Thank you, Mr. Chair.
Good afternoon.
My name is Dominique Boies, and I am the chief executive officer of Enerkem. Thank you for inviting me to meet with the committee today. I am pleased to contribute to your study on the future of the low-carbon and renewable fuels industry.
To start, I'd like to give you some background on Enerkem. Established in 2000, Enerkem has developed and commercialized a one-of-a-kind disruptive technology to produce low-carbon advanced biofuels and renewable chemicals from non-recyclable waste materials.
Our technology is an integral link in a true circular economy, contributing to the diversification of the energy portfolio and the production of greener mainstream products, while providing a smart and sustainable alternative to landfill and incineration. To achieve this level of technology maturity, Enerkem raised more than $850 million in capital, largely through private and foreign investment.
On December 8, with a group of strategic partners including Shell, Proman, Suncor and Hydro-Québec, and with the support of the governments of Canada and Quebec, Enerkem announced plans to build a biofuels plant in Varennes at a cost of $875 million. Recyclage Carbone Varennes will produce biofuels and renewable chemicals from non-recyclable waste materials and forest biomass. The plant will actually convert more than 200,000 tonnes of waste per year into more than 125 million litres of biofuel annually.
Now, I would like to tell you a bit about the context in Canada and around the world. I don't want to throw too many statistics at you, but according to the World Resources Institute, in 2018, Canada was the 10th largest GHG-emitting country or region. Canada's GHG emissions continue to rise despite current measures.
Last week, Prime Minister Trudeau committed to reducing GHG emissions by 40% to 45%, a much more ambitious target than the one in the Paris agreement. Canada also committed to a carbon-neutral economy by 2050.
Canada has made strong commitments to reduce GHG emissions, but achieving those targets first requires taking stock of the situation and creating the right conditions.
Where do things stand? In terms of transportation, electrification support and initiatives are commendable, important and necessary, but will not be enough to significantly reduce Canada's GHG emissions.
Canadian gross sales of gasoline totalled 44.8 billion litres in 2019, with no significant decrease in recent years. Vehicle registrations in 2019 totalled 36 million. Today, Canada's total vehicle fleet includes fewer than 200,000 electric vehicles, or 0.5%.
Now that the targets are set and the state of play is known, it is time to take action.
Here are some important considerations. When it comes international markets and the appetite for low-carbon biofuels, the Canadian marketplace is less attractive given the lack of both minimum content regulations for biofuels derived from waste materials and a low-carbon fuel standard, or LCFS. For instance, the United States has the renewable fuel standard, California and Oregon have the LCFS, the European Union has the RED II to promote the use of renewable energies, and the United Kingdom has the renewable transport fuel obligation. All of those jurisdictions have already put ambitious standards in place to force fuel distributors to increase their supply of low-carbon biofuels made from waste.
These types of standards create the right market conditions for producers. For instance, a litre of methanol or ethanol produced at our Edmonton facility now goes for double in California and nearly four times as much in the United Kingdom, including transportation costs. Without a competitive regulatory environment in Canada, keeping low-carbon biofuels in Canada will be a challenge.
Unlike incineration, which burns waste and uses energy, Enerkem's gasification platform recycles carbon and hydrogen from waste into biofuels and renewable chemicals.
We offer a true green alternative to landfill. For instance, our new plant in Varennes will help reduce GHGs in Quebec by 170,000 tonnes of carbon dioxide equivalent annually. Imagine what 10, 15 or 20 plants could do.
In an effort to be constructive, I would like to share some recommendations.
If Canada is going to achieve its ambitious GHG reduction targets, it must create favourable market conditions to support the application of innovative solutions. A carrot and stick approach is necessary. When it comes to the carrot, Canada does not have to reinvent the wheel.
Many tools and programs have been used successfully in other industries such as green electricity, oil and gas, and mining. For example, governments have reduced the risks of early wind farm development by offering long-term power purchase agreements. It is necessary to create a competitive Canadian market to attract foreign private investment and support bioenergy projects.