Natural Resources Committee on March 26th, 2009

[Glen Murray]

The Canadian Urban Institute does a lot of work in Africa, in Ethiopia and Somaliland, some with the federal government as a partner and some on our own. Those are very critical issues.

The other thing I want to say--and it might be a bit controversial--is that we have existing energy architecture in this country. We have existing energy systems. I think in Ontario we're going to have to increase nuclear by about 50%, and that's not popular.

We have to clean coal in Saskatchewan and Alberta simply because we do have clean coal technologies that I think work, and you can't economically replace that.

We are dependent on oil exports for a lot of our national wealth. I think we have the technologies to clean them up, but I don't think they're tested yet, because I don't think anyone, politically or realistically, in this country is going to compromise our energy.

Those are all tough decisions.

Water supply is going to be one of the biggest issues. Mr. Cullen has spoken out articulately about this as well many times. How do we have water security? That's going to be an issue. These are huge things.

We have very good relations, I think, with all parties around this table. At the Urban Institute one of the things we're working on with IPAC, which you would be familiar with, is trying to launch a population strategy for Canada. We're the only OECD country that doesn't have a population strategy, so we would be talking about energy mapping, and all of the things you just....

How do you create--which many countries have done--the capacity in rural and urban Canada to sustain sufficient population? As I said, we're the only OECD country that doesn't have that, and we'd love to invite all of you to be part of this dialogue about how we develop a population strategy.

Madam, you have raised some of the most critical issues of our time, and they go way beyond the issue of what we're talking about today. They actually drive the decisions we're making today. You've blown it up into the bigger question--that's the purple elephant in the room that no one really wants to talk about--and I think you've nailed it.

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Murray.

Merci, Madame Bonsant.

Mr. Regan, go ahead, please, for up to five minutes.

[Geoff Regan, Liberal, Halifax West, NS]

Thank you, Mr. Chairman.

I'm trying to read Mr. Anderson's lips as he's indicating something to me. I'm not sure what it is, but if he has a question for me.... It's really his turn, but I appreciate having an opportunity to ask some more questions.

[The Chair, Conservative, Leon Benoit]

I saw no indication of anyone wanting to--

[Geoff Regan, Liberal, Halifax West, NS]

That's fine. There will be other opportunities, I'm sure.

I have questions for three of you at the moment, but I'm going to save Glen's for last. You'll never guess why.

Let me start with Andrew Pride. Mr. Pride, you talked about regulatory barriers to using rainwater and grey water, and I'd like to know what those are and what level of government they're at.

[Andrew Pride]

We had pretty magnificent barriers associated with using rainwater to irrigate our lawns. There was perhaps good but perhaps unnecessary concern about contamination of that rainwater as it came down onto a roof and into a cistern. The concern was that the water would not be good enough for people walking by a sprinkler to drink. So it was a little bit difficult to try to get through all the regulatory aspects of using rainwater for irrigation.

I think it really stemmed from trying to do something different. It wasn't what we traditionally do, and for some reason every time we go down the path of trying to do something different that makes perfectly good sense to everyone, the regulatory barriers come out, and they start saying you can't do it; it's different. You have to be pretty tenacious to beat through that and to get through to where you need to be. There was a regulatory barrier from the city, from the municipality, and from the province, all of which independently said sure, we'll do this, but when we got down to the proof in the pudding, they wouldn't do it. So it was a matter of pushing it through, collaborating, integrating everyone together and asking, why is this a problem? And everyone said, “Well, actually it's not”. We got through the problem, and now this is a common development technique we use in all of our developments in Ontario, and now other developers are picking up on it.

It's amazing that when you change the pace from what is the norm, it's a large obstacle to go through. And thanks go to CMHC, actually, which stepped in and intervened on our behalf, saying this isn't working and we need to correct it; we need to use rainwater harvesting. It was through CMHC's leadership that we actually got to the point where we are putting rainwater harvesting in all of our buildings.

[Geoff Regan, Liberal, Halifax West, NS]

Do you know if it's still an obstacle elsewhere? I know there are places in the U.S. where I've seen water used for irrigation, for watering lawns and so forth, that is pretty smelly stuff. It's been reused a few times, and you certainly wouldn't want to drink it, but that isn't an obstacle.

[Daniel Pearl]

Actually we're dealing with an ethical issue when it comes to even using rainwater for irrigation. We feel that grey water should be used, with special taps that actually make sure it's non-potable, so that kids understand this issue. Rainwater should be returned to the aquifer. If we're trying to deal with the fact that we'll be missing water, the more we start to abuse water and don't actually put it back into the aquifer the more serious problems we're going to have long-term. So we've started to deal with that problem at Benny Farm. Even using rainwater for irrigation is a real ethical issue.

[Geoff Regan, Liberal, Halifax West, NS]

The next question is to Mr. Rogers.

You talk about the policies of Public Works and Government Services Canada that require you to put in the wrong equipment. Could you expand on that, please? Tell us what you mean.

[Greg Rogers]

I think I just answered that a minute ago.

[Geoff Regan, Liberal, Halifax West, NS]

Sorry.

[Greg Rogers]

It was regarding the lease. I was using the example of putting in the equipment. There's a disincentive under a semi-gross-lease arrangement for me to invest in energy-efficient equipment because the energy savings that I would normally use to repay me for the additional investment I've made in that equipment, as opposed to buying the regular stuff, are not permitted by PWGSC. PWGSC will not permit that saving, or any portion of it, to be paid to cover the cost of that better equipment, as would be the case under a private sector arrangement. It would be neutral, in fact slightly better, to PWGSC to go in that direction, to do that kind of a deal with me, but the regulations prevent it.

