Transport Committee on April 9th, 2024

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Can you at least give us the answer in writing, if it is not possible to do so verbally right now? I think it would be beneficial for everyone to know the number of hours worked and average hourly rate.

[Frédéric Duguay]

We will send you the answer to this question.

[The Chair, Liberal, Peter Schiefke]

We very much appreciate it, Mr. Duguay.

Thank you, Mr. Barsalou‑Duval.

Next we have Mr. Bachrach.

The floor is yours, sir.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

I'm looking through the communications that came out around the time the bank approved in principle its participation in this project. I'm not finding any mention of importing power from the United States.

We have a quote from Mr. Corriveau who is with the bank. He said that the “expectation” is that “energy will flow from Ontario to PJM over the long term given that Ontario has a much higher share of the lower marginal cost sources of supply—which is typically non-emitting—compared to PJM.”

Again, this is directly contrary to what we heard from Professor Winfield.

In the press release that the CIB put out, there's a quote from you, Mr. Cory:

This project will allow Ontario to export its clean, non-emitting power to one of the largest power markets in the world and, as a result, benefit Canadians economically while also significantly contributing to greenhouse gas emissions reductions in the PJM market.

Let's go down and hear from the then minister, Catherine McKenna. This is what she had to say:

With the U.S. pledging to achieve a carbon-free electrical grid by 2035, Canada has an opportunity to export clean power, helping to reduce emissions, maximizing clean power use and making electricity more affordable for Canadians

It seems like an incredible sales job when the actual rationale that you've explained to us today was that in mid-term you're going to be a net importer of American power and in the long term probably also a net importer of American power, whether clean or otherwise.

Why didn't the bank come clean at the beginning and articulate that this was largely going to be a project that imported American power to Ontario?

[Ehren Cory]

I'd love to clarify things. We're using short, middle and long-term in different senses probably, so let's go back to some core facts.

Remembering that the project will both import and export power throughout its life, it's a net question. In the first 10 years there are four million tonnes of GHG reductions, estimated by the IESO and verified by our external adviser in Ontario. That's from importing power instead of turning on a gas plant in Ontario in the first 10 years. There will be seven million tonnes of reduction in the U.S. in that same time frame. If you go out in a longer term, those benefits continue to accrue on both sides of the border at slower rates because all markets become tighter and all markets become cleaner. The amount of GHG emissions savings gets less and less over the 40 years of the life but they continue on both sides of the border. The project, over the 8,760 hours in any given year, will both import and export.

I stand by everything in the quote you read from my quote and all the quotes, but certainly mine remains true. Everything I said is true. It is a great opportunity for all three, grid reliability, economic benefit and the GHG benefit, for Ontario and Ontarians.

The Minister of Energy in Ontario, Minister Smith, in his ministerial directive issued in 2022, thought the same, as does the independent system operator.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

The thing that stands out to me, Mr. Cory, is the lack of any mention of importing American power. I'm not sure why that is. Maybe it's because it's less palatable to Canadians to invest so heavily in a project that's importing electricity from the United States.

Be that as it may, there's a real question based on what Professor Winfield has said, and he has studied this in great detail, about the core rationale behind the project because Ontario is now awash in fossil gas electricity. Looking forward, as we heard from Professor Winfield, emissions are going to go through the roof, and that is something that should concern all Canadians and should certainly concern the infrastructure bank.

Given that I only have five minutes left—

[The Chair, Liberal, Peter Schiefke]

You have 20 seconds left.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Twenty seconds. Mr. Chair, you're so generous.

I would like to move the following motion:

That the committee do order the production of all documents and correspondence related to Canada Infrastructure Bank’s modelling and analysis of the greenhouse gas implications of the Lake Erie Connector project, and that such documents be delivered to the committee no later than Wednesday, May 15, 2024.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Bachrach.

Is there any discussion or comment on that?

Yes, Ms. Koutrakis.

[Annie Koutrakis, Liberal, Vimy, QC]

I would like to ask for a suspension, please, to discuss this a bit further.

