Natural Resources Committee on March 1st, 2018

[Nick Whalen, Liberal, St. John's East, NL]

When I look at the B.C. act, I see that the spirit of the B.C. Wood First Act is to create a wood culture. It's very clear when I look at the language. The language of Mr. Cannings' bill isn't necessarily quite as broad. He appears to be more focused on wood being better at greenhouse gases, and we want to make sure that greenhouse gases count toward the consideration of wood so that wood is properly treated equally.

In your reading of the bill, I wonder if you would consider that it's really the focus on the greenhouse gases and not necessarily a global creation of wood culture as being within the spirit of the bill.

[Derek Nighbor]

Yes. I think it's two things. I think the two tests Mr. Cannings has in his bill around the LC, life cycle, the environmental, and the economic pieces are bang on. I think the profile that he's given, to Michael's point about ensuring that wood is thought about early in the process, to us is the spirit of the bill. That's why we would support it.

[Nick Whalen, Liberal, St. John's East, NL]

I share your view.

[Michael Giroux]

I'm less apologetic. Yes, that's probably where it should go, but I'd like to say that wood production is the only structural material that is exclusively Canadian owned and operated. At the end of the day, we have no foreign ownership of this or multinationals. I don't think we should be apologizing for wanting to support something that's Canadian, and proudly so. That's the balance.

[Nick Whalen, Liberal, St. John's East, NL]

I think east coast folks can make cross-laminated timber. I think we'll be okay on the east coast.

[The Chair, Liberal, James Maloney]

Mr. Whalen and I have a different definition of a very small question.

Gentlemen, thank you very much. We're going to have to stop there. We appreciate your taking the time to join us today. Your evidence is interesting and incredibly helpful for us.

We'll suspend for a few minutes and then we'll get started with the second hour.

[The Chair, Liberal, James Maloney]

We have two witnesses this hour.

We have Forestry Innovation Investment Ltd. with Michael Loseth and Sonya Zeitler Fletcher.

From FPInnovations, we have Mr. Martel, who I know has appeared before this committee before. He is joined by Mr. Lavoie.

Thank you, all, for coming.

For the benefit of those who haven't been here, and you heard me say this earlier, each group will have up to 10 minutes to make their presentation and then we'll open the table for questions with very strict time limits, I'm going to emphasize, just so everybody's paying attention.

Mr. Martel, you're the veteran, so why don't we start with you.

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

Actually, he'll start first.

[Michael Loseth, President and Chief Executive Officer, Forestry Innovation Investment Ltd.]

I'd like to thank the standing committee for the invitation to appear today.

I'm Michael Loseth, the president and CEO of Forestry Innovation Investment. My colleague Sonya Zeitler Fletcher is our vice-president of market development.

Forestry Innovation Investment, or FII, is a crown corporation of the province of British Columbia tasked with developing and diversifying markets for B.C. forest products and with fostering innovation in the use of wood.

We're happy to appear before the committee to represent our perspectives and the experiences of Forestry Innovation Investment. It goes without saying that we're not here to speak on behalf of the provincial government of British Columbia.

In British Columbia and across Canada, forestry matters. In B.C., forestry is the largest economic sector. Thirty-six per cent of manufactured exports come from forest products. More than 60,000 people in B.C. are employed in the forestry sector, of which 12,000 are employed in value-added activities. Forestry supports over 7,000 businesses across British Columbia. These employees and companies are not just in rural communities. There are forestry jobs in virtually every community in B.C., from Vancouver to Vanderhoof and from Prince George to Penticton.

I believe it is fair to say that the 20th century was one that favoured concrete and steel. At the time, it was new. It allowed larger buildings to be built, longer distances to be spanned, and new architecture and designs to be realized. This was also a period of conspicuous consumption, often with little regard for the environment. Whether it was the buildings we built, the materials we used, how we insulated and heated those buildings, or the gas guzzling cars that we drove, carbon emissions and the environment were typically not part of our thinking.

I also believe that in the 21st century we will do things differently, and we already are. In fact, we know that roughly 30% of our carbon emissions in British Columbia come from the built environment, and that has to change. We need more energy efficient buildings. We need to look beyond fossil fuels for the energy to heat them. We need to pay attention to the products that we use to build them. In so doing, why wouldn't we want to use a product from one of our greatest natural and abundant resources? Wood grows naturally from the sun, absorbs and stores carbon dioxide, and releases oxygen back into the atmosphere. Wood use in construction extends carbon sequestration beyond the forests and into the products and buildings that we make with wood.

