Natural Resources Committee on Feb. 10th, 2026

[Voices]

Oh, oh!

[The Chair, Liberal, Terry Duguid]

Colleagues, we're going to our second round now.

We are going to begin with Monsieur Malette for five minutes.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Thank you, Mr. Chair.

I have a question for Mr. Thiele.

As you know, northern Ontario's mining sector is expanding, which is increasing the demand for electrification. How can energy storage support large industrial loads while maintaining stable costs?

[Andrew Thiele]

Robert, do you want to jump in?

[Robert Tremblay]

Absolutely. Thanks, Andrew.

One of the main drivers of costs on the electrical system is peak demand, so you'll need more wires to serve more peak demand, and as we're electrifying, that's placing more demand on the grid. Presumably, the mines and the mining sector, all else being equal, would like to be on during peak periods as well.

Energy storage, whether it's electrical or thermal behind the meter, which is already quite common in Ontario through the industrial conservation initiative program, helps with this by allowing those facilities during peak times to be powered by their energy storage instead of the grid, which reduces peak demand and reduces costs for ratepayers by reducing the need for more wires.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Can you talk a bit more about that? Do current regulations and utility rate structures reward mines for deploying storage, or do they create barriers?

[Robert Tremblay]

It varies by province.

Ontario has a fairly mature program—called the ICI, or the industrial conservation initiative—that rewards demand responsiveness during peak times.

In my home province of Alberta, we're currently reforming our electricity rate structure, and that's certainly something we're advocating for in the form of demand charges.

It really does vary province by province. In many Crown provinces, the electricity rates traditionally have been a lot simpler, for the sake of their electricity systems being simpler, in the form of regulation.

There's definitely work to do, but there is a good example here in Ontario.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Which province would be the leader and which province would be the laggard?

[Robert Tremblay]

It's a good question.

As I've said, I think Ontario is a leader here through the industrial conservation initiative. In Alberta—I don't want to throw the word “laggard” around without reason—there is work being done to reform our rates and make more efficient use of the transmission system.

Energy storage is still a relatively new technology, and although it's being deployed at very heavy scales globally, we're still catching up with some regulations and rate structures. That's a lot of our work here at Energy Storage Canada.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Mr. Thiele, during your presentation, you mentioned tax credits, and then you mentioned, as your second point, deployment programs. Could you expand on that and give examples that would help some of those areas that need more help?

[Andrew Thiele]

Yes, absolutely.

The one program that has been particularly relevant to our members in the deployment of projects and assisting in trying to move things along has been the SREPs program, as well as programs through the Canada Infrastructure Bank. Those fundamentally have served as an incredible means to get storage projects deployed.

I'll highlight specifically the Canada Infrastructure Bank and its project involvement in one of the largest battery deployments that has happened here in the last number of years, which is the Oneida energy storage project. It was connected to the grid last June or July and has been serving Ontario's grid, and it did so quite importantly during some of the peak demand cycles we saw in the summer.

Without those programs through the CIB and funding opportunities through SREPs, those types of projects would never have been developed. They are the types of examples at the federal level that are really contributing to provincial dynamics and energy system planning.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Thank you.

If we were to scale up our energy storage capabilities, what parts of the value chain could realistically be in northern Ontario and northeastern Ontario?

[The Chair, Liberal, Terry Duguid]

Give a quick answer, please.

[Andrew Thiele]

Right now, in real time, we are seeing a pivot from EV auto transition manufacturing to grid-scale battery development. NextStar, an LG project here in Ontario with Stellantis, was an example of that. Many of our member companies, like EVLO, which Robert mentioned, are leaders in battery management systems manufacturing.

There are some elements where we are already leading, and we should capitalize on those examples while seeking further opportunities for the rest of the supply chain.

[The Chair, Liberal, Terry Duguid]

Thank you.

Mr. Danko, you have five minutes.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Thank you, Chair.

It's always good to see a representative from McMaster University at committee. As a proud McMaster engineering graduate myself, I've known Dr. Stephenson for about 30 years now, which is kind of crazy.

Dr. Novog, my first set of questions is for you.

In your opening statement, you talked about international refurbishment of CANDU reactors as an export opportunity for Canadian talent. You talked about small modular reactor design and export opportunities for Canada. When I think about Hamilton, I think about the opportunities for SMRs locally, the industrial centre in Hamilton, electric arc furnace production, data centres and district energy. People don't really know that Hamilton has a very robust district energy system.

How do you see the future of nuclear, both domestically in Canada and abroad, globally? What are the trends we're seeing?

[David Novog]

Thank you for the question. I'm always happy to support parliamentary committees as I can.

