Natural Resources Committee on Feb. 15th, 2024

[Tory Rushton]

This gives me a final opportunity to emphasize how important this is to Nova Scotia. Many people are looking at Nova Scotia as a leader in wind. Sectors are already here, engaging and working on their plans.

We do need the amendments to pass to take the next steps with consultation, with setting up regulatory regimes and moving forward with this very important project to set the stage for Nova Scotia, Newfoundland and Labrador and Canada.

[Andrew Parsons]

What I could say to that is that I think we fully recognize the impact that this new industry will have on our province, which is why we've been quite bullish on it and any opportunities it will bring.

We feel it positions us quite strongly as a province that has fully relied on oil and gas for some time. We are not talking about that going anywhere, but we have an opportunity to move forward into a new field, with new jobs, new investment and new royalty regimes and benefits to Newfoundlanders and Labradorians. We want to move forward in that regard.

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Thank you.

I feel like we have some gatekeepers here when we have a party that is opposing what both provinces want.

In Nova Scotia it's a very progressive Conservative government that's working with the federal government to help Canadians, Nova Scotians and Newfoundland as well. You know, I'm a little perplexed, because I look at the Conservatives and I hear them every day in the House talk about jurisdiction, but doesn't this seem like “Ottawa knows best” from the Conservatives? It doesn't matter what the provinces said; the Conservatives think it's wrong, so it's wrong.

Do you have any comments on that?

[The Chair, Liberal, George Chahal]

Ministers, if you'd like to comment, I'll ask you to do so very quickly, please, because we're at the end.

Minister Rushton, were you about to comment? You can do so very quickly, if you'd like to. No? Thank you.

Thank you for taking your time, honourable ministers, to come to the Standing Committee on Natural Resources. It's been an honour and privilege to have both of you here to provide important testimony. Thank you to you and your teams for attending.

We will now suspend for about five minutes to change panels.

Thank you.

[The Chair, Liberal, George Chahal]

I call this meeting back to order.

Pursuant to the order of reference of Tuesday, October 17, 2023, and the adopted motion of Wednesday, December 13, 2023, the committee is resuming consideration of Bill C-49, an act to amend the Canada-Newfoundland and Labrador Atlantic Accord Implementation Act and the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act and to make consequential amendments to other Acts.

Since today's meeting is taking place in a hybrid format, I would like to make a few comments for the benefit of members and witnesses.

Please wait until I recognize you by name before speaking. For those participating by video conference, click on the microphone icon to activate your microphone, and please mute yourself when you're not speaking.

For interpretation, for those on Zoom, you have the choice, at the bottom of your screen, of either floor audio, English or French. For those in the room, you can use the earpiece and select the desired channel.

I will remind you that all comments should be addressed through the chair. Additionally, screenshots and taking photos of your screen are not permitted.

In accordance with our routine motion, I'm informing the committee that all remote participants have completed the required connection tests in advance of this meeting.

With us today for the second hour, we have the Brazil Rock 33/34 Lobster Association, with Daniel Fleck, executive director; the Ecology Action Centre, with Shannon Arnold, associate director, marine programs; Marine Renewables Canada, with Elisa Obermann, executive director; the Membertou Development Corporation, with Chief Terry Paul; and from Net Zero Atlantic, Alisdair McLean, executive director.

Welcome.

We will now proceed with opening statements, beginning with Mr. Fleck from Brazil Rock for five minutes.

The floor is yours, sir.

[Daniel J. Fleck, Executive Director, Brazil Rock 33/34 Lobster Association]

Thank you, Mr. Chair. I would like to begin by thanking the committee for inviting the Brazil Rock 33/34 Lobster Association to provide our testimony on Bill C-49.

The membership of Brazil Rock represents thousands of hard-working families plying the waters of lobster fishing areas 33 and 34. These are lobster fishers who call the waters of Nova Scotia home. Of the $2.6 billion in seafood exports from the province of Nova Scotia, our members toil in the most productive regions of the fishery, meaning that any impacts would reverberate across the economy of the province.

