Natural Resources Committee on May 9th, 2022

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

Okay. That makes my point there, I guess.

There's the whole issue of indigenous communities fully supporting the natural resources, and you've indicated that theirs is probably double the average investment from indigenous peoples in the industry. There isn't any other industry. Many of the equity partners are employed by many of these indigenous communities—our equity partners in their industries, I should say. They're employed by and they receive benefits from success in these local projects.

How would decreasing these natural resource developments affect the jobs of the first nations?

[Shannon Joseph]

It would disproportionately impact first nations jobs, because the resource projects occur in those communities in those areas. Many indigenous business owners, and I'm thinking of the oil sands, in particular.... There's about $2.4 billion annually in procurement with first nations and indigenous-owned businesses, so that's a disproportionate impact to those businesses that isn't going to be replaced.

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

Thanks.

I want to go to Mr. McTeague, given my time. I like your comments in your opening about the timeliness versus the reality of the energy pricing, and the high levels of prices versus the balance of what the consumer can absorb. That we've been given that opportunity to consider problems as a quick fix was one of your comments there. I really appreciate the comment that many sources aren't scalable. You could look at the German example there.

Ms. Smith from Clean Energy made the comment that clean energy is a solution. I think that was her last comment. She also said that electric bills will be higher. Young families are struggling today with these high prices that we're seeing from inflation and other things in housing. Her last comment was this is okay, but you'll pay now and save later.

How is that going to happen and is it reasonable, given that they can't even buy a house, let alone a car now?

[Dan McTeague]

Those are the big issues of the day that you, as politicians, will have to deal with, but I can tell you from experience here in Ontario, a province that has a significant amount of clean energy already produced, the cost has been significant. The Province of Ontario has picked up $6.5 billion every year to defray the cost of so-called green energy.

By the way, green energy in my province has not yielded those transitional jobs. Quite to the contrary, we've seen an exit of jobs in the energy sector. That aside, I think what we're doing here is perhaps ignoring the bigger picture. Those opportunities exist if the subsidies continue to be there. We're dealing with your government or a government of Parliament that is sitting on some of the biggest record debts that I've seen in my time. I served as a member of Parliament trying to slay those very large deficits that became unwieldy.

I think we can make this transition that people keep talking about, but it's not going to happen because you decide 2030 is the day or 2050 is the day. Many countries are having second thoughts about pursuing this direction, because it's not only costly. It's now brought the world into a far more dangerous position of security, and energy security, in particular.

By the way, what happened in Europe as far as Russia is concerned—long before Russia met the troops on the border of Ukraine—is we had a very serious problem with energy and supply. A lot of that was due to the fact that energy companies have been told not to invest in oil and gas. We don't want any more. The International Energy Agency last year said we don't need any more oil and we should stop making fossil fuels altogether. Let's get rid of it. Two weeks later, they got their data wrong and said, “Wait a minute. OPEC, please provide us a little bit more oil”.

We can't have policies based on wishful thinking. We have to be practical and pragmatic, and being pragmatic today means you start listening to the consumers out there who can't make ends meet.

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

Thank you.

Some previous witnesses have said that wind and solar manufacturing are dependent on foreign supply chains, yet we have nuclear right here in Canada that is supported by a very stable domestic supply chain and that benefits communities by supplying long-term local jobs.

Can you give me your thoughts on whether it will take all of the energy sources we have to meet net zero? I believe you indicated that. In our committee's recommendations to the government, should we prioritize energy sources that better support Canadian jobs and the economy right here in Canada? Can you elaborate on that?

[Dan McTeague]

I just think we need to be pragmatic. The point is that we can achieve these things, but we're going to achieve them by understanding the limitations of the current technology that's there. We can all want a greater and more prosperous future, but we're not going to get there if we simply throw the baby out with the bathwater.

