Evidence of meeting #31 for Transport, Infrastructure and Communities in the 43rd Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cib.
A recording is available from Parliament.
4:45 p.m.
Liberal
The Chair Liberal Vance Badawey
Thank you, Mr. Stewart and Mr. Bachrach.
We'll now move to Mr. Scheer of the Conservatives.
You have the floor for five minutes.
4:45 p.m.
Conservative
Andrew Scheer Conservative Regina—Qu'Appelle, SK
Thank you very much, Mr. Chair.
I really appreciate the testimony that we've heard. I certainly appreciate the different perspectives. I always find it interesting when proponents come in and give governments ideas on how they can do a better job of things. It's not necessarily always about just spending more money. The expenditure of money is not necessarily the best metric to determine success. It's the efficiency of that program. When you spend a lot of money but get poor results, we've got something wrong.
I really enjoyed the feedback on the impact of cabotage rules and the consequence on our shipping industry and our logistics industry. I'm hopeful that we can continue on with this line of questioning.
Mr. Chair, we have had a motion before the committee for the last few meetings. Many members have had the opportunity to express themselves. Hopefully, we can quickly take care of some housekeeping and then move back to give our witnesses more opportunity to discuss this very important topic.
Mr. Chair, I'd like to move that we resume debate on the motion and the amendment we were dealing with at the last committee meeting.
4:50 p.m.
Liberal
The Chair Liberal Vance Badawey
Thank you, Mr. Scheer.
We have a motion to resume debate. Are there any questions on that motion?
Mr. Fillmore, do you have question on that motion?
4:50 p.m.
Liberal
The Chair Liberal Vance Badawey
Mr. Fillmore, my apologies. There are no questions on that. It goes straight to a vote.
4:50 p.m.
Liberal
Andy Fillmore Liberal Halifax, NS
I have a point of order, Mr. Chair.
Is the motion we're voting on now whether to resume debate?
4:50 p.m.
Liberal
The Chair Liberal Vance Badawey
Thank you, Mr. Fillmore.
Mr. Clerk, can you call the vote, please?
(Motion agreed to: yeas 6; nays 5)
Thank you, Mr. Clerk.
We have one hand up so far. I would encourage others who are going to have questions or comments to get their hands up.
Mr. Fillmore, you have the floor.
4:50 p.m.
Liberal
Andy Fillmore Liberal Halifax, NS
Thanks, Mr. Chair.
I do want to make some remarks, but I want to begin by saying thank you to the witnesses who joined us and shared their wisdom with us tonight. It's much appreciated.
I guess the first thing I'd ask is whether Mr. Scheer consulted with Ms. Kusie. We just passed a motion by Ms. Kusie on how to best spend the time of this committee, and here we are with another Conservative motion thwarting the intention of how this committee should best spend its time.
I want to carry on. We've had some interesting debate on this motion. Unfortunately, it's been very time-consuming. It's left witnesses who have prepared for the meeting unable then to speak. We did a little bit better today. Unfortunately, we're still leaving maybe an hour on the table that we're not going to be able to have with the witnesses.
I really have been reflecting on the motion and the motivations behind it. The more I thought about it, the plainer it became that this is simply a motion that we can't support.
I know we've moved some amendments that have tried to make marginal improvements to the motion, but they've been just that—marginal. We've been tinkering at the margins.
We tried to make changes to a completely unreasonable deadline for a request that will run into the thousands of pages for a document production order. We tried to make an amendment to make sure we respect official languages in how this motion would be responded to, given the importance that we all place on ensuring that both of our official languages are respected and that official language laws are always followed at the federal government level. We even tried to make amendments to ensure that our committee is not asking the Canada Infrastructure Bank to violate its own statute.
At the end of the day, those amendments—even if they all got passed—would only serve to make slight improvements to what is a fundamentally flawed motion, and one that we simply cannot support.
The point is that this motion has been designed to sabotage the Canada Infrastructure Bank's ability to fulfill its mandate, which is to attract private and institutional capital to get more projects built across the country to benefit Canadians.
We heard, even this evening, testimony from a witness who twice brought up the importance of attracting private capital to investments in public infrastructure in Canada, and the necessity of that, the ability to appear attractive and to bring investment partners online for projects of scale that are important to job creation, and to moving toward a low-carbon economy and toward creating an inclusive economy. Yet here we are, persisting with a motion to sabotage the CIB.
