Natural Resources Committee on April 21st, 2026

[Imran Noorani]

Yes, absolutely, and I think the storage potential in particular in Alberta is something the world should be watching. I do think that, from a federal perspective, there's a lot of opportunity to fine-tune under domestic content considerations with the ITC. Once we start to see a different model that balances all of the needs of the sectors—steel, renewables and different associations—I think we'll be able to find a good solution, and that will be where we unlock domestic capability for the country.

[The Chair, Liberal, Terry Duguid]

Thank you. That's your time, Mrs. Stubbs.

[Shannon Stubbs, Conservative, Lakeland, AB]

Chair, can the witnesses provide a written submission to follow up?

[The Chair, Liberal, Terry Duguid]

Yes. I always do that at the end, but we welcome comments and additional information that you didn't get around to saying.

Thank you, Mrs. Stubbs. That's a great suggestion.

Mr. Guay, go ahead for five minutes.

[Claude Guay, Liberal, LaSalle—Émard—Verdun, QC]

Thank you very much to the witnesses for being with us today. It's much appreciated.

Mr. Ghatala, greener-made products—an example that comes to my mind is low-carbon steel—often command a higher price on the international market as many companies consider ESG concerns when purchasing. What role do biofuels play in decarbonizing and making other Canadian exports more sustainably produced? That is my first question.

My second question is this. With canola being a great input for SAF, sustainable aviation fuel, what is stopping us from developing it? I hear there's a global shortage of it. How can Canada play a bigger role?

[Fred Ghatala]

Thank you very much for those questions.

The Reuters headline today was something like “Biofuels back in vogue”. The current geopolitical crisis is showing us how biofuels are showing up to help with fuel supply availability concerns for gasoline, diesel, jet fuel and marine fuels. Biofuels are part of the energy mix, not just a green solution—which of course they are, but they are a fundamental aspect of energy security.

You asked about how biofuels and low-carbon fuels made in Canada can help our exports. One of the benefits of low-carbon liquid biofuels is that they mix seamlessly with our petroleum fuels. They can use the same supply and distribution infrastructure. SAF, sustainable aviation fuel, is jet fuel. It can be certified as jet fuel. There are no additional handling concerns. In the same way that we can export crude, we also export refined petroleum products. Integrating biofuels in those exports is part of how we can make those attractive to international buyers that do not just have energy availability concerns but want to reduce emissions in the process.

Your second question was regarding SAF and what we need to do. Sustainable aviation fuel is a massive opportunity for Canada. It's one where we can have much of our sustainable canola go into. Canola is a very good SAF feedstock for many reasons—low cloud point, cold weather operability, etc. The most important thing that could be done for SAF is to simply move it under a regulation like was done in British Columbia. There is over 1% SAF being used in that province.

The clean fuel regulations, being a federal policy that followed on the renewable fuel regulations put in place by Prime Minister Harper, have the plumbing to include SAF. We think that's a key thing that will help supply low-carbon jet fuel, while also making it cost-competitive due to the compliance credit market the clean fuel regulations have.

[Claude Guay, Liberal, LaSalle—Émard—Verdun, QC]

My next question is for Mr. Noorani.

In order to export more electricity with the demand that is coming in the next 10 or 15 years.... You mentioned that we need an increase in renewables. Can you talk to us about the role of energy storage, and how that can help us produce or export more while addressing our domestic needs?

[Imran Noorani]

What is the advantage of renewables today? They are fast and easy to deploy. We do need other things in the grid that provide stability and a backbone, but when we're talking about quick ramp-ups, you pair intermittent renewables with storage. Storage creates the stability that you need to run any type of real facility, right down to medical. What we're starting to see is that renewable energy, when it comes to storage, acts like our lovely endowment of hydroelectric energy throughout the country. We've hit our capacity there. Storage provides the same benefit for us. It provides the backbone for manufacturing.

When we start to talk about the export of low-carbon fuels, green hydrogen, etc., this is where opportunities are further unlocked.

[Claude Guay, Liberal, LaSalle—Émard—Verdun, QC]

Mr. Renou, I invite you to tell us a bit about your LignoForce system, which I find interesting. Maybe you can present your elevator pitch to us.