In any discussion of or accounting for environmental footprint, we need to look at both embodied energy and operating energy, ideally using life-cycle assessment and scientific tools. The operating energy relates to the environmental impact of the heating, cooling, and operation of the building over time. Embodied energy relates to the environmental impact of the products that go into the building. The science is clear, and there shouldn't be a lot of debate. The important take-away is that both embodied and operational impacts matter and need to be considered.

We're not here today to encourage you to ban using concrete and steel or plastic and petroleum-based products. However, we do encourage this committee in its consideration of this bill to take a step forward in establishing a new and responsible lens to procurement decisions for federal buildings, a step that will help commercialize new innovations in wood and showcase those to the world.

As you may be aware, in 2009, British Columbia passed the Wood First Act. I quote:

The purpose of this Act is to facilitate a culture of wood by requiring the use of wood as the primary building material in all new provincially funded buildings, in a manner consistent with the building regulations.

In our experience, the passage of this act did not eliminate the use of non-wood building materials. However, it does require government procurement officials and their design teams to ask themselves if they can use wood. Sometimes the answer is “no”, but often it's “yes” or “in certain applications”. In so doing, in British Columbia we have expanded the use of wood, not only in schools, universities, and government office buildings, but also in post-disaster facilities and first responder buildings where wood buildings are safe and resilient, meeting and exceeding the strictest fire and seismic requirements.

In British Columbia, the aspirational steps taken through the Wood First Act continue to make a difference today. Sure, some may grumble, but what I typically hear is that it doesn't hurt to look at wood and consider how it can be used. Use the right product for the right application, but look at all the alternatives, including wood. If it costs significantly more, or won't work for some reason, fair enough. However, projects should at least consider wood and the exciting innovations that are possible today.

In FII's world, fundamentally we work towards two key things. First, we work to help diversify markets for B.C. forest products, with a strong focus on expanding markets in Asia. Second, we work to foster innovation in how we use wood at home. In our experience, those two things are fundamentally and inherently linked. It's typically by first advancing innovation, using wood here at home, and demonstrating its potential that we then have the technical information and, frankly, the credibility to introduce those same innovations into our export markets.

Therefore, how do we support innovation in the use of wood in British Columbia? It includes advancing building codes and regulations to recognize today's modern wood products and the engineering and performance capacity that those products and building systems have. It includes educating and sharing knowledge with the design and construction community on what is possible with wood.

We support technical research and demonstration to overcome any impediments that may exist and to advance the business case for new products and building systems, and we showcase what is possible to help commercialize new products and construction technologies. Because of our Wood First Act, that includes showcasing wood use and innovation in publicly funded projects.

Our programs and efforts in B.C. are closely aligned with federal government programs. Most of the activities I just mentioned collaborate with, share costs with, or draw on the support of existing federal programs, and those federal programs are extremely helpful. What the federal government is not doing, however, is actively showcasing the use of wood and new innovations in government-funded buildings. In our view, that's a lost opportunity.

If you go to our naturallywood.com website, we have a sampling of more than 80 projects in British Columbia where the government's commitment to support innovation has been put into practice, and buildings have been built. If you look closely, you will see glass, concrete, steel, and a range of building products in each of those buildings.

As I mentioned earlier, in our experience, it's not about excluding other materials; it's about putting wood on an even playing field and showcasing what is possible with modern products, modern design, and modern engineering.

In the couple of minutes I have left, I'd like to quickly look at a few examples.

"The use of wood honours our local culture and heritage. It also confirms our commitment to the use of sustainable resources," said the school superintendent responsible for Westview Elementary School. Six hundred and five tonnes of CO2 are sequestered in the wood in the building, which is equivalent to taking 128 cars off the road for a year.

Built to meet LEED silver-level certification standards, the design intent was to create a welcoming space that would be incorporated into the urban fabric of the city and would contribute to a positive profile for the RCMP.

While not a huge building, 835 tonnes of CO2 are sequestered in this building, the equivalent of taking 177 cars off the road for a year. In first responder buildings such as this, resiliency and performance during and after natural disasters is a key consideration. Wood can meet or outperform other options.

