Transport Committee on Nov. 24th, 2016

[The Chair (Hon. Judy A. Sgro (Humber River—Black Creek, Lib.)), Liberal, Judy Sgro]

I call the meeting to order.

Pursuant to Standing Order 108(2), the Standing Committee on Transport, Infrastructure and Communities, meeting number 35, we are studying unmanned aerial vehicle regulations.

Witnesses, welcome to our committee. I'm glad to see that everybody's here.

[A voice]

Not quite. EXO Tactik is caught in traffic.

[The Chair, Liberal, Judy Sgro]

One set of witnesses is caught in traffic. I guess they're not using a drone, or they would have been here on time.

We will start with who we have right now. We have Ian Glenn, chief executive officer for ING Robotic Aviation Inc., and Mark Aruja, chairman of the board of Unmanned Systems Canada.

Gentlemen, welcome. Thank you for providing us with some important comments on a fledgling industry in this country and around the world.

Mr. Aruja, you have the floor.

[Mark Aruja, Chairman of the Board, Unmanned Systems Canada]

Madam Chair, I wish to extend my appreciation to the committee for the invitation to appear as a witness.

Unmanned Systems Canada is a national not-for-profit association established in 2003. With 500 members, we represent the Canadian unmanned systems community. We have been proactively engaged with Transport Canada since 2006, a decade ago, regarding the development of UAV regulations. We have co-chaired the UAV systems program design working group with Transport Canada since its inception in 2010, which has resulted in the guidance material used today by industry and regulators.

The current visual line of sight practices, honed over five years of commercial operations, are the basis of what is being proposed as amended regulations with Canada Gazette part I notification expected by mid-2017.

From an industry association's perspective, I will not address the regulations themselves, but rather how they will be implemented. Our critical concern is business continuity.

Under the current regulations, UAV operations are approved by means of a special flight operations certificate, SFOC, whereby an operator in their application for that SFOC describes how the risks of their operation are mitigated. A decade ago, the issue was the lack of guidance to industry and the regulator on how an application should be made by industry for an SFOC, how the regulator might approve an application, and the business risk associated with the lack of an approval process.

Since then, the working group results, our association's visual line of sight best practices, improved Transport Canada staff instructions, and increasingly reliable and affordable equipment, coupled with major business opportunities, have resulted in the dramatic growth of SFOC approvals.

Let's talk about business continuity. In 2011 about 100 SFOCs were approved by Transport Canada. Last year that number was 2,480, and we've passed the 4,000 mark as of this year. There are now 1,000 UAS-related businesses in Canada. This is why business continuity is at the forefront of our concerns. These companies invest in intellectual capital, equipment, training, marketing and sales to meet the requirements of the regulator and to develop commercially viable businesses.

UAS technology applied in areas as diverse as the film industry, construction, and precision agriculture have resulted in better, safer, and cheaper business practices. These results are reflected in an increase in investment dollars flowing to the industry. Regulatory certainty is an important criterion for investors to determine the risk to their investment. Therefore, we are very pleased that Canada is moving ahead toward a regulatory structure.

The business continuity risk we're discussing here has two aspects. One is the transition to the regulations and the second one is the capacity risk at Transport Canada. The two are linked.

With regard to the transition, the regulations are going to address three fundamental areas and accords with how the regulations are structured: knowledge requirements, operating procedures, and equipment.

Companies have invested heavily to build their businesses, and therefore it is critical to their business continuity that the transition to the proposed regulations take into account a business means test reflected in an enabling transition plan. Companies with approved SFOCs should see no change in their operations other than minor adjustments. However, we have concerns, such as how UAV equipment requirements will be defined. Part of the solution will be grandfathering, which recognizes investments made, ongoing business obligations, and proven expertise.

Let's turn to capacity risk at Transport Canada. You may be surprised to learn that there are only two people in the department who are dedicated to UAS regulations. This situation poses the most significant risk to Canadian industry. Not only is the transition to the proposed regulations at risk, but there is also a growing backlog of issues critical to the future of the industry.