[Geoff Regan, Liberal, Halifax West, NS]

Thank you for reinforcing the point.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Regan.

I'm going to actually ask a question here.

Mr. Chrapko, you're involved in the intellectual properties side of this, and a key part of this new technology being developed is that people can commercialize the intellectual property and make money from it. I'd just like to ask you if there are any particular problems you'd like to mention in the protection and development of the intellectual property side of it.

[Shane Chrapko]

In our case, no particular problem, other than going through approaching it from a world-class scale. So it's not just protecting it for Alberta or for Canada; it has to be protected globally, and that's how we approach it.

ARC has been an interesting dance for us, but I think that will get solved fairly quickly.

[The Chair, Conservative, Leon Benoit]

Thank you very much.

Mr. Lobb.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Thank you very much.

I was in Kitchener maybe a year ago and you were speaking at the Delta there. That was a nice presentation.

The folks at Minto can answer this question, or anybody can answer this as they see fit. In my previous job I worked for a company and I was in charge of the building as far as the relationship goes, I guess. What we found very frustrating was the cam structure, and you've touched on it already. There's really not an incentive for the landlord or the building owner to make any improvements to the building that would reduce costs, such as your heating costs vis-à-vis natural gas and or your electrical costs. Do you have any recommendations or suggestions for that?

I know this is a frustrating thing as a tenant, and the way the landlord situation is set up is they normally add about a 15% cost to it as well, so there's really almost a disincentive for them, because actually the more it costs them the more of a percentage they take.

What are your thoughts on this?

[Greg Rogers]

I think there's a really easy answer, and that would be we have agreed under the terms of the gross lease to accept all the energy cost risk. The government would get the benefit of energy costs, should they ever fall. It doesn't happen that often, but it does from time to time. Another way of approaching it would be to say the energy costs are this much going into the deal, they'll be indexed on the way through, and if they happen to be any less than that the landlord is free to use that as a means of recovering investments in equipment that would reduce energy, and they would have to prove it. And they can only get it.

So the landlord then has an incentive to pursue the savings because they're now available to the landlord. Believe me, lots of landlords would be all over it. PWGSC occupies millions of square feet across the country.

[Ben Lobb, Conservative, Huron—Bruce, ON]

I have another one further to that on the building side, and this is really reduction or conservation, as there are many old high-rise office buildings throughout Canada. There are millions of square feet out there--we know this. The region of Waterloo put in a program with a bit of success, I think, on actually looking at all the water that's used--the taps, the toilets, and so forth--because we know there's a tremendous amount. Whether it is on the back end or the front end, whatever way you want to look at it, it's reducing the actual infrastructure costs that they're going to have as the economies expand.

I just wonder if you have any comments, Mr. Murray, on this one. Do you have any ideas or thoughts to help us promote this? I think it was a good program, and it's really tough for a region to promote it, because they have a limited marketing budget.

[Glen Murray]

Really quickly, I'd have a look at New Zealand. In the property tax system, they virtually don't tax buildings in New Zealand. They tax land and they have unit charges for services. There is huge incentive to retrofit your building, to build it as high as you can.

The federal government and Natural Resources Canada--your staff in this department are very good. If you could import that knowledge and look at some of the systems that are doing that.... When I said we tax the wrong things, I'm quite radical on this. I think if we just simply tax land, and I don't mean agricultural land—we don't want to tax productive land—but if we did that....

The second thing is that utilities used to allow—if you bought a green technology that was more expensive to buy, a better heating system or better insulation, you could write that off against your utility rates. So your utility rate was sealed, but as you were actually using less energy, the difference for the energy you weren't paying for allowed you to write down the higher cost of the technology.

The federal government has been very good at introducing those kinds of programs. Those would be two examples. But if you wanted something really big and very cool and dramatic, try to negotiate something along the lines of what New Zealand has.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Murray.

Actually, we have one final question coming from Mr. Anderson.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

It is a question to Mr. Rogers.

You mentioned that we were number two in something, just behind Germany. Could you just elaborate on that?

[Greg Rogers]

Sure. I'll let Andrew answer it. It was his team that went over and was part of the whole event.

[Andrew Pride]

Yes. It's part of a program, Sustainable Building Challenge 2008, which runs every three years. It's an international competition for sustainable buildings. A Canadian group put together a submission. There was a Manitoba Hydro building and Minto Roehampton, one of our buildings, that were put forward as key sustainable buildings in Canada, where Canada is going.

It was a competition among many different countries. Germany, of course, came out first because they've got a federal government and an infrastructure that completely supports the idea of sustainability and taxes that are supportive of those who do good things and not of those who don't. So they hit number one. Canada, through what we believe is good leadership from Manitoba Hydro and through ourselves, came in second. So we're quite honoured by that.

It was focused on all the different geographies coming forward and saying what they have done for sustainability, how they've shown green buildings to be a good and practical way.

[The Chair, Conservative, Leon Benoit]

Thank you very much.

Thank you all very much. Two of the witnesses had to leave early to catch a train, and some of our MPs had to leave to catch planes, I know, and others are on the way.

I really do appreciate your input here today; it is very helpful to us in our study and very interesting, fascinating. Thank you all very much.

The meeting is adjourned.