The Brazil Rock 33/34 Lobster Association is an active participant in the fisheries advisory processes operating in the region, including the fisheries advisory committee of the C-NOSPB, which was much lauded in last week's testimony. We feel it is important to highlight that our ability to get answers relating to the real-world implications of Bill C-49 for our sector has been highly challenged by the apparent approach that the fishing industry should be spoken to only after the bill had been tabled and purely in an informal information session with limited accommodation by staff of the responsible departments. In short, we were asking important questions but not receiving the answers that shed any sort of real insight on the issues before us.

Many of our questions you have already heard from other witnesses associated with the fishing industry. For instance, how is the legislation that is before you appropriate for offshore wind energy or other marine energy production? During the initial drafting of the accord legislation, the only energy projects being pondered in the offshore areas were restricted to oil and gas, and there was incredible focus on the development of suitable legislative tools to ensure that development was safe and well thought out. However, the legislation before us merely amends the initial legislation to accommodate renewables, so it is fundamentally unchanged from the original legislation, with the content applicable primarily to the oil and gas sector and failing to realize the advancements made around the world.

How does this legislation empower outcomes of processes such as regional assessment, which the industry is actively engaged in? As the legislation reads, any guidance from those processes is only loosely being considered as a guidance. Why should I ask my association members to take time away from their enterprises to inform an assessment process that can be ignored by the regulator when selecting areas for development?

The legislation is also mute on impact agreements and otherwise for anyone outside the provincial or federal governments. In other jurisdictions, offshore energy proponents undertake real legal agreements with local fishers and/or communities to ensure that any potential lost income resulting from development is acknowledged and accounted for on the front end of a development process. This legislation is intentionally silent on the matter. We have an opportunity to create a legal requirement that robust, transparent and public agreements be achieved that would be to the benefit of those most impacted by the development. We should take that advantage.

Furthermore, any damages needing consideration for compensation are restricted to incidents, namely when an event such as an oil spill or a piece of infrastructure negatively impacts a piece of fisher infrastructure. This creates a glaring gap for fishers who may directly be impacted by reduction in fisheries productivity caused by the offshore wind development. This issue has long been a concern of the fishing industry related to oil and gas development, and we are dismayed that this input has again been ignored by this piece of legislation before you.

We have much to learn from other jurisdictions on what to expect from an offshore wind development that fails to be considered in the development of this legislation. For instance, we find that while some regulators and developers suggest harvesting activity can be undertaken in an offshore wind farm development, the insurance industry in other jurisdictions refuses to provide coverage for those operations, citing unacceptable risks. No harvester would risk their multi-million dollar investment under such conditions. Where can mitigation of this issue be found or even pondered by the current legislation?

Our members are not opposed to reasonable, responsible offshore wind development in any way, but we can only move forward when the legislative framework that supports development is sufficiently robust to ensure that the interests, livelihoods and communities of existing users of the marine environment are maintained.

We realize that this legislation is being rushed to completion, but we encourage you to take the extra week to develop a framework that highlights Canadian leadership on the issue. A few short weeks of effort will not lead to profound delays in development off our shores, nor will it imperil commercial interest in the Canadian development.

The wind isn't going anywhere, and the technology to harness this wind in a safe and reliable fashion is only improving day after day. Take the time and build good legislation that is appropriate for the matter at hand.

In short, on behalf of our members, here is our ask of you: Please consider in the legislation the development of a royalty- or revenue-based fund that can be held and employed to support and compensate harvesters and communities that may be directly or indirectly impacted by large-scale renewable energy developments off our shores.

Thank you for this opportunity.

[The Chair, Liberal, George Chahal]

Thank you, Mr. Fleck. We'll now proceed to the Ecology Action Centre.

Shannon Arnold, you have five minutes. The floor is yours.

[Shannon Arnold, Associate Director, Marine Programs, Ecology Action Centre]

Thank you, Mr. Chair, for the opportunity to address the committee.

My name is Shannon Arnold. I am the associate director of marine programs at the Ecology Action Centre. We're based in Halifax, Nova Scotia.

For over 50 years, the Ecology Action Centre has taken leadership on critical environmental issues, from biodiversity protection to climate change to environmental justice.