We are one of the most innovative industries in Canada, so visioning is part of our DNA. In October our association published “Beyond Visual Line of Sight Best Practices” to enable the industry to take the next critical step. The business case for BVLOS operations needs to be built, just as we have done with visual line of sight operations to capture the immense economic potential.

A recent PricewaterhouseCoopers report estimated that the global accessible market for UAS operations is $127 billion. In sectors ranging from mining to forestry, environmental, pipeline and railway monitoring, to precision agriculture, we have the geography and the expertise to take our experience to the global market.

The lack of capacity at Transport Canada has directly impacted Canadian businesses by a lack of priority on BVLOS operations which is the Holy Grail of the industry in which we're in a global competition.

Canada is a world leader in developing the UAS industry. Unfortunately, failing comparable investment by other nations such as the U.S., Australia, and the various countries in Europe, we are now falling behind. Therefore, we need accelerated government action and investment to ensure that our industry continues to innovate and flourish. We encourage government to examine the broad economic and social implications of this industry, and how other departments can provide resources beyond just those implicated in a regulatory development.

In summary, we are pleased UAS regulations for visual line of sight are being proposed. However, we need a thoughtful implementation strategy to enable Canadians to establish a global market share with this technology, with accelerated government investment and action that is responsive to market realities.

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Glenn.

[Ian Glenn, Chief Executive Officer, ING Robotic Aviation Inc,]

Good morning. I'm Ian Glenn, CEO of ING Robotic Aviation.

This is my 20th year in the UAV business. In 1996, the Canadian Army entrusted me with their UAV program, and I've been engaged with UAVs since then. I've also been engaged with Transport Canada since then. This is the year when I'm looking for Transport Canada to give me the gold watch.

We have not moved forward far enough fast enough. Mark's done a great job of illustrating where we stand today. Where we stand today is, we have failed to keep up with the rest of the world. We were leading, and due to resourcing and focus of Transport Canada on this sector, we have failed to the point where companies are now not looking to Canada but to the U.S. to move their businesses.

That said, there is a way forward for Canada in particular. The first slide I show you is really what the trillion-dollar question is here. It's not about the unmanned aircraft industry. It's about Canada's inability to safely and effectively move product to tidewater. This is a place where robotic aircraft have a great place to play where we can demonstrate to the world that we are safe and effective in reducing greenhouse gases in moving our products to the world.

Most of these products actually transition through first nations lands. I'm one of the first to have taught first nations how to safely fly UAVs. There's a great opportunity in Canada for us to move forward.

On the second slide, which is the one with the picture of the plane and the UAV, there is a technology available today that will address part, if not all, of the challenges faced by Transport Canada and the country. That's a little technology called a transponder, and they are tiny little devices today. Manned aviation uses this type of technology all the time. This is ICAO-approved technology for big planes. We find in 2016 that this is now small and useable technology that every drone could be equipped with.

What does that mean to us? If we think of last week, we had Porter thinking they saw a drone—probably a weather balloon—just because of where it was, but they didn't know. Our airline pilots are spooked by the whole drone phenomenon. There are more unmanned aircraft flying in Canada today than manned aircraft. By Christmas this year, there will be two and a half million drones flying in North America. Remember, we only have 33,000 registered aircraft in Canada. There's a technology that will allow us to work with this. I call this little device, of which there are many manufacturers, the seat belt of 2016. How do we effectively let everyone know where drones are? That's the point I would make.

I've been on every CARAC working committee for 20 years. There are three things we need to do as a country to move this forward rapidly.

Number one, if you're going to fly beyond visual line of sight—and this is where the money is; this is the reason we come to work—we have a thing called a compliant operator. That means you look, smell, and taste like an aviation company, and so you have to have all the safety management processes, and you have all of those things you have to do. If you just go to Best Buy and pick up a drone, you have a lot to learn, and that's important.

