Natural Resources Committee on Feb. 5th, 2024

[Christine Bonnell-Eisnor]

I agree with what Scott said, and we also have an example that I can speak to.

We have a long-standing fisheries advisory committee. Engagement with the fishers and indigenous groups is very important to us. We've been doing that as we've regulated petroleum and oil and gas activity, and we'll continue to build on those strong relationships we have because indigenous groups and the fishers have very unique insights and information that we need to understand when we're making our decisions.

Our fisheries advisory committee includes over 30 fishing groups that fish in the Canada-Nova Scotia offshore area. We meet with them a few times a year and we've been meeting with them a lot more because they're interested in learning about what this future industry will look like.

We facilitate conversations they can have with governments, and we look forward to future engagement with these groups.

[Yvonne Jones, Liberal, Labrador, NL]

You're both energy regulators—

[The Chair, Liberal, George Chahal]

Ms. Jones, your time is up. You can save that for the next round.

Thank you for your questions and thank you for your answers.

We'll now move to Mr. Simard from the Bloc Québécois for six minutes.

[Mario Simard, Bloc, Jonquière, QC]

I would've given my time to Ms. Jones, because I really like her, but I still have some questions, and I know it concerns her region.

Mr. Tessier, I wonder whether the Canada-Newfoundland and Labrador board, currently called the Canada-Newfoundland and Labrador Offshore Petroleum Board, has any expertise in wind energy? Has anyone in your organization already successfully carried out any wind energy projects?

[Scott Tessier]

The short answer to the question is no. We don't have anybody with direct experience in wind energy projects because we haven't had any such projects in our offshore.

As mentioned in the previous response, there are many areas of transferable skills in terms of offshore safety regulation, geoscience and other areas under our current remit that are directly transferable to the offshore energy sector.

[Mario Simard, Bloc, Jonquière, QC]

Those two sectors are nonetheless quite different, in my opinion.

I don't know about Newfoundland and Labrador, and I don't know whether you have information on future projects; however, I saw that Nova Scotia has a wind road map. In a minute, I'll ask Ms. Bonnell‑Eisnor a question. She had a wind road map setting a five‑gigawatt target by 2025, which is an extremely short time frame.

To your knowledge, does Newfoundland and Labrador have a similar road map setting out how much power it hopes to generate from wind energy?

[Scott Tessier]

There's no such target for offshore renewable energy at this time in Newfoundland and Labrador. The focus in this province to date has been almost exclusively onshore. There are a number of proposed projects for onshore wind to hydrogen.

[Mario Simard, Bloc, Jonquière, QC]

If I were to ask you whether you know the cost per gigawatt of a wind project, you wouldn't be able to give me an answer. You also wouldn't know how much it would cost to transform that wind energy into hydrogen using a hydrolyzor.

[Scott Tessier]

I'll begin simply by saying I do not. It would vary widely depending on the project, I would think, but I don't have that information.

[Mario Simard, Bloc, Jonquière, QC]

I'm still a little surprised.

Ms. Bonnell‑Eisnor, I saw Nova Scotia's proposed road map. It mentions five gigawatts by 2025. Five gigawatts seems like a lot to me. In total, with its dams, some remaining power plants and wind energy, Hydro‑Québec produces 37 gigawatts. Hydro‑Québec is one of the biggest producers of clean electricity in the world. Producing five gigawatts in such a short time frame, by 2025, seems very optimistic to me.

Do you know how wind produced in partnership with your office would be used?

[Christine Bonnell-Eisnor]

Thank you for the question.

I'd like to clarify the numbers you're speaking to. In September 2022, Nova Scotia Premier Tim Houston made an announcement that had two parts.

The first was that the first call for bids, which is how licences are issued for offshore wind projects, will occur in 2025. That means once we become the Canada-Nova Scotia offshore energy regulator, we will administer a call for bids or a licensing process on their behalf no later than 2025.

The second part of his announcement was that by 2030 there will be five gigawatts of offshore wind potential licensed. That doesn't mean there will be turbines in the ocean producing electricity. It means that, at that time, there will be enough licences in place to potentially install wind fields that could generate up to five gigawatts of offshore wind power in the future.

Those are the targets the provincial government has in place, and it is responsible for giving us the strategic direction for having and administering the call-for-bids process on its behalf. Those will be the targets it will use when it's providing that strategic direction to us about future processes for licensing.