The CIB is investing in important projects all across the country, such as the biggest public transit project in Quebec in the last half-century, the Réseau express métropolitain, the REM, in Montreal; projects like the Alberta irrigation infrastructure project, helping to make farmland more productive and to enhance Canada's food security and strengthen our homegrown agricultural industry; and projects like the very topic we are discussing with the excellent witnesses we have with us right now, the Erie Connector, the subject of this motion and project that will reduce Ontarians' electricity costs, reduce greenhouse gas emissions and create jobs.
This motion is meant to put a stop to projects like these, by harming the Canada Infrastructure Bank's ability to attract the very private and institutional capital that is at the heart of the CIB's mandate to make Canadian tax dollars go further, as underscored by tonight's witnesses.
The Conservatives claim to be on the taxpayers' side, but it's hard to see how, when they are trying to sabotage the CIB's ability to make every tax dollar get more built for our citizens. This motion is an attempt to drag confidential business information from the Canada Infrastructure Bank's investment and project proponent partners into a partisan committee where it can be used and misused for political purposes by the opposition.
As I said on Tuesday, it grieves me to see the other opposition parties following the Conservatives' lead on this. It's really unfortunate. It's an attempt to destroy the independent and apolitical status of the Canada Infrastructure Bank, an institution that is intentionally insulated, through its statute, from political interference so that we can actually attract that private and institutional capital in an unhindered and unimpeded way.
I'm going to share with you that in one of the places where I was a city planner over my long career trying to build communities and build infrastructure, my observation was that many of my colleagues were—
4:55 p.m.
Bloc
Xavier Barsalou-Duval Bloc Pierre-Boucher—Les Patriotes—Verchères, QC
I'm calling on you to say that you've started a filibuster.
4:55 p.m.
Liberal
4:55 p.m.
Liberal
4:55 p.m.
Liberal
Andy Fillmore Liberal Halifax, NS
It was a mistake with the mute, I think.
Okay, thank you.
When we were trying to regenerate the downtown of my city, we came to realize that there had been a culture that had emerged within certain departments in the local government that was more concerned with enforcing stale rules than with understanding the nature of capital and how capital builds cities, how capital builds infrastructure. I was able to bring some experts to the community to speak to fellow staff members about the role that capital plays in regenerating a downtown and rebuilding a city. That shifted the culture in the institution. As a result of people's understanding capital, understanding the risks of private capital that the people providing that capital go through, the risks they take, we were able to redirect the fortune of my city, and we are now in an incredible renaissance.
I think that maybe some members of this committee could use the same remedial instruction on the importance of capital and the frailties of it when it comes to overexposing proprietary secrets.
I also mentioned on this committee before that I worked on the Boston Big Dig project. That was a $14-billion project that spanned seven miles through the downtown of Boston. Had the lead company, Parsons, Brinckerhoff Quade and Douglas Inc., had to reveal their business case when bidding for that project, that project still wouldn't be built because they would have run away from building what is one of the greatest modern infrastructure projects in contemporary urban history.
What would happen if this motion were passed? Investors, infrastructure companies, and managers of institutional capital in Canada and abroad would see that there is now a new risk that they need to account for on top of all the other ones—pandemics, changing interest rates, and every other financial risk we can imagine that must be accommodated in a business case. They would now need to account for a risk in negotiating and finalizing infrastructure projects with the CIB, knowing that everything they do might wind up on the front page of a newspaper or be broadcast on a publicly viewable Zoom committee meeting. There would now be a new political risk that they would need to account for.
It's unconscionable. How can the Canada Infrastructure Bank negotiate in good faith and sign the confidentiality agreements that are a standard part of any large investment deal, knowing that this committee might try to extract that confidential information from it in violation of its signed commercial contracts? Involving the law clerk and other such propositions won't make a difference to these institutional and private firms. What they will see is their potential investment partner being forced to break the contract that they have signed.
