Natural Resources Committee on Nov. 4th, 2024

[Viviane LaPointe, Liberal, Sudbury, ON]

Thank you, Minister.

Minister Freeland, can you provide some insights on how the TMX might strengthen Canada's position in the global energy economy?

How might this translate into greater financial stability for the Canadian energy sector as we transition toward that clean energy?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Thank you for the question.

I'd like to make two points.

The first, I think, was central in the thinking around ensuring that the pipeline could be built. There is just no good reason for Canada to be giving money away to America for free. There is no reason for us to allow that differential to exist. When there is a big differential, that is money that goes directly into the United States—into the U.S. economy—to benefit U.S. refiners and U.S. consumers. It's money we're taking away from Canada.

I believe that we have a lot of needs in Canada. I think we need to invest in our health care system. We need to invest in education. We need to invest in infrastructure for housing. By closing that differential, we're getting more money for Canadians, both in terms of money in the economy, jobs in the economy and also direct revenues for federal and provincial governments.

In terms of the global picture, this is also a project that supports our own national economic security. Given the illegal Russian full-scale invasion of Ukraine, it actually supports the energy security of the western alliance.

I have been having conversations with some of our partners who have specifically said that this pipeline is going to make it possible for us to further constrain Russia and Russia's sales of its energy into the global market. That is really significant.

[Viviane LaPointe, Liberal, Sudbury, ON]

Can you tell us how this pipeline aligns with other fiscal strategies that the government is implementing to attract private capital into clean energy initiatives?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Sure. I'll say two things.

The first is—and Minister Wilkinson has alluded to this—that we have been working as a government on another huge, potentially nation-building project. That is a major CCUS project with the Pathways Alliance. We have now voted into law investment tax credits for CCUS, which would facilitate that project. There are good conversations going on between the Canada Growth Fund and the Pathways Alliance.

I think that is exactly what Jonathan was alluding to when he said that we really believe that Canada can and Canada must decarbonize our economy, even as we create more good-paying jobs and pull in more private sector investment.

[Viviane LaPointe, Liberal, Sudbury, ON]

Minister Wilkinson, can you talk to us about the long-term benefits that the pipeline and this infrastructure will bring to our resource sector, including support for renewable energy initiatives that improve the access to clean energy markets?

[Jonathan Wilkinson, Liberal, North Vancouver, BC]

As Minister Freeland talked about, part of the underpinning of the reason this project moved forward was to be able to reduce the differential so that Canada is actually extracting full value for its resources. That is important from an economic perspective as we look toward a world that is transitioning toward lower carbon. That is going to require investments in a range of different things, including renewable energy, nuclear technology, hydrogen and biofuels, and investments in a range of technologies, such as carbon capture and sequestration.

It is important for us to be extracting that value as part of investing in our plan for economic growth going forward. We have now committed to invest over $160 billion in the clean energy transition, the vast majority of that going into projects to create good jobs and economic opportunities that will be sustainable going forward.

[The Chair, Liberal, George Chahal]

Thank you.

We'll now go to Monsieur Simard.

Monsieur Simard, you have six minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Mr. Chair.

Thank you, Madam Minister and Mr. Minister.

Madam Freeland, in 2022, when the cost of the pipeline rose from $12 billion to $21 billion, you said publicly that you wanted to assure Canadians that there would be no additional public funding for Trans Mountain. The cost then was $21 billion, but now it's $34 billion.

In 2022, you also created the Canada Growth Fund, initially managed by the Canada Development Investment Corporation, the company that sort of owns the pipeline. However, in 2023, you made changes as part of Bill C‑47, so that the Canada Growth Fund is now completely outside the reporting perimeter and beyond any government control. The Parliamentary Budget Officer can't look at its activities and, ultimately, you can do whatever you want.

You mentioned earlier that you're currently in discussions with the Pathways Alliance about funding for carbon capture and sequestration.

So, we're talking about $34 billion for a pipeline, $12.5 billion in tax credits and $15 billion that could potentially be used for the gluttons of the oil sector, which are posting record profits.

Today, I want to know if you can reassure me and Canadians and Quebeckers that not one penny of the $15 billion Canada Growth Fund will go to the oil companies. Can you tell me that?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Thank you for the question.

I would first like to clarify that the Canada Growth Fund has already made significant investments. We're not talking about $15 billion, because the investments have already been made.