I have worked in the fisheries, aquaculture and seafood worlds in Canada and globally for 15 years. Our marine programs support sustainable fisheries and ways of living off the ocean with the aim of keeping coastal communities thriving and the ocean we all depend on healthy for generations to come. We sit on regional, national and international fishery advisory committees and on marine planning and protection tables. Together with colleagues in our energy program, we are currently involved in the regional assessment for offshore wind development in Nova Scotia.

We would like to express our overall support for the much-needed amendments that Bill C-49 brings to the accord acts. We are facing a climate crisis that calls for a swift transition towards renewable energy.

In Atlantic Canada, or Mi'kma'ki, rapid shifts in our waters due to climate change are already affecting our coastal communities. More intense storms are damaging infrastructure and posing greater risk to those at sea. Fish and lobster are relocating to new areas, altering traditional fishing grounds. Changes in whale migration routes are leading to increased interaction with fisheries and shipping, and these impacts are being felt economically, socially and culturally.

While new and cleaner energy sources like offshore renewables will impact some fisheries, these impacts will pale in comparison to the far-reaching consequences of unchecked climate change on our marine ecosystems. Offshore renewable energy will likely play a critical role in our energy transition, and Bill C-49 ensures that the regulatory regime needed to support this transition is in place. As we adapt, though, equity, community benefits and the rebuilding of biodiversity must be centred.

To that end, we are pleased to see provisions in this bill that will allow regulators to prohibit offshore energy, both oil and gas and renewables, in marine conservation areas, as well as the ability for the federal and provincial ministers to jointly cancel existing oil and gas interests in conservation areas. This power is critical in enabling Canada to meet its international commitments to protect 30% of our oceans by 2030 and to ensure that this marine protection is strong and of high quality. We're also pleased to see provisions introduced that support increased public hearing options for the offshore boards.

However, if offshore renewable energy is to deliver on the promise of a sustainable energy future for the region, the government must ensure that this bill and the assessment processes on projects to come are an improvement on ways we have evaluated industrial development in the past. We would like to see the bill ensure that calls for bids are issued only in areas with a completed strategic and regional assessment. These highest-level assessments must consider socio-economic and ecosystem impacts, cumulative effects and long-term sustainability objectives. This planning and assessment stage is essential for fostering participatory decision-making and establishing clarity on shared use and priorities for all rights holders and stakeholders. Individual project-specific impact assessments should follow. The bill should require that these strategic and project-level assessments be conducted.

Clear provisions for full and meaningful participation in planning and assessment processes must be included alongside dedicated funding to support this requirement. Strong planning with inclusive participation will be crucial for minimizing conflicts and achieving coexistence and shared use.

We support the submissions of our colleagues at East Coast Environmental Law with regard to further details on any proposed amendments.

The nascent offshore renewable energy sector offers an opportunity to depart from the exploitative and destructive legacy of previous industrial uses of our ocean. We cannot repeat patterns of energy development profiting large corporations at the expense of ecosystems and local community well-being.

As an environmental advocacy organization, we do not take lightly the potential social, cultural and ecosystem impacts of offshore renewable energy, and we share some of the concerns expressed at this committee by others.

However, the climate and biodiversity crises compel us to act urgently yet with care. We reaffirm our general support for Bill C-49 and emphasize the crucial need for both the bill and the broader government climate strategies it is a part of to address concerns and impacts from the outset. This includes guaranteeing stringent ecological protection, safeguarding coastal livelihoods and habitats, providing extensive opportunities for participation and collaborative planning, involving fisheries expertise from the outset and prioritizing the greening of our regional energy grid first for local community energy benefits.

Thank you for this opportunity, and I welcome questions.

[The Chair, Liberal, George Chahal]

Thank you for your opening statement.

We will now go to Marine Renewables Canada and Elisa Obermann for five minutes.

[Elisa Obermann, Executive Director, Marine Renewables Canada]

Good afternoon, and thank you to the committee for inviting me to attend today's meeting. I am really appreciative of the opportunity to provide some insight on how critical Bill C-49 is for the offshore wind industry and the members I represent here today.

