Natural Resources Committee on May 14th, 2007

[Graham Campbell]

What I've indicated as well in the deck, sir, is that it's roughly 13% of our total portfolio, which tries to cover renewables and end-use technologies in three broad areas: transportation, industry, building, etc. It's a question of allocation of resources over a number of very important areas. If you combine the clean coal and CO₂ capture and storage, it's roughly 13%. We're hoping to increase that sum, but it's a question of trying to balance the portfolio across a number of very important areas.

Let me return to the answer my colleague offered you a moment ago. He mentioned, I believe, that we will try “as new plants are built”. In the meantime, we'll be using technology that isn't quite as good as it needs to be. We're telling the committee today—

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

We could even say awful or very bad technology.

[Graham Campbell]

Not necessarily as clean as it could be.

We're telling the committee today about a couple of technologies, gasification and oxy-fuel, that have long-term potential.

But there's been recent construction in Canada of an intermediate step along the technology pathway. It's called supercritical technology. That plant has been constructed in Alberta at a location called Genesee 3. It is a significant improvement on the technologies that exist today.

I just wanted to mention that there are some intermediate steps that can be made today, and our utilities are making those steps when they have a chance to rebuild and to replace existing technology. So to your basic question about share and so on, there are a number of important areas.

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

I'd like to come back to the $230 million over four years. This works out to $57.5 million per year for research under the EcoAction Initiative. Could you break down this amount for us? There is clean coal, CO2 capture and storage, etc., but also passive and active solar energy, geothermal energy, wind power, really, all clean energies. Also, $840 million is being spent to support nuclear energy. Could you break down this $57.5 million for me, meaning break down the portfolio for clean energy?

[Graham Campbell]

We don't have the figures here today.

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

Could you provide them?

[Graham Campbell]

Yes, we could provide them to you.

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

I want to come back to a question raised earlier. Could you tell me why only $5 million has been allocated to clean coal energy? Is it because you never asked for more money or is it because the government is refusing to give you more? Five million dollars for research is nothing. We could spend that amount on an electric light bulb. However, we are spending this amount for huge power plants producing a lot of electricity with coal, a very abundant resource in Canada. Why is only $5 million being allocated for this?

[Graham Campbell]

I think I'll leave the answer I had previously, sir, and that would be that we have to balance. We have balanced, and that's the amount of money we've decided to allocate.

We had promised to provide you figures on the different proportion across the other areas. If the committee needs more at that point, we'd be happy to come back.

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

If I understand correctly — and I thank you — you are going to provide us with the details of the entire clean energy portfolio. You are going to provide us with all of the expenditures in this area for a total of $57.5 million.

Thank you.

[John Marrone]

I want to point out that when we invest $5 million, that's just the federal share. In fact, we do a lot of this work with industry, and typically we never fund more than 50% of the cost. Sometimes it's one-third, sometimes it's up to 50%. It's deceptive to just look at the $5 million. It's really more like $10 million or $15 million worth of research that gets done with that kind of money. I just want to point that out.

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

It's important, yes. Thank you.

[Graham Campbell]

We call it the leverage, and it's typically between 3 and 3.5 to 1.

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

Thank you.

[The Chair, Conservative, Lee Richardson]

Thank you, and thank you, Mr. Ouellet.

Welcome, Mr. Stoffer.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Mr. Chairman, it's a pleasure to be here, and thank you very much.

Gentlemen, is this technology available now anywhere in the world? Is any other country using this or moving toward this technology? If so, can you explain which ones, and if not, I'm thinking of other countries like China, Asia, Russia. Is anybody using this?

[John Marrone]

Maybe I could just start by saying this is a relatively new field of research. Anybody who has coal is interested in it, so lots of countries are doing work right now in oxy-fuel and gasification and so on.

For instance, if this feed study from SaskPower allows them to go forward with that technology, that will be the first oxy-fuel clean coal power plant in the world. Although a lot of people are looking at it, it's brand new.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Thank you.

Sir, you started off your presentation by talking about environmentally acceptable manners or standards. Who sets those standards?

[John Marrone]

It would be the provinces and the federal government setting standards as to what the emissions ought to be. In my case, what I was referring to is zero emissions, so that should meet standards.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Okay, great.

[Graham Campbell]

Could I add to your first question, sir? We're aware of six gasification projects operating at the moment across the world, none of which operate with Canadian coals and none of which have capture and storage with them.

In terms of oxy-fuel, there's a German company called Vattenfall, which is doing a small-scale oxy-fuel demonstration project at a location just outside of Berlin in Germany. This will be one of the leading examples of use of oxy-fuel technology, but it too doesn't have CCS attached to it. Attempts are certainly being made around the world to move these technologies ahead, but not necessarily with Canadian coal quality nor with CO₂ capture and storage. So we think the integrated approach we see in the offing in Canada is a significant opportunity.

Thank you.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

You say you hope this should kick in around 2015. Is that correct?

[John Marrone]

Around 2012 to 2015.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

So in that time these older plants will still continue to operate. Is that correct?

[John Marrone]

Up until the end of their useful lives. They typically have a 40-year useful life. Some of them will come due before that date, so utilities will have to make some decisions as to what they would like to use then.