Evidence of meeting #11 for Natural Resources in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was buildings.
A recording is available from Parliament.
5:05 p.m.
Conservative
The Chair Conservative Leon Benoit
Thank you.
Thank you, Mr. Tonks.
Now we'll go to Mr. Allen, for up to five minutes.
5:05 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
Thank you, Mr. Chair, and thank you, everybody, for being here.
The first question, to Mr. Nickel, is with respect to the development.
I was very intrigued by your development and the closed loop you have there. You say you're at one megawatt now, and you're expanding...you said a 400% expansion. Does that mean you're going to four megawatts, or is it going to be plus or minus that?
5:05 p.m.
Representative, Assistant General Manager, Highmark Renewables Research LP and Growing Power Hairy Hill LP, Town of Two Hills
It's a bit more complicated than that.
We'll be able to take 400 tonnes of manure, plus 40 to 70 tonnes of some other products. We've identified municipal solid waste as something we want to take into that particular facility. The amount of gas we're able to produce is almost five-plus times as much as we're currently able to produce.
Unfortunately, the energy required in the whole system doesn't require exactly 33% electricity and 67% heat, so we'll be installing an additional 1.4 megawatts of generating capacity, bringing our total to 2.4 megawatts. The total thermal capacity there is 10.5 megawatts. So we're swaying in favour of thermal in that particular location.
If we were to make only electricity, it would be between four and a half and five and a half megawatts, depending on the exact recipe we'd put in there.
5:05 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
I want to talk a bit about your investment model. Your recommendations were on the loan guarantee side, but you didn't say there was any kind of government support into this model. Are you able to share your investment model with us?
Obviously the people who are investing, whether it's a cooperative or whatever, are seeing a return in this; otherwise, they wouldn't be in it. Can you tell us how that investment model works?
5:05 p.m.
Representative, Chief Executive Officer, Growing Power Hairy Hill LP, Town of Two Hills
We're getting some support from the provincial government. We don't have financial closure yet, but at the end of the day we will probably be one-third government support, from a variety of programs, one-third debt, and one-third equity.
5:05 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
Okay, so it could be from two levels of government then.
5:05 p.m.
Representative, Chief Executive Officer, Growing Power Hairy Hill LP, Town of Two Hills
It absolutely is. Yes.
5:05 p.m.
Representative, Chief Executive Officer, Growing Power Hairy Hill LP, Town of Two Hills
Sorry?
5:05 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
Is the federal government support going to come on the ethanol piece of it?
5:05 p.m.
Representative, Chief Executive Officer, Growing Power Hairy Hill LP, Town of Two Hills
And technology--STDC.
5:10 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
Thank you.
The next question I'd like to ask is for Mr. Pride.
You were talking about government procurement. I think it was Mr. Pride who said that Public Works and Government Services Canada policies were forcing you to install equipment that really didn't make sense. Can you elaborate on that a bit? I find that interesting. Is that because of the way the sale and leaseback agreement is negotiated, or how PWGSC is negotiating the rents?
5:10 p.m.
Executive Vice-President, Minto Group
The government procurement of office space is typically on a semi-gross basis, which means they pay a defined rent that includes a number of operating costs. Included in those operating costs is a defined amount for energy. And it's indexed. It increases every year by the amount of the index. If I change equipment in a building, I'm inclined to change the equipment such that the energy cost remains the same. If it goes higher, I eat it; if it goes lower, they benefit.
I'm incentivized under the terms of a gross lease arrangement to keep those energy costs the same because it's a defined amount in the lease. They get the benefit; if I over-invest and produce a saving, they get it. I get no recovery of my investment in that benefit to the crown and to the country.
Under a normal net lease arrangement with the private sector, I would go to the tenants in a building and say, “Look, I have an opportunity to reduce energy costs by 50¢ a square foot. It's going to cost me some extra money. Of that 50¢ a square foot, I need 40¢ to recover; I'll give you 10¢ back. The alternative is we can remain as we are with no change.” So there's a small benefit to them. I get a recovery of my additional cost over a period, typically, of between 15 and 20 years. That's the way it would work in the private sector.
