Evidence of meeting #21 for Natural Resources in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was electricity.
A recording is available from Parliament.
Conservative
The Vice-Chair Conservative Shannon Stubbs
Okay.
For six minutes, the next round of questioning will be from Monsieur Guay.
Liberal
Claude Guay Liberal LaSalle—Émard—Verdun, QC
Thank you very much, Madam Chair.
Mr. Mousseau, I'd like to go back to something you said earlier, at the very end of your remarks. You seemed to be making a case for major investments in technological modernization in Canada. I'm curious. I would like to give you some time to tell us more about these modern technologies.
First, can you give us some examples of what you alluded to?
Second, can the clean economy investment tax credits the government has announced help?
Maybe Mr. Pineau would like to add something on that afterwards.
Professor, Université de Montréal, As an Individual
Thank you, Mr. Guay.
The Institut de l'énergie Trottier published a report on this last October. The world is already using transportation technologies to electrify modes of transportation. Canada doesn't produce those technologies.
We've identified sectors where Canada could be a leader. Canada could develop an expertise in off-road transportation, such as in mines. The same is true for industrial heat pumps, such as heat pumps for the manufacturing and agri-food sectors, where there is no global structure or expertise. These technologies are still being installed and optimized on a very small scale. However, if Canada had a real program, it could create an efficient service industry and potentially start exporting. Those are some examples.
In fact, Canada produces none of these technologies at the moment in the major industry, in the manufacturing sector, in building and in transportation. As time goes by, the possibility for Canada to develop original niche markets diminishes, but certain niche markets, such as the ones I mentioned, are possible.
That said, you need more than just tax credits to get there. There needs to be a real strategy to allow investors in the service sector, for example, to train staff, establish supply chains with product suppliers and develop expertise to guarantee long-term optimization.
The programs currently used are driven by demand, so there's no structuring. We see it: People in the industry install heat pumps, but when they break down, and they aren't replaced, because we lack a properly created smart ecosystem that allows Canada to turn to modern technologies.
Liberal
Professor, Chair in Energy Sector Management, HEC Montréal, As an Individual
Our level of consumption is a major challenge. Look at energy prices in Canada. Our lack of development of expertise in maintenance and innovation stems from our fortunate abundance of natural resources. We have a wealth of energy resources, which has made it possible to keep prices very low. Unfortunately, this has led to a culture of nonchalance in energy management. This often explains why we over‑consume energy and why we don't tend to really innovate.
Tax credits here and there can be beneficial. However, basically, if Canada wants to become a true energy superpower, it must have the courage to look at its energy efficiency and consumption in the various sectors and to seize opportunities to accomplish more with much less energy. By boosting the energy efficiency sector, we'll gradually shift towards the innovations referred to by Mr. Mousseau, such as heat pumps and other technologies.
Obviously, this can be supported by an industrial policy designed to encourage the development of certain sectors. However, as we've seen in Quebec, when we want to support the electrification of buses or the development of the battery industry, for example, it's quite risky. I'm always wary of governments that choose so‑called winning sectors. Unfortunately, this can quickly backfire on the players involved. That said, Canada will always benefit from greater productivity and efficiency. We have enormous potential for making gains in this sector, because we're currently terrible energy consumers.
Liberal
Claude Guay Liberal LaSalle—Émard—Verdun, QC
In the past, you have criticized Quebec with regard to electricity exports. I think that you had this in mind when you talked about the need for us to consume more responsibly in order to be able to export.
Tell us a bit about the environment and Canada's electricity grid.
Are there any benefits to interconnecting our electricity grids in Canada?
What are your thoughts on this?
Conservative
Professor, Chair in Energy Sector Management, HEC Montréal, As an Individual
In terms of electricity, there are enormous benefits to increasing the interconnections among the provinces and, ultimately, with the United States. The goal isn't so much to export net volumes of energy, but rather to exchange energy.
I disagree to some extent with Mr. Mousseau on one thing. Contrary to his assertion, Canada has a competitive advantage over other countries in the world. We have ample space, plenty of wind, a great deal of sun and many storage tanks. We have a competitive advantage because of our geography. This can help us produce more electricity at a lower cost.
