Natural Resources Committee on May 2nd, 2022

[Mario Simard, Bloc, Jonquière, QC]

All right.

[The Chair, Liberal, John Aldag]

Oh, here he is.

I'll restart the clock at six minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Mr. Chair.

I'd like to draw the attention of my good friend, Mr. McLean, to one particular point. I know that he cares deeply about Canada's public finances. If he is looking for pointless spending on financial support, I would mention that in the gas and oil sector, $750 million are spent on the Emissions Reduction Fund, which I think is rather more difficult to defend than support for some other organizations. We can talk about this again later.

Mr. Pineault, I think that all of our witnesses agree that the Canadian government is not about to abandon fossil fuels.

You are maintaining that there is a decline in tax benefits from the oil and gas sector, and fewer jobs. You mentioned two avenues worth considering, one of which is to develop a plan to offset oil production, and the other for us to develop a plan for the transformation of the economy. My impression is that in order to achieve a genuine just transition plan, the transformation of the economy is what's needed.

Have you seen anything to indicate that the federal government is headed in this direction at the moment?

[Éric Pineault]

I wouldn't say that there's a plan, but there are some positive signs.

On the one hand, I see that there are policies to support green energy development, and other policies to support green renovation. On the other hand, there is a policy to support expanding the hydrocarbon sector in Canada. This takes the form of the CCUS tax credit for carbon capture, utilization and storage. Basically, the purpose of the measure is to protect the Canadian oil sector from climate policies in other countries.

Other countries are going to say that they don't want anything to do with a barrel of oil that has such high levels of carbon emissions. What we are going to do is spend money on until 2030 to reduce GHG emissions in that barrel of oil, while not reducing emissions overall. What we're talking about here is an expanding sector.

So I don't see a plan. What's needed is a plan that would aim at carbon neutrality in 2050 by capping oil and gas production and transforming the regional economies that depend on it. As we know, the situation is particularly critical in Newfoundland, with 50% of investment going to the oil sector. There is therefore a lot of work to be done for that particular economy. On the other hand, wind power has enormous potential.

Not only that, but Alberta's economy is already stronger and more diverse, although it needs support. Serious support and a predictable downward ceiling on production are needed, in my view. That's exactly what we did with coal. In Quebec, we had asbestos. At some point, you have to shut things down.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Mr. Pineault.

I'm now going to give Ms. Dusyk an opportunity to comment.

Ms. Dusyk, you and your colleague spoke about a plan that would put an end to fossil energy production.

What do you think we could do in the short and medium term to develop a plan like that?

[Dr. Nichole Dusyk]

As I mentioned in my testimony, there are global forces at work that are beyond what is happening in Canada. Obviously, climate policy is happening in other countries, and we are seeing that and we will see the effects. We are seeing electric vehicles. The rates of purchase of electric vehicles are going up globally, and that will have its own effects.

In Canada, we basically have climate policy that will seek to reduce domestic demand for oil and gas. That policy is largely in place, so we have ZEV mandates and we have a commitment to clean electricity by 2035. We have a number of policies that are working on the demand side in Canada.

The question that we're here to discuss today is the result of what those policies will be on workers and how we can make sure that workers don't get left behind and communities don't get left behind.

The point I would really like to make is that we need to proactively plan for that future. We need to think about that future. We need to understand what the end goal is and come to some shared understanding of what that end goal is in order to make sure that we have the supports in place and that both workers and communities are supported.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Ms. Dusyk.

If there's a little time left, I'm going to give my friend Mr. Morrice a chance to ask a question.

[Mike Morrice, Green, Kitchener Centre, ON]

Thank you, Mr. Simard.

I want to start by asking a question of Ms. Dusyk as well. I can appreciate that some in this committee might not be thrilled with respect to IISD when they have spent time sharing about the billions of dollars that have been committed in subsidies to oil and gas.

Since the “Making Good Green Jobs the Law” report that IISD came out with, the environmental commissioner shared that “When it comes to supporting a just transition to a low-carbon economy, the government has been unprepared and slow off the mark.” Is there anything you want to share in light of this report that reflects thinking that this committee should hear about?

[Dr. Nichole Dusyk]

Yes, absolutely. One of the key quotes out of that report, at least in my mind, is that “the current pace of planning for a just transition will make it difficult to address the upcoming shifts in the labour market and the needs of the Canadian workforce during the transition to a low-carbon economy.”

I will just quickly say that the report points out the need for governance and the need for accountability and implementation, including metrics. That is key for ensuring that the programs being put in place are in fact meeting the objectives that we're setting for them and that they are in fact supporting communities and workers in the way they need to be supported.

[The Chair, Liberal, John Aldag]

Thank you.

We're going to move over now to Mr. Angus. I need to keep this moving because Monsieur Pineault does need to leave at 5:30.

We'll go over to you, Mr. Angus, for your six minutes.

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

Thank you very much.

Mr. Pai, I want to start with you from an international perspective. You've said that the transformation is happening.

I know that my Conservative colleagues think it's some kind of conspiracy against the Canadian Association of Petroleum Producers, and my Liberal colleagues don't seem to know where any good green jobs are. They keep demanding to know where they are.

In terms of the global perspective, the transition is happening. How do you see it playing out for Canada if we start to invest in a clean energy economy, and how do you see it playing out for Canada if we don't?

[Dr. Sandeep Pai]

Thank you for that question.

