Natural Resources Committee on April 24th, 2018

[The Chair, Liberal, James Maloney]

Good morning, everybody. Thank you for joining us today.

We have a fresh start today as we begin our new study on the current state and future of national energy data. It is much talked about; there's great interest in this topic. We're starting with two very important sets of witnesses from the Department of Natural Resources and the National Energy Board.

Drew Leyburne, Laura Oleson, Jim Fox, and Abha Bhargava, thank you for joining us this morning. It's probably safe to assume that some or all of you have been here before, but I'll explain the rules just in case you need a refresher. Each set of witnesses has up to 10 minutes to make a presentation, which you are free to do in either official language. In fact, you're encouraged to do it in either official language. You will almost certainly be asked questions in French and English. Following the presentations by both sets of witnesses, we're going to open the table to questions by the members around the table.

Thank you for joining us and we'll get right into it since we're running a few minutes behind.

Ms. Oleson, you look like you're ready to go, so why don't we start with you.

[Laura Oleson, Director General, Energy Policy Branch, Energy Sector, Department of Natural Resources]

I sure am.

Thank you very much, Mr. Chair, for the invitation to appear before the committee to speak to the current and future state of Canada's national energy data.

My name is Laura Oleson and I am the Director General of Energy Policy at Natural Resources Canada. I am joined by my colleague, Drew Leyburne, Director General of Strategic Policy at Natural Resources Canada.

I would like to start by acknowledging that Canada is in the midst of a global transition towards lower energy emission, which is fundamentally shifting how we make, move, and use it. The global energy transition is critical to our economy, where energy industries, including oil, gas, pipeline transportation, electricity generation, transmission, and distribution directly and indirectly account for 10% of our GDP and employ 900,000 Canadians.

That is why this time last year the Minister of Natural Resources launched a broad and inclusive dialogue on Canada's energy future, Generation Energy. The discussion ultimately engaged over 380,000 Canadians through a variety of in-person and online activities. What we heard is that Canadians expect energy decisions to be informed by evidence, using accurate and accessible data. Canadians also feel that people have their own opinions and increasingly their own facts, which makes accurate and transparent energy information important for constructive and fact-based conversations about the costs and benefits, opportunities and challenges of this transition. Moreover, it was clear from Generation Energy that trends like big data, open data, digitalization, artificial intelligence, and blockchain are fundamentally changing both the energy industry and the information available. As government, it is crucial that we keep up with these latest developments.

For all these reasons, it's important for Canada to have a strong energy information system, and we do. At the federal level, Canada's energy information system is a collective contribution of several organizations, including four federal departments or agencies: Natural Resources Canada, Statistics Canada, Environment and Climate Change Canada, and the National Energy Board. When it comes to collecting, analyzing, modelling, or disseminating energy information, these departments and agencies play different roles, which you will hear about this morning.

Natural Resources Canada is responsible for the following. NRCan is mandated under the Energy Efficiency Act to provide energy use data to Canadians and to report to Parliament. This includes data such as the energy use of heating systems in different types of residential buildings, the energy consumption and greenhouse gas emissions of different industrial sectors, and more. We are responsible for Canada's monthly and annual submissions to the International Energy Agency. NRCan compiles more than 50,000 data points that it provides to the IEA for use in its global database and reports.

We also publish the annual “Energy Fact Book”, which provides key information on energy in Canada in a format that is accessible to non-experts. It provides information on the relationship between energy, the economy, and greenhouse gas emissions. I have provided copies to the chair for you to look at or to have.

NRCan is also the host of the federal geospatial platform, which brings together data from 21 federal departments and agencies, making it available in a coherent way to the public, academic institutions, the private sector, and others. We've been working closely with the other federal partners to make improvements to Canada's energy information system to also better reflect the transition in the energy landscape. For example, we worked over the last two years with Statistics Canada, and Innovation, Science, and Economic Development Canada to launch a new clean technology data strategy, and we continue to work with Statistics Canada to improve the data on natural resources, including energy, to better track this evolving transition.

Other important partners in the energy information system include provincial and territorial government departments, regulators, and utilities such as Alberta Energy Regulator, the Ontario Energy Board, and Hydro-Québec, which each collect and disseminate a wide range of data.

Finally, academic research institutions and industry associations such as the Canadian Energy Research Institute, Simon Fraser's Energy and Materials Research Group, and the Canadian Association of Petroleum Producers are additional sources of information. Collectively, all these organizations make up Canada's energy information system.

Canada's energy information system fares well by international standards, with our experts regularly providing advice to the United Nations, the International Monetary Fund, the Organization for Economic Co-operation and Development, and the International Energy Agency.

