Natural Resources Committee on Sept. 20th, 2023

[Normand Mousseau]

It is an option for electricity, but not for heavy transportation. One example is backup heating. However, it is not yet clear. If we don't test at scale, we won't be able to have a real vision of the role of blue hydrogen in Canada.

[Mario Simard, Bloc, Jonquière, QC]

What can be used to double the generation of electricity?

Quebec is unique with its hydroelectricity. However, in the rest of Canada, what would be the best sources to double electricity production? Is it wind? Is it the return of nuclear?

[Normand Mousseau]

If you look at the cost modelling, the cheapest options are wind energy, solar energy and electricity storage. For a real and safe context, however, nuclear power will probably have to be used to guarantee a base.

[Mario Simard, Bloc, Jonquière, QC]

If we try to give a timeline, what does that look like?

[Normand Mousseau]

It should have started yesterday. Canada is already lagging behind other countries.

The advantage is that there is a lot of decarbonized electricity in eastern Canada. However, more decarbonization needs to be done. We also need to increase electricity production. To do that, we need a true integrated vision. If each province does it independently, it will cost a lot more than if we also rely on interconnection networks. These are decisions that each province will have to make. At the end of the day, we have to move forward and increase electricity production.

[Mario Simard, Bloc, Jonquière, QC]

You're saying it should have started yesterday. So you feel that Canada is lagging significantly behind other countries.

[Normand Mousseau]

That is the case when it comes to planning.

[Mario Simard, Bloc, Jonquière, QC]

That is also the case in modelling.

[Normand Mousseau]

Modelling is another matter.

[Mario Simard, Bloc, Jonquière, QC]

I think my time is up.

[The Chair, Liberal, John Aldag]

That's the end of the six minutes. Thank you.

We're going to go now to Mr. Angus, who will have six minutes for his round of questions.

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

Thank you, Chair.

Thanks to all of our witnesses for your expertise.

I'm going to start with Mr. McGowan.

The Alberta Federation of Labour and the energy workers you represent were really out front on this issue and really pushed the Liberal government on the issue of getting tax credits and a program like the IRA. I think it was widely expected that Alberta would be first out of the gate given the huge potential, level of expertise, opportunity and entrepreneurial spirit.

I'd like to get a sense of what it's meant since the Danielle Smith government decided to put a spike in clean energy investments. We've been told that upwards of $35 billion in projects are now on hold or pulling out. Could you tell us what the decision by the Conservatives in Alberta to attack clean energy has meant for energy workers in Alberta?

[Gil McGowan]

The UCP government's announcement of the moratorium on renewable energy development was, frankly, devastating and demoralizing for the workers we represent in Alberta and, frankly, for the majority of Albertans. It came out of the blue. We weren't expecting it, and it's exactly the opposite of what we need.

You know, I sent a letter on behalf of our 175,000 members shortly after the announcement, and I said that with this moratorium she and her government were undermining a thriving industry in the renewable sector and that they were killing current jobs and jeopardizing future jobs. Frankly, I argued that they were turning Alberta into an investment pariah.

As we've heard from other witnesses today and as we know from media coverage over the past six months or so, it's not just the Americans with the IRA. Basically every country in the world has looked at the devastation that climate change has wrought this summer—floods, fires, extreme weather—and citizens are demanding that their governments take action, so this is not an option for Alberta or for the country.

The energy transition is happening whether we like it or not. We can't choose to turn it off or turn it on. What we can choose, however, is how we respond to it. As many of the witnesses have argued today, the best way to respond to it is by embracing IRA-style government-led industrial policy in the public interest to pivot our economies toward a lower-carbon future. That might seem scary, but it's inevitable. We don't have the choice to go backwards, but it also presents all sorts of opportunities. Those are exactly the opportunities that are being crushed or at least postponed by the UCP's decision to put a moratorium on renewable energy development.

It's supposed to be a seven-month moratorium, but what we're afraid of and what I think many Albertans are afraid of is that it will make us an investment pariah even after they lift the moratorium, because it's already sent the message, and the message is that renewable energy investment is not wanted in this province, which is devastating in terms of investment, job creation and the future of our economy.

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

Thank you for that.

I certainly talk to a lot of people in critical minerals who are pumped. They're ready to move investment stateside on a dime because of the opportunities. Calgary Economic Development—hardly a left-wing think tank, but they could get heckled at our committee—said that 170,000 jobs would be created in Alberta alone by these investments in clean energy. We've been told that there's a fear these jobs and opportunities are going stateside because of the clear investments that are offered through the IRA. Are you concerned that we're going to lose those jobs from Alberta energy workers stateside as a result of the UCP's ideological attack on clean tech?

[Gil McGowan]

Yes. That giant sucking sound you hear is billions in investment and thousands of jobs migrating from Alberta down to the United States because of this moratorium. It's not a question of if we're going to lose investment and jobs. It's a question of when and how much. The Americans under the Biden administration have put in place a framework that is incenting literally trillions of dollars of investment, and if we do nothing, we're just going to lose all the investment and the jobs.

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

Thank you.

I have to interrupt you here because I'm running out of time.

I think what's a real concern is that Danielle Smith claims that the transition is decades away. I would like to get your sense of that, because we know Suncor just laid off 1,500 workers. Rich Kruger has said he's going to target workers in his effort to build up profits, and we've seen a 50,000-job loss in the oil sector in Alberta in the last 10 years. Is the transition decades away or is it happening now, and do we have to adapt to it for Alberta energy workers?

