Transport Committee on May 10th, 2012

[Brian Bower]

The current requirements are include a lighter-than-air element and experience—in fact a considerable amount of lighter-than-air vehicle driver experience. From the discussions we've had with the people who fly them for the company we've partnered with, they say that rotary wingers are the best at operating or hoisting aboard the concepts of operating these vehicles, but I would say either one could satisfactorily perform the duties.

[Jeff Watson, Conservative, Essex, ON]

I'm not sure I have any further questions. I don't know if one of my colleagues has one.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

There seems to be potential for this technology to provide services that the government purchases or provides, whether it's aerial surveillance, some sort of mapping, or transportation of large volumes of cargo to northern communities for which Aboriginal Affairs and Northern Development is building housing. Would your enterprise be able to compete with other modes of transportation in a head-to-head request for proposal in those areas?

[Garry Venman]

I would say, yes. If we can't compete commercially, this thing won't fly.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Sullivan, you have the floor.

[Mike Sullivan, NDP, York South—Weston, ON]

Thank you, Mr. Chair.

Thank you to our presenters today.

Much as I'm fascinated by the Discovery Air Innovations project, I really want to talk to the folks from WestJet about biofuel.

It appears that what you're suggesting is that a biofuel alternative would save some greenhouse gases. My understanding is that it's not a huge amount, but it is some, so we shouldn't ignore any opportunity to save greenhouse gases. The real pitch is about cost, is it not? You're trying to lower the costs of your fuel.

[Geoffrey Tauvette]

Ideally we'd like the cost of fuel to be lower all the time. In this case, aviation has globally committed to some pretty aggressive goals: 2% improvement on fuel efficiency year over year up to 2020; from 2020 on, carbon neutral growth; and then by 2050 to reduce our emissions by 50% compared to 2005 levels. For us, biofuels represent a solution to the carbon-neutral growth perspective.

There's still a lot of work to be done on the sustainability of several of the crops. As we're seeing recently, industrial crop seeds such as camelina and mustard seed, specifically, can be grown in harsher conditions in Canada. Rotational crops don't compete with food. There have been very good, established sustainability criteria already in the provinces, in terms of the amount of water being used and so on.

[Mike Sullivan, NDP, York South—Weston, ON]

What's the advantage to the farmer? What's the price differential between growing a crop for the purposes of feeding the world and the purposes of feeding an airplane?

[Geoffrey Tauvette]

Thanks for the question.

That's part of the policy development. It is an area that is currently being looked at by the U.S.. In Canada we're participating, for example, with a group in Saskatchewan called Ag-West Bio, which represents the biofarming industries. That's exactly the question we're trying to ask. I guess to get to these non-food or industrial crops, those are the questions that need to be answered. How will the farmers grow them? What does it mean for them? That's where it's coming into crop rotations and harsher pieces of land that can't grow anything. Yes, that is a key component of the policy going forward.

[Mike Sullivan, NDP, York South—Weston, ON]

The bottom line is that you don't have the answer. There's no number.

I heard an interview on the radio not too long ago with a corn grower in Indiana who was saying that he could get $4 a bushel for his cornfield, but he could get $4,000 a bushel if he grew marijuana. You don't have a similar type of analysis of the field being used for corn and the field being used for aviation fuel.

[Geoffrey Tauvette]

It's being looked at. Are we competing against canola? At the end of the day, it depends what it is competing against. Certainly what we do know is that 90% of the costs of biofuel, whether it's aviation or diesel, are the feedstock. So anything that can be done to reduce that cost—

[Mike Sullivan, NDP, York South—Weston, ON]

But we don't know what the farmers are likely to do because we don't know whether it's more profitable for them.

I'll go back to the other part of your comment about the energy independence issue, which has become quite the theme of the U.S. approach. Canada is somewhat lacking, I believe, in creating any kind of energy independence in this country. In fact, our government's goal seems to be to pipe the energy, the bitumen, out of the country as fast as we can, and let it be refined somewhere else. You're suggesting that, if we're not careful, not only bitumen but the feedstock for biofuel is going to be exported, and we're not going to refine it. Where is the refining of most aviation fuel done now?

[Geoffrey Tauvette]

There's no commercial-sized aviation bioreactor in place today. The recent incentives that the U.S. has put in place through the EPA RINS credit, I believe, will help incent someone to build something.

[Mike Sullivan, NDP, York South—Weston, ON]

In the U.S.

[Geoffrey Tauvette]

In the U.S. most likely, yes. And they are looking at our feedstock, of course. Canola is already sent to the west coast for production into biodiesel, for example.

[Mike Sullivan, NDP, York South—Weston, ON]

Is the current non-biofuel refining done in Canada or the U.S. for most aviation fuel?

[Geoffrey Tauvette]

My understanding is that there are a few biofuel refineries in Canada—

[Mike Sullivan, NDP, York South—Weston, ON]

Non biofuel.

[Geoffrey Tauvette]

For jet fuel in Canada? Forty-five per cent of our current jet fuel requirements are actually imported into Canada today. The rest is from the domestic refiners.

[The Chair, Conservative, Merv Tweed]

I have to stop you there.

Before I recognize Mr. Adler, one of the issues that came up with alternative fuels in the automotive industry was whether the engines would accept the product and whether the warranties would be covered? Does the aviation industry have a challenge with that? Can a new jet biofuel cause a problem with a new engine that is being produced today?

[Geoffrey Tauvette]

Thank you. Actually, the term “drop-in” is exactly that. The aviation biofuel looks exactly like and acts exactly like jet fuel. Currently the specifications today allow for a mix of 50%, a blend, and the newer technologies coming out are targeting 100% aviation biofuel. So some of what the FAA money has recently been invested has been to look at what the longer-term effects are on the engine; but the ASTMs of the world and the CGSBs and the engine manufacturers have spent a lot of time investigating. It looks exactly the same but it has a reduced carbon impact at the end of the day.

[The Chair, Conservative, Merv Tweed]

Mr. Adler.

[Mark Adler, Conservative, York Centre, ON]

Thank you, Chair. I also would like to preface my comments by thanking the chair for bringing forward this subject matter for discussion. He has shown great wisdom and I'd like to thank him for that.

[An hon. member]

Hear, hear!

[Mark Adler, Conservative, York Centre, ON]

That's just the way you wrote it, Mr. Chair.