Natural Resources Committee on Dec. 1st, 2022

[The Chair, Liberal, John Aldag]

I apologize. I should have introduced our officials who are with us.

Briefly, before we go into the next round of questions, we have with us in person, from Natural Resources Canada, Deputy Minister John Hannaford; Mollie Johnson, associate deputy minister; and Shirley Carruthers, chief financial officer and assistant deputy minister of the corporate management and services sector. Welcome.

Online today, we have Erin O'Brien, assistant deputy minister of the fuels sector; Debbie Scharf, assistant deputy minister of the energy systems sector; Jeff Labonté, assistant deputy minister of the lands and minerals sector; Glenn Hargrove, assistant deputy minister of the Canadian forest service; Drew Leyburne, assistant deputy minister of the energy efficiency and technology sector; Frank Des Rosiers, assistant deputy minister of the strategic policy and innovation sector; and, finally, Angie Bruce, assistant deputy minister of Nòkwewashk.

That is our panel today.

We're going to go now to Mr. Maloney, who will have five minutes for his questions.

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

Thank you, Chair.

Thank you to all the witnesses for being here.

I'm going to focus my questions on nuclear energy for the most part, but I'm going to start with the estimates, which, of course, are the reason we're here.

There are two components to the supplementary estimates (B) dealing with that. Area one is the $450,000 to Atomic Energy of Canada Limited, and then there's a transfer of $4.9 million to the Canadian Nuclear Safety Commission.

Can you just give us a brief overview of where this money is going to go and what organizations are going to benefit from it, for starters?

[John Hannaford]

Thanks, Mr. Chair.

To take a step back, nuclear is very likely to be a pretty critical aspect of our energy mix as we are looking at an increase of demands on our electrical grid, perhaps two to three times the current demands by 2050. The government has taken a series of steps to support the development of this technology.

You mentioned the support to the CNSC. That is in part to reinforce the centrality of the commission as a world-class regulatory body. One of the great assets we have right now is recognized expertise with respect to not only the technology, but also the regulatory environment, which is critical, obviously, to the safety and operation of these facilities.

The government has also, though, taken steps to announce support for, principally, small modular reactor technologies in the last period of time. The Canada Infrastructure Bank is supporting the development of the Darlington site, where some $900 million has been put toward a 300-megawatt demonstration operation of SMR technology. There's also support that's being provided more generally to CNSC. There was a $50-million announcement with respect to the support of our regulatory regime, which will go to CNSC in order to develop some of the regulatory tools that will be necessary to ensure the safe operation of the technology. In addition, we've been investing through the strategic innovation fund to support specific applications.

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

Thank you.

My next question was going to be on the steps taken to support the small modular reactors. I'll move on from that, then.

It is a critical part of our clean energy strategy going forward. Everybody recognizes that. As much as we disagree on this committee and elsewhere, there are areas where there isn't a lot of space among the parties. I think this is one of them.

My question is this: Given the importance of this—and it's recognized by the federal government and most, if not all, of the provinces—where does Canada stand on the small modular reactor stage compared to other countries around the world?

[John Hannaford]

The investment we just made in the Darlington plant does put us in a leadership role internationally. There are a number of different international players who are focusing on this technology as one with real potential, but we have real assets strategically with respect to nuclear generally and with respect to this technology development.

I mentioned the strategic innovation fund, where we've made specific investments in some of the technologies that show real promise. There, again, those can contribute not only to the support of our electrical grids, but also to some of our remote communities, providing the possibility for them to move to cleaner, low-emitting energy.

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

Okay, great. Thank you.

We heard the minister say, “Canada has enormous opportunities to be the clean energy supplier to the world”, and this is obviously one of those areas.

I'm going to move on to another aspect of nuclear energy, and that's in the health field.

In my riding, I have an organization called Kinectrics, which is in partnership with Bruce Power and a French company working on medical isotopes. It's done through the CANDU nuclear process. I went down and visited Bruce Power this summer. It's a private sector initiative, but it needs a little nudge and support from the governments, and I think the federal government has stepped up on that.

Maybe you can use that as an example, but can you give us other examples where the federal government has helped the private sector push that ball down the field?

[John Hannaford]

I'm sorry, but to be clear, is this specifically with respect to isotopes or with respect to nuclear technology in general?

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

Let's deal with isotopes.

[John Hannaford]

Canada has had a significant role with respect to the provisions of isotopes internationally. Through a variety of different operations, we have provided isotopes into the global demand.

I will maybe turn to my colleague, Debbie Scharf, just on any specifics she wishes to flag with respect to isotopes.

[Debbie Scharf, Assistant Deputy Minister, Energy Systems Sector, Department of Natural Resources]

Thanks, Deputy.

