Natural Resources Committee on Nov. 22nd, 2012

[Voices]

Oh, oh!

[Carolyn Bennett, Liberal, St. Paul's, ON]

Evan?

[The Chair, Conservative, Leon Benoit]

Go ahead, Mr. Chrapko.

[Evan Chrapko]

As a waste-to-energy solution, we are finding ourselves in numerous jurisdictions—not just in Canada, but around the world—in underserved, disadvantaged communities or in communities that lack infrastructure. What we're doing is inherently smaller-scale; it means that we do not depend on a smart grid or a transmission and distribution infrastructure that has to be built in advance.

The answer to the question goes beyond the communities that you're specifically asking about to anywhere in the world that's more remote or that has people. They have waste and they need power. Converting their waste to energy can be done on both a small scale and a large scale.

To the earlier question from Member Trost on what we can do that doesn't involve spending money, the answer in part is that we can re-emphasize Canada's long-standing reputation or commitment to humanitarianism and development in the third world by looking at using the renewable sector as a vehicle for delivering some of this aid, essentially to power societies or to power communities all over the place, including in our own backyard.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Chrapko.

Mr. Schmidt.

[Glen Schmidt]

Thank you.

I think the words you used, Ms. Bennett, were bang on: the partnership that you would have with the community. We're a participant in the Wabasca community. We have an office within the community and it is staffed from the community, which puts us in a position where we can communicate. In 2011 we had $50-million worth of contracts within the community. We chair an industry group, so there's your sense of partnership.

How do we build capacity? It's a great question. We do it by asking the community. Our involvement with the other industry members in answering that question is called “managing growth”. We work with chief and council. We work with the social institutions and the schools within the community of Wabasca, not just to ask the question about training—which we're looking for, and I'll come back to the potential impact on training within the Wabasca community—but to ask where we could or should make a difference in the donations or the contributions with the community, and where it's viewed that it has the greatest effect. We've had great success with the community in directing those investments to where they identify the need, rather than us assuming what it is.

With respect to jobs, the metaphor I used is Calgary. I was born in Calgary. One member of our board of directors described Calgary in the 1960s and 1970s as being full of Texas and Oklahoma accents, because the geologists and engineers did come from the U.S. Today, we come from Calgary, from Kingston, Ontario, or from Halifax. It's the same thing in the community. People flying in are currently more dominant in our workforce, but our commitments are to train in the local community. Our incentive to do that is not only the retention, but also the direct impact on the community from really good-paying jobs. At an operating level, I'm talking about jobs that are in the six figures.

Our direct commitment isn't just partnership and participation. It's capacity building with the local industry and it's listening to the community, not only in how we participate in meeting needs, but in how we can jointly work together to meet mutual needs between jobs and a long-term sustainable workforce—and jobs of quality.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Schmidt.

Thank you, Ms. Bennett.

We'll now start the five-minute round with Mr. Anderson, for up to five minutes, please.

Go ahead.

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

Thank you, Mr. Chair, for the time. I wish I had a little bit more because I have a lot of things that I would like to talk about.

I want to ask each of you a question.

My first question will be to the solar industry.

For the other two, Mr. Chrapko, I would like you to talk to us when we get to you about the technology and innovation involved in your process.

I want to ask the same question of Mr. Schmidt. I understand that you spoke about using propane and butane to enhance recovery of the oil sands. Can you talk about the innovation involved there? I understand that you're using a technology involving radio frequency. Could you be prepared to talk about that technique and the innovation involved in it?

I want to start with solar. Mr. MacLellan, I have just a couple of observations. When you talk about the subsidization from Germany, if my math is right, it costs them about $125,000 per job in direct subsidization. A few years ago, I looked at putting some solar panels on my property. I live on a farm towards the end of the grid. One of the issues—and I see that from the subsidization—is the cost. There's a high cost involved if people are going to participate in solar. Also, there has been a short lifespan for the product.

Can you tell us what you have done in the last five years that has changed either the length of time that the technology can be used or the cost of the technology? You showed us a very innovative product here this morning. What are some of those things that you've been doing?

[Ian MacLellan]

Let me address, first of all, the longevity. Next time, call us, and we'll give you a solar system that will last a long, long, time.

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

Perfect.

[Ian MacLellan]

When the Russians sent up Sputnik, it had a battery that lasted for two weeks. When the Americans sent up Vanguard, it had a solar cell from Bell labs on it, and it lasted for six years. Solar works in outer space. It's extremely reliable.

I was at a conference recently talking to an expert scientist from the NREL. I was saying that I wanted a really good date, and I asked how long these things really last. If they're built properly, he said that they don't know, but it's probably at least 40 or 50 years. In fact, to use an example, and I'll touch a bit on innovation shortly—

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

I don't have too much time.

