Evidence of meeting #34 for Natural Resources in the 43rd Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was carbon.
A recording is available from Parliament.
Partner and Senior Analyst, Navius Research Inc.
From the perspective of greenhouse gas emissions, there is no particular advantage. From the perspective of helping manage the electricity system, hydrogen may be useful there. From the perspective of someone in a natural gas-producing region who wants to keep their job, blue hydrogen could be useful there.
NDP
Richard Cannings NDP South Okanagan—West Kootenay, BC
Thank you.
I'll go to Mr. Wolinetz again.
At the end of your presentation, I think you were talking about low-carbon renewable fuels and some of its advantages and pitfalls. One that you quickly ran through was a concern about the disturbance of soils and deforestation that must be avoided.
Could you expand on what you meant there?
Partner and Senior Analyst, Navius Research Inc.
Sure. There is a vast amount of carbon that is locked up in the biomass of the forests as well as the soils of Canada. If you do something to produce fuels that disturbs that carbon, you can very easily end up in a situation of releasing more greenhouse gas emissions than you would by using fossil fuel emissions.
Don O'Connor is certainly more of an expert on this than I am.
The concern I have is that in our modelling analysis, we show a market and a need for low-carbon biofuels such that they are driving up the price of feedstock to the point where we could conceivably be logging forests to produce that feedstock, so if this kind of fuel production is existing outside of good greenhouse gas accounting and life-cycle greenhouse gas accounting, we'd be missing a really big part of the picture.
There are challenges there. I'll give you an example. B.C. has a fairly healthy export industry for wood pellets, which are used for energy in other parts of the world. Previously most of those wood pellets were coming from mill waste, leftovers after you use the wood at a lumber mill or a paper mill. However, those pellet companies have long-term contracts to deliver pellets, and if there's a downturn in the forestry industry, there is suddenly less waste. There have been incidents and reports of their bringing in whole logs, which may have been dead logs or downed logs, but they are full logs to turn into pellets. The problem is those logs would have sat as logs for a century or more and would have then delivered some of their carbon both to the soil and to the atmosphere, and if we bring them in and turn them into pellets, we're releasing those carbon emissions right away, so there are challenges with bioenergy, certainly bioenergy from forestry or agricultural residue whereby you can disturb the carbon balances within nature.
NDP
Richard Cannings NDP South Okanagan—West Kootenay, BC
I was going to ask Mr. O'Connor to elaborate, but if there's—
President, S&T Squared Consultants Inc.
What's been said is all true, but it's also true that we can build soil carbon, particularly in agriculture. Canada has an excellent track record of doing this, in that every year we have more than 10 million tonnes of CO2 being added to the soils across Alberta, Saskatchewan and Manitoba because we've adopted more sustainable agricultural practices in the last 10 or 20 years. It's forecasted that the increase in soil carbon, while it declines a little bit every year, is going to continue for quite a number of years going forward.
Liberal
The Chair Liberal James Maloney
Thank you.
Thanks, Mr. Cannings.
Mr. McLean, it's over to you for five minutes.
Conservative
Greg McLean Conservative Calgary Centre, AB
Thank you, Mr. Chair.
Thank you to all of our witnesses today. Your testimony is fascinating, and I have a whole bunch of questions here for elaboration.
First of all, Mr. O'Connor, thank you very much for your presentation. The one thing that very much struck me was that you talked about the importance of reducing CO2 emissions sooner rather than waiting to reduce them up until 2030. When you consider life-cycle analysis of these transitions and the upfront CO2 emissions involved in the transition, how do those square with reducing emissions now versus by 2030?
President, S&T Squared Consultants Inc.
Generally speaking the emissions that are associated with building plants tend to be a very small portion of what ends up being the total life cycle. They are not usually included in most life-cycle analyses because we run into questions like over how long a period of time we should amortize these construction emissions. Should we do that in 20 years, which is what we do for tax purposes, knowing that the plants will last a lot longer?
Given the fact that they're small and that no one can agree on the amortization period, they're generally not included and they don't impact the conclusion that we should be doing as much today as we possibly can.
Conservative
Greg McLean Conservative Calgary Centre, AB
Okay. Thank you.
We looked at this years ago when I was in venture capital. We looked at the life-cycle analysis that showed biofuels costing 1.6 units of energy to produce 1 unit of energy. We've asked for some updates on those numbers and haven't received them. That's like paying $1.60 to earn $1.
Can you square that for me? How does that make sense in terms of biofuels' inclusion in an efficient horizon going forward?
President, S&T Squared Consultants Inc.
If you go back 30 or 40 years, that might be true, but there have been tremendous improvements in the efficiency of really all aspects of the biofuel production process.
Conservative
Greg McLean Conservative Calgary Centre, AB
Yes, this was just over a decade ago, so we're not talking 30 or 40 years ago.
President, S&T Squared Consultants Inc.
This could still be some pretty old data.
Conservative
Greg McLean Conservative Calgary Centre, AB
Actually, they've confirmed that data for us, and we haven't seen the updates in the last decade, so we're looking for those.
President, S&T Squared Consultants Inc.
I have data from existing plants, operating today, that use about 25% of the energy that they did 20 years ago.
Conservative
Greg McLean Conservative Calgary Centre, AB
Okay, thank you.
I'll go over to Mr. Wolinetz now.
Mr. Wolinetz, thank you for your last response to my colleague's question.
We have heard from the forestry study here on this whole nature of the mosaic of the forest and how some of the forest naturally will burn; some of the forest will have to decay and take 100 years to release the carbon, as opposed to turning it into it.
You think that there are still some residues left that we can turn into biofuels, given what the forest industry needs as far as that mosaic that they talk about, to fuel their industry and to maintain their carbon footprint.
Partner and Senior Analyst, Navius Research Inc.
Yes, absolutely. From the forestry industry, I think the big untapped opportunity is what's called “harvest residue”. When logging happens, there are a lot of smaller pieces of biomass. These would be tree branches and tree tops. They decay relatively quickly, and in some cases, they're actually piled and burned on site in order to mitigate fire risk.
Partner and Senior Analyst, Navius Research Inc.
Yes, slash piles.
That's the opportunity there. We're not talking about whole-tree harvesting or pulling up stumps or anything like that. We're talking about this relatively short-lived biomass that in some cases is already being released to the atmosphere.
Conservative
Greg McLean Conservative Calgary Centre, AB
At the same time, the forestry industry says that's what they want to use as well. I'm just worried about duplicating what our environmental inputs are, as far as who's going to use that excess biomass for something different in the process here.
Partner and Senior Analyst, Navius Research Inc.
Yes, that's a real concern. To put it simply, everyone is counting on the same truck of wood chips.
I have talked to some experts who believe that in the future, every molecule of usable wood will be used for something. We shouldn't necessarily count on that wood going into fuels. It could also be used for a number of different products—so bioproducts.
That being said, energy is a large bulk commodity market, whereas a lot of other things are specialty items. It provides a significant opportunity.
Conservative
Greg McLean Conservative Calgary Centre, AB
Great, thank you.
Let me ask another question here.
To build on what Mr. Patzer said earlier, I note there's a report by a group called Thunder Said Energy in the U.K. that has confirmed something that a whole bunch of studies have said, namely, that the CO2 produced from biofuels when you break new land is effectively double what you're replacing that fuel with.
Mr. Jaccard from the University of Victoria was one of our witnesses a week ago. He said he's seen 30 studies like that. He disagrees with those studies.
Can you comment on that? It seems that this is a recurrent theme, that we're actually producing more CO2 from biofuel production with new land being broken, as opposed to the already existing stock of biofuels material.