My name is Elisa Obermann. I am the executive director at Marine Renewables Canada, or MRC. It's a national association representing the offshore wind, tidal, wave and river current energy industry. We represent about 180 members, including technology and project developers, suppliers, researchers and communities.

Many of those members are focused on realizing offshore wind development opportunities in Canada, including companies already developing offshore wind projects internationally, as well as numerous suppliers with decades of experience working in Atlantic Canada's offshore and marine industries. To support these interests, MRC has been advocating for a supportive and predictable regulatory path that can both catalyze growth and ensure sustainable development in the sector.

With some of the best offshore wind resources in the world, developing this new sector could help address several of Canada's clean energy and net-zero goals, spur economic opportunities and create new jobs. We view Bill C-49 as being critical to realizing these opportunities and advancing offshore wind in Canada for several reasons.

First, time is of the essence. Canada is already competing against many other jurisdictions that have mature regulatory frameworks for offshore wind in place. Investors will go to the countries that have both an attractive energy resource and a clear regulatory regime. Bill C-49 establishes the regulatory path and certainty that are needed in Canada now.

Delays in establishing a regulatory framework not only impact Canada's competitiveness but also delay the economic opportunities, local jobs and clean electricity that would result from offshore wind development.

Second, amending the accord acts builds upon existing and proven frameworks that will allow Canada to develop offshore wind efficiently and effectively. Leveraging the regulatory experience of the offshore boards and working within a framework that the provinces are familiar with and helped to establish creates a strong foundation for this emerging sector. This approach is not unique. Other jurisdictions seeking to diversify their energy mix and enable a transition to cleaner energy resources have also leveraged offshore oil and gas regimes and regulatory experience to support offshore wind.

Third, establishing a regulatory framework is a critical first step amidst the other initiatives under way. We recognize that Bill C-49 is not designed or intended to cover every aspect of the regulation of offshore wind, but it will impact how and when offshore wind can be developed in Canada. Delays to enacting this law have ramifications on parallel initiatives, including Nova Scotia's target to begin leasing offshore wind in 2025.

I also want to say that, while we believe it is critical to move swiftly to have a regulatory framework established, we also recognize that this is a new industry for Canada. It must be developed responsibly, with the scientific rigour required to maintain the integrity of marine ecosystems and with respect for the inherent legal and treaty rights of our indigenous communities. That same respect must be extended to local residents and other ocean users. To that end, MRC and its offshore wind developer members have been working to foster an early two-way dialogue with fisheries, communities, environmental organizations and indigenous groups to understand concerns, share information about offshore wind and find areas of co-operation and collaboration.

In closing, I would like to emphasize that, given the critical importance of establishing a regulatory framework for offshore wind, Marine Renewables Canada supports Bill C-49 without any additional amendments and encourages the Standing Committee on Natural Resources to adopt the bill in a timely manner and move it to the next stage of review and consideration.

We are confident that the contents of Bill C-49, along with parallel processes and initiatives under way at provincial and federal levels, establish the regulatory certainty that is needed by industry to make critical investment decisions and, ultimately, develop offshore wind in Canada.

Thank you very much.

[The Chair, Liberal, George Chahal]

Thank you for your opening statement. We'll now go to Chief Terry Paul from Membertou Development Corporation.

Chief, welcome. You have five minutes for an opening statement.

[Chief Terry Paul, Chief Executive Officer, Membertou Development Corporation]

Thank you, Mr. Chair, for allowing me to speak to the committee.

Good afternoon. It is my pleasure to be here with you to talk about Bill C-49.

As chief in Membertou, our Mi’kmaq community located on Cape Breton Island, I can tell you we are focused on two things. The first is creating economic opportunities for our community and the Atlantic as a whole. The second is investing in projects that will generate long-term stability for our people.

At the core of everything we do are the people we do it for: our community members. With every major project we take on, we do our due diligence to ensure that it aligns with our Mi’kmaq values while also pushing our community forward. This is why we support the intent of Bill C-49.

Through this bill, we can enable the development of offshore wind in Nova Scotia. Membertou is an equity partner in proposed offshore wind developments that have the potential to positively shape the entire landscape of our island.