The design is focused on creating a warm, natural facility to reduce the stress of the experience for patients as well as on meeting rigorous building performance standards.

"The use of exposed wood in a project is one of the ways that we can improve conditions for our patients. Wood conveys a sense of warmth and comfort that supports the healing environment and improves the overall patient experience,” said the VP of capital projects for this building.

It is not just about large medical buildings. Wood is used in small community facilities, like this first nations health centre. Universities are also embracing wood. After all, they are the brain trusts of today and are setting trends and training the leaders of tomorrow.

In addition to meeting regulatory requirements, this project minimized the environmental impacts by incorporating energy and water conservation elements as well as durable, non-toxic, low embodied energy materials, earning a LEED gold-level certification. This building is also designed to function as a post-disaster operations centre after a major seismic event.

We spoke a little about my last slide with some of the earlier speakers. Brock Commons Tallwood House is a mass timber hybrid student residence at the University of British Columbia, which at 18 storeys is the world's tallest contemporary wood building. Not only did this building allow for significant innovation, but it was built for less cost than a comparable concrete building. With advanced engineering and technology throughout, it's probably one of the safest buildings in the country today.

[The Chair, Liberal, James Maloney]

Thank you. That was right on time.

Mr. Martel.

[Jean-Pierre Martel]

Thank you, Mr. Chair, and members, for the invitation to present as a witness to this group. Our organization has presented a few times on other topics. We want to maintain our role as being kind of a third party, factual and science-based organization.

I believe everybody has a copy, French and English, of the brief. I will start in French and finish in English.

Good morning, Mr. Chair. Thank you once again for inviting me to testify before the Standing Committee on Natural Resources.

My name is Jean-Pierre Martel. I am vice-president, strategic partnerships, at FPInnovations. I am accompanied by my colleague Patrick Lavoie, our senior researcher, sustainable development. He is one of our researchers, one of our experts on life cycles and on the subjects we were talking about earlier.

At FPInnovations, our vision is of a world where products from sustainable forests contribute to every aspect of daily life, including housing and infrastructure. Our vision is for the long term, and we are working with all the various sectors to move that vision forward.

FPInnovations is a public-private partnership seeking to improve the competitiveness and accelerate the transformation of the Canadian forest sector. FPInnovations has 170 member companies. We have an annual budget of around $75 million and 450 employees in five laboratories, including one located in our headquarters in Montreal. There is another one in Quebec City. There is a big lab in British Columbia on the UBC campus. There is another in Thunder Bay, working on bioeconomics. The final lab is in Hinton, Alberta; it conducts research into forest fires.

On the next slide, slide 4, sometimes scientists make things complicated when we talk about carbon and the carbon cycle. The U.S. EPA some time ago developed a kind of common approach to try to explain how carbon works and how CO2 works. They call it the bathtub approach.

The bathtub is basically the atmosphere, and we're trying to achieve some level of concentration within the atmosphere. The faucet is basically what we put in. Emissions from the use of fossil fuels or deforestation contribute to bringing in more carbon or CO2 into the atmosphere.

With regard to dealing with it, one solution is to reduce the incoming, so turn off the faucet a bit. The other way is to deal with the drain. Drain comes from the absorption of CO2 by the ocean and by the land, of which the forest is a key part.

When we think about a bill like this, we take into account the role of the forest and forest products. It's important to consider where it fits in the global solution around climate change and CO2 mitigation.

For the next part, I'll leave that to the experts to talk about the forest carbon cycle.

[Patrick Lavoie, Senior Researcher, Sustainable Development, FPInnovations]

Thank you, Jean-Pierre.

Thank you, committee, for taking the time to hear this presentation. I hope to speak to the scientific argument under discussion, and hopefully we'll get more into the details in the question period.

If you look at slide 5, you will see a slide that's very similar to what Michael presented earlier with the forest carbon cycle. What's important to understand is that carbon by weight is made about 50% from carbon, and that carbon comes from the atmosphere. It's being drawn from the atmosphere. If you look at the top, carbon dioxide goes into photosynthesis, ends up in the material, and gets stored for a short-, medium-, or long-term period, depending on whether we use it in buildings, in fuels, in panels, or in pulp and paper. We do have some feedback cycles where, if the material reaches the end of life, it can be recycled into panels, and it can be used for energy recovery, so there are multiple feedback loops. It's that connection between the forest and the forest products that really can help make a difference in terms of the mitigation of climate change, as Jean-Pierre pointed out.

