Natural Resources Committee on April 16th, 2007

[Carol Buckley]

Certainly. It's a public study, and I can make it available to the committee.

[Mike Allen]

Thank you, Mr. Chair.

[The Chair, Conservative, Lee Richardson]

Thank you.

That does bring us to the hour we had allocated.

I have two names on the list. If I could ask Mr. Tonks and Mr. Ouellet to be very brief, then we won't bite into the time of the next witness too much.

I'll start with Mr. Tonks. A brief question and a brief answer.

[Alan Tonks, Liberal, York South—Weston, ON]

Mr. Chairman, thanks to the committee for allowing a couple of brief questions.

Along the line of questions of Mr. Bevington, the chart on page 5 graphically illustrates that when we talk about an east-west grid, people have often thought about transcontinental when we're actually talking about regionalized approaches. It seems to me that when you talk about NO_x and SO_x, and you talk about climate change with respect to carbon, the real concern on that chart is the generation mix reflecting the use of coal. I didn't hear any mention of the research and commercialization with respect to gasification of coal and the perspective with respect to that type of initiative. That's my question.

[Tom Wallace]

Some of my colleagues may be more familiar with the technology side and some of the projects on the clean coal side.

Graham, would you like to respond?

[Graham Campbell, Director General, Energy Policy Sector, Department of Natural Resources]

Thank you, Tom.

I'm Graham Campbell. I'm with the Office of Energy Research and Development at Natural Resources Canada.

I believe we're coming back to the committee on May 14 for a discussion on clean coal in general. But, Mr. Tonks, just briefly, gasification is one of the three types of technologies that we would see moving ahead that could potentially offer two or three benefits.

One would be the direct capture of CO₂ from the gasification process. The second is that there are a number of by-products that come from gasification that can be potentially very useful, including hydrogen, by way of example. And there are other by-products that come off as well that might be useful. The overall efficiency of the system when it uses gasification technologies is significantly greater than what we have now with conventional systems.

So you put your finger on one of the main and most promising areas for the future use of coal in a sustainable way. It's encouraging also to note that there are projects happening in Alberta now, one in particular, which is led by a consortium, that will take gasification technologies significantly further ahead, should that project go ahead. So there are some encouraging developments on the private sector side as well, in addition to the research we're doing.

But stay tuned for May 14, when another colleague and I will come back to the committee for a fuller explanation of clean coal technology.

[Alan Tonks, Liberal, York South—Weston, ON]

Thank you. We'll look forward to that, Mr. Chairman.

[The Chair, Conservative, Lee Richardson]

Thank you.

We'll go to Monsieur Ouellet.

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

Thank you, Mr. Chairman.

On page 22, you refer to the reduction in the growth of energy demand. Correct me if I am wrong, but I think that the growth in energy demand in Canada is approximately 1% per year, and that of electricity is much lower.

You refer to a 55% drop in the growth in energy demand. That represents 55% of 0.75%, which is very, very little. We aren't reducing energy consumption, we are only talking about reducing growth in demand.

You are quite timid and reserved insofar as energy savings as a whole are concerned. For instance, you talk about 5% with regard to ventilation and air conditioning and 27% for buildings as a whole.

The Royal Architectural Institute of Canada, which is well known and made up of responsible persons, has just created a program for which it is in fact asking for government support. It takes as a premise that building, are the main producers of greenhouse gases in Canada. The institute wants to see reductions of 50% by 2010, 60% by 2020, 70% by 2030, 90% by 2040 and 100% by 2050. I don't see this reflected here.

The minister announced the construction of ten zero-consumption energy-efficient model homes. He could have announced that they would build 1,000 or 10,000, because homes that consume 50% or even up to 75% less energy have been around for 20 years.

You, the government advisors, seem so timid and reserved to me that we can't seem to make any headway. Why did you ask Marbek Resource Consultants and M.K. Jaccard & Associates, who are very conservative, to print this announcement?

[Carol Buckley]

The numbers on this slide represent not a government analysis but an analysis that was done by highly respected energy researchers and modellers in the economy on behalf of all jurisdictions of Canada, a work group that was looking at demand-side management potential. We didn't give them any instructions to be reserved or timid or aggressive or bold. We simply asked them, to the best of their knowledge, with the best of the information that their models contained and what they expect to see for the future, what the demand potential looks like, and this is what they came up with. So this is not our own projection; this is what somebody out there, totally disinterested, brought back to us. That's point one.