Traditionally, indigenous Canadians were not invited to participate in major industry projects. I am proud to say that is changing. When we all work together, great things happen. We truly believe that an offshore wind industry can coexist with other industries in a sustainable manner.

Membertou has operations in sustainable seafood, as well as offshore and inshore commercial fisheries, which will not be impacted by these developments.

It is important to note that broad consultations, including comprehensive environmental assessments, will be undertaken before offshore proponents will receive the necessary approvals from all levels of government. Ensuring that habitats are protected is at the heart of these processes, and that is made clear in the proposed legislation. This is a value that is very close to us and of the utmost importance.

As Mi’kmaq, we want to be part of the solution in fighting climate change. We recognize that the development of this industry is needed in the global climate crisis and to meet the net-zero targets put in place by the government.

As a major harvester in the offshore fleet, we know that any forthcoming plans for offshore wind development will be developed thoughtfully and to fully protect this and any other sensitive areas.

We will continue to work with all interested and involved parties to ensure that we create new opportunities for our people while also protecting the industries that remain critical to our way of life.

Thank you for providing me with an opportunity to speak to you today.

Wela'lioq.

[The Chair, Liberal, George Chahal]

Thank you, Chief, for your opening statement.

We'll now proceed to Net Zero Atlantic and Mr. Alisdair McLean.

You have five minutes, sir.

[Alisdair McLean, Executive Director, Net Zero Atlantic]

Thank you, Mr. Chair. I appreciate the invitation to offer some input into Bill C-49.

I am a professional engineer and the executive director of Net Zero Atlantic, which is an independent, not-for-profit research association with a mission of enabling the transition to a carbon-neutral future in Atlantic Canada. We lead applied research, contribute to projects, and provide credible and objective data for public discussion.

Net Zero Atlantic supports Bill C-49. We specifically support expanding the mandate of the offshore petroleum boards of Nova Scotia and Newfoundland and Labrador to be offshore energy regulators. We encourage the rapid passing of the legislation.

In 2020, our team at Net Zero Atlantic was curious as to why offshore wind wasn't part of the conversation about clean electricity in Nova Scotia, so we dug into the numbers. In the spring of 2021, we presented our results at a conference in Halifax.

We found that by the 2030s, offshore wind could produce electricity at lower costs than onshore wind in Nova Scotia. Since then, we've contracted experts to produce reports on topics that include how to simulate offshore wind development, access to U.S. electricity markets, and best practices for stakeholder and rights-holder engagement.

We have a request for proposals open now for an expert to study how the offshore wind industry would impact the Atlantic Canadian electricity grid.

Further, for the past two years we've been extending our research with community engagement, starting in Nova Scotia. Together with Mi'kmaq leaders and our other partners, we've been building local capacity in Mi'kmaq, rural and other equity-deserving Nova Scotia communities with respect to offshore wind.

Canada's offshore Atlantic coast and the research needed to identify and reduce the risk of human activities in the area require dedicated, careful and knowledgeable attention. Before we became Net Zero Atlantic, our geoscience research focused on the exploration risk for offshore oil and gas in the Atlantic. As OERA, we contributed to a thorough evaluation of Nova Scotia's offshore geology. The analysis helped to track $2 billion in work commitments from multinational energy companies, some of which are now active in the offshore wind space. It was during that work that we first engaged with the staff at the CNSOPB, so we've known them for years.

The CNSOPB has experts on staff with prior knowledge of the likely areas for offshore wind development. The organization has decades of geological survey, weather and ocean data. They also have excellent data storage and retrieval tools, thus reducing the cost and complexity of future data storage and analysis.

Although it's outside our field of expertise, we've seen that they have professionally run land‑tenure processes and regulated, safe offshore industrial activities, including exploration, construction, operation, maintenance, decommissioning and abandonment. These are all activities that are directly related to offshore wind.

Aegir, a Danish offshore wind expert that we engaged for one of our studies, shared the following recommendation: “One-stop-shop concepts of one authority coordinating key permits make for an efficient process with less delays and lower market risk perception.” That one-stop shop is what the CNSOER and C-NLOER would provide.

