Natural Resources Committee on April 27th, 2022

[Lionel Railton]

Okay. Some of the other areas that we're currently looking at right now and discussing with our owner clients and our contractors are hydrogen development, carbon capture and ammonia development. There are a number of different areas that will allow for the transition. In the case of ammonia, we need it for our fertilizers to grow our food. You take ammonia and you extract off the hydrogen atoms and you can burn it as a clean fuel.

I think Canada can be a clear leader. You already referenced SMR technology, nuclear technology. In our opinion, nuclear technology can be one of those areas where you can transition a lot of the skill sets that our men and women have to build a non-emitting, safe application. It can reduce the reliance on diesel fuel in the north and decarbonize, or at least lower the carbon footprint of, oil sands extraction. Not only do you get the electricity, but you get high-quality steam and heat from these reactors, which you can use in lots of industrial applications.

[James Maloney, Liberal, Etobicoke—Lakeshore, ON]

Thank you, sir.

I'm going to move over to Mr. McGowan.

You referenced the new economy concept, and you talked about C.D. Howe and the need for a Marshall plan. What would you include in your Marshall plan? What areas would you target?

[Gil McGowan]

Before I get there, and I will, I want to address a sentiment that I heard in your questions and the previous member's comments.

I think some people are struggling, suggesting that the question we're trying to answer at this committee and in our country is whether we should transition. That's not the question. The transition is already happening, and it's happening in oil and gas. I mentioned that we have 130,000 people in my province working directly in oil and gas. That's down 40,000 workers from 2014. That's partly as the result of a drop in the price of oil, but it's also because the industry is not the engine of job creation that it once was, and it never will be.

For us, the transition is already happening, and the question is not if it's going to be a transition, but what kind of transition it's going to be. Is it going to be an orderly transition or a disorderly transition, or a planned transition or an unplanned transition? That's the question.

[James Maloney, Liberal, Etobicoke—Lakeshore, ON]

My question really was this: Where are the jobs that are the “just” part of the transition?

[The Chair, Liberal, John Aldag]

We have to end here. We're over the six minutes.

The time goes quickly. I hate to cut it off, but we need to go to our next time slot.

Mr. Simard, you have six minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Mr. Chair.

I want to thank all of the witnesses.

I'm a bit torn because, like Mr. Bragdon, I'm in the mood to preface my questions with a lengthy statement. I may not have my father's lunch bucket, but something is bothering me, and I can't hide it.

I think a public decision-maker should tell the truth. It's way too easy to tell people what they want to hear. It's easy to tell them that they are going to keep their jobs, that nothing will change, but that's no way to help them. I think a public decision-maker has to be responsible, and history has taught us as much.

In Saguenay-Lac‑Saint‑Jean, where I'm from, the pulp and paper industry came to a turning point. We don't sell paper anymore. It's no longer the medium most people use, so a lot of pulp and paper jobs were lost. In La Baie, a nearby municipality, AbitibiBowater shut down, and then the mortality rate skyrocketed. Researchers at the Université du Québec à Chicoutimi studied the phenomenon. The same thing happened in the asbestos sector. A lot of workers fell on very hard times when asbestos mining came to an end. Nevertheless, people need to be told the truth.

They needed to be told that asbestos jobs were finished. Transition measures should have been developed to help workers. That's what should have happened in the pulp and paper sector but didn't. According to the report the commissioner released this week, we are very unprepared. As an example, he cites what happened in Newfoundland and Labrador in 1992‑93, when the cod fishery collapsed. In the decade that followed, the province lost about 10% of its population. If that doesn't frighten you, then there is something seriously wrong. Climate change is real, and it's having an impact.

As a public decision-maker, my only job is to tell people working in the sector to be prepared. I have nothing against Albertans. I realize their livelihoods depend on oil, but instead of investing $14 billion in Export Development Canada, the government should have used the money to plan for the transition. Why didn't it?

According to an Oil Change International report, all of us collectively spent $78 billion on oil and gas subsidies in 2018. That is an astronomical amount of money. It's a bottomless pit, and who is going to suffer? Oil and gas workers, because the transition will inevitably come.

It's fine to sit here and think about how this will play well on our social media, as we talk about workers and all, but lying to people is totally irresponsible.

Witnesses come here to tell us how we can support workers. At the very least, our job is to listen to them and ask them questions about how we, as public decision-makers, can provide them with support; ignoring a known fact—climate change—will do nothing to help them. That is the wrong way to go.

My apologies for the rant.

I have a quick question for Mr. Bolduc.

In your opening statement, Mr. Bolduc, you mentioned a structure or body similar to a Crown corporation to support the just transition. Could you elaborate on that?

[Denis Bolduc]

Thank you, Mr. Simard.

I can give you an example of a structure that was put in place in another jurisdiction. Our resident expert, Mr. Rondeau, can provide additional information if needed.