I think what you're having trouble reconciling is the fact that we only see a reduction in demand of half the demand. So it's not taking the demand and reducing it; it's reducing the demand down to half of what it otherwise would have been. You say, “Can't we do better?” The royal architects and others see much more significant reductions possible, and we do too. The federal government has just led an exercise with the provinces to upgrade the model national energy code for buildings by 25%, with the hope, the very strong intent, and the objective that the provinces follow, because it's their jurisdiction, by putting in place building codes that are 25% more efficient than those today. We think that will happen in the very, very near term.

But what's happening is two things. That's building a new building, when you're doing it from the start. Only 2% to 3% of the building stock and the housing stock are new every year, so we have to deal with buildings that are going to have lifespans of 40, 50, or 60 years, and we have to deal with them in 2025. Most of them are already in place today. So then we're talking about retrofit potential, on which, of course, you can do 25% or 35% savings, but it's extremely expensive to do over a large scale of the economy given the number of buildings in Canada. So the study looks at that as well as the fact that it's much easier to do new than when it's existing.

But keep in mind the growth of the economy. If the economy weren't growing at the rate at which it's growing, we wouldn't have an issue. It would be easy to ramp down demand below current levels. There has been a 25% increase in households over the past decade and a half. There are more houses. The population is growing, and the houses are getting bigger as well. There has been a 25% increase in floor space for the commercial/institutional sector. We have a couple of factors working against us when we're trying to reduce demand, so I don't think we're being too timid. I think we're working with some very difficult realities and trying as hard as we can to bring technology and economics to bear to make the reductions that are necessary.

[The Chair, Conservative, Lee Richardson]

Thank you very much, Ms. Buckley.

I think we're going to move on. Thank you for your question, Monsieur Ouellet.

Thank you again, Mr. Wallace, Ms. Buckley, Mr. Campbell, and others, for your participation.

Could I just ask in closing that you would perhaps send to the clerk that Hydro-Québec data? I think it would be useful to our study.

Again, I appreciate your appearance and the excellent deck you prepared. Thanks very much.

I suppose we should suspend for a moment.

[The Chair, Conservative, Lee Richardson]

We are now organized to proceed. I would now like to welcome two familiar faces to the committee: from the Canadian Electricity Association, Hans Konow, who is the president and chief executive officer; and from the Canadian Gas Association, Michael Cleland, president and chief executive officer.

I don't think we have to spend a lot of time explaining to you two gentlemen how we operate. Who is going to begin?

Monsieur Konow. Thank you.

[Hans Konow, President and Chief Executive Officer, Canadian Electricity Association]

Thank you, Mr. Chairman.

Thank you for the invitation.

I will make my remarks in English, and I'd be happy to take questions in either language.

The Canadian Electricity Association is, as many of you know, the national voice of the electricity sector in Canada. Our members represent the full value chain from production through to delivery to the customer.

On behalf of the association's membership, we appreciate the opportunity to meet with the committee and explore how the industry is taking action today to help us meet the challenges of tomorrow.

At the Canadian Electricity Association, we believe electricity is a critical enabler of the economy and of Canadians' expectations for an enhanced quality of life. We share the standing committee's interest in a sustainable electricity future, and our members--the companies that deliver electricity to Canadians--work every day to ensure that we meet that goal.

We are committed to a sustainable, safe, secure, reliable, and competitively priced supply of electricity as being essential to Canada's prosperity tomorrow just as it is today.

Electricity is a vital component of our quality of life and the foundation of a sustainable and thriving economy. Twenty-four hours a day, 365 days of the year, Canadian utilities must plan to match production from generating plants with customer demand, while maintaining reliability, meeting environmental targets, and keeping operating costs low.

The result is a highly complex and developed system that optimizes generation, transmission, and distribution technologies in an effort to provide reliable and competitively priced electricity to meet demanding consumer expectations. The comparative advantage of electricity services in Canada is a key driver that underpins and enables growth in other sectors of the Canadian economy while contributing significantly to Canada's export revenues.

Electric utility programs for energy efficiency in Canada have been emulated in jurisdictions around the world. Nevertheless, there are opportunities for greater action through renewed and accelerated cooperation between governments and industry. Energy efficiency is an effective strategy to help mitigate demand, moderate the impact of rising electricity prices, reduce energy use and emissions, and improve economic competitiveness.

Governments and industry must focus on energy efficiency as a strategic energy policy that is supported by a long-term and sustained commitment to energy efficiency programs and incentives. There is considerable potential for energy efficiency in Canada, and through collaboration between government and industry, action is being taken. However, more needs to be done.