Through Net Zero Atlantic's research and engagement, we know that offshore wind can contribute to Canada's greenhouse gas reduction targets while also generating economic opportunities for Canadians. Atlantic Canada is blessed with strong winds, large areas of shallow water, suitable geology and an active maritime economy.

Electricity from offshore wind in Atlantic Canada can be produced at a similar or lower cost than that in the United States. Green ammonia produced from offshore wind energy could be delivered to Europe at similar or lower cost than production in Europe. Given this, Atlantic Canada is well positioned to become a global player in the industry.

However, the market for investment is competitive. There are at least 19 countries with offshore wind targets for 2030. Canada is the only G7 country without an operational offshore wind industry today.

Developing an offshore wind industry in Atlantic Canada will bring significant economic opportunities to a region that currently has a lower than average GDP per capita. Canada, Nova Scotia and Newfoundland and Labrador need an offshore wind regulator and a regulatory regime in place without delay.

Net Zero Atlantic supports the proposed amendments to the accord acts, as outlined in Bill C-49.

I would like to finish by observing that in September of last year, a Canadian company, Northland Power, secured $5 billion in funding for a one-gigawatt offshore wind project in Taiwan.

If we put the elements in place for a sustainable, equitable offshore wind industry, perhaps their next project will be at home.

Thank you for the opportunity to provide my statement. I look forward to any questions.

[The Chair, Liberal, George Chahal]

Thank you for your opening statement.

We'll now proceed to our first and only round of questions for today, which will be for five minutes each.

I'll go to the first member, Mr. Clifford Small from the Conservative Party of Canada, for five minutes.

[Clifford Small, Conservative, Coast of Bays—Central—Notre Dame, NL]

Thank you, Mr. Chair, and thank you to the witnesses for coming to take part in our important study.

Mr. Fleck, I'm going to start with you.

I had a text this morning from Michael Barron, a lobster and crab fisherman from Cape Breton Island. He said there are plans to create a 4,000-square-kilometre wind farm off Cape Breton on St. Anns Bank. He says he'll be forced into early retirement.

How many lobster traps can go on a 4,000-square-kilometre patch of the ocean floor, do you think, Mr. Fleck?

[Daniel J. Fleck]

I'd say thousands upon thousands and tens of thousands.

[Clifford Small, Conservative, Coast of Bays—Central—Notre Dame, NL]

That's tens of thousands. You're talking about enough fishing gear to support 35 to 50 families, would you say?

[Daniel J. Fleck]

Yes, sir.

[Clifford Small, Conservative, Coast of Bays—Central—Notre Dame, NL]

That's just enterprises. There are the crew members as well.

Where would a guy like Michael go to catch lobster to provide for his family and his crew if he could no longer fish on his traditional grounds?

[Daniel J. Fleck]

I don't think he will be able to.

I'm not a biologist by any means, sir, but it takes a lobster seven years to go from a larval stage or an egg until it's able to be harvested at a legal size. Michael or anyone in that situation might not see the ramifications of that for seven years. That's if there are going to be lobsters there, amongst that apparatus.

[Clifford Small, Conservative, Coast of Bays—Central—Notre Dame, NL]

There's no mention of compensation to fishermen for loss of livelihood in situations in which they lose access to fishing grounds. Would you like to see an amendment in this bill to address that situation?

[Daniel J. Fleck]

I would. I can't quote the section. I don't have it right here in front of me. We looked at the legislation they were using when offshore oil and gas was developed. If we're talking about applying that same language to offshore wind, basically if a fin or propellor flies off a windmill and strikes a boat or damages some gear, they might take care of that gear. There's no talk of actual compensation for that fishing operation that's put out of business because it's lost that ground and the fish are gone.

[Clifford Small, Conservative, Coast of Bays—Central—Notre Dame, NL]

Who do you think should be responsible for compensating fish harvesters for loss of livelihood? Do you think it should be the taxpayer, or do you think it should be the proponents of wind energy development?

[Daniel J. Fleck]

I would hope it would be integrated into the legislation now that the proponent should put that money up in case something like this developed or we became aware of it six, seven or eight years down the road.