In order to get to that next stage in the next 10, 20, 50, 100 or 150 years, I think we have to recognize that Canada with its technologies is the way ahead. We can provide that to other countries as well, but we can't do it by simply saying, “Oil companies made a lot of money this year.” Of course they made money this year, because they're being told not to reinvest. Of course natural gas companies can provide an opportunity to alleviate the situation in Europe and in Asia, but we consistently have said no to pipelines and no to infrastructure while we focus uniquely on something that is not yet workable.

I don't disagree with the need to do these things. I just think rushing as we have been doing, and not following what's happened in Europe, is, to put it very bluntly, short-sighted.

[The Chair, Liberal, John Aldag]

All right. That's the end of—

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

I'd just like to finish by saying that we're definitely on the same page.

[The Chair, Liberal, John Aldag]

Okay.

Mr. Sorbara, you have five minutes on the clock.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you, Chair.

Welcome to all the witnesses—those present and those virtual.

I'll start off with the folks from the Canadian electricity association and Electricity Human Resources Canada. I heard some comments that about 80% of electricity being produced in Canada now is from non-emitting sources, and that we're going to need a substantial investment in electricity infrastructure to get us to 100%. On that, do you have any further clarity in terms of what the substantial investment would be and what a pertinent or appropriate and realistic time frame would be?

[Francis Bradley]

Thank you very much for the question. It is an excellent question.

The most recent study we did in terms of trying to identify what the infrastructure build would be for the electricity sector was before we had the full net-zero 2050 targets. At that time, the expectation was that it would require about $1.7 trillion between now and 2050 for decarbonization and electrification. We're actually looking at updating those studies to get a better sense of the scope and scale of what the investment is going to look like, in light of both the 2050 net-zero targets and the 2035 target that the government has with respect to a net-zero grid.

These targets are very aggressive. These targets are going to be challenging in some jurisdictions of the country, but the electricity sector is committed to working towards those targets. As I said previously, the only way we're going to be able to achieve that is an “all of the above” approach.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Okay.

Michelle, would you have any comments on that, please?

[Michelle Branigan]

Looking at it from the jobs perspective, I think we need to also recognize a couple of really important factors. We have a rapidly retiring demographic here in Canada as well. As we start looking at the just transition and those numbers, we need to recognize that we are going to need to replace those who are retiring. We have anecdotal evidence that COVID may be resulting in some of that being accelerated. We don't have the data yet, but that's what I'm hearing from the industry. We're going to have some challenges in ensuring that we have the people to keep the grid operating.

I think that's really important. There are two things here. We need to ensure that we're attracting that next generation of talent from a resiliency and reliability perspective. We haven't even touched on the fact that here in Canada our current workforce does not represent what the population of the country we serve actually looks like.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you, Ms. Branigan. I do want to move on. My time is limited.

To Clean Energy Canada, you referenced comments on a well-designed clean energy strategy. You also spoke with regard to battery manufacturing and some of the investments that have been made in the Canadian auto sector. I'm the chair of our Liberal auto caucus and have covered this sector for a number of years, both when I was in New York City and back in Toronto, so I'm very familiar with that.

Do you have any comments on the well-designed energy strategy? Please respond very quickly, in about 20 seconds, so that I can ask one more question after that.

[Merran Smith]

With respect to the clean industrial strategy I was talking about, the country needs to get clear on where it's going. We need policy certainty on decarbonization. We need certainty on supports like tax credits and investments. I think we need certainty. The business sector is asking for certainty and not this “yinning and yanging” back and forth. There's been enough clarity about the cost of all clean energies coming down, such as battery storage. The solar project I mentioned in Alberta is at 4¢ a kilowatt hour.

The technologies in some cases are definitely ready for prime time. They're cheaper than fossil fuel infrastructure. There definitely is a need to build out infrastructure, to build out supports and to support worker transition and affordability, which I don't think we focused on enough here today. We need affordability so that while the electricity bills of all Canadians will be more expensive, their overall energy costs will be cheaper, but we need to support families to get to that place.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you.

