Transport Committee on May 15th, 2012

[Jonathan Burke]

We think natural gas will come in over the next several decades from a variety of sources in Canada. We have conventional gas resources. We have what's known as tight gas or coal bed methane, for example, in the border between Alberta and British Columbia in what's called the Montney area. Then we have shale gas as well. There is also a tremendous resource in Canada of renewable natural gas, called biogas in many cases, and that's gas that comes from waste material like landfills, dairy farms, and other renewable sources. So there's a whole range of sources of natural gas for transportation. It's not any one source, such as shale gas. It's going to come from a whole range of sources.

We already have facilities in Canada that are generating biogas, which comes from waste sources such as a waste water treatment plant, for the purpose of re-injecting it into the pipeline grid and selling it to consumers.

In the United States we actually have dairy farms that are collecting the methane from sources you can imagine and then they are trapping it, they're cleaning it a small amount, and they're fueling their vehicles with that methane. So it's a virtuous life cycle.

Waste Management operates a fleet just outside of San Francisco where they take garbage up to a landfill. The landfill then produces methane. They collect all that methane, they clean it, and they fuel all their garbage trucks. There's no fossil-based natural gas used in that life stream.

So there is a whole variety of alternatives. It's been done in Scandinavia for over a decade, where biogas is being extracted from a whole number of waste streams. There's already very proven commercial technology around deriving biogas, or renewable natural gas, from things like farm waste, forestry residue, other waste materials, organic waste.

[Robert Aubin, NDP, Trois-Rivières, QC]

Merci beaucoup.

[The Chair, Conservative, Merv Tweed]

We have a bus in Brandon that runs on French fry cooking oil. When it drives by you can smell the French fries. I can't imagine what the methane vehicle might smell like.

Monsieur Poilievre.

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

Thank you for the introduction; I appreciate that very much.

The question I have relates to regulation. We've heard from a number of natural gas proponents that there are inconsistent regulations across provincial and Canada-U.S. borders that make it difficult for the seamless flow of commerce with respect to these vehicles. First, is that the case? Second, can you provide us with a summary of what we need to do to fix that?

[Jonathan Burke]

Sure. I don't know the specific issues; I can't identify any one specific issue. But there are requirements for crash testing here in Canada that are different from what are in the United States, as an example that I understand. For example, Honda Motor Company in the United States manufactures a car—running on natural gas—that for the past seven years has been rated the cleanest car in North America by a very well recognized standards organization.

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

Is it the Honda Civic?

[Jonathan Burke]

It's a Honda Civic manufactured at the factory as a natural gas vehicle; it's called the Honda Civic GX

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

Is it available in Canada?

[Jonathan Burke]

It is not available in Canada.

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

Why?

[Jonathan Burke]

Because there are certain barriers that Honda has indicated to me—I can't speak on behalf of Honda—that prevent Honda from getting it into Canada without significant investment and cost.

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

Are they regulatory burdens?

[Jonathan Burke]

I believe they are, yes, and I think probably some commercial expense as well. But I'm not sure what those are, and I can't speak for Honda Motor Company.

I do know of organizations that have brought Honda Civic GXs into Canada in what they call the grey market and registered them, but they don't get dealer support. It's not as seamless as if you were to install a home refueler in your garage and wanted to go to your Honda dealership to buy that car. You can't buy it today.

For example, we're going through the process with our Ford F-250/F-350 product, which is being manufactured in the U.S., to get it certified for Canada. It's a different set of regulations for Canada than it is for the U.S.

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

So harmonization would help you with that.

[Jonathan Burke]

Harmonization would be a great help, absolutely.

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

On the question of fuelling stations and corridors, are the corridors that exist right now supplied by truck or by pipeline?

[Jonathan Burke]

They're supplied almost exclusively by truck, just as diesel would be supplied. You would see a value chain identical to that for diesel in that the refinery is a liquefaction plant, which is a plant on a large pipeline that's liquefying or chilling the natural gas until it turns into a liquid, and then it's dispensed into a truck. For example, in the Gaz Métro plant in east Montreal it's dispensed into a truck. The truck then takes it to Boucherville, dispenses it into the station's tank, takes another load, for example, to Mississauga, and then returns to the liquefaction plant to pick up another load.

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

Is there a way that liquefaction could occur at the fuelling station itself?

[Jonathan Burke]

There is. There are small-scale liquefiers that operate on a much smaller scale than does the Gaz Métro plant in Montreal. However, with smaller scale comes added cost and inefficiency. The larger the plants are, the more efficient they are and the more energy efficient they are.

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

I see. If stations across the city of Ottawa, for example, started providing natural gas, the idea that they could withdraw that fuel from the network of pipelines that already heat our homes is probably not practical.

[Jonathan Burke]

No, it is very practical for automotive use, or for buses for that matter.

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

Okay, because they could use compression.

[Jonathan Burke]

Exactly. These days there are several companies. In fact a very well-known Canadian company, now owned by a U.S. company but headquartered in Chilliwack, British Columbia, called IMW Industries, is one of the world leaders in natural gas refuelling stations. They provide anything from a small-scale refuelling station that has one receptacle all the way up to these large-scale, multi-point refuelling stations for big waste fleets or transit fleets. They can be installed on a pipeline, just like the one for residential.

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

So you could conceivably have filling stations across a mid-sized city that wouldn't require refuelling or resupply trucks? They'd just take their fuel.

[Jonathan Burke]

They would take it out of the pipeline, so long as they were situated on a pipeline with enough capacity to serve, and that's the challenge. Many of the pipelines that run underground aren't large enough to supply the demand of a fuelling station. That's not to say that, for example, here in Ottawa all the stations aren't situated on sufficient-capacity pipelines.