Evidence of meeting #8 for Natural Resources in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was budget.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Mark Corey  Assistant Deputy Minister, Earth Sciences Sector, Department of Natural Resources
Carol Buckley  Director General, Office of Energy Efficiency, Department of Natural Resources
Mary Preville  Acting Director General, Office of Energy Research and Development, Department of Natural Resources
Jonathan Will  Director General, Energy Resources Branch, Department of Natural Resources
Charles Tanguay  Communications Officer, Union des consommateurs
Marc-Olivier Moisan-Plante  Economist, Union des consommateurs

9 a.m.

Conservative

The Chair Conservative Leon Benoit

Good morning, everyone. Welcome.

Today we are starting a study on the status of the ecoENERGY programs.

We have with us today, as our first panel, from the Department of Natural Resources, Mark Corey, assistant deputy minister, earth sciences sector; Carol Buckley, director general, office of energy efficiency; Jonathan Will, director general, energy resources branch; and Mary Preville, acting director general, office of energy research and development.

Welcome to all of you. We won't get into a real discussion of this right now, but I would like all of you to think of the following as we go through the meeting today. We have organized the panel for today, including the departmental officials, and three other meetings on this. I think the intention is to then go back to the isotopes report, although there has been some uncertainty as to whether we had agreed to have three meetings, including this one, and then go to the report—or to have this meeting and three others. So if you could think about that, we will get back to it at the end of the meeting and very briefly settle it and decide where to go.

We'll start with the presentation by Mr. Corey, and then we'll get to the usual questions and answers in the usual format.

But first, thank you very much for coming today. We have been talking about visiting these programs for some time, and I'm glad we're going to have a little look at them, at least, over the next few days.

Go ahead, please.

9 a.m.

Mark Corey Assistant Deputy Minister, Earth Sciences Sector, Department of Natural Resources

Thank you, M. Chair.

First of all, we sincerely would like to thank the committee for inviting us here today to discuss Canada's ecoENERGY initiative. During the first hour, we will be covering all of the programs, and during the second hour, we will provide you with a more detailed summary of the ecoENERGY Retrofit—Homes program. I know that this is a matter of concern to you, and we will be discussing it in greater detail.

We also have a handout, which I'll be speaking to.

Page 2 of the document pertains to ecoENERGY initiatives that are part of the government's Clean Air Agenda Program and all of its EcoAction programs.

These initiatives represent an investment of more than $4 billion and are designed to promote energy efficiency, increase the supply of renewable energies—including biofuels—and to create clean energy technologies. The three objectives of the ecoEnergy programs are as follows: To help Canadians consume energy more efficiently, to promote the supply of renewable energies and to create and roll out technologies designed to reduce greenhouse gas emissions. The programs have been divided into the following four categories: energy efficiency, renewable energy, biofuels and technology.

Significant progress has been achieved thanks to these investments. Investing in clean energy technologies and energy efficiency stimulates the growth of the clean energy industry, creating high-paying jobs for Canadians, and at the same time protecting the environment.

I am going to read you a brief presentation about our ecoENERGY programs and the achievements to date. For practical reasons, I divide them into four categories, as I mentioned earlier.

I will be talking again to the four basic groupings of the ecoENERGY programs.

The first one is energy efficiency. This has a lot of programs in it, as you can see from the slide, from the retrofit homes program down to the equipment one. The ecoENERGY efficiency initiatives promote smarter energy use by Canadians at home, at work, and on the road. The programs use multiple instruments to improve energy efficiency. We use incentives, codes and standards, training, education, and awareness. The programs address each sector of the economy. They rely on partnership and collaboration to lever resources from provincial, territorial, and utility partners.

Frequently the federal initiatives provide a foundation to which other organizations can add their complementary measures, furthering the reach of energy efficiency across Canada. The initiatives include the ecoENERGY retrofit homes program, which has been a very popular program, as you know. Carol Buckley, our director general, will be doing a presentation on that during the second hour, and I think we'll be really focusing on that program in the second hour.

On the fifth page are the results of the energy efficiency programs. Training, for example, has been provided for between 1,000 and 2,000 home builders every year, so they can build R-2000 and Energy Star homes that are 25% more efficient than conventional new builds. Commercial truck and bus drivers learn how to maximize fuel economy through training, as do plant foremen and energy managers in industry. The popular Energy Star label identifies the top performers for 50 products, and 60% of Canadians use this label now to inform their energy purchases. Many provinces and utilities also base their rebate programs on Energy Star products.

A strong regulatory package will address 80% of the energy used in the commercial and residential sectors. Thirty new and more stringent product regulations will be in place by March 2011 to address lighting, refrigerators, motors, consumer equipment like televisions, and more. The provinces with energy efficiency regulations work closely with Natural Resources Canada to make sure our approaches are aligned.

Slide 6 talks about renewables. The ecoENERGY renewable initiative is focused on increasing the commercial deployment of renewable energy technologies. In the case of renewable electricity, this has taken the form of a production incentive designed to improve the relative competiveness of these technologies. In the case of renewable heat, this has been achieved through a broader set of initiatives, including a capital incentive to install solar thermal systems, partnerships with the utilities and other service providers to increase the use of solar hot water systems, and actions to increase industry capacity such as training certified installers. Response to both of these initiatives has met or exceeded expectations, and we expect to meet or beat our initial targets in these programs.

