Government Operations Committee on Feb. 4th, 2019

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

You mentioned your program BOMA BEST. Is that for new builds or just for existing builds with the retrofit? Please elaborate on that program a bit for us.

[Hazel Sutton]

It's only for existing buildings. We don't have any new building components. It's really just for a building that has been in operation for more than 12 months. We want to see how it's actually performing. Is it doing what it's supposed to be doing? Are the people aware of the programs? Are the management programs there to support it? It's really just for operations and management.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Does your organization have a similar program for new builds?

[Hazel Sutton]

No, but there are other organizations that have similar programs.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Like the LEED.... We're all familiar with LEED.

Is it similar to that, but for existing buildings?

[Hazel Sutton]

Exactly.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Thank you for clearing that up.

While I have you here, I'm just going to ask if you're familiar with the term “green lease clauses”, and if so, whether you can elaborate on that. Is there any value to that, and what should we in government know about those clauses?

[Hazel Sutton]

Absolutely.

With green lease clauses, we have specific questions that encourage our users to put them in place as well. It's a very good way to encourage communication and sharing between the tenant and the landlord.

There are a lot of building types—light industrial, for example—where it's very hard for the landlord to get access to energy and water data, because the tenant may feel a little private about that and not want to share it. If you put in place a green lease that specifies that there will be sharing to help the building manager achieve the green building targets, then it facilitates that conversation. The building manager would want to identify what the priorities are, and then make sure they're in the green lease so the tenants have to comply. It increases that communication.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Thank you for elaborating on that.

Ms. Giroux-Schmidt, the energy services acquisition program, which we're discussing today.... As the government shifts toward more carbon-neutral fuel sources, you must have many recommendations regarding that shift that you haven't discussed today.

Should renewable electricity be purchased on site or are there more appropriate ways to do that? Do you think that's an important priority for the Government of Canada?

[Colleen Giroux-Schmidt]

If it can be on site, that's great, but one of the things we would encourage you to look at is aggregating the demand. Perhaps you're going to procure from a project from an indigenous community that doesn't have access to any other economic development but might have a renewable energy program. Being a little more strategic with where you're procuring from allows you to also unlock some of that economic development opportunity. If it's just focused on the individual demands of each individual building, there's never going to be enough power to enable one of these projects to go ahead.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Walk me through how that might work in a practical sense. Part of the cost of energy, of course, is getting energy to the user. What analysis would need to be done to see whether that would be appropriate?

[Colleen Giroux-Schmidt]

There are a couple of options.

As a customer of the utility in the jurisdiction that it's in, the government could be working with that utility to ensure that they're procuring from those indigenous partnered projects.

Another option or tool that's in the marketplace right now is something called a renewable energy credit, or REC. That's used in a lot of places to enable projects being built somewhere different from where the end user is. Corporate PPAs, or virtual PPAs, is another term that's increasingly coming up. That's what you see a Microsoft or an Ikea doing when they say they've procured 100% renewable electricity. Often, it's not right next to where their facilities are. They're procuring it somewhere else in the world but through that virtual PPA they are able to have it connect to them.

There are a lot of different tools out there now. We think there are opportunities to tweak those existing tools to favour indigenous-partner projects here in our country.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

I'm out of time. I'm sorry about that.

Thanks, Mr. Chair.

[The Chair, Conservative, Tom Lukiwski]

We'll now go to our five-minute rounds.

We will start with Mr. Deltell.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Thank you so much, Mr. Chair.

It's a real pleasure for me to talk to you today.

First, I want to pay a serious and sincere tribute to Michael Ferguson. I was terribly moved by the news of his death. I didn't know that he was sick, which shows how he remained professional until the end of his life. He was a decent and honest man with integrity. He became bilingual past the normal age for becoming bilingual, which shows that we can always achieve this great Canadian goal. I want to express my condolences to Mr. Ferguson's family and loved ones.

I want to welcome everyone to your House of Commons.

My topic today is the wind turbine. As we know, if we want to look at new ways of producing energy, wind turbines are one of them. In Quebec, we've had a great experience with this and there has been movement during the last few years.

I remember quite well that when I was a member of the National Assembly in 2014, I was a strong advocate of making good use of public money. This is why I was very upset to realize that wind turbine energy costs three times as much as hydroelectricity in Quebec.

I used to say all the time that if it cost three times as much, it cost three times too much. That was in 2014. The situation has improved in Quebec, but not in a very convincing way.

Last August, Quebec's auditor general concluded that it wasn't cost-effective in Quebec to produce electricity using wind turbines.

There was also a major project proposed in Quebec by an indigenous community, with the support of a private company. Last August, the president of Hydro-Québec announced that, according to the Crown corporation's findings, wind energy, and specifically this project, could generate losses of $2 billion. As a result, Mr. Legault, the recently elected premier, stated on November 29, 2018, in Wendake, which happens to be in my constituency, that he wouldn't proceed as long as Hydro-Québec had surplus energy.