Canada also benefits from a strong relationship with the U.S. Energy Information Administration, or the EIA. The EIA is among the best-resourced national energy information organizations in the world, collecting, analyzing, and disseminating independent and impartial energy information. We in Canada consistently look to the EIA for best practices, and take advantage of collaborative opportunities whenever we can. For example, over the last two years, we have worked with the Mexican and American governments, including the EIA, to implement an agreement on North American co-operation on energy information. This has resulted in the first ever shared map of North American energy supply and infrastructure.

As we look to the future, there are promising opportunities for energy data to be used in new ways to optimize industrial processes and reduce environmental impacts. Big data is enabling smart grids to improve efficiency and reduce the cost of electricity. Oil and gas companies are using AI-capable robots in oil exploration and production, which can increase productivity while reducing worker risk.

Incorporating AI, big data analytics, and other information-based technologies into how we make, move, and use energy will be key for the continued competitiveness of Canada's energy industries, and we are seeking ways to work with industry to drive the adoption of such techniques. Maintaining and augmenting a robust but versatile and adaptable energy data system like the one we currently have is indispensable for the transition of our energy industries to the future.

Mr. Chair, thank you once again for the opportunity to address the committee. I hope that this overview has been helpful. I would be happy to respond to members' questions.

[The Chair, Liberal, James Maloney]

Thank you very much. The timing is excellent, too.

Mr. Fox, you look as though you're ready to jump on the mike.

[Jim Fox, Vice-President, Integrated Energy Information and Analysis, National Energy Board]

I am.

Mr. Chair and committee members, thank you for the opportunity to talk to you about your study today.

Since you have our written remarks, I'm not going to go through them, but I'll give you the 30-second version, which will give us more time to turn to questions.

The National Energy Board is both a producer and a user of energy data, probably more weighted towards a user of energy data than a producer. We have a bit that we do from the production side, but most of it is using it.

As Ms. Oleson noted, energy data in Canada is dispersed amongst a lot of different players, and because of that, co-operation is the key strategy. Building co-operative relationships between and among those parties is the critical path forward for us, it has been for roughly 50 years that the NEB has been using data, and it will continue to be, going forward.

As I noted in my remarks, we are co-operating already with many players, but the key to moving forward is co-operating more, co-operating more fully, and possibly even adding some formal governance to those co-operation agreements.

The NEB is ready to continue to be part of the energy information landscape in Canada. We are here to work with our partners towards a better energy information landscape.

With that, I'm happy to take questions.

[The Chair, Liberal, James Maloney]

Fantastic.

All right, Mr. Serré, why don't we start with you?

[Marc Serré, Liberal, Nickel Belt, ON]

Thank you very much, Mr. Chair.

Thank you for being so specific, Mr. Fox. Thank you for the information you provided, Ms. Oleson.

Allow me to review the context. Ms. Oleson, you seem to be very confident in the quality of the data we currently have. Yet Mr. Fox said that we need more cooperation, which raises questions in my mind. When I think of the four federal departments involved, all the provinces and the associations that gather industry data, I wonder whether we have a national strategy for all that information. Do we need that kind of strategy? If not, how will that affect our work, Mr. Fox and Ms. Oleson?

As you know, I only have seven minutes and I will have other questions as well.

[Jim Fox]

It wouldn't be up to the NEB to put in place a national strategy, but the way I would respond is that the National Energy Board has built co-operative relationships with energy information providers and energy data providers to meet its own specific needs and the needs of those who come to it. Our relationships and our systems are built to allow us to do the work we're doing, and I would imagine that's true of others.

We have not looked much beyond our own responsibilities to ask what do Canadians need, and therefore what do we need in a larger set of co-operative relationships to meet Canadians' needs?

[Laura Oleson]

Merci.

I think we don't currently have a national strategy. From an energy perspective, we have begun a discussion with provinces and territories to start to identify how we can co-operate better on energy data, but there are broader discussions. We are in a time of incredible change, and so discussions are also going on about how we can improve the data around natural resources more broadly, and, even larger than that, about what data the government requires. From that perspective, I think this would fit into a broader, all-encompassing national data strategy.

[Marc Serré, Liberal, Nickel Belt, ON]

I would like to ask the two witnesses the same question.

So we do not have a national strategy. The provinces and various industry associations have to gather their own data, and you certainly know that private gas and mining companies also have to collect their own data since they cannot count on data being collected nationally.

How does this impact the private sector? Do you have the necessary experience to estimate the additional costs to the private sector of not having a national government strategy?

[Jim Fox]

In terms of actual extra costs, I'm not in a place to estimate or judge. The energy data is widely available in Canada in a large number of places, but you have to be somewhat of an expert to find it easily. Companies will build that expertise and understand where to get the data they need, including from industry associations; provincial governments; certain other kinds of agencies, such as electricity system operators, which are non-governmental organizations; or one of the federal departments. They will build that capability, and it will add a bit of cost, but it's not that the data isn't available; sometimes it's not aggregated.

