Thank you, Mr. Chair. I'll be giving the presentation.
Thank you for the opportunity to talk about innovation and energy today, with a focus on energy supply. It's an area where Canada does a lot of very good work and work we can be proud of.
For opening remarks I'd like to talk a bit about the global context of the energy outlook, and talk as well about energy and the Canadian economy, because that really sets the frame for what we do in innovation and R and D in the programs that we run.
We'll talk about science innovation activities and some international comparisons, as well as public expenditures in energy research.
To wrap up, I'll talk about some of the technologies that we're focusing on in renewable energy, as well as what we do with respect to oil and gas.
On slide 3 you see the global outlook produced by the International Energy Agency going forward to 2035. What you see is that energy demand is expected to grow by 40% and that fossil fuel will remain the dominant type of fuel being used, about 80% of the total.
Ninety per cent of the growth is in the non-OECD countries, and by 2035 we expect China to be consuming about 20% of all energy produced at that point in time, which will be at that point about 70% more than the U.S.
One note from the IEA as well is that as we go forward, the U.S. is becoming less dependent on energy imports. That will certainly be true by that timeframe.
Slide 4 is a busy slide, but it's really trying to show that energy in Canada is much more than oil and gas. There are other resources such as coal mines and uranium. There is quite a lot of potential for renewable energy in Canada. There is a lot of tidal energy potential, there is nuclear, and there are some refineries, so there is quite an infrastructure right from coast to coast to coast in Canada.
There are also other things that do not fall on this map but are required for energy going forward, things like rare earth minerals, which will be an important part for energy technology going forward.
Slide 5 shows that Canada is a global player in energy. The oil sands are currently estimated at about 180 billion recoverable barrels. This is expected to grow to over 300 billion barrels as technology improves.
For shale gas, 6% of the world's technical recoverable resources are in Canada, and for uranium it's 9% of the known recoverable resources.
Canada has a very clean electricity supply already. Over 75% of our electricity is generated from non-emitting sources, consisting mostly of hydro but also including nuclear and other renewables.
Renewable wind power installed capacity could reach 12,000 megawatts by 2015.
There is also significant potential in a number of areas, both in traditional resources such as oil and gas in the north as well as quite a lot of potential for energy in wind, solar, bio, marine, and geothermal sources.
What Canada does with these resources has significant impact on Canada's economy. As I mentioned, we're third in the world in hydroelectricity production; second in uranium production; third in natural gas production; third in oil reserves, behind Saudi Arabia and Venezuela; and sixth in oil production.
You can see the raw numbers of the contribution to GDP, to employment, and to exports, and 24% of total public and private investments in Canada are related to energy.
In terms of science and innovation in Canada and how we perform in this area, a chart from the OECD on page 7 maps out how Canada does. It's not specific to energy: this is all science and innovation. The graph indicates where Canada is above or below the OECD average.
Canada actually does very well in scientific publication, does well in the number of degrees in science and engineering, in the percentage of researchers employed per thousand employed, and it does well with patent, with foreign co-investors, and with the number of firms with new-to-market products.
Where Canada lags behind is in the business expenditures in R and D, in venture capital as a percentage of GDP, and in what's called GERD, which is the gross expenditures in R and D.
When you then look specifically at what Canada does in energy R and D, Canada ranks third in the world in expenditures with respect to the per cent of national GDP. These are numbers that are derived from the IEA and from the OECD.
The federal government, in this capacity, is a key investor in energy research and development.
We show what percentage of federal investments go towards cleaner fossil fuel, which is about 29%; renewable and clean energy, which is about 43%; distribution, including a pipeline and grids, which is about 12%; and energy efficiency related to transport, buildings, communities, and industry, which is about 16% of our expenditures.
Who else contributes to R and D in Canada? On the supply side, the federal government invests about $468 million per year. The provinces invest about $400 million in energy R and D. The private sector invests $1.2 billion in energy R and D, mostly on the fossil fuel side. This is one place where energy R and D differs from some other S and T areas in Canada, in that industry is contributing quite a lot to the R and D being performed in Canada.