From a global point of view, we could even start with Asia. People think most of the energy demand will be there in the future. People think most of the consumption for oil, gas and coal will be there. If you think about countries like India and China, you see that they've committed to stop building new coal plants. Even if they have not fully committed, fewer and fewer coal plants are being built.

Ten years ago, if somebody had said that India would stop building coal plants or that China would stop building coal plants beyond 2020, that would have been unimaginable. Those countries are already deploying large-scale solar and large-scale wind technologies. They're talking about reducing the use of fossil fuels in the long run. Even from a demand point of view, you see that countries that could have been demand centres in the future for these technologies may or may not bite on some of these resources that Canada is trying to export. That's the big picture.

Of course, every country has commitments on clean energy in one way or another. That's a very important distinction, if you think about it from a 10-years-back point of view. Canada has an opportunity to hold on to its traditional sectors and try to delay as much as possible, but it will be competing with countries that may be able to produce oil at a much cheaper rate. Therefore, it will be very difficult for a country like Canada, which is exporting, to compete with Saudi Arabia or other countries. In that sense, I think it gives Canada, being a rich country, an opportunity to really invest in a clean energy future and really plan how, in the short term, long term and medium term, these transformations can be planned.

Within that framework, I think it's also important to address the issues of workers and communities. As I said in my introduction, I do believe that hundreds of communities will be impacted across Canada as these transitions happen. As that happens, we really need to think about what the different local jobs are that can be created and what the skill sets are that will be required.

As a last point, there may be some mapping with respect to the clean energy industry and whether you could create some of those jobs locally. It won't be all.

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

Thank you so much for that.

Mr. Mertins-Kirkwood, in an editorial you wrote on the just transition, you said that “weak legislation may be worse than no legislation at all”. Given what I'm hearing from my Liberal colleagues on their view of the just transition, and certainly I know where my Conservatives are coming from, what's your concern about weak legislation being worse than none?

[Hadrian Mertins-Kirkwood]

Thank you for that question.

The concern broadly is that sometimes we make plans and commitments, and then we pat ourselves on the back and don't do anything about them. There's a risk that passing just transition legislation will allow the government to say that it has closed the file even if nothing actually changes on the ground.

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

Would you say that the environment commissioner's recent report saying that this government has missed every single target, continues to make promises, and continues to fail would be a good example of that?

[Hadrian Mertins-Kirkwood]

Well, I think the point of the environment commissioner, and I'd agree, is not that the plans are bad, necessarily; it's just that there needs to be a lot more follow-through.

We know, for example, that the green infrastructure money budgeted in 2017 still hasn't gone out the door. Great—we have that commitment in the budget, and yet we still haven't spent the money. There's a lot of stuff we promised to do that we haven't done yet.

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

Thank you.

Ms. Dusyk, I was looking up your organization because it sounded so nefarious from the way my colleague was describing it. You guys work with the UN and you have all kinds of international funding, but I have to say how shocked I was that you actually have a quote from Brian Mulroney on your page. It's no wonder that my colleagues in the Conservatives are so upset, because they've moved beyond that Conservative party to being this kind of extreme Conservative.

That aside, you said that you had six recommendations, I think, that you could share with the committee. Would you be able to walk us through them, or, if you run out of time, at least provide them to us?

By the way, I don't want to say that I had anything bad to say about Brian Mulroney. I have a lot I could say, but on the environment, he actually showed up and did some work.

[Dr. Nichole Dusyk]

I can quickly walk you through the recommendations. There are five.

First, the just transition legislation should reference key international terms and commitments. It should directly reference a transition away from fossil fuels so that we know where we're going, we know the principles we're using to get there, and we're referencing key legislation already in place, such as the Net-Zero Emissions Accountability Act.

It should articulate the tripartite-plus process. It should name the partners who are involved in those and name other stakeholders who will be engaged in the process. It should make commitments to indigenous rights, be clear about indigenous rights and specifically commit to leave no one behind.

The act should also establish an advisory body with a clearly defined role, and have a mandate and a membership for that body. That should be set out in the act so that it is very clear to all. That advisory body needs to be well resourced in order to do its work.

As I mentioned in reference to the commissioner of the environment and sustainable development's report on the just transition, the act needs to lay out a plan for implementation and accountability. It should set out governance structures and give the framework for who is responsible for what. It should also ensure that there are methods for evaluation to make sure that the programs and the policies are put in place and that the funding that is put in place is going to the right people and doing the work it is intended to do.

Finally, the act needs to refer to a larger just transition strategy. It needs to think about the larger complementary measures, not just the legislation itself. As my fellow panellist was saying, that's not necessarily enough. We need to think about this more comprehensively. We need to think about funding mechanisms and economic diversification strategies. We need to make sure there's appropriate training and retraining and reskilling, and then include monitoring and evaluation as well.

[The Chair, Liberal, John Aldag]

That takes us to the end of the time.

With that, witnesses, I would like to thank each of you for being here today. Thank you for your understanding as we struggled through a late start and some votes in the middle of our testimony. As I say to all witnesses, if you have any additional thoughts or heard anything that triggered any thoughts, we invite you to send to the committee an additional brief of up to 10 pages. You can go through our clerk if there is anything that you'd like to send.

With that, we'll let you go. Thank you so much for being here today.

Committee members, we have the room and the interpreters until 5:55 p.m. We can suspend and go in camera to start in on the recommendations of the report, if there's agreement to do that.

Thank you.

To the witnesses, have a great afternoon.

[Proceedings continue in camera]