[Laura Oleson]

Yes, I agree. If I were to ask where we could most improve—and I've had these discussions with my provincial and territorial counterparts as well—it is in the accessibility of the data. It's difficult to navigate the system without a level of expertise. There are 20-plus organizations you can go to for that type of information, and what we heard from Canadians through Generation Energy is that they want a one-stop shop where they can go for reliable and independent information to help inform themselves about the important discussions on energy that are happening in this country.

[Marc Serré, Liberal, Nickel Belt, ON]

The U.S. and Europe have national data strategies because they feel it's important. This is a non-partisan question. For the past 50 years in Canada, for some reason we've felt that a national strategy was not needed. I wanted to get a sense from both of you as to why you feel that Canada has not invested and looked at a national data strategy for the past 50 years. Are there any barriers there?

[Laura Oleson]

While we don't have a formal national data strategy, we have incredible co-operation across jurisdictions, led by Statistics Canada. The data we collect is often informed by provincial data collection. We certainly try not to duplicate what provinces are already collecting. I think my colleagues from Statistics Canada can speak more to that, but there is a tremendous effort to make sure that we work closely with them in spite of the fact there's no formal national strategy.

[Marc Serré, Liberal, Nickel Belt, ON]

Go ahead, Mr. Fox.

[Jim Fox]

I think that sums up the answer. The processes we have in place have worked for us, and Canadians' interests have changed rapidly in the last four or five years, as we at the National Energy Board know very well. Maybe from an energy data standpoint, we've struggled a bit to keep up with the pace of that change, but we are changing and are reacting.

[Marc Serré, Liberal, Nickel Belt, ON]

Ms. Oleson, you mentioned blockchain and big data. I heard the governors and politicians in Washington and in Peru talking about it. The world is talking about it. How are we adapting here to that, I wouldn't say trend, but that need, when we look at blockchain and big data in this context?

[Laura Oleson]

Certainly, my colleagues at Statistics Canada will be able to explain how they are integrating those new technologies into how they're collecting data. We, from an NRCan perspective, are trying to understand how these are impacting the business that occurs, what the needs are of producers and suppliers of energy, and how we might be able to facilitate that from a regulatory and policy perspective.

[The Chair, Liberal, James Maloney]

Mrs. Stubbs.

[Shannon Stubbs, Conservative, Lakeland, AB]

Thank you, Mr. Chair, and thank you to all committee members and witnesses for being here today.

Before I proceed with my questions, I want to take a few minutes of the committee's time to put a motion on notice, which I'm sure my colleagues will have anticipated. I do apologize for interrupting the witnesses, but this issue is of utmost importance. I'm sure everyone around this table will agree.

As you all know, on April 8 Kinder Morgan suspended all non-essential spending on the Trans Mountain expansion, and provided a deadline of May 31 to stop the challenges, settle the obstacles, and provide certainty for the completion of the approved expansion which is clearly in the national interest.

As recently as April 18, Kinder Morgan reiterated that the expansion might be untenable. This continues to be a crisis for all of us. If this issue is not addressed, and Kinder Morgan halts the expansion altogether, it would, of course, have serious ramifications for the Canadian economy overall, including provinces, municipalities, indigenous communities, interprovincial relationships, energy sector development, and investment in Canada now and in the future.

Given the urgency of this issue, I want to put the following motion on notice:

That, pursuant to Standing Order 108(2), the Committee immediately undertake a study to find solutions to the obstacles facing the approved Trans Mountain Pipeline expansion; that the Committee consider factors such as: (a) the May 31st deadline issued by the proponent, (b) the potential economic, socio-economic, investment, and government revenue losses, and impacts on market access for Canadian oil, related to the potential cancellation, especially on Indigenous communities, (c) municipal, provincial, and federal jurisdiction as it relates to the project, (d) potential points of leverage between the federal and provincial governments, (e) potential fiscal, constitutional and legal solutions; that the first meeting take place no later than May 3rd, 2018; and that all meetings be televised where possible; and that the Committee report its findings to the House.

Thank you for allowing me to take the time to provide notice of this motion, Mr. Chair. I'll proceed with my questions. We have copies of the motion for the committee in both official languages.

I'm really interested in this discussion taking place so far. I would ask the witnesses to confirm that this does not necessarily seem to be an issue of a lack of data, information, or sources of information, but that you seem to be suggesting there's a lack of compilation and consolidation of the information.

I want to take this time to recognize the outstanding, and longstanding exceptional work of the National Energy Board. Over the past several years there have been many implications that the agency had not been up to par. Certainly, on behalf of my colleagues in the Conservative Party, I want to recognize, on the record, that the National Energy Board has for decades been recognized as a renowned and exemplary regulator. It is second to none, literally, of any oil and gas producing jurisdiction in the world, including in terms of its consultations; standards; independent and objective evidence; decisions made by experts; its incorporation of indigenous and traditional knowledge; and its assessments of the environmental impacts of energy development and the cumulative economic effects. It's important as committee members that we recognize, particularly in this context, the longstanding outstanding track record of the National Energy Board.