Slide 7 talks about the biofuels component of the program. The ecoENERGY for biofuels program supports Environment Canada's renewable fuel regulations that will come into force in 2010. The program provides incentives to increase the supply of renewable transportation fuels. As of March 2010, the program is committed to supporting the production of up to 1.6 billion litres of biofuels by 2012. The budget has largely been allocated, and the remaining bit will be committed over the next few months.

Slide 8, the last section, is on the ecoENERGY technology initiative fund, which funds research, development, and demonstration to support the development of next-generation clean energy technologies such as carbon capture and storage and renewable energy technologies. For example, seven new CCS projects, ranging from $4 million to $33 million, support preliminary engineering and testing activities.

The other program we use in conjunction with this, which I mentioned, is the clean energy fund program, which is also making a major contribution to carbon capture and storage. The clean energy fund was announced in January 2009 under the economic action plan, and to date it has committed $466 million for major integrated large-scale CCS projects.

The ecoENERGY technology initiative and CCS projects have helped set the stage for clean energy fund projects. Opportunities are being taken where possible to co-fund projects through both ecoENERGY technology initiatives and the clean energy fund to move projects along to large-scale demonstration.

The last slide talks about the future. I know this is a question we'll get. As indicated in the March 2010 Speech from the Throne, the government is now reviewing its energy efficiency and emissions reduction programs to ensure they are effective. I should mention that this is actually fairly common. A lot of times the government will fund programs for a four- to five-year period, or longer.

When the period is up we usually review them in the last year to make sure that the programs are still necessary and effective. For a number of these programs that finish at the end of this year, such a review is now ongoing and it will be basically for ministers to review and to decide. But again, the government has not decided yet on the future of these programs.

9:10 a.m.

Conservative

The Chair Conservative Leon Benoit

Thank you very much for your presentation.

We will start the questioning.

We'll start with, from the official opposition, Mr. Tonks, actually. Back to Mr. Tonks.

Go ahead for up to seven minutes, please.

9:10 a.m.

Liberal

Alan Tonks Liberal York South—Weston, ON

I'm not sure I like that characterization of “back”....

9:10 a.m.

Conservative

The Chair Conservative Leon Benoit

Well, you've been back and forth a couple of times.

9:10 a.m.

Liberal

Alan Tonks Liberal York South—Weston, ON

Thank you, Mr. Chairman.

Thank you to our witnesses.

I guess the first question I have is in terms of evaluations. With respect to reduction in greenhouse gases, has there been any ongoing monitoring and assessment of the general clutch of programs and linking that to the effectiveness with respect to greenhouse gas reductions?

9:10 a.m.

Assistant Deputy Minister, Earth Sciences Sector, Department of Natural Resources

Mark Corey

Yes, in fact there has. For each of these programs, we go in and we calculate the megatons, for example, of GHG that will be reduced from it.

Just to give you an example, I'll ask Carol to talk a little bit about some of the energy efficiency programs and some of the measurement that we're doing there.

9:10 a.m.

Carol Buckley Director General, Office of Energy Efficiency, Department of Natural Resources

Thank you very much for the question.

We currently have five evaluations under way on the energy efficiency suite. They will be completed in the next couple of months. Those evaluations will assess the emission reductions of each program against the proposed emission reductions. I don't have the results of those evaluations to date, but on an ongoing basis, from the first year of these programs, 2007, and in each subsequent year, the program captures the emission reductions. We estimate what the impacts are, depending on the nature of the program, and we report on those in an annual report to Parliament.

The emission reductions are also reported in the Kyoto Protocol Implementation Act reporting requirements, which are organized by Environment Canada. We provide the emission reductions associated with each of the programs to that exercise and they are reported publicly.

9:10 a.m.

Liberal

Alan Tonks Liberal York South—Weston, ON

Okay. As a corollary to that question and that answer, to what extent, then, are those evaluations related to direction to the government with respect to an extension of the programs or variations on the programs?

9:10 a.m.

Director General, Office of Energy Efficiency, Department of Natural Resources

Carol Buckley

All the data on program effectiveness will be used in the government's assessment of the programs. As indicated in the Speech from the Throne and in budget 2010, there will be a review of energy efficiency and clean energy programs. Part of the data collected and used in that analysis will be the progress and effectiveness in the programs in making emission reductions vis-à-vis what their expected targets were. All of that information would be input into the review, which will, in turn, inform the decisions that ministers will make about the programs in the future.

9:10 a.m.

Liberal

Alan Tonks Liberal York South—Weston, ON

I'm jumping ahead a bit--this question probably is more related to when we talk about the home energy retrofit--but the government has decided to not take any other applications. I would like to try to get a handle on the extent to which the evaluation would have guided that decision. I'm not sure that's in order at this point.

Is that okay, Mr. Chairman?

9:15 a.m.

