Natural Resources Committee on Feb. 21st, 2017

[Frank Des Rosiers]

The short answer is absolutely. The Prime Minister and the minister have been on record again and again in public forums to say that it's not a choice between greening the fossil fuel sector and trying to grow the renewable sector. It's trying to do both. Those contributions in terms of reduced emissions from the oil and gas sector are quite significant, as that sector is a major source of emissions for the country.

We've been leading the charge in innovating to get to where we are. From an innovation perspective, we should be quite proud of what has been accomplished, but there certainly is scope to do a lot more. The industry is seized with this, and are the Province of Alberta in particular, and the Government of Canada, which has been there to step it up.

I've mentioned that $50 million oil and gas demonstration fund, for which we have received high-quality submissions from those many recipients to do a variety of projects. Those should be announced in fairly short order. I'm glad to report that the Province of Alberta was also very much involved in it. They kindly volunteered some experts and scientists to help in the selection of those projects, and they are very supportive of what the federal government is doing. We see a potential to do a lot more of that for sure, going forward.

[John Barlow, Conservative, Foothills, AB]

That's great. Thank you.

[The Chair, Liberal, James Maloney]

Thank you.

Mr. Serré, you're next.

[Frank Des Rosiers]

If I may make a plug here, Chair.

Drake Landing was mentioned. It's a quite innovative seasonal storage project that has filled 100% of the heating needs of that community this past season. Yes, we do have a strongly increased interest in replication...on a large scale, perhaps in Canada or abroad.

[John Barlow, Conservative, Foothills, AB]

That's great news. Thank you.

[Frank Des Rosiers]

There's more to come.

[John Barlow, Conservative, Foothills, AB]

That's excellent.

[Marc Serré, Liberal, Nickel Belt, ON]

Thank you, Mr. Chair.

I have two points.

The first one is on IP, intellectual property. When we talk about a billion dollars in R and D investment, NRCan, and risk and the private sector, what is the department's position on intellectual property when you link to the private sector, university, and government-funded...?

[Frank Des Rosiers]

Maybe I could have the first crack and Julie could supplement this.

In terms of programming, some of the elements we are putting an extra emphasis on are twofold. First is the pathway to market overall. We want to make sure there are more compelling cases around it.

The second is around IP. We're looking to make sure that the companies have a more deliberate game plan when it comes to managing their IP, because in many cases if you're a clean-tech company, it's not so much your physical assets you own, but the knowledge you have created. This is really the value you have. Whether you're in a waste-to-energy business or in the bioenergy business, it's mostly that IP.

Right, Julie?

[Julie Sunday]

Yes, certainly in our funding, the IP is owned by the companies if it's a government-funded program, where there is collaboration with our national laboratories—which there can be. IP that's generated by the labs is owned by the crown, but different arrangements can be implemented to license and enable that IP to be used commercially.

We're looking at how we ensure that the IP generated is supporting Canadian industries. We're quite seized with that.

[Frank Des Rosiers]

The last point I would emphasize is around the IP for international projects. That's a tricky thing. For instance, when we do a joint project with the United States and the Department of Energy, who owns the IP?

Every government historically used to claim 100% of it. That isn't going to work. We have to find ways to find such solutions. We managed to do so with a $20 million demonstration project at our CanmetENERGY Ottawa facilities. The parliamentary secretary was pleased to integrate with the senior DOE officials, and we had to negotiate it.

As we're looking through Mission Innovation to do more of this international collaboration, we'll have to find ways to come to an agreement on IP.

[Marc Serré, Liberal, Nickel Belt, ON]

Thank you.

The second question is related to R and D. Australia has done a lot in the last few years, spending $2.2 billion on R and D. They have done a lot more commercialization when you talk about the valley of death. A lot of what they have done, they have learned from us over the last few decades.

Can we return the favour and have formal agreements with Australia, and visit them and have links with them to learn more about what they have done with the R and D to have commercialization, leading to clusters and all that?