The Scottish government set up the Just Transition Commission, which it tasked with providing advice on the development of just transition plans and on the most suitable approaches to address workplace transformation. The Scottish government also tasked the commission with reporting to Parliament, so it has to publish a report every year.

Mr. Rondeau, our expert on the matter, can provide more details.

[Patrick Rondeau, Union Advisor, Environment and Just Transition, Fédération des travailleurs et travailleuses du Québec]

Thank you, Mr. Bolduc.

What you said, Mr. Simard, was especially compelling. Before I answer the question about the Crown corporation, I'd like to say a few words in connection with comments made by other members, if I may.

First and foremost, workers are the people we represent. We are doing this for them. We aren't saying that the government should dismantle Canada's economy overnight and put our members out of a job, but they are doomed if we sit around and do nothing. We have to get on with it. I agree wholeheartedly with what you said, Mr. Simard. We have seen too many cases where things were not handled properly; let's not do it again.

Coming back to your question about the Crown corporation, I would say that is why we were a bit surprised with the consultations led by Enerkem. The focus was on two components: defining a just transition and establishing the framework for an advisory body to provide advice to ministers, who would then consider it and possibly act on it.

We believe Canada is ready to take meaningful actions now, and that's why we recommended a body along the lines of a Crown corporation, but it could be another entity—a standing committee, for instance. The Crown corporation structure was one of many possibilities. We simply need some entity or place to support those actions. Before the government passes legislation, we think it's much more important to focus on the process that includes all those who will be impacted.

[Mario Simard, Bloc, Jonquière, QC]

Thank you.

[The Chair, Liberal, John Aldag]

We will now move to Mr. Angus for his six minutes.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you.

Thank you so much for coming.

I agree with my colleagues from the Conservatives, the Liberals and the Bloc that this should be worker-centred, so I'm going to do something different. I'm going to try to limit my conversation so that I can hear from the workers, because I have heard all their opinions many times.

Mr. McGowan, I'm going to start with you. The Financial Post of January 22 said that the ongoing exodus of workers from oil and gas is no longer cyclical; it is structural. Even as oil and gas are making record profits right now, they are not reinvesting in workers, and we're seeing continual drops and planned drops in the workforce.

Would you say that the transition is not something theoretical or ideological and that it's a fact that is happening on the ground now?

[Gil McGowan]

The transition is under way, and it's having profound effects on Alberta communities and the Alberta labour market. As I said in my opening remarks, we have already lost about 40,000 jobs in oil and gas, just in one province, and those jobs are not coming back.

It started out as a response to the collapse in oil prices and the resulting drop in oil and gas-related investment, but oil companies are responding to the lower price environment by automating and reducing their costs. As you said, money is being piled back into the industry, partly by government and, more recently, by profits. Most of our big oil sands companies are recording record profits as a result of the recent spikes in the price of oil, but they are not plowing it back into investment. They are using it to buy stock options, pad their profits and pay down their debts.

It's clear to us in the Alberta labour movement that the oil and gas sector in our province will never be the engine for job creation that it once was, and it's irresponsible for our leaders to wave their hands and suggest that we can go back to the way things were. We're used to a boom-and-bust cycle, but the boom and bust is over. This is a structural transformation, so instead of talking about maintaining the status quo, we should be planning for a future that's going to look very different from our past.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you for that.

I come from northern Ontario and I have lived through a number of unjust transitions. We lost every single silver mining job in a year in our community. We lost the iron economy in our region in a year, with 4,000 workers gone in Elliot Lake. When those transitions happened, there was no place for those workers to go. The training didn't begin until all the jobs were lost, and it was a disaster, no matter what they said. They hired a lot of consultants.

This is a different situation. It's much more complex. There are a lot more workers upstream, downstream and in construction. I see, though, that right now in clean tech there are 430,000 jobs. Calgary Economic Development suggests there could be 639,200 jobs if—and it's a big if—government invests.

The issue here is the need for this transition and putting investments on the ground so workers can transition into better-paying jobs now. That would send a really clear signal to workers, to regions and to economic development.

I'm concerned that my Liberal colleague, who is the lead on this, doesn't know where these jobs are. That might send a pretty unsure signal to me.

Mr. McGowan, how important is it for the government to start working right now on a plan to start investing in the clean tech opportunities so that we do not see that lag for workers?

[Gil McGowan]

Clearly, what we really need is a plan.

Mr. Railton talked about the uncertainty that workers are feeling. That uncertainty is real. They know change is happening. They know their jobs are in jeopardy. Some have already lost their jobs.

Instead of just talk and hand-waving and promises about maintaining the status quo when it's clearly gone, we need a plan. We need an industrial plan that is established by governments at all levels—federal, provincial and municipal. We need funding to incent developments, and there's no shortage of opportunities, whether it's clean tech, renewable energy or housing retrofits.