Number two, we need compliance systems. We have developed all of those regulations through the CARAC process that basically say, “You look and work like an aviation asset, an aircraft.” That's important.

Number three, we need to tell each other where we are. A “no drones” sign on the fence at the airport isn't cutting it. You know, the education program.... You can tweet all day long; it doesn't really cut it. We need to use a bit of technology and enforce it, not just for unmanned aviation, but for manned aviation as well, and the expense is not high.

The fourth slide speaks to a thought I have about how we can do this and keep everybody happy, because we're Canadians. Most of the work that we want to do in Canada is not over the GTA or downtown Ottawa; it's out over the woods.

I have a team up past Cochrane, Timmins, flying magnetometer surveys for De Beers today, in the snow. That's where we need to be flying. I could be much more cost-effective, much more efficient, if I were able to operate beyond visual line of sight. If every aircraft in Canada had this technology, that would be a great risk reduction exercise.

The origins of ADS-B were that, in 1999, Alaska adopted it. They immediately saw a 78% decrease in man-on-man accidents. It's a great technology.

Finally, we have this ability today, technologically, to move forward. I have certainly made the suggestion that for our manned aviation folks who prefer not to spend money, they're going to buy it anyway. In the U.S., in two years or three years they're going to have to have this technology to fly down to Fort Lauderdale. What they could do is perhaps make it a tax credit. We're talking about a couple of thousand bucks for equipage.

Good technology recognized in the world would change the equation for Canada and all of our citizens. In particular, when we think of the great white north, wouldn't it be wonderful if our first nations, for instance, who are objecting to moving product to tidewater, had the ability to have high-tech jobs in their own communities to help us ensure that we're moving product well?

Thank you very much.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

I'm glad to see that you have arrived. Anne-Sophie Riopel-Bouvier, vice president, operations, welcome.

The floor is yours.

[Anne-Sophie Riopel-Bouvier, Vice-President, Operations, EXO Tactik Air Support]

Good morning.

Do you mind if I do my witness statement in French?

[The Chair, Liberal, Judy Sgro]

No, of course not.

We welcome that.

[Anne-Sophie Riopel-Bouvier]

Thank you very much.

Good morning.

Stéphane Bouvier and I are representing Support aérien EXO Tactik this morning.

Our company was launched in February 2014 to provide air support service with drones for public safety purposes. We are operators, we pilot the aircraft to help police officers, firefighters and civil emergency responders to obtain live aerial images of the intervention sites. We therefore help them make better decisions faster, optimize their operations to save more lives, and protect those who often risk their lives to protect us.

The first months of operation were a bit more challenging, as the current process to obtain a flight certificate does not apply to emergency operations. There are many initial delays before a flight certificate can be obtained. Unfortunately, fires don't wait for Transport Canada. After doing a lot of work, we managed to get a permanent special flight operations certificate. This has been an essential support to our operations.

Last year, in 2015, we also submitted a brief to the Canadian Aviation Regulatory Advisory Council, as part of the notice of proposed amendments for unmanned aerial vehicles.

My colleague wanted to go over the history of drones. So I'll do it in his place.

It will soon be the 100th anniversary of the creation of drones. In fact, they were already active during World War I. At that time, drone operations were mainly military, which has been the case until recently. Since the 2010s, the technology has become much more accessible to consumers and the general public.

The devices come with GPS. The devices are also miniaturized, like the transponders that Mr. Glenn showed you. Everything has become smaller, much more accessible, less expensive and much easier to fly. The batteries have also become much more accessible.

In 2013, DJI launched a drone called the Phantom. We'll bring one into the room in a second. It's like the model T for cars. It is the first accessible model: it is easy to operate for consumers and the general public. It has revolutionized the world of drones. That's when the popularity of drones exploded.

Today, there are more and more drones. That's when things become more problematic, as was the case in the early days of the automobile. One day, there were too many cars and it was necessary to regulate the traffic, to install traffic lights and to introduce the seat belt.