Globally, this is an immense build-out time for nuclear, where there's a confluence of energy needs, energy expansion, EVs, data centres and heavy industry decarbonization. These things are all coming together in multiple jurisdictions when you look across the world. Even at the COP summit several years ago, there was a pledge to triple nuclear capacity globally, which would move us from around 400 reactors globally to over 1,000.

Globally, there will be a large amount of construction, predominantly in the existing nuclear countries like France, the U.K., Canada, the United States and those in Asia.

I'm really excited about what the future holds in Canada. I've been a professor in the nuclear industry for a long time, and I've been in several valleys and hills, but now I see an alignment, with the federal government, provincial governments and municipal governments being really on board with nuclear.

While I haven't seen any discussions centred on Hamilton, it has a large industrial base and the requirements for large heat sources in the hundreds of megawatts for steel production and arc furnaces. I can look to examples. In Texas, there's a Dow project to couple a nuclear reactor with a Dow chemical plant. This would be the first time we see the intimate marriage of combined heat and power in an industrial facility. That would be a tremendous example to build upon when we look at what's possible in regions like Hamilton and elsewhere in terms of getting both reliable electricity and the heat required for some of those processes. That's really where nuclear's future lies—the combined heat and power application to support both the grid and industry.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

You said something really interesting about the confluence globally of having more focus on electricity for an electric future, and about federal, provincial and municipal governments becoming more in alignment and seeing nuclear as a priority. As part of that transition, there are a couple of federal initiatives. We talked about the clean energy tax credits, but another one is industrial carbon pricing.

I want to open this up to either of you to respond to. Where do you see industrial carbon pricing fitting in to encourage the transition to a low-carbon, net-zero carbon future?

[David Novog]

Maybe I'll take that first.

I think it was said earlier that in our experience globally when we look at deep decarbonization targets through taxes alone in places like France, where there's large public discord as a result of increasing energy prices, the carrot will be the route to success and less the stick. Looking at incentivizing decarbonization, as opposed to taxation, will help the public to keep its eyes on the prize rather than getting discouraged by another form of inflation in terms of energy pricing.

When I look globally at examples like that, it seems to be the best chance of success, both for growing the economy and for achieving carbon reductions in industry and in the grid.

[The Chair, Liberal, Terry Duguid]

That's all the time we have for you, Mr. Danko.

Mr. Thiele, you can work something into one of your future answers, if you wish.

Colleagues, we have three more slots to go: Monsieur Simard, Mr. Malette and Mr. Hogan.

I'll have to reduce Mr. Malette and Mr. Hogan to three minutes each, because we don't want to keep our other witnesses waiting.

We'll start with Monsieur Simard for two and a half minutes.

Mr. Simard, you have the floor.

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much, Mr. Chair.

I won't get into the rhetoric of whether Canada can be an energy superpower. Some witnesses answered that last week. However, what I'd like to know, particularly from you, Mr. Thiele, is where Canada stands in terms of energy storage. Personally, I see it as an advantage that a major player like Hydro-Québec has developed expertise in hydroelectricity and is still developing technologies around that today.

I don't know if you have any models, but I'd like to know how Canada compares to its American neighbours in terms of supply chain opportunities.

I talked to you about critical minerals earlier. I'll let you answer, and I'm not going to ask you to do our work for us, but if you could provide the committee with a kind of table that explains Canada's current position in terms of its opportunities, advantages and, perhaps, disadvantages related to the value chain, that might give us some food for thought when we draft the report. I'll let you answer in the short time that's left.

[Andrew Thiele]

I'm happy to follow up with some of that information.

As we've dug into provincial-level policy, across Canada some governments have already been tackling the issue of supply chain management and what opportunities exist. I have some detailed infographics, which, as you guys prepare your report, we can certainly provide.

I want to also take this opportunity, if I may, to hand this over to my colleague Robert for his comment on the OBPS question that was raised previously.

[Robert Tremblay]

Industrial carbon pricing, from our perspective, is a really important aspect in correctly incentivizing energy storage deployment. Especially in market-based electricity systems like Ontario's and Alberta's, the OBPS correctly prices different kinds of generations—natural gas, energy storage or nuclear—and properly values the cleanliness that some of those technologies bring.

When you compare that to jurisdictions that don't have carbon pricing, like, for example, the U.S., what we see is that there will be deeper tax credits and more subsidies used instead—almost a reverse carbon price—that will require more spending on the part of the government.

[The Chair, Liberal, Terry Duguid]

Thank you.

Mr. Malette, you have the floor for three minutes.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Thank you.

I have a question for Mr. Novog.

With renewables and nuclear set to supply 50% of the world's electricity demands by 2030, how can Canada leverage its nuclear energy capabilities to attract global markets?