We have approached PWGSC on a couple of occasions and said this is the right thing, and they said yes, but the policy says we can't.
5:10 p.m.
Conservative
5:10 p.m.
Conservative
5:10 p.m.
Bloc
France Bonsant Bloc Compton—Stanstead, QC
You talk about subsidies. You know that the federal government provides subsidies to oil companies through billions of dollars of tax credits each year. We will pay for carbon sequestration through our taxes, as well as for cleaning up Alberta. Seen from space, oil sands operations look like the end of the world.
I am asking that question because we absolutely have to reduce our greenhouse gas emissions before 2050 because of climate change. If we do not, some countries will have to displace their populations and some cities will disappear.
Since I also used to be a city councillor, I am aware of the situation. We do not want any interference from the federal government in our cities. It is already hard enough to answer to the provincial government without also having to answer to the federal government. By the way, that is one of the reasons why I am a sovereignist.
How could we ask cities to plan for the arrival of millions and millions of refugees from all over the world who will have no place to live because of the increased flooding of our planet? That is a sustainable development issue.
5:10 p.m.
President and Chief Executive Officer, Canadian Urban Institute
That is an excellent question. Very difficult to answer but I will try.
5:15 p.m.
Bloc
5:15 p.m.
President and Chief Executive Officer, Canadian Urban Institute
I think we have a couple of crises. The elephant in the room that we're not talking about is the fact that we're about to lose 35% of the species on this planet between now and 2050. I would love to hear what the Government of Canada is going to do about that.
Of the 20 most common bird species in North America, for example, we've lost 50% of the population within the last few years, which is way ahead of any of the estimates.
We're all nodding here and some of you are smiling, but the biggest problem we're going to have is the loss of diversity and resilience. It's going to kill agriculture. It's not about rising waters; it's about the loss of species.
As for our part of our challenge, how will that affect cities? It's going to reorient us to food supply and to those kinds of changes. Where is our food going to come from? I'm a western Canadian and have spent most of my life on the prairies, and I looked at what some of the water supplies mean to cities like Regina and Calgary, and where the water is coming from to grow that wheat. And now we're competing for food, because cities are driving up energy costs.
I think those folks at the other end of the table are brilliant, because they're shifting away from using food as a supply, to municipal waste, and farm waste, and I congratulate you. Thank God for what you're doing. And the energy payback you've had is extraordinary, by any standard. So that's the big challenge.
The other big problem we're going to have in our Canadian cities is that the mean temperature of continents like Africa isn't going up by two degrees; it's going up by five to ten degrees. One-third of the world's population by 2015 will lose its water supply. Canada is going to be heavily pressured to accept environmental refugees, and we have no population policy in Canada.
I will tell you, as mayor of the city of Winnipeg, which struggled to retain population, we had a great relationship with the federal and provincial government—with the government from Mr. Dewar's party, and, at the time, with the Chrétien and Martin governments—and I think it continues to this day with Mr. Harper's government. How we are going to deal with the environmental implications of how we settle people, and how we're going to deal with those tensions, is a subject for major national policy.
Parliamentarians, I have to tell you, I have huge thanks for you. I know you have a tough job....
Sorry. Yes, Madam. I apologize.
5:15 p.m.
President and Chief Executive Officer, Canadian Urban Institute
You are very kind. Thank you.
5:15 p.m.
Bloc
France Bonsant Bloc Compton—Stanstead, QC
I am not a good politician but I am a good representative of my electors. In my riding, Enerkem Is starting to produce energy from all types of waste.
We are going to be faced with another problem: people living close to water will not have any drinking water. Seawater is not good for farming. That will become an additional problem.
Do you not think that our government should invest in research and development on desalinating seawater to make sure that people have enough water on this planet?
5:15 p.m.
Some hon. members
Israel does it.
5:15 p.m.
Bloc
France Bonsant Bloc Compton—Stanstead, QC
Really? It is not being done very much in Africa however. They do not have money for that.