Notwithstanding steady progress through end-use energy efficiency improvements, electricity demand continues to grow, as you heard from the earlier witnesses. Based on the results of a study sponsored jointly last year by CEA, CGA, and NRCan's Office of Energy Efficiency--which, again, was referred to earlier--overall energy demand is expected to grow across all sectors by 22% from 2000 to 2025. This is an annual average growth rate of about .85%.

For the electricity sector, demand is expected to grow on an annual basis of about .75% or three-quarters of a percent in the commercial sector, a little over 1% in the residential sector, and about one-half of one percent in the industrial sector. Other projections that we have from different sources indicate that demand for electricity could be considerably greater.

Concerning energy efficiency potential, the same study that provided an overview of expected consumption trends also looked at the potential for energy efficiency. I believe you must have that data, because it was referred to in the earlier testimony. That was the Marbek and Jaccard study, which found that energy efficiency measures implemented would result in a 3% to 10% reduction in total energy demand by 2025. Of course, the high end of that would represent about a 50% reduction in demand growth.

The growth in housing and building stock, larger homes, market penetration of more energy-using devices in homes and in commercial enterprises, and industrial production growth offsets the effects of energy efficiency improvements.

As an example, a recent study by the Consumer Electronics Association in the United States noted that residential consumer electronics, excluding DTV, accounts for 11% of household electricity use in the U.S. and 4% of total U.S. electricity consumption. Further, in 1975 the average number of consumer electronics devices per U.S. household was 1.3, compared to 25 in 2005.

Electric utilities have successfully delivered programs to help their customers better manage their energy use for over a decade. Utilities continue to enhance their program offerings and increase their funding commitments. Across Canada, to a greater or lesser degree, utilities are augmenting, ramping up, or reconstituting energy efficiency programs.

Utilities have an established relationship with consumers and are an effective delivery channel for programs. In fact, our research has shown that consumers place a high value on receiving information to help them manage their electricity consumption, and further, they look to their electric utility to provide energy efficiency programs and information. For example, to the end of 2005-06, Manitoba Hydro's Power Smart efforts have achieved estimated electricity demand and energy savings of 434 megawatts, and Manitoba Hydro's 2006 Power Smart plan entails a detailed plan to achieve electricity savings of 616 megawatts.

Lighting is responsible for a significant portion of the electricity consumed by buildings: 18,000 gigawatt hours annually of residential electricity in Canada, or 4% of total use, and almost 40,000 gigawatt hours annually, or 14% of total use, for the commercial sector. CEA member companies are partnering with federal and provincial governments, standards bodies, and others to transform the lighting market in Canada to high-efficiency alternatives. Activities include standards, data acquisition, regulation, influencing product design, code changes, and information gathering and deployment to be undertaken on a collective basis.

Toronto Hydro's summer challenge program rewarded eligible customers with a 10% rebate if they used 10% less electricity between July 15 and September 15 based on weather-normalized data from their 2005 electricity bill. During the summer challenge, energy reduction was almost 80 million kilowatt hours, equal to taking 80,000 homes off the electricity grid for an entire month. Greenhouse gas emissions were also significantly reduced, with a CO₂-emissions reduction in Toronto of 43,000 tonnes, equivalent to taking 56,000 cars off the road for two months.

At the conclusion of the summer challenge, 153,000 Toronto Hydro customers, or more than one in four eligible customers, had earned rebates totalling $3.1 million by reaching the 10% target. Interestingly, 51,000 of those customers had succeeded in reducing their electricity use by 25% or more. The average rebate for residential customers was $17. It doesn't sound like much, but you can see what was achieved.

Although progress is being made in reducing the demand for electricity, the take-up on energy efficiency is often lower than expected due to market barriers. These include lack of awareness about energy efficiency opportunities, benefits, and products. There are many simple actions that can yield significant results, and yet CEA research shows that almost 30% of Canadian households do not have even one compact fluorescent light bulb, and 19% of households report that they have not taken any energy efficient actions over the past year. The primary reason for this inaction seems to be that “it won't make a difference”. High first costs for energy efficiency equipment combined with lack of access to appropriate financing is another barrier. The levels of effort and challenge to become informed, select products, choose contractors, and install equipment is yet another.

The individual who pays for the energy efficiency measure may not be the individual who will benefit from it, an example being low-income housing residents or, in other settings, apartment residents who are not responsible for their electricity bills.