The privileged information section of the Canada Infrastructure Bank Act exists for a very important reason. It exists to give the infrastructure world the confidence that it can deal with the Canada Infrastructure Bank as a good-faith investment partner. It's no coincidence that Export Development Canada, the export bank of Canada, has almost word for word the same provisions in its legislation. The Business Development Bank of Canada, BDC, to name another example, has almost exactly the same provision in its legislation.
Mr. Chair, it's clear that the opposition is using this motion to try to make it appear that the CIB is somehow being evasive or not transparent enough, even though this committee could call whenever we like—as I have mentioned and as my colleagues on the government benches have mentioned—the CEO of the CIB, Ehren Cory, to answer any questions that we might have. Any question that you would like to have answered, the CEO will come and discuss that.
However, the truth is that this motion is designed to cut the knees out from under the CIB—just as it's hitting its stride—for wanton, political point gathering. The CIB has made over half a dozen new investment commitments in just the last six months and is announcing new deals all the time. These investments benefit Canadians. They grow our economy. They get new, important projects off the ground that otherwise might not ever get built—like the Lake Erie Connector—and Canadians end up with cleaner, greener, more-livable communities in which to live, work and thrive.
We heard a point made by one of the members on Tuesday that parliamentary privilege somehow trumps the law by which the CIB works. That may well be, but I'll tell you this: Those infrastructure companies and those private and institutional investors have no idea of what parliamentary privilege is or why it's worth a darn. What they care about is being able to do the work that they have spent years becoming good at, years of learning how to build the infrastructure that keeps Canadian communities going.
If this motion passes, all they'll see is that they signed a contract with the Canada Infrastructure Bank that included commitments by the CIB that they would not share the company's commercially sensitive information with anyone outside the CIB, and now, the parliamentary committee, claiming privilege, is forcing the CIB to break its contract for wanton, partisan, political point-gathering. It's such a travesty and an embarrassment.
That's why I have said before that this motion, should it pass, would have a chilling effect on the CIB's ability to fulfill its mandate and attract private and institutional capital. It introduces political risk that the CIB was specifically designed, specifically conceived of and specifically executed to avoid this very thing. We won't let this opposition try to derail that, so we will continue to oppose this motion.
Thank you, Chair.
5 p.m.
Liberal
Helena Jaczek Liberal Markham—Stouffville, ON
Thank you very much, Chair.
While I am pleased to enter into debate on this motion, I do want to apologize to the witnesses. I was very much looking forward to having my turn to question them.
Mayor Porlier, if you're still listening at all, I did have the opportunity to look up your wonderful site on tourism at Sept-Îsles. It is very intriguing.
Mayor Parsons, one of my best friends comes from Corner Brook, but I have never visited, so I am certainly hoping to have that opportunity.
Let's get back to the motion.
This motion ostensibly is about transparency, trying to find out more about this deal related to the Lake Erie Connector. The implication is that there is some sort of nefarious, secretive stuff in various documents that presumably will reflect badly on the government.
As my colleague Mr. Fillmore has said, clearly Mr. Scheer has made his opinion of the Canada Infrastructure Bank very clear. The motion is simply a way of putting a chill on the agreement in principle. It will no doubt cause other projects that are in line for consideration by the Canada Infrastructure Bank—probably many of those already being negotiated—and for the principals of those projects to wonder if their agreement is going to be dragged in front of a parliamentary committee and scrutinized and so on.
It seems to me that it's clearly a partisan move by the official opposition that may very well, in fact, cause a number of projects to be deferred or not entered into because investors will not want to have their particular project go through this process that we're embarked on today.
As the notion is transparency, I think it's very important for people to realize just what is totally public information about the project itself, as follows:
How was the route chosen?
The Lake Erie Connector project is being developed by ITC Investment Holdings Inc., the parent company of ITC Holdings Corp., the largest independent electricity transmission company in the United States and a subsidiary of Canada-based Fortis Inc.
Why is this transmission line needed?
The Lake Erie Connector is needed to create a direct energy transmission corridor between the Ontario IESO and U.S. PJM energy markets, helping improve the security and reliability of both regional systems. It also is expected to help increase market efficiencies
—surely something the Conservative Party would approve of—
and benefit the economies of both regions. The project has the potential to strengthen the regional grid by playing a role in emergency grid restoration.
How does power currently flow between the Ontario IESO and the PJM energy markets?