The deputy is right. We have been a key player in this field in the past. Right now we work internationally with other partners to maintain the supply chain for the types of isotopes we need in Canada for use in cancer treatment, sterilizing medical devices, diagnostic procedures, the treatment of food and consumer products. The lead for maintaining that supply chain in Canada is the Department of Health, or Health Canada, at the federal level, making sure that the isotope supply is available to all who need it for all of those applications.

The Canadian Nuclear Safety Commission, the CNSC, does play a role in licensing, as part of their regulatory functions, for the types of reactors that could produce isotopes if it was something Canada wanted to do again.

You are absolutely right. ISED does have, through its strategic innovation fund, the ability to fund R and D and commercialization, which could include a variety of different areas, including nuclear innovations.

Those are some of the things—

[The Chair, Liberal, John Aldag]

I'm going to have to jump in. We're out of time on this one.

Ms. Scharf, thank you for those comments.

We're going to go now to Monsieur Simard, who will have two and a half minutes for his questions.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Mr. Chair.

Mr. Hannaford, I don't know if you know this, but it's very difficult for the forestry sector to receive assistance from the federal government. The only economic arm is Canada Economic Development, and it cannot support forestry companies that are engaged in primary or secondary processing. Their requests are automatically transferred to Global Affairs Canada, which systematically refuses them because of trade disputes with the United States.

The forestry industry's only lever is the famous investments in forest industry transformation program, which is underfunded, according to all the stakeholders I consulted. Many people even tell us that they don't apply to this program because they know it will be rejected.

Do you have any data on the number of applications that are made under this program, the number that are accepted and the number that are refused?

[John Hannaford]

I'll ask my colleague to respond.

[Mollie Johnson, Associate Deputy Minister, Department of Natural Resources]

Thank you, Mr. Chair.

I don't have the data on the number of programs here, but we are able to get back to you on that.

[Mario Simard, Bloc, Jonquière, QC]

To your knowledge, is it more than three quarters of the applications that will not be completed due to lack of funding?

That's the figure I heard. I was told that more than three quarters of the applications submitted aren't funded because the program is underfunded. Are you aware of that? I'm asking you to answer as much as you know.

[Mollie Johnson]

Perhaps I can ask our ADM of the Canadian forest service, Glenn Hargrove, to speak to that.

[Glenn Hargrove, Assistant Deputy Minister, Canadian Forest Service, Department of Natural Resources]

Certainly. Thanks, Deputy.

Mr. Chair, I don't have the exact numbers for what we might term oversubscription of the program. It certainly is a very popular and productive program. We do receive more applications than we can fund.

[Mario Simard, Bloc, Jonquière, QC]

Thank you.

There is $11 million in the budget to combat the spruce budworm. I remember that in previous budgets, this money was mainly for New Brunswick.

Do you have any idea of the current breakdown of that amount? In other words, do you know how the $11 million will be allocated?

[The Chair, Liberal, John Aldag]

We're out of time, but if you have a brief response, we can take that before we move to our next question.

[Mollie Johnson]

I apologize. I missed the end of it. Was that for the spruce budworm or the mountain pine beetle?

[Mario Simard, Bloc, Jonquière, QC]

Do you know what the breakdown of this $11 million is?

In past years, most of the money went to New Brunswick.

[Mollie Johnson]

We'll have to get back to you.

[The Chair, Liberal, John Aldag]

Mr. Angus, it's over to you for two and a half minutes.

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

It's very clear, with the United States going into high gear in terms of a clean-tech economy, that it puts a lot of pressure on Canada. We have to have, at every level, a real, coherent strategy and collaboration. At the federal level, NRCan has to deal internationally, but then you have to deal with all the different provinces and their various political focuses.

I want to focus on that, because this morning in the news, one of the top stories was about the launch of a Calgary clean-tech program, and they said that the only thing people were talking about in Calgary at this clean-tech launch was the uncertainty caused by Danielle Smith and her sovereignty act and that it was threatening to scare business out of Alberta.

Deborah Yedlin, who's president of the Calgary Chamber of Commerce, said there was no shred of evidence that this act will lead to economic growth. She said, “We see this as potentially introducing a very significant element of risk and uncertainty for businesses in Alberta.”

I certainly don't want to have you comment on the political machinations of Premier Smith, but I would ask you how important it is for the federal government working with the various provinces, if we're going to try to supply clean tech and compete with the Americans, that we do this in a framework of a shared goal, shared values and a shared vision?

[John Hannaford]

I would say that that's very much the intention of the regional table approach that the minister described in his comments. It's significantly because of the scale of the challenge that we are facing. In order for us to meet the challenges of the climate crisis, the challenges that are posed by some of our geopolitical realities, concerted effort between the federal government and the provinces is very important, and we have a real opportunity right now.