Natural Resources Committee on Oct. 23rd, 2017

[Jamie Schmale, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

Okay. I thought it was around supply. I thought that's what we were talking about.

[John Matthiesen]

As more electric vehicles come onto the grid, there's going to be an increase in—

[Jamie Schmale, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

Exactly, yes, that's what I asked, but you also mentioned that Ontario does have a surplus in electricity, as do Manitoba, Quebec, and a number of other provinces. How much focus do you think we should be putting on the intertie, on the demand for the federal government to get involved and move forward?

I know that many of the witnesses have said that it's a piece of the plan, but not the main driver. I'd like to hear your thoughts.

[John Matthiesen]

I would agree with what you've just mentioned. I think it is a piece of the plan but not the main driver.

I think that when you look at the future of transmission networks, at where they're going, it's more microgrid, more community and smaller scale.... It's going to be local supply with local load where possible. On the long-distance transmission lines, I think they make sense when you have a very large, very clean, and very reliable power source, such as Quebec might have on the hydro side. If there's a way to bring that elsewhere, I think that makes sense.

Large coal is pretty much gone. For large gas plants, there are some of them, but they're getting closer to communities—either that or communities are expanding closer to where the gas plants are.

Personally, I believe it's more in the community, smaller-scale area. That's where the challenge is going to be and the need will be.

[Jamie Schmale, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

Thank you, sir.

I'll turn it over to my colleague.

[Shannon Stubbs, Conservative, Lakeland, AB]

I think I might only have a minute and a half, so I might not get to a question.

I want to recognize the exceptional work that WorleyParsons has done, including a 2014 study that compared Alberta with nine other oil- and gas-producing jurisdictions around the world and found Alberta to be a leader in environmental standards enforcement, compliance, and transparency.

I want to thank you also for pointing out in your presentation—and citing specific examples—that the conventional oil and gas companies and pipeline companies in Canada are among the biggest private sector investors in renewables and energy projects and technology. I think it's important to recognize that this innovation and this culture of technology and advancement are part of the same continuum, and not opposed to one another.

I was a little concerned last week. We heard the NEB say that they believe there's a lack of information with respect to renewables. The witness said, “Whenever we do these analyses, and we do them regularly, it takes a great deal of our staff's time and effort to come up with what the current situation is.”

She also said, “When we're looking at policy and changes to the energy system, if we had better.... What is the current state of events? We also have very poor information in Canada with respect to renewables. We have struggled to try to fill that gap.”

When you look at the percentages in the total amount of federal grants and contributions in Canada given to the energy sector in 2016-17, you see that 75% went to wind, for example, and only 6% went to fossil fuels. I think this discussion around cost mitigation for consumers and respect for taxpayers is a serious one, especially given the multi-million dollar collapses of renewable energy companies in the U.S. that have left taxpayers on the hook financially, but also with significant environmental mitigation and land surface disturbance, and the storage of hazardous waste that now needs to be disposed of because of these publicly funded—

[The Chair, Liberal, James Maloney]

I'm going to have to stop you there.

[Shannon Stubbs, Conservative, Lakeland, AB]

—companies that went out of business.

[The Chair, Liberal, James Maloney]

Usually I'll let you go over to finish answering a question, but since there isn't one, we'll move on.

[Shannon Stubbs, Conservative, Lakeland, AB]

I would have welcomed your insight on how to mitigate those risks.

[The Chair, Liberal, James Maloney]

Mr. Tan, it's over to you for five minutes.

[Geng Tan, Liberal, Don Valley North, ON]

Thank you, Chair.

The committee has heard about some benefits of strategic interties. Ontario, B.C., and Quebec all produce more electricity than they can consume domestically. As a result, all three provinces sell their surplus power to other provinces, and as you or the other witness mentioned, to the U.S.

The greater intertie coordination and the quota needed for more efficient energy management by the provinces as a whole means they're going to be selling more electricity to other places. Of course, they can use the surplus power to produce hydrogen by electrolysis, like you mentioned, but they can also sell more power or electricity to the U.S.

How might this impact on the Canada-U.S. energy trade and their relations?

[John Matthiesen]

I'm not sure I'm in the best position to answer that.

I'm more of a power generation guy, and—

[Geng Tan, Liberal, Don Valley North, ON]

I'd ask the other witness, but he's gone, so I'm asking you.

Anyway, if you don't mind, I'll go to the next question. This one you might be able to answer better, based on your study and background.

Our committee is currently studying the strategic electricity interties with a focus on five aspects, which probably you have heard somewhere: the regional electricity independence, low-carbon electricity distribution, opportunities for alignment with the Canada energy strategy, the Canada-U.S. energy trade and relations, and the fifth is employment and the economic impact.

From your study, how might the government best prioritize these five aspects in order of importance or need? How close is your company aligned with any of or all of these five aspects?

[John Matthiesen]

I'll answer the second question first.

One area where we're seeing a lot of opportunity and connecting to the Canadian energy strategy is around energy efficiency. We're seeing quite a shift in some of our traditional clients in the hydrocarbons, petrochemicals, and mining sectors, where costs are becoming more important. The price that they can sell their product for is reducing. They're looking at how to more efficiently generate their product, and their electrical consumption is high on that list—and water, actually. Maximizing electricity and water are both taking a priority.

On energy efficiency, we've been doing some work with some mining clients and refineries around how to make their assets operate with less power. We have a large office in Sarnia—several hundred people down there working with a number of players. In Alberta, Edmonton, and Calgary, we do a lot of work out there with oil and gas clients in this space.

I'm going slightly off topic, so if you want to bring me back to any particular point, let me know.

[Geng Tan, Liberal, Don Valley North, ON]

Go ahead.

[John Matthiesen]

Other areas where we see real opportunity are around innovation. I know there are some innovation clusters being developed. I think that's really important, both from branding the country from a technology perspective, as well as connecting to universities and training the next generation of employees in the new energy industries.

Personally, I went to the University of Waterloo. I think there are a number of great technical universities in the country that are contributing to the innovation, as well as small technology companies.

There's also something to be said about putting some of these innovation hubs closer to the universities. Again, slightly off topic, but if you look at how RIM was created, being well connected to a technology university, the close proximity, was beneficial. I think in the energy sector, if you're looking for companies that are creating new technologies and driving that growth, there's something to be said about linking that with technical universities.

I didn't quite answer all your questions, and I apologize.

[The Chair, Liberal, James Maloney]

We're out of time, unfortunately. We'll stop there.

Mr. Matthiesen, thank you very much for joining us, and again for adjusting your schedule to accommodate us.

We're going to suspend the meeting for a couple of minutes and then we'll go into committee business. We'll let you go. Thank you again.

[Proceedings continue in camera]