[Stéphane Renou]

In a kraft process, the LignoForce process extracts lignin, which can then be used as a by-product. Normally, black liquor is burned directly at the mill. The LignoForce process makes it possible to extract the lignin and use it as a stand-alone by-product. This allows us to enter the bioeconomy more broadly going forward.

Unfortunately, in Canada, lignin production is in free fall, because it requires investment and a mill whose long-term viability is assured in order to incorporate these systems. Some production exists in Germany and Sweden, and even there, things are beginning to show signs of strain.

That said, these processes allow us to make progress and diversify our activities, which is very important.

[The Chair, Liberal, Terry Duguid]

Thank you both.

Colleagues, we're going to go to Mr. Simard for two and a half minutes.

The bells are going to start ringing at 1:03 p.m., so Mr. Rowe and Mr. Clark, I'm going to cut back your time a little bit so we can make our way up to the House.

Mr. Simard, you have the floor for two and a half minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much, Mr. Chair.

Mr. Renou, I encourage you to submit documents that will help us complete our study, particularly regarding what you just mentioned. I'm also thinking about cellulose fibre and all those elements. If you have any information to share with the committee, I invite you to do so, because I'm going to have to do something I don't usually like to do, which is to introduce a motion while witnesses are present. However, Mr. Renou, you won't be upset by this motion. It may be a little less relevant for the others.

Mr. Chair, last week I tabled a notice of motion, and I would now like to move it.

The report of the working group on the forestry industry has been tabled, and we've had informal discussions with Mr. Hodgson. He told us that members of Parliament would be able to receive a briefing on the contents of this report. We have conducted a study on the forestry industry, but I would find it quite interesting to hear from the two co-chairs of this working group. We could do this quickly, perhaps after we get the briefing. If we have any questions to ask, it would be a good thing to do.

I'll quickly read the motion to you:

That further to its study on the forestry industry, the committee hold an additional meeting and invite the co-chairs of the Canadian Forest Sector Transformation Task Force, Ken Kalesnikoff of Kalesnikoff Mass Timber and Frédéric Verreault of Chantiers Chibougamau, to appear for one hour, and that the meeting take place as soon as possible.

Perhaps I would still wait until we've received the briefing. Afterwards, we could hold the meeting. I think there's broad agreement on this, Mr. Chair.

[The Chair, Liberal, Terry Duguid]

Thank you, Mr. Simard. That motion is in order.

Colleagues, is there any discussion?

The forestry study is still under way, so seeing no objection, we will have one more meeting.

(Motion agreed to)

[Mario Simard, Bloc, Jonquière, QC]

That's fantastic. What a beautiful day!

Mr. Renou, you had a discussion with my colleague Mr. Guay, and I immediately thought of cellulosic fibre, which we've been trying to produce back home in Kénogami for many years. Unfortunately, however, there's no market for this product.

It's a somewhat intractable problem. How can these new technologies find markets?

I'd like to hear your thoughts on that.

[Stéphane Renou]

Many products, such as nanocellulose and cellulose fibre, as you call it, or CF, as we commonly refer to it here, are a bit like salt and pepper, the magic ingredient you add to a recipe to enhance a product's properties.

When the paper and packaging industries are doing well and technology is advancing, we incorporate these products to enhance their strength, durability, and so on.

When the industry is struggling, and we aren't creating many new products, we use less of them, and volumes remain relatively low. We won't save the industry with CF. However, with CF and nanocellulose, we can create products that will generate new value.

So, we're creating a blend, in a way. We focus on the little magic ingredient, but we don't see that it enables the creation of new products. The real problem facing the industry right now is volume. We have a chip volume problem and an issue with international competitiveness. So, these things are great, but they won't save a paper mill, unfortunately.

[Mario Simard, Bloc, Jonquière, QC]

Right now, what should we be focusing on?

[Stéphane Renou]

The focus needs to be on the efficient use of wood chips to save the sawmill industry and on the modernization of kraft pulp mills, which is the most significant issue at the federal level.

