Natural Resources Committee on Nov. 22nd, 2017

[Pierre Lapointe]

I would go back to the new clients. We are having an issue, and I'll give you a very specific example of the case of the biodiesel project in La Tuque. We have Neste for producing the biodiesel, and we have the biomass, but we need to get to the gas station. We need to have those types of partnerships, and we don't right now. This is very difficult and very costly. If we, both FPAC and FPI, don't have that type of flexibility, this is going to increase the time to market. The issue the forest sector is facing is time to market on those new projects. We really have to be able to de-risk and to get to those new markets.

[The Chair, Liberal, James Maloney]

Thank you.

Mr. Cannings.

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

Thank you for coming before us today.

Both of you mentioned the mass wood technologies, the tall buildings, and bridges. We've heard from previous witnesses that Canada is a leader in this technology in terms of North America. I wonder if you might comment on where we are vis-à-vis the United States. I know Europe is probably head of us, but where are we in the North American context?

[Pierre Lapointe]

We are a leader. I will give you two examples.

The first one is that the “Cross Laminated Timber (CLT) Handbook” technical guide for the U.S was produced by FPInnovations. I make my case. If you look at the producers that we have in Canada, whether it be Structurlam in B.C. and Nordic Structures in Quebec, they are already exporting. Nordic is doing the Buffalo Sabres' second arena. They are really good examples of our leadership.

What we need to make sure is that every province is really buying into that. B.C. and Quebec have done a fantastic job. Now we have succeeded in getting Toronto into the market. I think that the best way to export is going to be the ability to do it ourselves everywhere in Canada.

[Robert Larocque]

I just want to add from a technical perspective that I completely agree, but also from a policy perspective, Europe is ahead of us. In Canada, there's some wood procurement policy, if you want, but we're working with the federal government to have some kind of low-carbon policy that would allow that. For example, we're working on the building codes.

Another concept that Europe is ahead of us in is called embodied energy. When you're building a building, you also have to look at the material and not just the energy used. We're still far away from that in Canada. We are working with the government right now through the building codes, but it's another aspect that allows wood to be used.

We are still ahead of the United States though. Europe is ahead of us.

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

Yes.

When you say “embodied energy”, are you talking about that sequestration of carbon?

[Robert Larocque]

When you build your building right now all the concepts that the government is working on...net zero energy, for example, is just the energy that you use to heat it using natural gas or solar panels or whatever.

What we want is when you're looking at building a 20 storey building, you look at the carbon it took to make the steel, the wood, the concrete, and all that. It's a full life cycle carbon accounting of your building.

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

Okay.

Is that done in Europe?

[Robert Larocque]

That's done in Europe, in Austria. Germany is very close to it. Companies are reporting on it. In order to access government funding, you need to say what the carbon impact is of your proposed building.

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

I think you briefly mentioned something about federal government procurement, government monies to build these buildings to help companies.

[Robert Larocque]

It's not only the building part of it that's important. The Government of Canada does build buildings, but it's also there are billions of dollars in infrastructure. I think there were $12 billion to $15 billion coming in on infrastructure that go to the provinces. It would be nice to have some kind of a low-carbon policy attached to that funding to make sure what we are building with that money has a low-carbon impact.

I know that the government's looked into it. I've been to a couple of workshops on concepts. There are a couple of private members' bills that are in the House on that concept right now. We would have full support to....

We feel that the forest side and the product side have been a little bit slower to work versus the energy side. It seems that all the effort was spent on the carbon tax, the carbon fuel, and justifiably, as a lot of the emissions come from those sectors, but we would like to see that those other polices would move as quickly under the pan-Canadian framework. They seem to have been delayed.

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

When you talked about infrastructure monies, were you just talking about the monies we're giving provinces and municipalities or were you talking about using wood in things other than buildings?

[Robert Larocque]

Yes. There's the bridge that Jean-Pierre was talking about.

We have a perfect project for communities. I think it's London that wants to go to completely zero energy, but unfortunately they can't build a 106 storey building. Those are some examples of where the federal government could have the leadership and say that you can build up to 12 with the money attached to it.

That's what I'm talking about. It's not just a building. I think it's infrastructure in general.

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

Do any of you have any details on the cost of, say, the Mistissini bridge versus what it would have cost to build in traditional steel?

[Pierre Lapointe]

On the cost of bridges, if we take into account the time of construction, the wooden bridges are way less costly. If you look at the example of Nordic and the Stornoway Diamond Corporation mine, they constructed 17 bridges in three months. Once the cement pads on both sides of the river are dried, the bridge is built in one week. If you take into account those types of parameters, they are cheaper. Their life is longer also.

[Robert Larocque]

Also, let's not forget on cost, you include the price of carbon, which we are in this world.

[Pierre Lapointe]

Right.

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

It's the same sort of thing with sequestration of carbon in buildings. Do you have any figures on that?

[Robert Larocque]

Yes, roughly. It's in the presentation. For every cubic metre of wood it's one tonne of carbon.

[Jean-Pierre Martel, Vice-President, Strategic Partnerships, FPInnovations]

It's one tonne of CO2.

Basically, on average, every time you use a cubic metre of wood in a building, it sequesters one tonne of CO2 overall. We're doing various studies for various provinces and we figure that sequestration of CO2 in buildings, in wood, is one of the best kinds of return on investment, if you will, in terms of the value you can get in reducing CO2 emissions.

[Robert Larocque]

If we do tall wood buildings, probably by 2030 it will be the equivalent of all of our sector's emissions today. It's six to 10 million tonnes of carbon. We emit six million tonnes as a sector. If we shut everybody down, we're better off to build tall wood buildings.

[The Chair, Liberal, James Maloney]

Thanks, Mr. Cannings.

Ms. Ng.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you so much for coming today and for sharing your perspective with us.

We certainly understand the challenges in the sector for a range of reasons. It's good to hear about the diversification and the innovations that are taking place in the sector.

We've heard other testimony here of those who are the force, such as the primary producers, and the challenges in the sector in terms of mills closing, etc. Yet at the very same time. we heard from others, as we are from FPInnovations, of the range of diversification and innovation that can happen, the spur or the new spin-offs and the creation of new products, companies, expert capabilities, and so forth. The thing that occurred to me, as we were hearing this, is that there seems to be a gap there between those in that primary part and the emerging new opportunities.

This question is for both of you. What role could we have to incentivize a greater meeting of that gap? It seems to me that things like the bugs and fire, etc., are challenges for sure. At the same time, we heard other testimony that some of that wood that wouldn't be used in one way can be used in other ways, which is the diversification and innovation side. When we were hearing testimony we were hearing it from one end of the country to the other. What can we do as a federal government to incentivize that coming together?

I'll get to my second question in a second.

[Robert Larocque]

Okay, you start from a technical perspective and then I'll finish off.

[Pierre Lapointe]

Okay.

The one aspect which is very important that we learned and, believe me, we have learned it the hard way, is an organization like ours that does research and development has now to go further into the commercial chain. The de-risking part is the most challenging part and there's no financing in Canada for that. Now there's a trend for EDC and SDTC to go toward this, but the most difficult part is the de-risking part.

The second part, as Bob was mentioning, is going toward the new market and the new client. When talking to Michelin, and I've been with Michelin for the last two years, you need to have a different language. It's not French. It's not English. It's Michelin. I went to Lego headquarters and you have to understand what Lego wants. This is what we are learning. The de-risking part and the new market to help us going toward those, and I mean FPAC and FPI, is something we are learning and that we need to find a way to finance.