Program churn, the turnover of programs, can become confusing to individuals.

Finally, there's a need for improved rates of return on utility investment in energy efficiency programs, especially when programs exceed expectations, i.e., there should be a good business case to be made for energy efficiency.

We have a number of recommendations that we think could help. By addressing these fundamental market barriers, public policy and programs can influence the adoption of greater energy efficiency in the economy.

The first is a long-term and sustained commitment to funding for energy efficiency programs, commensurate with renewable energy and other supply options. The Government of Canada, with provincial, territorial, and utility partners, should ensure that energy efficiency programs are funded on a long-term basis in order to reap the full benefits of these programs.

The second is a greater emphasis on outreach and providing information to Canadians concerning energy efficiency opportunities and benefits.

The third is programs to benefit those who are least able to invest in their own efficiency.

Fourth, the Government of Canada should also establish a federal energy efficiency grant program in order to fund energy efficiency programs. One example of some initiatives to be funded would be support for programs that yield significant energy savings but are not yet cost-effective to deploy on an individual utility or regional basis. There are a number of possibilities there, such as insulation programs and equipment efficiency. There are various regional programs for which a one-size-fits-all national approach may not be appropriate.

The government should also provide additional resources where individual organizations cannot provide incentives and resources of sufficient significance to influence the market or where a national focus on improved energy efficiency is needed to complement regional efforts to significantly increase market impact. For example, programs for low-income Canadians or first nations would fall into this category.

Multi-year support is needed for housing and equipment standards and labelling to reflect the timeframes required to put regulations in place. As you heard earlier, NRCan is working on codes, standards, and labelling, but funding traditionally has been on an annual basis, whereas the process to put codes and standards in place takes many years.

Programs for commercial facilities such as ice rinks and community centres might be a useful target.

Tax incentives, such as a rebate program for residential, commercial, and institutional markets, are required to encourage widespread upgrading to Energy Star appliances, such as dishwashers, stoves, and refrigerators.

In summary, the experience of the Canadian electricity industry in responding to customer needs for energy efficiency information and support has produced significant results, and it promises to deliver more in the future. Canadians look to their energy providers for such support. With appropriate regulatory decisions regarding cost recovery and transparent market signals through the price mechanism, many of the barriers to achieving even better results can be overcome.

Finally, governments have a role in helping to support code and standard development; in raising the performance bar for broad classes of energy-consuming equipment; and in ensuring that social goals are met, particularly with respect to the special needs of low-income Canadians and first nations.

I thank you for the opportunity to share our views. I look forward to your questions.

[The Chair, Conservative, Lee Richardson]

Thank you, Mr. Konow.

Mr. Cleland.

[Michael Cleland, President and Chief Executive Officer, Canadian Gas Association]

Thank you, Mr. Chairman.

I have a short deck that I believe has been distributed to members of the committee, and I was going to use it to speak to you.

Let me start by—

[The Chair, Conservative, Lee Richardson]

If I can just interrupt for a second, I think it was distributed electronically, Mr. Cleland.

I'm noticing a furrowed brow at the end of the table, so if anybody doesn't have that but would like one, I have an extra copy here.

Mr. Bevington would like a copy, along with Monsieur Ouellet, en français.

We are running a little tight on time, which may restrict questions at the end. We can now follow it more carefully, and I'll ask Mr. Cleland to begin.

[Michael Cleland]

Thank you very much.

I'll try to step through this reasonably quickly, because I'm aware of the time.

On page 2, there are a couple of points worth noting.

I want to start by congratulating the committee on your choice of this subject. There's been a lot of time spent in the last year or so looking at the energy production system and industrial energy use and what we do about greenhouse gases in particular. That's important work that needs to be done.

There's another half of the important work that needs to be done, and that's looking at energy in our communities. There are some very good reasons for doing that. One is that it really amounts to about 50% of the energy we use. If we are looking to the kind of fundamental transformation implied by a 60% or 80% reduction in greenhouse gases, one of the things we are going to have to do is completely restructure the way we use energy in those communities, as well as the way we produce it and the way we use it in our industry sector.

The other side of that coin, though, is that there are some very quick gains to be had. The kinds of things we can do in our communities through energy efficiency and other choices can be achieved relatively quickly with a lot of small investments and things we can get on with right now.

Finally, through self-generation--in other words, by improving the energy autonomy of our communities--we can also make very big environmental gains and improve the reliability of the system.

