Evidence of meeting #63 for Natural Resources in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was technology.
A recording is available from Parliament.
January 29th, 2013 / 4:55 p.m.
Manager, Technical and Utility Affairs, Canadian Wind Energy Association
To be honest, I'm not entirely familiar with it. I don't have much to say on it.
NDP
Laurin Liu NDP Rivière-des-Mille-Îles, QC
I would also like to ask Mr. Gray a question.
A number of businesses, including RIM, have already said that this could result in the outsourcing of research and development.
Are you also seeing this trend in the oil industry?
Director and Professor, University of Alberta, Centre for Oil Sands Innovation at the University of Alberta, As an Individual
My impression in the oil industry is that we're seeing growth, research, and investment in Alberta although I don't have the statistics in front of me. We're also seeing international groups interested in getting more involved in R and D on energy-related issues across the board. I see an increase in research activity rather than outsourcing, which I think is the kind of issue you're referring to, Ms. Liu.
NDP
Laurin Liu NDP Rivière-des-Mille-Îles, QC
Let me go to another topic.
Some witnesses, particularly the representatives from Écotech Québec, suggested the idea of a marketing tax credit.
Mr. Whittaker, do you think that is a good idea?
Vice-President, Investments and Chief Technology Officer, Sustainable Development Technology Canada
One of the recommendations from the Jenkins study was providing these coupons, if you will, for different types of activities. And the value-added services, so the marketing services and being able to put together proper business plans, raise financing, the types of things we're doing at SDTC, the follow-on financing and quick adoption, are all good things to do. Whether it happens as a tax credit, which is something that smaller companies have a more difficult time taking advantage of—larger companies have an easier time taking advantage of it in general—or it happens through a different mechanism, the need is there. I think the need is correctly identified. The actual instrument is certainly one that can be debated.
NDP
Laurin Liu NDP Rivière-des-Mille-Îles, QC
Thank you.
I also noticed that you calculated the total annual reduction of greenhouse gas emissions as a result of projects funded by SDTC.
How many megatonnes do you expect Canada to eliminate?
Vice-President, Investments and Chief Technology Officer, Sustainable Development Technology Canada
That's a great question.
The data that we have.... It's eliminated over time, and recognize that these are all around implementation, and so depending on the uptake and depending on how you calculate it, and the timeframe that you take it.... So this becomes a “how long is a piece of string” type of question, because there are a lot of caveats and conditions on how you actually measure your emissions: are you measuring at a point in the year, or are you measuring the net emissions? What we've done is a net present value of these emissions over time, and what is the societal benefit, because people think in dollars and cents, they don't think in tonnes of CO2 necessarily.
When we look on the domestic side, the net benefit from our early investments, which were just several hundred million dollars, show that it's several billion dollars worth of return. So there has been a 14 times, 15 times return on that kind of investment. Those are kind of the figures we're looking at. That's how we do the math on emissions and turn them into a quantifiable economic value.
Conservative
The Chair Conservative Leon Benoit
Thank you, Ms. Liu.
We go now to Mr. Leef for up to five minutes.
Conservative
Ryan Leef Conservative Yukon, YT
Thank you, Mr. Chair, and thank you to the witnesses for attending.
We heard in past testimony, and I think it was Mr. Gray who touched on this a bit...maybe I'll just put this question to everybody in order. Mr. Gray was talking about better operational strategies for today and then seeing technology show its benefits three to five years down the road. We did hear that from past witnesses, who were talking about how what they were doing to contribute to innovation was largely just trying to find ways of improving day-to-day operational strategies and not necessarily seeking out the latest and greatest technology that will see benefits down the road.
Could we start with Mr. Levy, and then Mr. Whittaker, and then we'll go over to the gentleman joining us by video conference? Maybe touch on what things you're involved in, or your appreciation for where operational advances are today prior to looking at the longer-term technology things that we're talking about.
Manager, Technical and Utility Affairs, Canadian Wind Energy Association
The today stuff is certainly around issues such as icing and forecasting; when icing is going to occur and day-to-day management of a wind farm that has received an icing event and is shutting down. The long-term stuff is certainly around storage and whatnot, and where is that. When do you make those investments? Is it based on a certain level of wind in the system, or is it based on the economics of actually building and implementing those? As wind forecasting improves, they can put that in the control rooms immediately and start using it in day-to-day operations, which immediately see efficiencies in overall dispatch of energy.