I have just one last question for Shannon over at CAPP. I've argued that the world needs more of Canada's energy, both renewable and non-renewable, if you look at our ESG rankings and so on.

Can you touch upon the decarbonization of the oil sands, whether in situ or conventional? It's very important.

[Shannon Joseph]

I agree with you that all forms of energy are important and that Canada produces it with a focus on emissions reductions. Our oil sands producers have been decreasing their emissions by 8% and 14% in the last 10 years, depending on the type of production. They want to go further, and they are investing right now in innovation to go further and have proposals to get to net zero.

[The Chair, Liberal, John Aldag]

That's the end of our time for that round.

We're going to go now to Mr. Melillo, who will have five minutes on the clock.

[Eric Melillo, Conservative, Kenora, ON]

Thank you very much, Mr. Chair.

I'd like to thank all of our witnesses for joining us today for this important discussion. We've already had a lot of very valuable feedback. I'm sure it's going to continue to spark some fruitful discussions, and there may be a little bit of debate as well—right, Mario?—in this committee, but we get along quite well and I think it's important that we're discussing this, because I do think we all have the same end goal. It's just a matter of how we get there and support workers in the process.

I'd like to direct my questions first to Ms. Joseph. Previously some witnesses before the committee have testified that the oil and gas sector will not be providing as many jobs as it currently is moving forward for Canadians, partly due to some of the cost-cutting measures that the sector is taking and that the producers are adopting. I'm just wondering if you agree with that and if you have any further comments on that statement.

[Shannon Joseph]

I think the most important driver in terms of jobs is going to be global demand for energy, which is still increasing. Yes, our members are doing everything they can to reduce emissions and to drive efficiency, but as long as the world is demanding energy, there are going to be jobs and ongoing work to meet those needs in an innovative way.

[Eric Melillo, Conservative, Kenora, ON]

I appreciate that. Thank you.

I'd like to pick up what my colleague Mr. Maguire touched on as well, in terms of global energy security. Obviously, that's a very important topic. It's one that's at the top of our minds right now, given what's going on in eastern Europe with the Russian aggression in Ukraine.

I'm just curious to get your further thoughts on Canada's ability to displace Russian oil and that of other dictatorships and regimes, and to provide a more ethical and sustainable energy source.

[Shannon Joseph]

Our members worked with the Government of Canada and we announced the potential for an additional output of the equivalent of 300,000 barrels per day to help meet the needs. A lot of that would flow through the United States and, with the increase in overall supply, would support having more ethical supply online. I think we're very open to working together with governments on an approach that would allow us to do more and to leverage projects that may be waiting, like Énergie Saguenay, and that are under construction, like LNG Canada, to see how we can do more.

[Eric Melillo, Conservative, Kenora, ON]

Would you have any more specific recommendations, even in terms of legislation or the like, as to what our committee could propose to support those efforts?

[Shannon Joseph]

I would just say from a general perspective, policies that create regulatory certainty and efficiency, that cut down on the time to get permitting done and construction addressed, things that provide certainty for investors about the direction we want to go in and the role we want to play, that would allow investors to invest with confidence. Those types of policies would be important, and those types of signals about what the government wants our energy to do in the world would be important.

[Eric Melillo, Conservative, Kenora, ON]

Thank you very much.

I'm sorry. I'm jumping around here on a few different topics, but there's a lot I want to get in, in a short period of time.

We heard as well from some of the witnesses in committee, or at least seemingly we had some witnesses who seemed to take the approach, that either you're on the side of the environment or you're on the side of Canadian jobs, and there's no in between. I would happen to disagree with that. I think there's certainly a lot of benefit to supporting Canadian jobs and Canadian industries, especially from the environmental side. I think we talk about some of the energy from regimes like Russia and others, but further from the global security standpoint I think there's an environmental conversation we need to have as well. I know first-hand from some of the opportunities I've had to do some tours, particularly in northern Alberta, about some of the great work that our energy sector is doing to be more efficient and greener.

I'm wondering if you can comment on some of those efforts as well.