[Ian MacLellan]

Okay. To use an example, this is a kilogram of silicon, and that's the main thing used to make solar cells. One kilogram of silicon, over its useful life, will produce about 10,000 kilowatt hours or about 5,000 litres of gasoline in an electric car. There are 5,000 litres of gasoline right there. The innovation is driving this very, very quickly.

I want to touch on your cost situation. When we opened up in Germany and started producing solar cells, we were selling them for about $12. Now they sell for $1. It kind of hurt our business model because we didn't build a big enough factory, but the costs have come down dramatically in the last five years.

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

We'll give the other two a chance to answer, and then I'll come back to you if we have time. I appreciate that response.

Go ahead.

[Evan Chrapko]

Thank you, Mr. Anderson.

Our process involves essentially what's happening in everybody's stomachs in this room now: digestion. We combine that with patent-pending algae technology to take care of—like your own digestion, there are byproducts—the byproducts we have, which can be further enhanced with algae, one of the most ancient organisms on the planet. We're harnessing natural, highly-evolved processes and bacteria to create energy from waste. It ends up being combined with some other technologies to produce a liquid biofuel that's zero, or negative, in its carbon impacts. Believe it or not, this is counterintuitive, which is the nature of research and renewables. We're producing essentially the carbon capture and sequestration answer via liquid biofuels.

As you're taking advantage of what's out there in the natural world, you end up leaving the planet a better place. Dr. Steven Chu, the U.S. Secretary of Energy, is rumoured to be stamping from foot to foot wanting to do the sod-turning on that big plant that I described in Kansas. Our owners are staunch Republicans, so they weren't going to have any of that kind of ceremony, but it does speak to the immense interest that we are now raising at utility-class scales.

We're not talking about doing little stuff. We're doing things on a global basis that are getting attention at the highest levels. Your support through Western Economic Diversification for a not-for-profit that we started to help our brother and sister companies in waste and in algae technology under BECii.ca will further enhance the processes that you're asking about as we bring little companies together and integrate their offerings.

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

Thank you.

Mr. Schmidt, could you answer the question, please? I think we're almost out of time.

[The Chair, Conservative, Leon Benoit]

You are.

But we'll have a short answer, please.

[Glen Schmidt]

On your first question on solvents, this is learning from the past. In the late 1970s and early 1980s, Alberta led the world in the recovery of light oil, using propane or ethane in natural gas. Recovery factors in reservoirs—I first started doing this out of school in 1981—went from 50% to 70%. So it's taking a natural constituent, mobilizing the oil more effectively, and leaving less behind.

Those same principles can be applied to in situ or thermal recovery. You don't have to mobilize bitumen just with heat. You can do it with natural constituents from oil. Propane and butane are part of that process.

Your question on radio-frequency heating comes back to the early stage that we're in. Can we take a different form of energy to mobilize bitumen? We're quite excited about radio-frequency heating because, based on the work we have done to date with our partners, we can deliver more energy faster. We've tested the antennas. We have been at the Suncor mine face to put in a horizontal well to demonstrate that we can propagate the energy, that we can heat the oil, and we are now moving to doing it underground. We're probably five to seven years away.

But the “can you imagine?” component is this: what if we went to the limit, that is, no steam, no water, electrical energy driving radio frequency to mobilize bitumen in the reservoir and supplement that with a natural constituent such as propane or butane? It would be a very elegant answer.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Schmidt.

Thank you, Mr. Anderson.

Mr. Calkins.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

I'm just going to continue on that vein.

Mr. Schmidt, are you talking about a microwave application? Is that what we're talking about here with the radio frequency?

[Glen Schmidt]

Radio frequency isn't a microwave. It's part of the electromagnetic spectrum, like the light in the room. It's just a different portion. It delivers heat as microwaves do for water. It's a similar idea.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

I have constituents who use a similar technology for cleaning up spillage or ground contamination from various sources, such as an old gasoline or petroleum station. The probe that is put in the ground attracts the hydrocarbons through the structure. Is that the same technology you're talking about? Are you talking about applying the electromagnetic or the microwave and using a similar type of gravity drain collection mechanism?

[Glen Schmidt]

You are right in the last sentence. We mobilize the oil and then we collect it in a well by gravity drainage. The science in that part is simple. Make it mobile, let it drain to the bottom, and then pump it to the surface.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

If you don't add a diluent, if you're not adding propane or butane, if you simply apply the heat that way, obviously the carbon footprint on that would be low and the use of water would be virtually zero. In a what-if scenario, when that product gets back to surface, could you not put it into a container where it would re-solidify for shipping?

[Glen Schmidt]

You would have to dilute it for shipping. You would require a diluent for transportation.