The interconnections help us to exchange energy in order to optimize our production and consumption structures. This is where their benefits come into play. It isn't so much a matter of generating net exports, but rather of exchanging energy.
Conservative
The Vice-Chair Conservative Shannon Stubbs
That's perfect. Thank you. You're just five seconds over. That's spectacular.
Now we'll go, for six minutes, to Monsieur Simard.
Bloc
Mario Simard Bloc Jonquière, QC
Thank you, Madam Chair.
I would like to thank the witnesses for joining us. Your remarks are eerily reminiscent of discussions that we've had on many occasions. I would like to work with you to ensure that your remarks are properly summarized in our report.
I'll get back to the current situation. The government is juggling the construction of gas and oil facilities, the construction of energy facilities and the resilience of the economy against the backdrop of unfavourable tariffs.
I gather that the time needed to build these facilities, their cost and the global energy situation mean that, in the long term, this wouldn't be viable for gas and oil.
Mr. Pineau and Mr. Mousseau, I would like you to explain this quite clearly.
Professor, Université de Montréal, As an Individual
In the short term, we're already seeing a significant downturn in global energy demand. We're seeing the beginnings of a decline. Moreover, when it comes to liquefied natural gas, a huge number of projects are under way outside Canada. We'll end up with a surplus. This could hit us quite quickly.
Bloc
Mario Simard Bloc Jonquière, QC
Okay.
Mr. Pineau, you often talk about energy efficiency. However, when it comes to oil and gas infrastructure, have you reached the same conclusion as Mr. Mousseau?
Professor, Chair in Energy Sector Management, HEC Montréal, As an Individual
Yes. I have reached the same conclusion.
As we can see, no private investors are breaking down doors to say that they want to invest. In my opinion, this is a good sign. The message is quite clear. As discussed, global oil prices are in decline and we're in oversupply. This means that adding expensive transportation infrastructure becomes a problem in a market where prices are falling and the quantities required are likely to decline in the coming years. This will further exacerbate global overproduction.
For natural gas, the path to take is perhaps a bit less clear. However, I fully agree with Mr. Mousseau's assessment that liquefied natural gas will become oversupplied worldwide and that Canada will find it tough to compete in this situation.
Bloc
Mario Simard Bloc Jonquière, QC
Given the current situation, what should a prudent government do if it wants to build up its economic resilience and take advantage of its energy potential?
Mr. Mousseau, you already spoke about the idea of investing in new technologies. However, what strategy could the federal government adopt to give our economy a bit of a boost?
Professor, Université de Montréal, As an Individual
This is where I disagree with Mr. Pineau. As I see it, energy efficiency must start with electrification and technological upgrades. That's how we'll remain at the cutting edge of technology. While we're at it, we may as well do things properly and efficiently.
We must support electricity production with strategies to bring prices down. We can see that some provinces don't have very effective strategies. We run the risk of seeing a movement against electrification.
We must support the electrification of transportation. As I was saying, we must also head in a direction where the rest of the world can't be found. We must try to find niches where Canada isn't dominant, for example by developing technologies for electric cars. However, we must also find ways to develop Canadian niches where we can gain a foothold on the world stage.
For me, this is the way forward. We need real strategies. Simply handing out subsidies won't work.
Professor, Chair in Energy Sector Management, HEC Montréal, As an Individual
In the short to medium term, Canadian exports aren't in any danger. Today's meeting is really about exports. Exports aren't at risk. Canada's oil exports are at record levels. Natural gas exports are picking up again, courtesy of the LNG Canada project on the west coast. We don't need to worry about these exports.
That said, we must remain wary of overdependence on export revenue. This revenue will fluctuate and decline over the long term. As just discussed, we certainly can't count on growth in this sector with new infrastructure that won't pay off.
What should we focus on? I'll repeat myself. In Canada, we have enormous sources of energy in various areas. We must continue to exploit the sources with a future, such as renewable and nuclear energy sources. We must become better consumers and increase our energy productivity.
Productivity lies at the heart of economic growth. If we manage to develop resources, we gain added value. We must focus on this productivity, which obviously comes with technological innovations. We must boost these innovations through incentives for better consumption.
