Natural Resources Committee on March 3rd, 2011

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Allen.

We will go to the second round now.

We'll have about three minutes for each questioner in the second round, starting with Mr. Tonks.

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

Thank you very much, Mr. Chairman.

Welcome, Minister. You should come a little more often. It's been very enlightening in terms of the evolving strategic adjustments you're making.

I have a question with respect to the Newfoundland and Labrador offshore agreement and the sizeable contribution—I think it's $1.3 billion or $1.4 billion—that is being made under that program. There is also a line with respect to Newfoundland equalization. What is the historical context of that?

There are two different agreements. My sense of equalization is that it adjusts according to revenue flows and so on. What is the explanation with respect to such a contribution when there was an equalization formula in place?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

Once again, it was under the previous government, and it's under the Canada-Newfoundland Atlantic Accord Implementation Act. That provides for equalization of set payments to the Province of Newfoundland and Labrador to compensate for part of the reduction in fiscal equalization entitlements resulting from the collection of offshore revenues.

The act provides Newfoundland and Labrador with transitional protection for 12 years, triggered by the cumulative production of 15 million barrels of offshore oil. This threshold was met in 2000 with production from the Hibernia project. You probably know better than I do—I was not there at the time—but these things are managed by the finance department.

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

I appreciate that, Chair. I know it's very complex.

I wonder if we could have sort of a storyline on that, so we could understand it a little better. I think we need to have that.

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

I think you should ask the question to the finance minister himself.

Maybe my deputy minister might have more technical information on that.

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

Could you perhaps take that under advisement and submit that back to the committee?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

Sure.

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

There is one other question.

In your estimates, what is the allocation with respect to Arctic and offshore drilling safety? This is not part of the deliberations. We've been dealing with energy security, but part of that concern is obviously in the area of safety.

Is there an increase in the allocations in your supplementary estimates, or is there a decrease? It's the safety with respect to nuclear safety, Arctic safety. It's a pretty general comment. Is there anything in here?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

It's just the Arctic. The $1 million you see there is the Arctic issue.

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

What is that for?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

There is no extra money for safety. It was in the main estimates.

Mr. Dupont, were there any safety issues? Are they in supplementary estimates (A)?

[Serge Dupont]

I don't think so.

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

There is no more on safety in the supplementary estimates (C) than the Arctic study that you see there.

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

I'm trying to understand; we have bits and pieces of a moving target here in terms of concerns that have been raised on response capacity...from a federal responsibility and a corporate sector responsibility. I just haven't seen anything in those lines that even comes around to addressing that.

Perhaps Mr. Dupont could respond.

[The Chair, Conservative, Leon Benoit]

Unfortunately, Mr. Tonks, your time is up. If the minister could give an extremely short answer...or we can get on to the next questioner.

Yes, Mr. Dupont.

[Serge Dupont]

Perhaps I could just indicate that the report on plans and priorities that would typically be produced for Natural Resources Canada...safety, security, and stewardship of natural resources is one of the strategic outcomes. We would report part of our expenditures under that heading. That would be in the main estimates.

I don't have that breakdown for you today, but we could certainly get it to you. There's nothing much in the supplementary estimates other than that item and a small other item, which is a transfer from the Department of National Defence.

[The Chair, Conservative, Leon Benoit]

Okay. We've noted that and we will look for it.

Mr. Blaney, you have up to three minutes.

[Steven Blaney, Conservative, Lévis—Bellechasse, QC]

I am going to use it well, Mr. Chair.

I'm going to start by thanking the committee members for having me here, because ordinarily I chair the Standing Committee on Official Languages. I am going to address that subject first, Minister. I simply want to mention that we have had the opportunity to hear from representatives of your Department at the committee, including your Deputy Minister Mr. Dupont. I want to congratulate you on the efforts your Department has made to implement the act in response to the last report by the Commissioner of Official Languages. What we were most pleased to learn was that the briefing notes for the Minister had to be translated into French. I have to tell you that this information made committee members smile.

That being said, I want to come back to your presentation. There are two points that struck me, Minister. The first relates to the restructuring of Atomic Energy of Canada. I am pleased to see that the direction you have taken, privatizing Atomic Energy of Canada, if we may put it that way, is approved by Luis Echávarri, the Director-General of the OECD Nuclear Energy Agency. That means that we are on the right track and that is the thing to do. He has clearly said that this will bring AECL business opportunities and that we will not end up, as you said just now, with contracts that are not profitable, for which taxpayers must ultimately pay the cost. I think Mr. Cullen and Ms. Brunelle compared this to a bottomless pit. In my opinion, you are really on the right track for sealing the cracks.

A second interesting subject in your presentation is nuclear reactors. Mr. Coderre mentioned that Ontario had expressed interest in buying advanced CANDU nuclear reactors. I even saw on the news that Argentina is considering that possibility. That is encouraging, in that regard. You also confirmed this afternoon that negotiations are underway. So that's a good omen. I think the subject has been covered well.

Minister, I would like to talk to you about sustainable development. Last Sunday you announced funding for various renewable energy projects. I would like to know the exact nature of the recent investments, and at the same time hear you on the subject of the principle of fiscal neutrality. We know that it is possible, in a program, to bill for expensive measures, for example in terms of energy, and distribute the revenue to those that save energy.

Would you talk about the measures you have announced in relation to renewable energy, please, and your plan to make Canada a clean energy superpower.

[The Chair, Conservative, Leon Benoit]

Mr. Minister, I'm going to have to ask you to keep your response short, please.

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

I think the 63...

[Voices]

Oh, oh!

[Denis Coderre, Liberal, Bourassa, QC]

That's the difference between sounding off and sound logic.

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

The 63.8 million announced last Sunday will be invested in renewable energy. In terms of ethanol, GreenField Ethanol in Quebec is doing a lot of grain-based ethanol production and is increasingly moving toward the second generation. There is also a renewable wind energy project in Digby Neck, Nova Scotia. Another wind energy storage project will be carried out also in association with the Cowessess First Nation in Saskatchewan.

So this is very promising and we will continue to implement the measures announced in recent years. As I said, there will be other financial incentives for the production of renewable energy over the next 10 years.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Blaney.

Madame Brunelle, you have up to three minutes.

[Paule Brunelle, Bloc, Trois-Rivières, QC]

Thank you, Mr. Chair.

Mr. Paradis, the Minister of Natural Resources of Quebec says that you have confirmed to him that the federal government would not be funding the installation of an electricity transmission network between Newfoundland and Nova Scotia. We know that this would amount to unfair competition for Hydro-Québec, which has always paid for its own transmission lines. Can you make a formal commitment today not to subsidize this kind of project in any way?

I don't want you to talk about PPP Canada.