[Gil McGowan]

We represent workers on the front line, and they tell us every day that the transition is already happening. We hear it in the stories from our members, but we also see it in the labour force numbers. At the peak in Alberta, we used to have about 180,000 people working directly in oil and gas. We're down to about 140,000 now. Because companies like Suncor are producing more with fewer people as a result of automation, that number is going to continue to decline. The transition is upon us, so that's the question that I will pose on behalf of the Alberta workers we represent—

[The Chair, Liberal, John Aldag]

Okay. I'm going to have to jump in.

[Gil McGowan]

—to all members of this committee: Where will the jobs and future prosperity come from in this global energy transition if we don't embrace an IRA-style industrial policy to pivot our economy?

Thank you.

[The Chair, Liberal, John Aldag]

Thank you. We're out of time on this one.

We're now going to go to Mr. Dreeshen, who will be the first up. He'll have five minutes.

I'd just like to say we have lots of witnesses we haven't heard from yet. It is very much up to the members to direct the line of conversation, but if you have something you'd like to weigh in on, feel free to use the “raise hand” function. It will be up to the members to choose if they get to you or not. These next couple of rounds go even more quickly than the first one, but we want to make sure that everybody has a chance to chime in.

I know, Mr. Saik, you have to leave at six.

If any of the members don't get to any of you who are part of the panel today, and you have thoughts based on the conversation, we invite written submissions of up to 10 pages. That can be sent to our clerk, who has been in contact with all of you. That's another way of providing input based on the conversation if you can't weigh in today.

With that, Mr. Dreeshen, it's over to you for five minutes.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you very much.

I'll start with Mr. Saik. I know that you have extensive experience in the development of technology, and you've consulted with many stakeholders for many years.

I wonder if you could characterize the current competitive environment in Canada compared with some of the other places in the world that you have focused on.

[Robert Saik]

First of all, there are a number of pieces the other witnesses have mentioned that I'd like to just touch on.

First of all, I have two public exits under my belt. They're both Canadian companies—both brilliant companies bought by U.S. companies. We have all sorts of innovation in the Canadian agriculture and agtech sector. I would echo Mr. Burany that there is this big gap right now between conception and basically proving an idea and scaling it, and we can't seem to get that kind of traction in Canada.

Point number two is that we, in agriculture, need phosphorous. Phosphate is critically important for the production of crops in agriculture. We should be supporting that initiative that he's working on, because it's vitally important to the security of Canada, if not North America. It would ensure lasting supplies of phosphorous, which is a critical ingredient in both agriculture and the industry in the electrification sector.

Now, on the agricultural side, the colleague from the United States said that we should just use crop residues. I agree with that. However, it comes with a caveat. That caveat is that 1% of organic matter equals 20 metric tons of carbon dioxide. The only way to increase sequestration of carbon dioxide in soils is through reduced tillage and the decomposition of the residue from crops into the soil organic manner. There are some places where you can burn biomass from crops, but it is not a large-scale solution.

The final thing I wanted to touch on is technology. There's all sorts of talk about agriculture getting a black eye and about agriculture being a problem. Agriculture is one of the few industries that can actually remove carbon dioxide through sequestration in soils, but we also have several mechanisms to reduce greenhouse gases from agriculture, including nitrification inhibitors to reduce the amount of nitrous oxide from fertilizer. These are technologies such as sectional control or variable rate technology that allow us to put fertilizer on more precisely.

You have to remember that many of the policies that are going on in Canada right now are punitive to Canadian farmers. Canadian farmers pay a carbon tax on the machinery they buy to grow the crops. They pay a carbon tax on the fuel necessary to put the crops in the ground, spray the crops and harvest the crops. They pay a carbon tax on the crop inputs and the fertilizer that are used. They pay a carbon tax on grain drying, because you guys can't agree on passing that legislation. They pay a carbon tax on hauling the grain to the elevator, and then all of the processors pay a carbon tax all the way through. This is something that our friends across the line in the United States have none of, so Canadian farmers in agriculture are differentially disadvantaged.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you very much.

Of course, the U.S. does not have a carbon tax. They also didn't have the problems with the fires and so on, because it's been one of the mildest fire seasons there.

Getting back to the finite amount of land in the world, putting windmills and solar farms onto land that should be producing for farmers, I think, is an issue.

I'm not sure about my time, but I know that you, Mr. Burany, talked about the three companies that you had. I was at the environment committee when you spoke last and you said they had bought one. The U.S. now owns it. Where does some of that money come from?

[Zsombor Burany]

The first company you're talking about is my telecommunications company. That's telMAX. TelMAX has been the fastest high speed in Canada for the last two years. I raised the money from a Nova Infrastructure fund and from the Robinson family in the U.S. Nova Infrastructure is a $13-billion company, and it got its money from the Canada pension plan.

Ridiculously, when I approached the Canada pension plan and the other pensions, they wouldn't fund telMAX, but they would definitely give the money to a firm in the U.S. that would now buy telMAX and now owns 85% of the telcos.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you. I appreciate that. It's one of those oddities that we certainly have.

I have just one last point. We talk about the moratorium. Part of the reason for that, of course, is that we need to have a plan for all of this land that is being used for windmills and for solar. That is the reason this discussion has taken place. If you go to the Alberta Utilities Commission, you'll realize that there is still a continuation. It's not the type of thing that we've been hearing from both the Liberals and the NDP.

Thank you.