On page 3 I'm talking about some of the things the gas industry has done directly. This, per se, does not relate to electricity, because what we're talking about here is reducing natural gas used directly for hot water and heat, primarily. Like the electricity industry, we have been investing in these sorts of programs, working with our regulators, and indeed, working with Natural Resources Canada as well, and we've made some pretty good progress--about one million tonnes of greenhouse gas equivalent through about $100 million in investment since 1995. That's ramping up steadily, and I think what we're going to see as we move into the future is a significant increase in those numbers. But it's a start.

As Mr. Konow said, one of the things that is important here is the role of the utility as the connection to the customer. We know our customers. We work with them directly, we understand their needs, and we are, if you will, the retail end of energy efficiency programming. Natural Resources Canada is the wholesale end, and we work closely together.

On the next page, “Beyond DSM”--demand side management--“The Integrated Energy System”, there are a couple of points to make. One is that energy forms are not all created equal. Electricity is the highest and most valuable form of energy. We should be using it wisely, and we should be using it where it makes the most sense. Mr. Bevington, I believe you spoke earlier about whether there are places where we're using electricity where we could find other ways of getting those same energy services. I think the answer to that is yes, because electricity demand is going to grow for those high-end applications.

The other three points are simply arguments for why we need to have a more integrated perspective. Energy forms do compete, and they're going to compete more and more in the future, whether that's gas, electric, or on-site renewables. They complement each other. Increasingly, we're going to see hybrids--hybrid electric renewable, hybrid gas renewable--as ways of improving efficiency, improving environmental performance, and improving reliability.

Finally, there is the interconnect, and the most obvious one is the role of natural gas, again, in distributed power generation in combined heat and power applications. For those reasons, it's important to see the whole puzzle in one picture.

The next page, very briefly, highlights residential use. You can see how much is used for space heat and for water. Over half of that space and water heat energy is from electricity. There is an argument that you could significantly improve your energy efficiency simply by using the right fuel in the right place at the right time. That could be natural gas, but over time it will increasingly be on-site-generated renewable.

My point here is that there is a quick win to be had that will take us through the next couple of decades by making the most effective use of our natural gas system in conjunction with the electricity system. One estimate in Ontario is that we could get about three million tonnes of greenhouse gas reductions at the end of five years. By comparison, that's three times as much as the million tonnes that we've achieved over the past 10 years. So there's lots to do.

Moving to commercial and institutional, I think the big story on commercial and institutional is the potential for combined heat and power systems. That's also true at the residential scale. I think you're going to see those starting to roll out in the near future. But commercial and institutional is better because they're bigger systems, and you have energy managers and so on who can make sure it's working properly. There's a lot to be achieved in terms of improved energy efficiency simply by the way we deliver energy in our buildings as well as in how we actually use it.

We have some suggestions for what we call a “framework for greening”, with three strategies. One is energy productivity. Call it energy efficiency; call it energy conservation. It is productivity, and it's something we can do a lot to improve. We need to make sure we're getting the same or better energy services, but doing it with less energy--in other words, not asking people to sacrifice, just being smarter in the way we go about it. And look at the integrated energy system, in other words, the community level, which includes not only the buildings but also the energy systems that are used to deliver that energy.

The second is renewables. Here I'm talking about on-site renewables--in other words, not the grid renewables such as wind or hydro, but rather ground source and solar. In partnering with the utilities, partnering with electricity and natural gas, there are a lot of opportunities to improve, again, the efficiency of the energy system overall and to significantly improve its environmental performance, largely through hybrids, basically using the existing grid as a basis on which we start to move more renewables into the picture.

Finally, there's energy technology. That's where there's a role for government to invest in demonstration, for the most part, of new energy technologies.

Mr. Chairman, I'll just wrap this up. On page 8 we have the same three strategies, but the fundamental point I want to make here is that these are all areas where both gas and electricity utilities are partners with government, partners with local government, and partners with consumers in trying to put these strategies in place.

I'll leave it there and turn it back to you.

[The Chair, Conservative, Lee Richardson]

Thank you very much. I appreciate the direction. People thought it was strange to have someone here from the gas association, and I think you handled it very well, because I think, obviously, this alternative is a good way to approach it.

We are running out of time, so I'm going to ask everybody to be brief. We're going to try to get one round in here. That would be one questioner from each of the parties represented. We'll try to keep it to five minutes with questions and answers.

We'll start again with Mr. St. Amand. If we have time at the end, we'll add another one.

[Lloyd St. Amand, Liberal, Brant, ON]

I'll be brief, Mr. Chairman. Thank you for this opportunity.