[Mario Simard, Bloc, Jonquière, QC]

Are these investments in the oil sector?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

I can give some examples of investments, for example that of the Eavor company, a world leader in geothermal technologies, which is headquartered in Calgary. The first existing project is in Germany. As Minister Wilkinson mentioned, this country is very interested in renewable energy sources.

[Mario Simard, Bloc, Jonquière, QC]

Yes, but I really want clarification on the following. We're talking about $34 billion for a pipeline. But the Parliamentary Budget Officer told us that this pipeline would not be profitable at a cost of $21 billion. For it to be profitable, we'll have to calculate its profitability over 100 years.

So we're talking about $34 billion for a pipeline and tax credits amounting to $12.5 billion. What's more, you seem to be saying that the Canada Growth Fund could invest in carbon capture and sequestration strategies. However, the committee heard from the president and CEO of Suncor Energy Inc., Mr. Rich Kruger, who told us that, in his opinion, too much effort was being invested in the energy transition.

The big players in the oil sector are telling us that too much effort is being invested in the energy transition, and Canada is investing indecent sums to support the oil sector. What I'd like to hear you say today is that not one penny of this famous growth fund will go to the oil and gas sector.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

First, I'd like to make a correction to what you said about the profitability of the pipeline. It's very important to be clear that this project is really profitable for Canada. The economist Trevor Tombe, for example, has published an article in which he says that, in his opinion, the federal government and Canadians will realize profits of between $4 billion and $8 billion. Yes, it's a big investment, but—

[Mario Simard, Bloc, Jonquière, QC]

The Parliamentary Budget Officer doesn't think so.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

The markets are showing today that this investment will benefit Canadians and Quebeckers. That's the reality.

[Mario Simard, Bloc, Jonquière, QC]

Can you guarantee that no money from the Canada Growth Fund will be reinvested in the oil and gas sector? I believe your government will be making an announcement this morning about a cap on greenhouse gas emissions. Surprisingly, on the other hand, you seem ready to invest colossal sums of money in this pipeline.

In the budget, you presented electrification as one of the federal government's most ambitious plans. When I look at the $34 billion spent on the oil and gas sector, the $12 billion in tax credits and more, just for one sector of economic activity, I find it unconscionable. I have to tell you, I find it unconscionable.

Moreover, it goes against your claim that you want to reduce the carbon intensity of the Canadian economy. In fact, you want to increase production, because if you want to make your pipeline profitable, you're going to have to increase production. So we're paying for the myth of low-carbon oil.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

A very important point is that we are not paying for the pipeline. From a fiscal point of view, the pipeline has already been shown to be a good investment for Canadians. That is the reality and that is what the market has shown.

As to the Canada Growth Fund, it is indeed a federal investment. We recognized that it is better to have professional investors do the investing. I have a lot of respect for Patrick Charbonneau, who manages the fund's assets and decides where to invest. He has the mandate to invest in all sectors to decarbonize the Canadian economy. I think that is a vision that everyone can support.

[The Chair, Liberal, George Chahal]

Thank you.

[Peter Schiefke, Liberal, Vaudreuil—Soulanges, QC]

I have a point of order, Mr. Chair.

I apologize, but I was trying to listen to the minister's comments, and Mrs. Stubbs was having a side discussion with Mr. Patzer. She seems to do that quite a bit.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

I have a point of order.

[Peter Schiefke, Liberal, Vaudreuil—Soulanges, QC]

Given that the ministers are here, we'd all like to hear each other. I would like to ask my honourable colleagues to not talk while a minister is responding.

Thank you.

[The Chair, Liberal, George Chahal]

Thank you.

I'll address your point of order, Mr. Patzer, after I deal with Mr. Schiefke's.

Colleagues, you can have conversations. If you want to have conversations around the table, take them outside of the room or into the back corner. Whisper in a very low voice if there's a conversation you need to have with one of your colleagues. I know it can be disruptive for colleagues if there are cross-conversations interrupting our focus and attention.

Thank you.

I'll go to you, Mr. Patzer, on a point of order.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

Thank you very much, Mr. Chair.

That's pretty ridiculous. That's what that is. It wasn't even a point of order, Mr. Chair. Colleagues always have little conversations among themselves at the table.

[The Chair, Liberal, George Chahal]

Can you tell me what your point of order is, Mr. Patzer?

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

My point of order is that he's deliberately trying to waste time. It wasn't even relevant. We can have conversations about what's going on in the room here. We don't need him to go “uncle paternalistic” on everybody.