[Julie Sunday]

They're in clusters.

[Some hon. members]

[Inaudible--Editor]

[Julie Sunday]

Absolutely. Part of what we've been doing over the past year and a half is really looking at some of those international best practices, and certainly Australia is on our list of countries to get to know.

In terms of our relationships, we have multiple international relationships but I would say, truly, we've been quite focused on a very intensive back and forth with the U.S from an R and D perspective. Certainly, that system is very impressive in hitting all the marks that Frank was talking about earlier, in terms of foundational R and D with the national lab structure, and translational R and D and moving stuff into the commercial space, pulling that research into commercialization. Disruptive innovation is the other one. They have an agency that's part of the Department of Energy, called ARPA-E, which is effectively an institute that generates disruptive energy technologies. It's one of a kind, but has proven to be a very effective model at generating those breakthrough technologies and creating new business lines, new cost curves that we know we need to get beyond the 2030 mark, and then finally, really good integrational structures.

So we've looked at that. Certainly we've looked at the U.K. system. Mission Innovation provides us with a real opportunity to get to know these 23 other countries that we're collaborating with, and we'll be doing that over the coming....

[The Chair, Liberal, James Maloney]

Thank you very much.

Mr. Cannings, we'll go to you for three minutes.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

I just want to pick up on Mission Innovation because you both mentioned it. It was announced in San Francisco last year, and everybody wants to get on the innovation clean-tech bus. Hopefully, it's an electric bus. I'm just wondering if there are sectors where you see Canada already leading, being a world leader, where we should perhaps concentrate both our efforts and our money and solidify our status in that world leadership, rather than trying to play catch-up in all sorts of other places. Not everybody can be a world leader.

Are places where you think we should concentrate?

[Frank Des Rosiers]

Sure. Mission innovation is one place where we're playing this, and some of you will have noted that Minister McKenna contributed to that announcement in Marrakech at COP 22 around the seven challenges identified in Mission Innovation. These will be pursued as priority areas in the coming years.

Canada is co-chairing this set of activities with the United Kingdom. So we play quite a significant leadership role, and the one area where Canada has already put its hand up to be a global leader is around bioenergy. Generally, countries widely recognize Canada as a world leader in this domain, but we're also playing quite actively in a number of other domains, like smart grid energy storage, where we have a lot of strengths, both nationally and in our companies, especially in the Toronto area. We've got quite a strong concentration of companies in this space. Off-grid/remote communities were also specifically identified as one of the seven priorities, and I mentioned earlier to committee members our keen interest in Canada to make some headway. We think we have important things to contribute in that regard.

Another area I would note is carbon capture, utilization, and storage. As we know, we have large-scale commercial sites already fully operational in the country and have made a lot of progress lately with the technologies on the use side of CO2s. There's an Xprize competition currently under way that is co-funded by Canadian producers, and we're now at the finalist stage, with 28 or so finalists. They want to bring it down to the top five. That's a pretty exciting area where we're looking for global solutions to that issue of the use of CO2s, and on the capture side of CCUS, Canada is very much a world leader, along with the U.S., I would say. We're probably the top two nations in the world in bringing the cost down, which is the main focus.

I wouldn't want to lose sight of sectors that maybe are seen by some as less sexy, but where Canada has a lot to offer. One of those sectors is energy efficiency, because a lot of our energy ends up being used in our residences and a lot of solutions have to be tailored to our climatic conditions. A lot more can be done in that regard for houses, commercial buildings, and industrial sectors. So I think it's important to keep an eye on those.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

[The Chair, Liberal, James Maloney]

That's fantastic. Thanks very much, both of you. I said at the beginning that you were starting us off, and you did a tremendous job. So thank you very much for taking the time to be here today.

[John Barlow, Conservative, Foothills, AB]

It's a good start.

[The Chair, Liberal, James Maloney]

I believe that's it for today. The meeting is adjourned.