[The Chair, Liberal, Peter Schiefke]

Okay. The committee will suspend for five minutes to allow members to discuss it.

The meeting stands suspended.

[The Chair, Liberal, Peter Schiefke]

I call this meeting back to order.

I believe there were discussions while we were suspended whereby the witnesses have agreed to resubmit the information that's already been submitted by the latest date put forward in the motion.

Do you want to withdraw your motion, Mr. Bachrach?

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thanks, Mr. Chair.

I understand that the witnesses did provide some information and not everyone on the committee was privy to that, so perhaps something was missed.

If that information indeed answers the questions that we have around the modelling and analysis, it will be very helpful.

I'm happy to withdraw my motion for now and we can look at the information that's been provided. If we still have further questions, we can bring back a motion at a future date.

(Motion withdrawn)

[The Chair, Liberal, Peter Schiefke]

Thank you, Mr. Bachrach.

I'll work with the clerk to ensure that all of that information is redistributed to all members.

We will now resume the line of questioning.

For that, I'll turn the floor over to you, Dr. Lewis.

You have five minutes, please.

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

Mr. Cory, I understand that Andrée-Lise Méthot was appointed to the Infrastructure Bank board. She previously served on the board of SDTC, which is a billion-dollar green slush fund company that is under multiple investigations.

Ms. Méthot had an interest in companies that received $42 million while on the SDTC board.

Do you know who appointed Ms. Méthot to the Infrastructure Bank board?

[Ehren Cory]

Thank you for the question.

The CIB board is an independent board of directors appointed by the government.

Frédéric can help me here.

[Frédéric Duguay]

In accordance with our act, our directors are appointed by the Governor in Council. That follows the open and transparent director selection process that is used across agencies of government and Crown corporations.

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

It was probably suggested by someone in government—by cabinet.

[Annie Koutrakis, Liberal, Vimy, QC]

On a point of order, Mr. Chair, I'm questioning relevance to the matter at hand.

I want to have a better understanding of the relevance of the member's line of questioning vis-à-vis what we're looking at today.

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

It's on transparency and largely the way taxpayer funds are used, which ties into the wasted funds that we saw on the Lake Erie project. It's all around the issue of transparency.

My next question pertains to that with respect to the apparent conflict of interest that is raised.

Have you raised an apparent conflict of interest with Ms. Méthot?

[Frédéric Duguay]

Mr. Chair, our board of directors has adopted a code of conduct for directors that includes our procedures for conflicts of interest. That's also publicly available on our website.

Upon Ms. Méthot's appointment—and I would say upon the appointment of all directors who are appointed to the board of directors—she would have to complete a director and officer questionnaire to disclose material interests. If there is any project that would raise a real, potential or apparent conflict of interest with a director, that is managed appropriately with respect to that director recusing themself from the meeting and from voting on the matter, as well as excluding materials from the director.

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

Specifically, can Canadians be assured that monies from the Infrastructure Bank did not go to Ms. Méthot's businesses that she has ownership interests in?

[Frédéric Duguay]

I think we're speaking about two different things.

There's a conflict of interest on a project where a director may have a conflict. They have a conflict where it's direct because they sit on the board of directors of an entity that we may provide a loan to. It may be indirect or perceived if they may have a close family member or a close friend that is related to that particular project.

In that situation, the appropriate approach with respect to managing a conflict of interest is through disclosure and recusal. That's how we manage conflicts that may arise on our investments with respect to entities that may be related to our directors or where they may have a conflict.

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

I understand that, but Canadians see an apparent conflict and they want assurances that money from the CIB did not go to her companies when she was sitting on boards that were affiliated with it and then sitting on the CIB's board.

Can Canadians have that assurance? That's what I'm asking you. Do your processes guarantee that assurance?

[Frédéric Duguay]

Our processes are robust such that directors are required to disclose all of their interests to boards that they serve on and in respect to their private interests. We are robust in our procedures in managing those conflicts.