cookie-cutter level, where your costs are one-half of what they are today, as you slowly scale towards moving this industry from the ocean to land. I don't know how we'd get it going, but perhaps an all-stakeholder, brainstorming, creative session with legislative recommendations coming out of this that all parties could buy into in terms of a solution process....

[Joyce Murray, Liberal, Vancouver Quadra, BC]

Thank you.

Dr. Wright, you talked about the 'Namgis partnership, where the land was free. Is that inherent in your costing model that there is not capital and there is not a mortgage to pay for land? If so, does that make it inherently a partnership with first nations? I know that many of the jobs in the industry now are first nations jobs in remote areas, and it's very important to those communities. I'm wondering if that's the model you're envisioning.

[The Vice-Chair, NDP, Fin Donnelly]

A very brief answer, please.

[Dr. Andrew Wright]

No, it's not. We did cost the price of land and we also have the luxury that hasn't been explored here. In British Columbia we have a huge amount of crown land that is available for low-lease consideration.

The former deputy minister for agriculture and lands in British Columbia said they would be delighted to facilitate that discussion. It is a huge national asset that we can put to work, just like we put forest tenures to work.

[The Vice-Chair, NDP, Fin Donnelly]

Thank you.

Ms. Doré Lefebvre.

[Rosane Doré Lefebvre, NDP, Alfred-Pellan, QC]

Thank you very much, Mr. Chair.

Right now, in Canada and around the world, many fish farms use open-net facilities to produce fish. Very few of them use closed-containment facilities during all phases of production.

In your opinion, what is currently the most important obstacle to the development and the implementation on a larger scale of close-containment technologies for salmon farming?

[David Lane]

I will give one answer first and then pass it to Andy.

In fact, land-based aquaculture is a huge industry around the world right now, but it has only newly moved to the opportunities with salmon. There are other species—tilapia and barramundi are examples—that have been well developed and are in huge production around the world.

What we're testing out now is salmon. Technically, it works very well. Salmon are grown in closed containment on land and, in the first part of their life stage, in hatcheries, so there's nothing new there. What's new is making sure that with the current price of salmon and the markets this all fits together. It may take a few years for that to develop in a way that gives a full opportunity.

[Dr. Andrew Wright]

From a hardcore engineering perspective, I would say the barrier to entry at the moment is true lack of knowledge of how to build these farms. One of the things I'm proud about in the 'Namgis project is that the package of information we're going to develop—all of the intellectual property, the knowledge of how to do this—is going to be made open and transparent, so that any community in British Columbia, or in the world, for that matter, can come and take our knowledge and cookie-cutter their own farm. There's a lack of knowledge and there's a dogma around the notion that it can't be done.

[Rosane Doré Lefebvre, NDP, Alfred-Pellan, QC]

Thank you very much.

In the past decades, wild salmon stocks in the Atlantic have declined by more than 75%, from 1.8 million in 1973 to 418,000 in 2001. This is a huge decline, by all means.

In your opinion, what is the most important thing the government could do to protect wild salmon?

[David Lane]

That's a complicated question, because there are multiple reasons for the decline. But if I were to list them.... I'm sorry that I don't know them beyond the British Columbia circumstances, but here it's a matter of protecting our wild salmon streams from agriculture and logging near streamsides. It's a matter of ensuring there aren't major pollution sources that are detrimental to wild juvenile salmon. It's about making sure that fisheries are sustainable: commercial fisheries, recreational fisheries, and first nations fisheries. Finally, it's a matter of making sure that there aren't impacts from salmon farms in the British Columbia context.

I wish I had answers for the east coast, but that's not my experience.

[Dr. Andrew Wright]

I would counsel you to look carefully at the Cohen commission. This has been a very difficult area and it is probably inappropriate for me to weigh in on it, but Judge Cohen has done a very thorough job of looking at all the aspects, and at all the disease impacts in particular. I suspect that the outcome of the commission will be very important to watch.