I have a question for Ms. Giroux-Schmidt, from Innergex. It should be mentioned that this company is heavily involved in wind energy in Quebec and is successful in that field. I want to acknowledge the company's recent major investment of $630 million in August to purchase five wind farms.

My question is very simple. Are we able to produce electricity from wind energy without costing taxpayers any money?

[Colleen Giroux-Schmidt]

I have a couple of comments on that.

The costs of wind have continued to fall dramatically over the last decade, and we're still seeing costs fall today. Recent competitive procurement processes in Alberta and Saskatchewan have seen wind come in around $3, so it is continuing to fall.

That being said, we need to look at each individual region of this country. There are going to be certain technologies that are stronger than others. Quebec, British Columbia and Manitoba are blessed with historic hydroelectric investments, so the existing power system there is a very low-cost electricity product.

I want to comment on your reference to taxpayers, because something that gets missed sometimes in the discussion about electricity and energy is ratepayers versus taxpayers. We tend to make our decisions and considerations of which energy source to use based on ratepayers, but the cost of inaction on climate and the consequence of what we're seeing with climate disruption is borne by taxpayers.

Another lens to this is the benefit that may accrue to an indigenous community through their involvement in a project. It's not necessarily something that's going to show up in the ratepayer context. I would encourage all of us to start to look a little more broadly when we look at the costs and benefits of these projects, and consider those broader taxpayer benefits in addition to ratepayer impacts.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

In your opinion, what should be the ratio between the losses incurred by taxpayers and the gains that you just mentioned?

[Colleen Giroux-Schmidt]

Unfortunately, I'm not in public office. It's a difficult one to start to grapple with, and it's not easy to say what that value is to taxpayers. It's a challenge, but collectively we need to start looking a little more broadly at some of these choices. In the Quebec example, there was tremendous regional economic development for the people of the Gaspésie through the build-out of wind over the last decade. In that example, there was a lot of value to those taxpayers as well.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Thank you, Ms. Giroux-Schmidt, for highlighting the fact that it's not easy to calculate the effort required of taxpayers in relation to potential gains in terms of local job creation or climate action.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

Next is Madam Murray, for five minutes, please.

[Joyce Murray, Liberal, Vancouver Quadra, BC]

Thank you very much, Mr. Chair.

Thank you to the witnesses.

I'm going to take this up a level in terms of the concept of greening government. One of the purposes of launching the centre for greening government was to have the federal government's activities towards meeting climate goals—through the federal buildings and fleets and other emissions—become a bit of a driver for the green economy, for innovation, and for a clean energy economy much more broadly.

I've had conversations with people in those sectors where, for example, the representative of a very major landlord of office buildings here in Ottawa said, “You know, it's great that government is doing this, because we're ready to be partners, but the market is really not demanding that we do the things we could be doing.” I've had the same conversation with a huge construction firm and other national construction firms, who are saying, “We're ready, but our customers are not necessarily demanding that we do the much more efficient and green projects. Government driving this will help.”

I am interested in what we need to understand as a government so that we can really leverage the work we're doing to stimulate these kinds of innovations, materials development and process improvements more broadly in the Canadian economy so we can become a real leader in that and export those goods and services.

Maybe BOMA could start with thoughts on that.

[Hazel Sutton]

It's interesting because there's always this understanding that perhaps to build a building well, to be efficient, is going to cost more up front, but eventually there will be operational savings and it will cost significantly less over the long run during the operations of that building. There is oftentimes a disconnect between whose incentives are deciding how the building will be built: It's not necessarily the same people who will be paying the operational costs and who will be paying for the building to be built. We need to make sure there is an ultimate alignment with the savings that are borne by whoever is actually having to pay for the operations of the building, and that this person is involved as well during the discussion of building the building. That could help align the two.

The other aspect would be training and education. Certainly, we are constantly trying to make sure that individuals understand the benefits of a well-run building, because it's more comfortable and you save money ultimately, so education is definitely important in that respect.

Mr. Wayland also mentioned training the people who would actually be doing the work. Getting this new green workforce up and running and understanding that their contributions are valuable to us, so that they can become the experts on how to build and operate these buildings, will be valuable to the country in the long run.

[Joyce Murray, Liberal, Vancouver Quadra, BC]

Does anybody else want to weigh in on advice to government as to how we can leverage up into the broader economy by being a test bed for innovation or first users of new technologies, and creating economies of scale for inventors? Are there areas we should be aware of where we can maximize our impact?

[The Chair, Conservative, Tom Lukiwski]

Mr. Silas.

[Alex Silas]

I'd say, listen to the public workers, the public servants and the on-the-ground experts. You heard earlier how my colleague, Paul, came up right away with a way to cool more efficiently: take the water from the Ottawa River; stop running coolers. We have these on-the-ground experts who not only are more knowledgeable than anyone else could possibly be about these plants, but who also care about these workplaces.