Vice-President, Investments and Chief Technology Officer, Sustainable Development Technology Canada
Thank you.
We've looked at this issue together with McKinsey & Company quite extensively. It comes down to risk, and every shareholder in the shareholder base behind these companies has different expectations of risk and return. And so if you look at the building sector, clearly you can get 80% of your efficiency gain in improved operations, the actual better operating of the building itself. It's not to say don't do new technologies, you have to, but it's in the operations that you're going to realize those savings. If you look at other sectors, they're different in the way that they invest in R and D, in what shareholders expect, and so all of that needs to be taken in the context of how you implement a new technology strategy. For some, you will be able to capitalize it very easily and readily and implement it. For other ones, it's going to be a long haul before you get these technologies adopted. Each sector, whether it's transportation, building, oil sands, has its own kind of profile for adoption.
General Manager, Supply Chain Management - Operations, Business Services, Suncor Energy Inc.
Having been a GM of operations, this is actually quite an interesting area for me.
As we're introducing these new technologies, I guess the real trick is to operate what you've got as efficiently as you possibly can. You'll see within Suncor that we have quite a big push on what we call “operational excellence”, which is really just tending to your knitting: monitoring your operations and keeping things within tighter bands.
If you look at some of these air emissions intensities as well as the water usage numbers I referenced in the prepared notes, those largely came from really the operators doing the right things at the right time, monitoring things more closely, having the right metrics and measures, and so on.
The operations side is rather mundane, I guess, but there is quite a bit of opportunity in that.
Director and Professor, University of Alberta, Centre for Oil Sands Innovation at the University of Alberta, As an Individual
All I'd like to add to my earlier comments, Mr. Leef, is that if we look across the energy sectors, both renewables and non-renewables, they're all characterized by huge capital investments for energy generation, distribution, and delivery. Whenever you have that situation, you have a strong incentive to operate as efficiently as you can and to get every possible benefit out of the investment.
Conservative
Conservative
Ryan Leef Conservative Yukon, YT
Okay.
Mr. Whittaker, you sort of touched on this, the fact that 80% of efficiencies are found in operations. You articulated that this is not to say that you don't invest in newer technologies and move on. But I guess the same could be said, then, about the government's strategic approach to funding R and D: strategic investment on the government's part is as sensible to find those efficiencies and where to invest as it is just about...you know, pouring a whole bunch of cash into a pot and saying, “Have at 'er, boys”.
Would you agree with that?
Vice-President, Investments and Chief Technology Officer, Sustainable Development Technology Canada
I would say that you have to be selective. You have to be really selective.
I mean, the reality is that you can't put everything into a single initiative or be too broad. You actually have to pick where the biggest gains will be made. When you're operating something new, because it's operations, you have to make sure that you've commercialized that thing appropriately, that it can be operated.
That's really where the gap exists. When you commercialize new technologies, you can have dozens of new technologies, but they don't get adopted because they can't be operated. It's that gap in there that says, as we commercialize these things, let's make sure they get used.
Conservative
The Chair Conservative Leon Benoit
Thank you, Mr. Leef.
We go now to Ms. Crockatt for up to five minutes....
Oh, my apologies, Monsieur Gravelle. I don't know how I could miss you.
Conservative
The Chair Conservative Leon Benoit
You should be heard. You have up to five minutes. Go ahead, please.
NDP
Claude Gravelle NDP Nickel Belt, ON
My question is for Mr. Wamboldt. I want to quote from a Globe and Mail article entitled “Dramatic temperature increases could threaten Canadian health, infrastructure”.
In the article, a Mr. Blair Feltmate is quoted. Mr. Feltmate runs Canada's Climate Change Adaptation Project. I'll just quote from the article:
...Mr. Feltmate said. But “climate change is a done deal. There’s nothing we can do to turn it off....How do we adapt to that new reality?”
Now, I'm quoting this because of the tailings:
Take tailings impoundment areas—the ponds used to store mine waste. Mr. Feltmate said many of the ponds in northern areas were designed “with the idea that permafrost will be in the ground permanently.” In many regions, that isn’t the case.
Can you tell me if this is something that you're looking at? Is this a big issue? And what are the solutions?