I invite you to expand more on the following. Is it just a mandate issue that somebody in the federal government has to say, “Get more information from the provinces”, where natural resources are their rightful jurisdiction, or does this necessarily need to be the creation of a whole new agency or arm? I respect that each of you can't comment on policy, but perhaps you could address that.

Also, Laura, you mentioned the U.S. Energy Information Administration. I would invite you to expand on that, specifically the key factors that you see setting it apart. Perhaps both witnesses would like to comment as well.

[Jim Fox]

I think Ms. Oleson has a more complicated answer, so I'll speak first.

Thank you both for your question and complimentary remarks.

I think, in Canada, we don't lack energy information or data. The consolidation you spoke about is the key factor we need to focus on. I will add, though, that, as the energy system transforms itself, we need to continuously look to new forms of information and data, new ways of gathering data, and new analytical methodologies to kind of keep pace and be able to give advice and information that decision-makers need to make their decisions.

That would go to one of the gaps that people speak about, renewable energy. A lot of renewable energy is not tied into traditional data-gathering sources, so we need a new method to find the information about renewable energy sources, use, uptake, and costs and be able to provide that in a consolidated way, a way that's easy to find and use.

[Laura Oleson]

When I talk to my provincial colleagues about the energy information system, we talk about data analysis, modelling capacity, and dissemination. Certainly, the data requires us to regularly evolve what we're collecting. The transition has required us to make sure we're collecting the right information to be able to track this transition. In recent years particularly, we didn't have the information on the clean-tech sector and what was happening there. I'm really pleased that that's a new line of data we are collecting.

On the analysis side, certainly all of the federal departments and the NEB have a strong analytical capacity that we can bring to bear on issues. On modelling, that's an area, certainly from an NRCan perspective, where we're having discussions with the NEB and Environment Canada about how we can bolster it. NRCan doesn't have its own economy-wide modelling capacity to look at policies, so we sometimes find ourselves challenged in wanting to look beyond what the emission reduction impact is of policies and programs to the economic benefits, how it is impacting jobs, and how it is impacting growth. That is something we're having an active discussion about, again, because the transition is so vast that we need to be able to see the full dimension of the energy sector when we're making these policies, not just the emission reduction profile.

Finally, there's the dissemination. You're right; it is difficult for people to find that one place to go for comprehensive, consolidated data to understand how the data aligns, because it's being collected by different parties. That is certainly a gap that I know the provinces and territories and we are talking about and are aware of, and we're working with Statistics Canada and other partners to see how we could improve that for Canadians.

[The Chair, Liberal, James Maloney]

Thank you.

Mr. Cannings.

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

Thank you all for being here today. This is a really interesting subject to me. Before I got this job, I was an ecologist working on national-scale ecosystem planning projects and bird population trend analyses that all involved big datasets across provincial boundaries, with a lot of data coming from industry. It was a nightmare gathering all that data. It sounds like it's kind of the same here.

The groups I worked with developed their own expertise in this, but when we looked at things like forest cover between B.C., Alberta, and Ontario, it was all different. Everything had to be cross walked in various ways. It was very time-consuming. I would have thought it would be a little different with energy, but it seems that some of the problems are the same.

Yesterday evening, I was over at the Positive Energy meetings at the University of Ottawa. They just put out a study called “Durable Balance: Informed Reform of Energy Decision-making in Canada”, which seemed very timely. They have a one-page summary of what that group feels needs to be done about the Canada energy information system.

I would first ask both groups here about the extent of that problem between provinces and industry. You say you have the expertise, but how big a problem is that with different datasets being in different formats, gathering different kinds of data, and having to massage it? Is that a concern in the energy data world?

[Jim Fox]

Dr. Bhargava, who is here with me today, is the leader of our modelling group. I think she'd like to take a stab at your question.

[Abha Bhargava, Director, Energy Integration, National Energy Board]

I guess the best way to put it is that the data is there. The problems are not uniform with every set of data. As our colleagues here explained, the data in Canada is widely disbursed. It comes from provincial sources, which are very important. You really have to look at each dataset to understand where the problem might be, or if there is a problem. For example, data on the production of oil and gas is collected by all the producing provinces for their own individual mandates on royalties. Where there may be a lack of data is in regard to storage. Natural gas storage, for example, is not easily found, even in the provincial sources. Crude oil inventories, for example, are not easily found.

I think the state of the data is such that some of it is very enriched and fulsome, while some is lacking. That's where the efforts need to be put. As my colleagues here have stated, collaboration and coordination are the two big words to use in this context.