The energy currently must flow across limited existing interties and through other markets such as Michigan or New York to travel around Lake Erie. Some entities do schedule power in this way, but it is inefficient and costly. The Lake Erie Connector will provide a new, direct, and efficient trading route between the two markets and will benefit both regions.
What is the route of this energy transmission line?
The proposed route of the Lake Erie Connector is between Nanticoke, Ontario and Erie County, Pennsylvania and beneath Lake Erie.
Nanticoke, as some of you may recall, was the site of a very large coal-generated electricity plant, and that was closed by the former Ontario Liberal government, and of course, it has all the infrastructure sitting there, ready to connect to this Lake Erie Connector.
How was the route chosen?
The two points of interconnection in Ontario and Pennsylvania were chosen because they provide excellent access to the existing transmission systems. The cable route has been optimized to connect these two points while minimizing environmental impacts, avoiding areas of historical and archaeological interest (such as shipwrecks), and utilizing low-impact shoreline crossings.
Where will the energy come from?
There are a variety of generation sources in the markets of the Ontario Independent Electricity System Operator...and PJM Interconnection, and neighbouring regions. The shippers who purchase capacity on the Lake Erie Connector will determine the source of the energy they transfer.
How large are these energy markets?
Ontario is Canada's second largest province covering more than one million square kilometres with a population of 13.5 million people.
Actually, I think it's closer to 14 million people since this was put together. It continues:
PJM comprises all or part of 13 U.S. states, with a population exceeding 60 million—the largest energy market in the world.
Have you engaged public input on this project?”
Yes, numerous, public consultations in Ontario and Pennsylvania were held—the respective connecting points of the line—to discuss the project and gather community input.
How could this project impact homes and businesses?
[The] project development team has worked closely with local and regional planners and with local residents and other stakeholders in the U.S. and Canada to minimize impacts to local residents.
What are the major milestones in this project?
I think some people may recall, as we heard last Tuesday, that this project was first conceived of in 2014.
In 2017 [the proponents] received major permit approvals from Canada's National Energy Board [with the] issuance of a Certificate of Public Convenience and Necessity for the project...; the U.S. Department of Energy...granted the project a Presidential Permit, which is required for international border crossing projects...[and] the U.S. Army Corps of Engineers...and the Pennsylvania Department of Environmental Protection [granted approvals]. Remaining milestones in the project include completing project cost refinements and securing favorable transmission service agreements with prospective counterparties, after which ITC Investment Holdings, Inc. would proceed with construction, as soon as 2021 or 2022.
Hopefully, without the derailment of this motion, we can see this project actually start construction this year.
Next, how will the cables be installed under water?
The Lake Erie Connector will use two cables that are each approximately six inches in diameter. A specialized ship will lay the HVDC cable along the bottom of Lake Erie utilizing low-impact water jet technology to create a temporary trench that is only slightly wider than the cable itself, and which will be filled by natural forces.
Of course, this type of underwater cable was used through the years: the transatlantic telephone cable. My father actually was an engineer on that project many decades ago. It's proven technology, and it will no doubt be a very efficient and effective way of transmitting the power that way.
Is this transmission project safe?
Placing transmission cables beneath waterways is an established and safe way to move power. These cables will be well insulated, do not contain liquids or gels, and are made from non-flammable materials.
Can the cable be damaged once it is placed under Lake Erie?
This is highly unlikely. The cables will be placed safely and securely beneath the lakebed. In the unlikely event that the cable is damaged, the system can identify the location and shut down within fractions of a second. Protocols are in place at both converted stations to ensure safety.
What is high-voltage, direct current transmission?
High-voltage direct current (HVDC) uses direct current to transmit electricity, in contrast with the more common alternating current (AC) systems. HVDC systems are often built as an overlay to a robust AC system or for unique circumstances. HVDC transmission lines are especially appropriate for underwater applications. HVDC systems have a long record of reliable performance around the world. As an analogy, an AC line is like a highway, with multiple interconnections to the regional grid that act as on- and off-ramps. A DC—
5:15 p.m.
Liberal
The Chair Liberal Vance Badawey
Ms. Jaczek, can I interject for just a second? I do apologize.
Members, unfortunately, once again, for the second meeting in a row, I am going to have to excuse the witnesses. It looks as though this is going to go on for quite some time.