There's no shortage of opportunities for job creation, but it needs a plan, it needs a push and it needs funding. We can't wait for the private sector to do this, because if we do, it will be a disorderly transition, as opposed to an orderly one, and it's workers and communities who will suffer, especially in places such as Alberta that have been reliant on the oil and gas industry for so long. It was a pillar of our past, but it can't be for our future.

[Charlie Angus, NDP, Timmins—James Bay, ON]

I'm going to interrupt you here, because we're going to run out of time.

I want to get back to your thoughts on this Marshall plan that you talk about, because I don't see us getting to net zero in any credible way without the skills of the energy sector workers.

We have huge opportunity, yet if all we have is talk and have no coherent plan, we're going to see an unfolding disaster. The environment commissioner talked about a collapse economically, like the cod fishery. When you talk about this Marshall plan, are you talking about an economic investment plan of taking these skills and resources and actually transforming the economy now rather than waiting for this transition to unfold as many of us fear it could unfold?

[Gil McGowan]

Yes, exactly, and specifically we're talking about introduction of what we're calling a federal just transition transfer, money from the federal government to the provinces, especially oil and gas provinces such as Alberta, to fund a transition in which money would be earmarked for projects that will actually put people to work.

That was the problem we had with the coal transition. People didn't want temporary handouts; they wanted another job. If we have a plan that's funded, that's supported by all levels of government in partnering with business, we can do just that. We can help people move from one sector to another and open up opportunities for people in other sectors as well.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you.

[The Chair, Liberal, John Aldag]

With that, we're through our first round. It goes quickly. Now we'll go to a shorter round of questions.

First up, we have Mr. Maguire for five minutes.

[Larry Maguire, Conservative, Brandon—Souris, MB]

Thank you, Mr. Chair; and thanks to all the witnesses today for their testimony as well.

I have a quick question here to start with. On a really cold winter day in Alberta, 1% of the energy comes from wind and solar, so how do we define “just transition”? I mean, 99% has to come from somewhere else. We're not anywhere near being able to meet the needs of provinces across Canada yet, not just Alberta.

We know there's going to be transition. We know there are alternative energy sources coming, yet the environment commissioner even yesterday, in the just transition report or audit, said the federal government “was not prepared to support a just transition to a low-carbon economy”. They're not ready yet.

My question is for the International Union of Operating Engineers gentleman here today. Do you have specific recommendations, other than increased consultation and funding, as to how the federal government can better prepare workers when adapting to these alternative energy sources?

[Lionel Railton]

Well, you've heard from some of the other witnesses. There were lots of good ideas put forward today, but as to some of the recommendations, clearly we have to identify....

First and foremost, and we've said this time and time again, we need a labour market analysis to clearly understand in a meaningful way what the current skills base is at this point in time. Then you would know the order of magnitude that you have to deal with and who's going to be transitioned from what.

There's a patchwork of LMI information that comes forward and there isn't a comprehensive program. In our opinion, the federal government should undertake that, because that is a nationwide exercise.

As we transition to some of these other energy sources, the other piece of it is to clearly identify what is going to fit in what region of Canada. We're currently in discussions with the provinces of Alberta, Ontario, Saskatchewan and New Brunswick about how we can deploy a nuclear fleet across the country, which would take up and provide that baseload that would allow renewables to take their rightful place in our society as they evolve and grow. Unless you get that certainty of power baseload that will keep people warm and keep the lights on, renewables won't have the ability to take up that space—

[Larry Maguire, Conservative, Brandon—Souris, MB]

Sorry about the time here. I appreciate your comment about the baseline being part of the plan that you're looking at having.

You mentioned nuclear energy. We've had some comments on that in previous meetings. How many of your members are directly or indirectly involved in the nuclear energy sector right now?

[Lionel Railton]

Two major projects are under way right now, among some of the biggest construction projects in all of Canada, the retrofit of Bruce Nuclear Generating Station and Darlington. Bruce is $13 billion and Darlington is $12 billion. At some point in time, we're going to have to replace Point Lepreau in New Brunswick, because it's coming to its end of life. There's a really good opportunity there, in our opinion anyway. Our research shows that SMRs could replace that nuclear plant and also be used for some industrial applications—

[Larry Maguire, Conservative, Brandon—Souris, MB]

There are a couple of things I'd just like to add here. Sorry for cutting you off.

I'm assuming your members, then, think that nuclear is a safe and clean energy source.

[Lionel Railton]

Many thousands of them go to work every day to support that industry and retrofit. In the province of Ontario, 60% of the baseload comes from nuclear. When you turn the light switch on in the morning, guess where it's coming from?

[Larry Maguire, Conservative, Brandon—Souris, MB]

Can you supply the committee with any data that you have on the unionization of workers in the nuclear facilities? There are lots of jobs in building them, but once these facilities are built, can you just give us some data on how many—