Natural Resources Canada manages a number of key clean energy programs. One is called the program of energy research and development. It has been in place since the mid-1970s. It was put in place after the oil embargo. It has been investing in federal laboratories and driving clean energy development, and invested in energy security in the early days. It has a core funding of around $45 million per year. It has four federal departments. On the supply side, there's work on unconventional oil and gas and frontier oil and gas; clean coal and carbon capture and storage, CCS; Generation IV nuclear; and renewables and clean bioenergy. The focus of this program is to minimize the environmental footprint of energy developments, not on finding more oil or gas.
The clean energy fund was a budget 2009 initiative, and its investments are in large-scale CCS demonstrations. There is significant leverage of investments by provinces and industry in this project. There is also a small-scale demonstration component focusing on renewable energy and integration of renewable energy into the grid. Again, there is significant leverage: for every dollar we put in, two dollars are invested by industry.
Budget 2011 had the ecoENERGY innovation initiative, which has two components to it, one of demonstrations looking at integration of renewable energy and one of R and D in clean electricity and conventional oil and gas and bioenergy on the supply side.
Where fossil fuel energy is concerned, the key objectives are cleaner fossil fuel, with few or no adverse environmental impacts in terms of greenhouse gas, air contaminants, water quality, and water quantity used in fossil fuel developments. The highlights would be the number of CCS projects that have gone ahead and have been applied to coal-fired power plants and to bitumen upgraders. There was a recent announcement by Shell about their facility in Alberta, and it reduces emissions in that particular facility by 35%.
There has been development and testing of technologies that reduce water use by increasing recycling and reuse of water and air emission by improving process efficiency and by improving tailings management through reduced tailings inventories. A lot of the work contributes to standards and regulations that mitigate environmental issues and safety, particularly offshore and in northern Canada. There are a number of key performers, including universities and provinces, and the private sector is a major performer of R and D in this area.
Under renewable energy supply, the goal is really to develop and demonstrate clean, renewable energy sources and to get to a point where they will be cost-competitive with other traditional sources of energy. In our highlights, there are 35 demonstration projects going ahead conducted by the private sector that integrate technologies into their operations for renewable power. We are demonstrating technologies in harsh climates and environments, whether it's in Canada's north or in the Bay of Fundy with marine demonstrations.
We have a number of projects looking at gasification technology using biomass to provide heat and power. There is also mapping of industrial waste sources, food waste, and yard waste that can be converted into power, and scaling up a number of technologies from buildings to communities. Key performers involve a very broad range of performers, from federal and provincial governments to power authorities and a number of technology companies, as well as a number of aboriginal groups that are looking, in off-grid communities, to integrate renewable power into the community to displace things like diesel.
The end goal is to position Canada in the global energy technology market. There are a number of areas where we have leading-edge, competitive technology, including heavy oil, shale gas, traditional hydro, bioenergy, and nuclear. There's been a lot of work done by Canada. It's a market that we see will be large in the future and where Canada is well positioned.
There are a number of emerging competitive technologies, such as carbon capture and storage, in which Canada is a world leader. We are a leader in natural gas, biofuels, and solar. There are a number of areas where Canada does not have a competitive advantage, such as gasification and geothermal. There is a large potential for geothermal in western Canada, but it has not been developed to date. We also have a considerable potential in wind energy.
In conclusion, globally we see the energy demand growing significantly, with much of that growth being in developing countries. Canada has abundant fossil fuels, which are expected to be 80% of the supply, and a clear advantage in many technologies. We have a vast and diversified energy endowment and we're a key global player in a number of different resources.
We provided to you a document that we use within NRCan. It's an energy fact book. It's available in both French and English. It gives you some basic facts about where Canada is situated in a number of resources and what this means for the Canadian economy.
With respect to R and D, Canada ranks third among OECD countries in energy R and D investments and expenditures as a percentage of GDP, and 43% of our R and D money is spent on renewable and clean energy supply.
We have leading-edge and emerging exportable technologies in a number of areas, and these are areas we're pursuing and looking at for future investments.