Turning to slide 6, there are a few levers of action that can be used to mitigate climate change. Essentially, I've identified three main ones, one being forest management. We can manage forests sustainably, as we do right now in Canada, and even more, intensify the forest management to increase the productivity of the forests, generate more lumber and more products from the forest, but also increase the forest carbon stocks. Research shows that it can be done, and it has been done elsewhere. Right now it's being more and more considered. In B.C. they have an approach to do that, and the same in Scandinavian countries.

There is one way to play on the carbon concentration of the atmosphere through the forest. We can also store some carbon in products. Buildings are an excellent example. Most buildings will last anywhere between 80 to 120 years, and that carbon doesn't go back to the atmosphere until we send it back there, either in the form of energy recovery or decomposition in landfills. There are multiple ways carbon is going to make its way back to the atmosphere and then re-enter that cycle again.

Finally, the last way we can make a difference in terms of concentration of GGs in the atmosphere is through the substitution of fossil or high embodied emission products, such as concrete, steel, and other building materials that are not renewable.

Those are the ways we can act and make a difference on climate change through both forest and forest products. As some of the previous presenters have mentioned, a positive side effect of that is that in doing that, we're generating revenues and jobs in Canada, because our companies are largely based in Canada.

I think it's important to point out, as I mentioned before, that carbon composes about 50% of wood's mass, which means there's actual carbon being stuck in the material. What's important to understand is that, when we harvest from the forest, most of that carbon is not in the material itself; it's in the soil and it's in the litter on the ground. It's being cycled in the ecosystem, so really, what we're doing when we're harvesting wood is taking some of the interest, but most of the capital stays in the forest. That's an important point to make that sometimes gets missed.

Slide 8 is a very good example of a life-cycle assessment, a life-cycle analysis, a case study of two functionally equivalent buildings. They are in the same area, and they are two very similar designs. One is a building made from concrete and steel, and the other is a CLT building. What the graph essentially shows is that the emissions that are generated in manufacturing the products that go into both buildings are significantly lower, 40% lower, in the wood building.

Jean-Pierre was referring to the faucet aspect. This is where that faucet is being turned off, so reducing emissions. The important point to make is that this is definitely not a building that has been optimized and is 100% wood. There are a lot of materials in this building, such as steel rebar, concrete, rockwool, and there is room for more optimization for biogenic and biosource products to enter those types of buildings in the future, as we continue to innovate.

Slide 9 shows two buildings representative of the buildings being built today. Those buildings are using common and standard products, yet more and more are working toward new generation biomaterials, insulation products, decking products, so all kinds of new wood solutions that will integrate more wood into our building systems in a safe manner, which is also code compliant.

I'll skip slide 10 and go directly to slide 11.

The results I have shown for building comparison is based on a very extensive scientific data collection. As Michael Giroux mentioned earlier, there are tools available today for industry practitioners to benchmark their buildings and do an assessment of the embodied emissions. The Athena impact estimator and the Canadian Wood Council and Cecobois have tools which are also quite good and very practical. It just goes to show that the information is there and the tools are there. It can always improve, but those are very good pieces.

I just want to leave you with something said by the IPCC, the Intergovernmental Panel on Climate Change, which essentially encapsulates what the main statement of the presentation has been. The biggest difference we can make in fighting climate change is by maintaining and increasing forest carbon stocks and at the same time producing a constant yield of products and materials. It's by adding those two elements that we can make the biggest difference.

I will leave it at that. Thank you.

[The Chair, Liberal, James Maloney]

Thank you very much.

Go ahead, Mr. Harvey.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

Thank you, Mr. Chair.

First of all, I want to thank all the witnesses for being with us today and sharing testimony on this important issue. It hasn't been lost on the committee regarding the importance of this conversation we're having around diversifying the way we look at structural opportunities, both in the public and private sector going forward, and how government can help shape the way that future looks.

My first question builds on some of what we heard from my colleague Mr. Schmale around the actual wording of the bill.

Bill C-354 puts the onus on the government to almost give preferential access to wood over other traditional building methods. I can start with FPInnovations or the Forest Products Association, but I want to get your take on whether you think that's the appropriate strategy. I also want to know whether you believe it needs to be identified as another building opportunity or another measurable way of doing construction, but not given preferential access, or if you think that maybe that increased onus should be based on a matrix that takes into account the total carbon sequestration over the life of the project.

