moved that Bill C-33, An Act to amend the Canadian Environmental Protection Act, 1999, be read the third time and passed.
Mr. Speaker, I cannot tell the House what a pleasure and an honour it is to stand and speak to the third reading phase of Bill C-33.
As everyone knows, there has been quite a bit of controversy around this bill in the days leading up to this particular juncture in the passage of Bill C-33. And it will pass. I would like to thank my colleagues from the Liberal Party and the Bloc for taking this legislation under consideration and moving it ahead. It shows real leadership by a government that in the face of a lot of adverse media and so on moved ahead with the right thing at the right time. I give those members a lot of credit for that. Of course the fourth party is leading a different parade, and I welcome it to that, because that is what it does best.
This is a tremendous opportunity. It has been a long road to get here. No one thought when we brought it in that this type of bill would face this kind of adversity, because all of us aggressively campaigned on this issue throughout past elections. Elections come around more quickly in minority situations, but in 2004 and 2006 every party campaigned aggressively on a biofuel strategy. Since we are in government now, Canadians obviously judged our strategy to be the most practical.
The other parties, including the NDP, said they wanted 10% ethanol. We are at 5% ethanol and 2% biodiesel, and I think that in this time and place that is the right quantity. We are moving ahead fairly aggressively on this. Ethanol and biodiesel plants have come into being across the country. This is a great opportunity for farmers to move ahead and to have a different warehouse door to deliver to. More than that, this is great for rural communities that are looking for some sort of renewal after many years of seeing urbanization across this country, whatever was driving it. However, I will not get into that today.
Addressing the environment is at the forefront of everybody's mind. As I said, all parties called for a renewable fuel mandate and based it on two things: ethanol is a clean-burning fuel and fossil fuels are not going to last forever. It is time to get serious, especially here in Canada, where we have the capacity to make these changes. It is time to get serious about moving to greener technology. It is all part of what is best for the environment as well.
This legislation is probably one of the best policies to come forward in the last decade. It is actually a bedrock principle: it is good for the Canadian economy, good for Canadian farmers, and of course it is great news for the environment.
There are a lot of studies at cross purposes out there. Most of them are based on a global model, which we are not talking about here today. We are talking about Canadian production and Canadian policy and that is what this government has to answer to. We cannot begin to analyze and ascertain the directions other countries are taking, but we have to speak to the Canadian electorate, the Canadian people, about why we are doing what we are doing.
There is good news out there. Due to the innovation and industriousness of Canadian agriculture and Canadian forestry, we have the capacity to do this and in no way affect our food lines.
A lot of people say that we cannot do both. They say we cannot grow food for energy and for consumption. Nothing could be further from the truth.
Anyone who has analyzed food production in this country knows that we are growing more, that it is better quality, and that it is safer. It is time that we started using that great renewable resource to create energy that is great for the environment and also starts to backstop a lot of what farmers were not able to get out of the food line fully to address their bank lines. This legislation is going to do that. We have already seen some effect of that positive side. Again, as I said, it is due to the innovation and so on that is out there.
Things are changing as we speak. Going to our 5% mandate, which is three billion litres of ethanol over the next few years, is the equivalent of taking a million cars off the road, which is a fantastic story in and of itself, but it also takes less than 5% of our capacity to grow these products.
Anyone who is familiar with farm production will tell us that in any given year the weather is a far bigger factor than 5%. There have been instances of floods or droughts, or it just plain does not rain at the right time, and that can cut a crop in half. That is 50%. That is another zero in there.
We are talking about 5% of our land mass being used for this production. With the industry and the innovation that we have out there, we can probably go further than the three billion litres on that type of land mass. We have new types and new varieties coming in with higher starch values in corn and wheat.
We are also spending a lot of money on moving ahead to the next generation of biofuels. For that next generation, the common phrase is cellulosic. What this entails is that we slip into the forestry side. We start to make use of logs and lumber not suitable for building. We start putting them into the ethanol system using a catalyst and using the innovation that is out there now.
A company called Iogen is actually using this. The member for Ottawa South is making muscles here, not very big ones, but he says that Iogen is in his riding and he is quite proud of it. I would imagine that he has had some great discussions with Jeff Passmore, the president of Iogen. Jeff is actually getting the final go-ahead to build a huge facility that will produce in the neighbourhood of 400 to 500 million litres of ethanol in my home province of Saskatchewan. The member for Ottawa South and I will have something in common, finally, and it will be Iogen.
We are looking forward to that. Iogen is going to use straw, wood chips from the Prince Albert pulp mill and different things like that to create that quantity of ethanol. That is a good news story. In the days to come, we will develop that technology, get it to a commercial status and move forward.
I had a discussion with Jeff Passmore a couple of weeks ago now. I ran into him at a function and we talked about it. He is very excited about the move to Saskatchewan. He is very excited about the potential and the capacity of Saskatchewan farmers to deliver the feedstocks to his plant.
So am I, because the majority of Canadians, some 74% or 75% in the latest poll, are very much behind this government in moving ahead on ethanol and biodiesel. Those are big numbers. What they are asking for, and there is no pun intended, is a homegrown solution to our energy situation, to our preponderance of fossil fuels, and they are asking for our exciting new developments to get hold of the environment and start turning things around. That is what they are driving for.
As I said, our mandate is 5% ethanol and 2% biodiesel, which is coming in the next years. The auto sector has taken up the challenge. That sector is now building vehicles that will burn up to 85% ethanol. That little conversion on the assembly lines means a one hundred dollar bill: that can almost be made back in the first month of driving that an average Canadian does. It will actually pay for that $100 plus take charge of the environment.
