Thank you very much, Mr. Chair. It's my pleasure to be back before the committee. I think the last time I was here was in June, and I'm very pleased to be here to appear before the committee.
You mentioned Cassie Doyle, the Deputy Minister of Natural Resources Canada. She's been with us for four months now and she's been doing a great job. We've also got Dr. Richard Tobin, who is the assistant deputy minister of the corporate management sector.
With your blessing, I'll try to keep my remarks short, Mr. Chair. I'll touch briefly on a number of issues. I don't need the translation here myself--only if I speak French; then I need the translation to know what I'm saying. I'm going to talk about the Clean Air Act. I'm going to talk about energy efficiency and renewable energy. I'll briefly touch on renewable fuels. I want to briefly mention regulatory reform, science and technology, and forestry. I will conclude with a few comments on income trusts.
I'm looking forward to your questions, so I'll go through these areas briefly. Let me begin with the Clean Air Act, Mr. Chair.
Our government has, as you know, tabled the Clean Air Act, and I want to emphasize that this is a new approach. This is the first time in Canadian history that any federal government has ever undertaken to regulate every single sector, from oil and gas to mining to forestry to the auto sector, on both pollutants and greenhouse gases. We believe this is a new approach. We think it's bold. We think it will have meaningful reductions in both the short and long term, and that's why we've taken this approach. I think it's important that we emphasize this.
I know there has been some discussion about the targets. I know there has been some criticism about the targets, about the fact there was a long-term target. I would like to bring to everyone's attention that in the notice of intent, there are also specific discussions on short-term and long-term targets, and that is worth emphasizing.
Of course we're all aware of the previous government's record. They set a target of 6%. The Commissioner of the Environment was somewhat critical of that because there was no plan attached, and in the 13 years they were in power, greenhouse gas emissions rose by 35% above that target.
But it's time to look forward, not backwards. Canadians want to know what we are going to do, so I want to stress to the committee that our government is consulting with every one of the sectors that I just mentioned. We genuinely believe they have to be part of the solution if this is going to work. We are going to consult with all of them. Consultations are going on now; in fact in one of the sectors, the electricity sector, there's another consultation tonight that I'm involved with after this meeting.
We have to consult with them. They have to be part of the solution. At the end of the day we have to come up with tough short- and medium-term targets, but they have to be realistic, they have to be achievable, and they have to be enforced. That is exactly what we're doing.
I just wanted to stress where we're going on the Clean Air Act. We think it's the right approach for this country. It's something we've never seen before.
There are other ways we are going to tackle the challenges facing our country, Mr. Chair. We all know the amount of energy we use as a country, the effect it is having on our environment, and the effect it is having on greenhouse gas emissions. I've said many times that one of the largest sources of untapped energy in this country is the energy we waste.
We are doing a number of things. In the industrial sector, we now have programs within our department through which we work with these companies and show them ways they can save. In some cases, a one-day workshop has resulted in up to $250,000 in immediate energy savings for some of these companies, so there is some very good work going on.
We've introduced, as part of the Clean Air Act, changes to the Energy Efficiency Act. A number of household items...will be strengthened in the regulations. Some will be brand new; we will regulate them for the first time. There are very inefficient items; we will be able to create significant efficiencies in this area.
Another area the department is looking at, Mr. Chair, is labelling. A lot of us have bought appliances such as refrigerators. We see the energy efficiency rating on these appliances, but quite often when you talk to people, the numbers don't mean a lot. They don't pay attention to them. We're looking at making some changes in this area. We could actually make it very consumer friendly, so people could see immediately, for example, that this appliance would provide $100 in energy savings annually over that appliance.
These are some of the areas we're looking at, but at the end of the day technology is really where we're going to win this battle. There are a number of technologies that are coming on stream, from very small items to very large items. We're very bullish on some of these technologies.
Let me share a few stories with you that you may not have heard. Group IV Semiconductor, a small company here in Ottawa in which we have invested a few million dollars, has taken solid state, not LED, and developed a way to turn it into lighting. The type of lighting they have developed is 95% light and 5% heat. The lights in this room right above us are 95% heat and 5% light. So what we're investing in this small company here in Ottawa will help them bring this to the marketplace and take it to the next stage of commercialization. This small company could actually revolutionize the way we light up North America. Right now, 5% of our total energy electricity consumption in North America is on lighting. So imagine if we could get our lighting to 95% efficiency instead of 5%. It doesn't take much to do the math.
I'm not sure if I've talked about the one-watt challenge. Many of the appliances in our homes, when put in standby mode, take 30 to 40 watts of power. There are technologies available today that can reduce that standby power to one watt. This is an area we're looking at.
So those are just a few items. We'll be very supportive of energy efficiency right across the board, from the consumers to the big companies, if there are ways we can help them. We believe it's in everyone's interest.
Let me now shift my focus to renewable energy. I'm very pleased to say that we are making significant progress. We're seeing wind energy increase at a very good rate in every corner of the country. We think this is very positive. There are lots of examples. I know that Nexen and GW Power Corp. have a 70.5-megawatt power project, and they will begin producing electricity in September. This will provide enough electricity, just from wind, for 25,000 homes. But more importantly, this project's offsets will be 95,000 tonnes of carbon dioxide gases a year, and this is from just one wind farm.
From my conversations with many in the industry, they are approaching the point where they're commercially competitive on their own. So we think there are very exciting opportunities with wind.