Gentlemen, the case has been made clearly by both of you about the importance of energy efficiency, and both of you in separate ways have made the case.

I just wondered, though, with respect to specific programs--and I appreciate it's not necessarily within your bailiwick to tell us what we should be doing--from your study of other countries, particularly European countries, what should the federal government be doing to incentivize Canadians to use energy more efficiently? You've mentioned programs, industrial and commercial and residential programs, but can you help us in terms of the specifics of programs that you would envision as being the best strategy in terms of energy efficiency?

[Hans Konow]

Perhaps I can start. I'm sure Mike also has some thoughts on it.

I think the federal government clearly would look first and foremost to those programs that would have a national application or national impact. Areas that have been mentioned several times and are often undervalued--they just don't seem particularly exciting--are codes and standards. That's where you get a huge bang for your buck. If you ramp up the efficiency on, say, the industrial side of the motors that drive so many processes, then every motor that goes in subsequently will be of that high order. No one has to make a choice trading off the economics of the fuel input with the efficiency of the motor. You just move up a whole class of consuming products.

It's the same for the white goods, as was referred to earlier; I think Carol mentioned 12% improvement in appliances. Certainly the charts I've seen show a dramatic reduction in energy consumption of white goods. The size of the refrigerator has grown; at the same time, the energy cost of running that refrigerator is less than half. That's pretty dramatic stuff, and that's driven as much by codes and standards as it is by consumer choice. This is one area where I think government can play a role.

Another area is dealing with those who are often left behind. Low-income Canadians, for instance, may or may not be informed. There are problems getting information to people in those circumstances, and with their inability to act on it. There are opportunities, I think, from a social policy point of view to drive energy efficiency where it's least likely to be picked up through self-interest or on an economic basis.

There certainly are many other areas. I mentioned the notion of a stand-alone fund that could be utilized by both industry and other jurisdictions in custom fitting energy efficiency solutions for particular regions and particular circumstances. Why is that important? Well, as people have noted, the circumstances in Quebec or Manitoba versus the circumstances in Ontario or Alberta are hugely different when it comes to the fuel base and the cost structure of the electricity systems. The types of programs are unlikely to fit absolutely seamlessly.

So there are lots of other possibilities, but I think government works best where it deals with setting the macro picture and leaving the economics, leaving consumers to make their choices and to be supported by industry in delivering customized solutions for each customer.

[Michael Cleland]

Mr. Chairman, perhaps I could add a couple of things to Mr. Konow's points.

This may be of interest and of use to the committee. Until recently I was co-chair of the Energy Efficiency Working Group, mandated by the federal government to develop a set of principles on how to approach energy efficiency in the public domain. It's something that the provinces and the federal government have been thinking about and using, and you may find that of use or of help.

Among other things, the principles talked about include, first, “price matters”. You have to get prices right. But that isn't enough, and I want to emphasize that, over time, Canadians will have to see the real price of the energy they use. We'll have to deal with the competitiveness impact, and we'll have to deal with the social impact as that occurs, but over time that will be unavoidable if we want to get those energy efficiency gains.

After that--I agree completely with Mr. Konow here--you need the full suite of programs, including standards, that are available to government. You need to use them much more fully than they've been used to date. It has to be consistent over time. If energy efficiency programs are going to be effective, they have to be a steady pull over the long haul to build up the relationships with customers and the people who deliver those programs.

Finally, you need to take an integrated perspective. Things are connected to each other, and the best opportunities may not be available to you if you take too narrow a perspective on the problem.

[The Chair, Conservative, Lee Richardson]

Thank you very much, gentlemen.

I have Madame DeBellefeuille next, but am I getting an indication that Monsieur Ouellet is going to take the questions?

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

I will be next, Mr. Chairman.

[The Chair, Conservative, Lee Richardson]

You have five minutes.

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

Thank you.

I have two very brief questions and I hope that you will both provide a brief answer. My first remarks are addressed to Mr. Cleland.

A little earlier Mr. Bevington said, quite rightly, that a plant that produces electricity from gas has an efficiency rate of 30%. However he failed to mention—he is aware of this but he did not want to take up too much time—that we don't recover all of the gas that is extracted from wells. Some three years ago our Liberal colleagues had estimated that to renovate the pipeline that goes from the West to Ontario it would cost $10 billion. I would like you to tell me in one sentence about the state of the pipeline if we are losing gas in transit. This is a matter of energy efficiency.