Conservative

The Chair Conservative Leon Benoit

Yes, those are the issues we're talking about. We could leave as much as possible for that second hour, but go ahead, Mr. Tonks.

9:15 a.m.

Liberal

Alan Tonks Liberal York South—Weston, ON

Thank you.

9:15 a.m.

Director General, Office of Energy Efficiency, Department of Natural Resources

Carol Buckley

Sure, evaluations do inform decisions, but other things inform decisions as well. With respect to the home retrofit program, we monitor the intake of that program very carefully. As director general, I review the statistics on the program every week, and I have done so since the inception of the program.

We ended the pre-retrofit evaluation phase of the program, the intake phase of the program, if you will. We ended that phase of the program at the point when the remaining budget was sufficient to offer an opportunity to those already participating in the program to have access to a grant. So that is just good management of a program budget in order to stay within your program budget allocation, to end intake at a time when the existing participants would use the remaining funds in the program.

9:15 a.m.

Liberal

Alan Tonks Liberal York South—Weston, ON

Okay. I will pursue that later on.

We had quite a presentation and had various witnesses on integrated energy systems. Part of the evaluation is whether these programs have stimulated the integration of new technologies and of alternate energy production, probably from a macro and strategic point of view.

Do the evaluations give us the sense that we are actually learning from the technologies, that we are stimulating them with these programs?

And is there any evidence that we are integrating technologies—geothermal, solar, wind applications—into transportation or whatever? Are the programs stimulating that kind of strategic environmental progress?

9:15 a.m.

Director General, Office of Energy Efficiency, Department of Natural Resources

Carol Buckley

Yes, there is a lot of evidence. Thank you very much for that question. It's an important one.

There is a lot of evidence that the programs are stimulating the uptake of emerging technologies and encouraging the integration of efficient technologies and renewable and other emergent technologies. I'll give you a couple of examples.

The home retrofit program has provided incentives to more than 1,000 domestic hot water systems in the residential sector and more than 7,000 heat pump systems, which provide both heating and air-conditioning. These are quite expensive technologies for the homeowner to adopt. The grant was very helpful, and I don't think we would have seen such penetration levels of those technologies without the incentive.

In other areas, we certainly see an impact on technologies. For example in the industrial sector, we have 19 benchmarking studies in different sectors of the economy that give information to the industrial plant managers and decision-makers about better technologies to put in their plants in order to bring the plants up to a benchmark efficiency level. We have evaluations of those to show that they're effective.

9:15 a.m.

Mary Preville Acting Director General, Office of Energy Research and Development, Department of Natural Resources

I can add a bit to my colleague's answer.

Through the clean energy fund, which Mr. Corey referred to, there is a component known as the renewable and clean energy demonstration. A call for proposals was launched in May 2009, and just in January 2010, 19 various projects were selected. Some of them relate to communities and the integration of various renewable technologies in communities in different regions across the country.

Through the ecoENERGY technology initiative, there is also support being provided to six integrated community projects under the EQuilibrium Communities initiative, which is led and co-funded equally by both Natural Resources Canada and Canada Mortgage and Housing Corporation.

9:15 a.m.

Conservative

The Chair Conservative Leon Benoit

Go ahead, Mr. Tonks.

9:15 a.m.

Liberal

Alan Tonks Liberal York South—Weston, ON

Could we have the inventory of those technologies you just mentioned, just to get the flavour of how this is actually happening?

9:20 a.m.

Acting Director General, Office of Energy Research and Development, Department of Natural Resources

Mary Preville

Certainly. We'll be glad to provide the committee with the list.

9:20 a.m.

Conservative

The Chair Conservative Leon Benoit

Thank you, Mr. Tonks.

We'll go now to Madam Brunelle for up to seven minutes.

Go ahead, please.

9:20 a.m.

Bloc

Paule Brunelle Bloc Trois-Rivières, QC

Good morning. Thank you for coming.

In the documents provided to us by the Library of the Parliament, I see that there are nine ecoENERGY programs. For the first program which is called ecoENERGY for Buildings and Houses, there are six components. Which of these programs has the largest budget? Is it the program designed for buildings and houses, as I would think?

9:20 a.m.

Director General, Office of Energy Efficiency, Department of Natural Resources

Carol Buckley

Yes. Merci de votre question.

The program with the largest budget is the ecoENERGY retrofit homes program, with $745 million.

9:20 a.m.

Bloc

Paule Brunelle Bloc Trois-Rivières, QC

How did you divide the money in the budget amongst the Canadian provinces? Was the money pro-rated on the basis of population or on the number of applications received?

9:20 a.m.

Director General, Office of Energy Efficiency, Department of Natural Resources

Carol Buckley

Thank you very much for the question.

The distribution of funds across the country is entirely demand-driven. The Canadian homeowners apply to the program from wherever they live, and that's how the grants are paid out. We don't carve out the grant by province; we hold it all in one budget, and Canadians apply wherever they live.

When I do the presentation on the program in more detail here--in just a few minutes--a slide in the deck will show the distribution of grant payments across the country. You can get a picture of how Canadians have taken up the programs province by province.