As to solar, in August of this year our government supported the Horse Palace at Exhibition Place in Toronto. This is Canada's single largest solar installation. It will generate roughly 120,000 kilowatt hours of electricity, which is enough to power up to 35 homes. Again, it will reduce 115 tonnes of carbon dioxide annually. The really exciting thing about Exhibition Place is that you can go on their website and engage Canadians. You can see in real time how much energy is being created, and at the very same time see the offsets in greenhouse gases.
It's true that solar technology is expensive compared to the other forms of energy, but it's making enormous strides. We have plants right across Canada that are doing things. They're creating solar systems to light up airfields. I know the Kandahar airfield is lit by solar technology from right here in Canada.
I can see a day 15 or 20 years from now when we'll be putting solar systems in new homes, just as we put in heating systems today. I think there are exciting opportunities for solar in the years ahead.
Tidal is another form of renewable energy. I don't know if any members of the committee are aware that the Government of Canada is supporting a project where we actually lowered the first tidal turbine in North America and anchored it to the ocean floor right off the coast of Victoria. That was done last month. This tidal turbine at the Race Rocks research facility will allow them to completely remove the diesel generator in that facility. But more importantly, the people doing this project believe there is a great opportunity to do this on a larger scale.
There is an enormous amount of energy in the ocean, and if we can begin to harness that energy.... Again, these are just other examples of renewable energy. Our government is very keen on this. We'll continue to support it.
Biomass is another area of emerging technology within the renewable sector. So there is a lot of excitement within the renewal energy field.
Let me just briefly touch on the renewable fuels. I know in the past you've heard us say that we're setting a mandate of a 5% ethanol content in fuel right across Canada by 2010. We also believe there is an opportunity to be looking at biodiesel. Again, this will take the equivalent of hundreds of thousands of cars off the road--and their emissions. These are tangible things that the Government of Canada is doing right now that will have a significant impact on the environment.
I should briefly mention, on regulatory reform, that this is an area that I think we need to look at. I've discussed it with my colleagues. It's on the drawing board. Right now, it's taking a long time to get a lot of projects approved through the regulatory approval process in a number of disciplines. I'm working with my colleagues at looking at how we can streamline this regulatory approval process. How can we put in defined timelines? We believe that by doing this you'll get a stronger result at the end of the day. By having a focused regulatory approval process that's very comprehensive, very complete, and by working with the provinces to eliminate overlap, we'll get far better results at the end of the day than by having a more patchwork approach.
There are some exciting things that are happening now. There have been pilot projects between various departments in the federal government, with some very positive results. We still believe there are opportunities to do even more, and that's an area on the radar screen.
Let me touch on science and technology. I said earlier that science and technology will be key. As many people on the committee know, we have a CO2 sequestration facility at Weyburn, Saskatchewan, which our government supports. This technology is evolving at such a pace that we will have the ability to capture the majority of CO2 gases from large final emitters. In the years to come, this technology, we believe, will be key to helping reduce some of these CO2 gases. So this is something we want to invest in, in our research, to ensure that these type of projects go forward.
For example, clean coal technology is another area that has fascinating promise. Right now, they're looking at projects that can eliminate up to 60% of the emissions out of coal-fired generation facilities with the latest technology. Can you imagine if we can develop this technology here in Canada and can deploy it to places like India and China, where they use massive amounts of coal for their energy? If we can do that, we'll do more for the global environment than anybody could possibly imagine. That's why it's critical that we invest in these types of technologies and that we develop them right here in Canada. The benefits would be immeasurable.
On forestry, as everybody on the committee is aware, we've made a commitment of $200 million to combat the pine beetle. I'm happy to update the committee that we're working very closely with the Province of British Columbia on looking at proposals. One thing that the department officials in both governments have agreed on is that we'll work together so that there isn't overlap and we're on one stream on how best to mitigate the infestation, on how we look at economic diversification. These are things we're looking at within the forestry. We also recognize that it is crossing over into Alberta. It is a priority for us to put in the dollars that are required to try to control that spread. That's something that we believe is very important.
We're also investing heavily on the restructuring of the forest industry. Obviously, with the softwood lumber issue behind us with the United States, and the cheques starting to flow now and return to the industry, we think there are some opportunities for the forest sector. We want to be there to support them as they move forward.
Last, Mr. Chair, I think I'd be remiss if I didn't address the issue of income trusts. As you know, this was announced by the Minister of Finance on October 31. It has had an impact on the energy sector, but it's very important that we be straight upfront and forward with this.
We knew BCE and Telus were planning on restructuring their affairs as income trusts, which would have allowed them to avoid paying any corporate taxes at all. That was their sole reason. We also had information that led us to believe that there was such a potential in the financial sector and the energy sector as well, and it really put the government in an untenable situation. So we made a very difficult decision. We decided that it had to be done. There was no other option.
To offset those changes, Mr. Chair, we provided a four-year transition period for those existing income trusts, as you know. We also put forward a proposal to allow pension income splitting and also to raise the age exemption for taxation. These are a few areas in which we want to try to protect the individuals.
Clearly, we were not going to be in a position where we were going to allow the transfer of taxation from corporations to individuals. This was an issue of tax fairness between corporations and individuals. Clearly, we had no other choice but to act, and that is exactly what we did and why we did it.
With that, Mr. Chair, I would welcome questions from the committee members on any matter related to Natural Resources Canada, and I look forward to your questions.
Thank you very much.