Bloc
Mario Simard Bloc Jonquière, QC
Mr. Mousseau, I don't know whether you can provide any analyses regarding the electrification investments made around the world, particularly in China and Europe, and their potential impact on the cost of oil over the next thirty years or so.
I think that I saw somewhere that the massive investments that the Chinese are making in electrification will inevitably mean that they'll consume less oil. This will affect supply and demand and drive down the cost of oil.
Do you have anything of this nature?
Professor, Université de Montréal, As an Individual
I don't have anything on hand, but there are many studies.
The issue lies in forecasting the value of oil over 30 or 50 years. The cost of oil is extremely difficult to predict. The markets don't only depend on demand. They also depend on production. It's a matter of knowing how adjustments will be made.
Certainly, even today, with oil overproduction and overcapacity in relation to demand—
Conservative
The Vice-Chair Conservative Shannon Stubbs
Sorry to interrupt you.
We're just a bit over. I've ensured that we go over equally on each one. There will be more opportunities to answer.
We'll go on to our second round now. The first question will be from Monsieur Martel.
You have five minutes.
Conservative
Richard Martel Conservative Chicoutimi—Le Fjord, QC
Thank you, Madam Chair.
This is all quite enlightening.
By all accounts, Norway, a natural resource‑rich country, has made a very successful energy transition. I believe that Canada has all the resources needed to make this transition.
Why is Norway so far ahead when Canada is also a natural resource‑rich country? What has Norway done that Canada hasn't?
My question is for both witnesses.
Professor, Chair in Energy Sector Management, HEC Montréal, As an Individual
Norway is an interesting case. It's a bit like Alberta and Quebec combined. Norway produces a great deal of oil and electricity. In terms of emissions per capita, the Norwegians aren't the leaders in Europe. Their emissions and energy consumption are quite high.
Norwegians are considered leaders in the electrification of transportation. It's real, because they have a major policy. Their approach is quite simple. I would recommend it to Canada. It would involve imposing extremely high taxes on the sale of gas‑powered vehicles in order to make electric vehicles naturally more attractive to consumers.
This involves taxing vehicles and oil products. That's my recommendation to the government. These economic signals align perfectly with the direction that the economy should take. It encourages the adoption of cleaner technologies and more profitable and productive behaviours.
Conservative
Richard Martel Conservative Chicoutimi—Le Fjord, QC
It's funny, because—
I'm listening, Mr. Mousseau.
Professor, Université de Montréal, As an Individual
Unlike in Canada, where oil and decarbonization are pitted against each other, Norway believes that, as long as people buy oil, it will produce and export it. However, at the same time, Norway is modernizing its territory. It's electrifying transportation and heating systems for buildings. It's also doing much more secondary processing in the aluminum sector, for example. This means that Norway is much more productive per gigajoule used in the aluminum sector. It doesn't just produce aluminum ingots. It transforms them into car parts, which have a higher added value.
A number of aspects are interconnected. However, first and foremost, we need to modernize our economy and our technologies. The electrification must go hand in hand with our oil exports, as long as markets remain available.
I think that this is reasonable. The idea is to avoid giving out subsidies. If private players want to invest in producing and exporting oil, let them. At the same time, Canada must develop and support a massive electrification of energy use.
February 3rd, 2026 / 11:40 a.m.
Conservative
Richard Martel Conservative Chicoutimi—Le Fjord, QC
This talk of electrification seems to have been going on for a long time. However, nothing really seems to be moving forward. We don't see anything concrete to make us believe that we'll get there.
We keep talking about the challenge of securing blocks of electricity for certain projects. We're worried because we think that we'll run out of electricity given the massive electrification and the emergence of artificial intelligence. I attended a conference recently. We heard that all forms of energy will play an important role in the future because we may face a terrible shortage with everything coming down the line.
I don't think that we should stop at all forms of energy. A transition is taking place. I just wanted to hear your comments on this.
Is Canada aware of the scale of electrification required with the emergence of artificial intelligence? Canada will have a hard time being self‑sufficient.