That's the stage we are at with the drones. These devices are here to stay. Sales will not drop by next Christmas; they will continue to grow.

Thank you.

[The Chair, Liberal, Judy Sgro]

Ms. Riopel-Bouvier, you referenced a report you gave to Transport Canada with some suggested regulations. Could you supply that to the clerk for the purposes of the committee?

[Anne-Sophie Riopel-Bouvier]

I will.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go to questioning. Mr. Berthold, for six minutes.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Thank you very much, Madam Chair.

Thank you very much to the three of you for your presentations, which have shed a lot of light on the current situation. The three submissions were very different.

In response to those three presentations, my first question is for you, Mr. Aruja.

We have just heard Mr. Glenn talk about the seat belt. In the introduction to your presentation, you talked about a transition period for the vehicles, so that the industry does not experience any kind of price shock, which would kill the momentum that is already there.

Previously, we have heard from the representatives of pilots, those other users of the sky. They all felt that transponders were absolutely essential.

What is the industry's position on the use of transponders for drones?

[Mark Aruja]

Thank you very much for that question.

First, we have to safely coexist in that airspace. Canada has an enviable safety record. The industry fully understands that is a core business risk we need to address.

I would conclude that what Ian has shown you in terms of that device—it's called an ADS-B transponder—is exactly the association's position that we need some form of government encouragement. It could be a tax credit. It could be some mechanism to get this adopted.

To put it very simply, it's like your cellphone. It sends out a signal, and says,“Here's who I am; here's where I am.” The really sophisticated system says, “Here's where I'm going.” This is now ubiquitous technology out there. That is exactly the type of technology that addresses the concerns of those who occupy the airspace, and gives us the technology we can take anywhere in the world.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

I'm sort of following you. You have announced a multi-million dollar or multi-billion dollar industry. I don't see why the government would have to provide financial incentives for drone owners to install transponders. In my opinion, the first concern of anyone who wants to share the sky is to ensure that their devices are safe. So I don't see why the government should intervene.

We can have regulations, but why should the government and taxpayers pay for the industry's transponders?

[Mark Aruja]

That's a good question. That's a proposal that's out there now. There is this difficulty. As we have accelerated this industry to the point we are today, how do we make that transition business-friendly? If in the U.S. this becomes mandatory.... When Alaska adopted it, the FAA actually paid for all of those transponders, and had an 80% reduction in their accident rate.

I believe there is a role for the federal government, as the sole regulator with regard to safety in the airspace, to put incentives in place to allow those things to happen. There are incentives for the adoption of electric vehicles and many other technologies.

I think the government has a legitimate role, not to pay the freight, but to put encouragement out there, most importantly, to put those kinds of requirements out there so we can underwrite the safety of operating in that airspace. There's an urgency to doing this, and mechanisms such as financial incentives, even over a short period of time, accelerate that sense of urgency.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Mr. Glenn, is the technology now available and accessible to the extent that, tomorrow morning, companies could equip their drones with that?

[Ian Glenn]

Absolutely. Yes, the technology is available today. That's one of the reasons I brought this. This is a smaller one. I've been flying one smaller than this on my drones for the last four years. We actually flew in Calgary in the controlled airspace last week doing a job. The technology exists. That's not the issue.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Is it expensive?

[Ian Glenn]

In small quantities, it's somewhere between $1,000 and $2,000. That's the price range you're looking at. As for adoption, if you pick up any piloting magazine, like Plane & Pilot, you won't get four pages in before you see a big ad selling ADS-B transponders for manned aviation.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

So it would be realistic for regulations to require the rapid installation of that type of transponder. It could be done. The government could act quickly and require it, especially since the equipment is available.

[Ian Glenn]

That's correct.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

You also raised the issue of the limited number of Transport Canada employees currently assigned to drones.

Can you tell us quickly about the problems this is causing to the industry, in the current state of things?

[Some hon. members]

Oh, oh!