[Mario Simard, Bloc, Jonquière, QC]

Thank you for that clarification.

I have a question for both of you.

If future projects are being given licences, in my opinion, that means that the associated costs have been estimated. You know that there are federal programs and tax credits for the production of clean energy and hydrogen.

Have you calculated the cost of such a project and the tax credits that this kind of project might qualify for, or is it far too early for that yet?

[Christine Bonnell-Eisnor]

Thank you for the question.

With respect to the economics of projects, we as the regulator don't get involved with those. As I mentioned, both governments will provide us with a strategic direction on where they want offshore wind projects to be located so we can administer the licensing process. It will be up to governments, and they will take those economic considerations into account when telling us which areas to start the process for.

[The Chair, Liberal, George Chahal]

Thank you for your questions and for your answers.

We'll move to Mr. Angus, from the New Democratic Party, for six minutes.

Go ahead. The floor is yours, sir.

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

Thank you so much, Chair.

Thank you, witnesses, for bringing us your expertise.

Mr. Tessier, I'd like to speak with you. At the outset you said you've been meeting with international regulators. We see huge projects coming on stream, such as the one in Aberdeen. Five years ago I was reading about the downturn in offshore oil, and they were hoping wind out in the North Sea would create jobs. Now we're looking at thousands of jobs. We see the United States under the Biden administration moving very quickly. You said you've met with regulators in Europe and Australia.

Globally are we looking at a revolution in energy with offshore wind?

[Scott Tessier]

I think it's fair to say that there is an unmistakable global movement to offshore renewable energy. Certainly, in other parts of the world, offshore wind has taken on tremendous momentum. The energy transition is under way and it is undeniable. You're absolutely correct.

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

Thank you.

I've spent some good times in Newfoundland and Labrador. I love the people and the place, but, my God, it's windy.

Are you telling me that you're going to be able to compete with those Australians, or do you have an advantage? Do you think that, if we get these projects up and running, we'll be able to hold our own?

[Scott Tessier]

I think the east coast of Canada has wind conditions that rival anywhere in the world. Christine and I can argue about who has the better supply of wind.

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

Thank you.

One of the things that have surprised us on seeing what the Biden administration has put in regarding tax credits and incentives is how fast it's moved. The U.S. is now on track to have twice the solar capacity by 2030 than what they originally forecast just three years ago, and 43% more wind energy capacity than forecast in 2021. That's an enormous drive.

How important is it for us to get in the game now? I'm worried, for example, that my Conservative colleagues seem to want to block this legislation. If we're sitting at the side of the road and don't move now while Europe, Australia, the States and other jurisdictions move ahead, will it impact the potential to get investment into Newfoundland and Labrador?

[Scott Tessier]

We as the regulator would offer this: Time is of the essence. There is a global imperative with respect to both energy transition and energy security, so it is certainly not too soon for Canada to get into the game.

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

I've seen the Premier of Nova Scotia speaking up on the importance of getting this legislation.

Would you concur that it is very important that we have the legislative framework in place so that Nova Scotia can start putting in for bids for offshore projects?

[Christine Bonnell-Eisnor]

The provincial government has issued, as I mentioned before, its target of a call for bids no later than 2025 and licensing of up to five gigawatts of offshore wind by 2030. With that, the government would determine its strategic direction and give us the timing. We're being told to actively prepare to be ready to administer it and run a call for bids by no later than 2025.

We're getting ready for that based on the priority of the provincial government.

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

Nova Scotia wants to be ready by 2025 to do the bids. Does this mean that, at the federal level, we have to get this done in 2024, so that you are in a position to do your work?

[Christine Bonnell-Eisnor]

That is correct, yes.

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

I want to raise the issue of Sable Island.

My Conservative colleagues seem to be concerned that this is chasing the oil sector away. I've followed the Sable Island issue. I know it drew a huge amount of response from fishers who were worried about the fragility of the marine operations. For tourists, this is a very unique place, as it is for environmental groups and regular Nova Scotian citizens. In the decision to stop the oil bid at Sable Island, the Premier of Nova Scotia had the veto if the federal government were to try to push ahead with that.

Is that right? The Nova Scotia government is in the driver's seat in deciding what should be protected and what shouldn't be.