[Jean-Pierre Martel]

You can start, Michael.

[Michael Loseth]

I can at least speak from my experience in British Columbia. The Wood First Act, in British Columbia is fairly strongly worded around requiring the use of wood and developing the wood culture.

I don't know that I have a lot to offer you in wordsmithing. I think there are a lot more experienced people in developing legislation than me, and whether it's “requiring” or “encouraging” or “providing preference for” or “an initial consideration of”, I think I'll leave to others. But I do think it's important in whatever this bill moves forward to still have some strongly worded direction. In my experience in British Columbia, there were a number of unintended impediments that we identified after the Wood First Act was put into place, and I can give you an example.

Without some strong pressure and some clear direction to government ministries and public works, these may or may not all be addressed. For example, in British Columbia when we looked at schools.... I showed you an example of a school. The Ministry of Education started to look at what building products were being used in B.C. schools. They found there was a lot of concrete and brick and steel and such. So they started to ask the question, why aren't we seeing more wood buildings?

Building codes allow for the vast majority of school types, and the size and shape and what have you, but it wasn't happening. It wasn't until the ministry was forced to go back and really start to peel it back that they identified that their costing models and the project planning systems that they had with the individual school districts were all developed and based on building a concrete school.

When those school districts went through the process and provided all the required information back to the Ministry of Education, of course, more often than not they fell back to the concrete buildings, which was how the system had all been designed and set up. It wasn't until they started to change that and opened it up to be far more product-agnostic , and to look at wood to see where wood was being unnecessarily excluded from the process, that it changed. Now we're starting to see a far better balance. Not every school in British Columbia is 100% built with wood, but there are more that are being built with wood, and those unintended impediments that existed in the system are being dealt with.

[Jean-Pierre Martel]

Our role as FPInnovations is basically providing science and facts to support decision-makers, designers, and architects, and so on in terms of what they're going to do. We don't get into the policy and the amendments as such. I think I'll leave that to you, the experts, to do that. What we're trying to do is really provide facts and develop new products.

One of the realities as well is that because of new building systems, because of new building materials, such as cross-laminated timber, now wood is being used in other.... It used to be only residential low-rise, and now, because of new systems and new building products, it opens the door to all kinds of new applications such as residential and non-residential, mid-rise, and tall wood. Our role is making sure that it meets all the specifications and also meets the requirements in terms of safety, acoustics, structure, and so on. Our role is really to provide that support.

We believe that because of those changes that have happened over basically the last 10 to 15 years, we get into those markets where people see competition where there should not be competition. Driving a culture of wood, I think, is what we're basically supporting by providing facts and data and science as supports.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

Based on the data and knowledge that are out there already, where would you identify the biggest potential growth opportunity for the use of these types of alternative structures—in federal, provincial procurement opportunities for government buildings, large-scale commercial, or tall wood residential structures?

[Jean-Pierre Martel]

I don't have all the most recent data. When you look at the potential for growth in Canada and also in North America more broadly.... We talked about mid-rise in terms of volume, but I believe that governments have a devoir d'exemplarité. I am not sure how you translate that, but as an organization you need to act by example—maybe that's the translation—and show what's possible and open the doors to some of those potential new buildings and new applications. Once again, we believe strongly that wood should stand on its own merit because we have facts to support it in terms of structure, in terms of fire protection, and so on.

I think the government has un devoir d'exemplarité. The role of the government is to act by example and demonstrate value.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

Based on that, quickly, before I run out of time, Chair—

[The Chair, Liberal, James Maloney]

I'm just going to leave that.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

I have a really quick question based on what he said about governments leading by example.

Have you found in British Columbia that there's a social licence factor to this, to the use of alternative structures with wood, in terms of society buying into that concept? Is that something that's been measurable?

[Michael Loseth]

Absolutely.

[The Chair, Liberal, James Maloney]

You're going to have to answer that in 30 seconds.

[Michael Loseth]

If you look at British Columbia, you'll see that 95% of the forest lands are owned by the government and, frankly, are a public resource. Producing more products, advancing innovation, using wood in interesting and expanded ways, and generating greater value out of that resource of course generates greater value for the public resource and provides additional dollars for hospitals, schools, highways, and all that fun stuff.