Although the witnesses gave us their very valuable time today, which we all truly appreciate, I don't want to take more time where they'll be just staring at a camera, listening to a debate.
With that, I give my sincere appreciation to all the witnesses. It was a very robust and great discussion, back and forth, with many of the interventions by the members, as well as answers by the witnesses. A lot of great points were made. Once again, I express my sincere appreciation to each and every one of you.
With that, I will excuse all of you. You have a great evening. Hopefully we'll see you back at this committee at some point in time.
Thank you very much.
Ms. Jaczek, you have the floor again.
5:15 p.m.
Liberal
Helena Jaczek Liberal Markham—Stouffville, ON
Thank you so much.
Are there any other transmission lines similar to this one?
Yes, transmission lines similar to the Lake Erie Connector have been in use all over the world for many years.
What is the environmental impact of this new transmission line?
The technology involved and the line route for the Lake Erie Connector were chosen to minimize environmental impact. The line will be buried under the lake bed and at the landing points. The safe and reliable HVDC technology ensures that this energy transmission line has no adverse impact to the environment. From planning our projects within the best interest of the environment to recycling at our facilities, we focus on sustainability efforts that set a positive example for the other businesses and the communities we serve. These efforts have been recognized at the local, state and federal level.
Will there be any overhead transmission lines used?
No. The current project plan envisions all of the cable being installed underwater or underground
For public concerns, will the cost of this transmission project change their utility bill?
The costs for this line will be borne by the parties that purchase capacity on the line.
How long will this transmission cable be in service?
There are numerous examples of similar types of projects that have been in operation for decades.
There has been complete openness as to what this project is all about and who the major proponents are, namely, well-established companies with a good record. It really is an indication, certainly to me, that we have no need whatsoever to demand any further information in regard to this particular project. We want this project to go forward.
As I said before, the current Conservative government in Ontario is extremely enthusiastic about this project. It needs to go forward and any delay would be extremely unfortunate for electricity consumers in Ontario.
Thank you, Mr. Chair.
5:15 p.m.
Liberal
5:15 p.m.
Liberal
Churence Rogers Liberal Bonavista—Burin—Trinity, NL
Thank you, Chair.
I, too, want to weigh in on this debate and to ask questions about what the opposition is putting at risk here, and the areas that CIB is really focused on and the importance of what they're trying to accomplish. I think it's clear to all of us that the motion is meant to harm the CIB's ability to attract private and institutional investments to infrastructure projects.
The opposition has complained about the CIB allegedly not succeeding so far in crowding in enough private capital, and now they want us to use this motion to make their criticism into a self-fulfilling prophecy.
I want us to understand the areas the CIB has targeted for getting more infrastructure built. These are areas where, if the opposition succeeds, Canadians will end up with less infrastructure in our country. They will be the losers, and the Canadian institutions of capital like our pension funds will continue to build projects that benefit citizens of other countries and not our own, so let's look at what the CIB is focusing on.
Prime Minister Justin Trudeau announced the Canada Infrastructure Bank's $10-billion plan to invest in major infrastructure initiatives to create jobs and strengthen economic growth. The growth plan developed by the CIB is expected to create 60,000 jobs across the country. Over the next 24 to 36 months, the CIB's plan will build new infrastructure that connects more households and small businesses to high-speed Internet, strengthens Canadian agriculture and helps build a low-carbon economy. These investments will help Canadians get back to work.
One of the defining characteristics of the CIB is to invest in projects in a manner that attracts private and institutional capital, now and in the future. In this way, every dollar of public investment has maximum impact.
In delivering this plan, the CIB will also work in closer co-operation with provinces, territories, municipalities and indigenous communities across the entire country—
5:20 p.m.
Liberal
The Chair Liberal Vance Badawey
Mr. Rogers, can I just interject for a second? Apparently there's a problem with the interpretation.
5:20 p.m.
The Clerk
Yes, I believe it's a connectivity or a sound issue with Mr. Rogers' connection. The sound quality was too poor for them to provide interpretation. You may have to go to a different speaker and come back because they aren't able to provide interpretation right now, and we have to be able to provide interpretation.
5:20 p.m.
Liberal