Priority should be given to these two technological areas to find solutions. Energy is part of it, but it's also necessary to look at the industry and identify the areas and industrial groups we can rely on to ensure that our homes will still be built with Canadian wood in 20 years. It's starting to get a little stressful.

[The Chair, Liberal, Terry Duguid]

Thank you.

Mr. Rowe and Mr. Clark, I'm going to give you three minutes each.

It's over to you, Mr. Rowe.

[Jonathan Rowe, Conservative, Terra Nova—The Peninsulas, NL]

Thank you.

My first question is for the president of Advanced Biofuels Canada. I have a biofuel refinery in the district. It's one of the biggest employers in the district. We're very happy that it's running. A lot of people in my riding, including me, are just curious about who's buying biofuel right now and why they are buying it.

Building on that, how do we make sure the demand is always there? What kinds of policies does government need to make that sustainable? What kinds of tax credits, perhaps, does that need in order to keep going forward?

[Fred Ghatala]

Thank you for that question.

There are multiple buyers of biofuel. The policy is designed provincially and federally such that the obligated parties under the regulations are the suppliers: the producers and importers of gasoline and diesel. Those parties buy biofuels.

Also, because the modern biofuels such as biodiesel, renewable diesel and bioethanol can be used in a wide range of industries, the industries themselves oftentimes will buy fuels directly through their fuel supplier. That's helped by the compliance credit market that's in place in many federal and provincial policies.

They buy them because they can be cost-competitive. Bioethanol is cheaper than gasoline. Biodiesel and renewable diesel are very competitive. They reduce emissions, they have operational benefits, and they also help in terms of local air pollution and global air pollution. There are so many reasons why biofuels are a useful thing for Canadians to produce, to sell, to buy and, of course, to use.

[Jonathan Rowe, Conservative, Terra Nova—The Peninsulas, NL]

Thank you for that. It seems that a lot of what you're saying is that because of these policies, the use of it was enforced. That's good to know. Our refinery uses cooking oil from Asian markets. It recycles the cooking oil and uses animal fats, which I think is a great way to recycle those products.

What I find interesting is that there are a lot of biofuels across the country—and you brought it up in your statement—that are using canola straight from the farms. We're farming the canola, then processing it and then it becomes fuel.

With the global population expanding rapidly, a lot of experts are saying that in the next few years we're going to have a hard time feeding the global population. Do you think that may transition farmers, and rather than producing food, they'll go to producing canola to make more money and we'll have a food crisis on our hands? Could we be solving the climate problem and creating another problem of world hunger, perhaps, on the other side of that?

[The Chair, Liberal, Terry Duguid]

We'll have a quick answer.

[Fred Ghatala]

I appreciate this question. The food and fuel debate will always be something that we need to talk about, but biofuels reinforce our food and fuel supplies. As we're currently seeing in the market right now, the canola that is grown can go into engines, the meal can go into animal feed and the oil can be used. Also, then, after it's used and fried in certain applications, it can be used again as recycled cooking oil.

[The Chair, Liberal, Terry Duguid]

Thank you.

Mr. Clark, you're going to be wrapping up for three minutes.

[Braedon Clark, Liberal, Sackville—Bedford—Preston, NS]

Thank you very much, Mr. Chair.

Thank you to all our witnesses for being here today.

Mr. Noorani, I wanted to ask you a couple of questions about renewable energy. Like my friend Mr. Rowe, I'm an Atlantic Canadian MP from Nova Scotia. Wind energy in particular has gotten a tremendous amount of interest in Nova Scotia over the last year or so. There are also significant projects around green hydrogen, which we heard about in our meeting last week.

Also, wind west is one of the projects of interest of the Major Projects Office. In your opening statement, you said that there are about 25 gigawatts of wind, solar and storage currently in Canada. Wind west, on a full build-out, is for 60 gigawatts. Obviously, the scale is massive. Of course, as we know, the wind doesn't always blow, but if you've been on the water off Nova Scotia, it often does, and to great effect, which is why it's one of the best places in the world to have offshore wind.

Could you give me your sense of the wind industry in general and of that project and how we can take it from a fantastic idea that everybody thinks is great to actual operation? What barriers or opportunities are there that we should be aware of to make sure it happens?