For the life of me I cannot understand why certain parties and certain groups would not recognize the overall benefit this is going to create for Canadians and of course around the globe. They seem to be stuck in their ideology and cannot get past it. What is required in times like these, when there is adversity and almost media hysteria, as we see in the headlines, is leadership. Leadership is what is required, from people who will forge ahead, who will continue to do the right thing at the right time for the right reasons and who will not bend to that kind of pressure coming from the ignorant masses and the people out there who do not understand the benefit of what this can do. I see a lot of head-shaking and nodding over there from the Liberal side, and they totally agree with me on that statement.
As a government we are concerned about poverty. We are concerned about hunger in the world. We had some great announcements the other day from my colleague, the minister in charge of CIDA. She made a great announcement that Canada continues to be number two in the world on getting those foodstuffs out globally to the poor and the hungry. We have tremendous domestic programs here that address this type of thing.
People from the United Nations are spearheading a lot of this. A lot of what they say I do not agree with, because it is not based on anything that I would call sound thinking, but they also say that there is enough food produced in the world to feed everybody. The problem is that we cannot get it to where we need it in a timely way, because it is all “best before” products. There is not the processing on the ground in some of these communities to make use of and keep fresh the wheat or meat that is delivered.
We have to be more thoughtful in our approach. I think the minister really batted it out of the park by untying our food aid. It has been talked about for a number of years. She finally got the job done. I am proud to stand with her in moving ahead on that issue.
That comes to grips with the timeliness of delivery. It comes to grips with the transportation costs to get that product there. In most instances, there is no port or infrastructure system capable of handling those boatloads of food aid when they arrive. A lot of it spoils on the dock, some of it because of infrastructure and some of it because of a governance system in the affected country that would trade that food for guns rather than distribute it to the people. People who are poor and hungry are much easier to lead when they are kept out there in the boondocks away from the real action where the changes can be made.
There is a lot work to be done to feed the poor, the hungry, and those in poverty situations in the world, but a lot of it comes as a result of good governance and infrastructure, as well as the delivery of that. I think that Canada has proven that we always punch above our weight on those issues.
When we did make the announcement of another $50 million into that food aid program, a lot of people stood up, screamed and hollered that it was not enough. The UN was calling for a 26% increase from all of the contributing nations and we actually came in at 28%, plus we are giving money to the non-governmental organizations like the Foodgrains Bank. It does a tremendous amount of work around the world with donations from farmers. We pay the transportation as the government. There is some processing involved and they get it to where it should go.
We have the Mennonite system working around the world with their different relief programs, whether it is flood, famine, plague or pestilence, whatever happens. The Mennonites are there helping out.
Our tax system also builds in aid that is not considered under the UN envelope in the same way. We want a homegrown solution and we are a resource rich country. Nobody can deny that, whether we are talking about fresh water stocks, oil and gas or the tar sands in Alberta that are taking a bad rap right now, some of it justified, a lot of it not, but at the same time we have to start moving away from our dependence on fossil fuels. Even the big petroleum companies say that.
One of the largest ethanol producers in western Canada at this point is a company called Husky Oil. It is basically owned by a gentleman from Hong Kong, but he has a facility tied to the upgrader in my riding at Lloydminster that is producing several hundred million litres of ethanol. Husky Oil is having trouble getting product because farmers are growing what they can but the weather last year around the Lloydminster area did not let us get those crops off like we should have. That was more of a problem than it should have been. With technology and innovation we are starting to move to crops that are a little more easy to farm and will give farmers better results.
I know the Minister of Natural Resources was out to make an announcement in Minnedosa the other day, talking about our regulations and how that would help to start the blending of that product. Husky has bought a company called Mohawk. I remember as a young guy when gas was two bits, 30¢ and 40¢ a gallon, not a litre. That was before the former prime minister decided to make things metric. At those kind of prices per gallon it sounds really cheap but at the time I was making 90¢ an hour, so it is all relative.
They used to put an ethanol blend into their products some 25 or 30 years ago and I am giving away my age when I say that but that is the reality. This type of product has been around for a long time. It is finally coming to the fore, that with these regulations passed in Bill C-33 we will see, mixed right at the refinery and brought to the pump, that minimum 5% blend.
I have seen pumps, Mr. Speaker, in your home town when I was coming back the other day. I stopped in Kingston to have a great meal downtown on the waterfront. I asked how well you were doing. They all said they loved the guy but he should come home more. We also stopped for fuel. I note that the Liberals over there are saying, “Mr. Speaker, you should not go home because you might not get elected”, but I am not sure about that one.
We fuelled up. I cannot remember the name of the station but it was a 10% blend. That is good news. Kingston is on the leading edge of ethanol and I praise you for that, Mr. Speaker. I know you have made that issue one of your own.
When we see the price of oil over that same timeframe jump from $20 a barrel to approaching $120 a barrel, it makes this type of economic activity more viable. We have a lot of work being done on new ways to produce ethanol. We have lots of work being done on biodiesel which is another huge success story. We as a government have taken on pilot projects to use rendered products from animals, the byproducts from restaurants, the leftover oils and greases and so on that of course we do not want in our food anymore. We are running them back through biodiesel. It is a tremendous opportunity to build environmental products around that.
There are a number of situations that have arisen that have driven up the cost in the food chain and a lot of those can be based strictly on transportation because our product does not move from the farm right to the processor. It goes through middlemen. There are a lot of different things that go on and when we seen increases in transportation costs that are doubling, tripling and so forth, because of fossil fuel and our addiction to it, the problems begin to arise where everyone takes a chunk of the pie. I will use round numbers.
When we see a $3.00 loaf of bread, and I hear the bread processors saying they have to raise the price again because the cost of wheat is going up, it is ridiculous to the extreme because the farmer on that $3.00 loaf of bread is getting 15¢. That is the cheapest part of that loaf of bread. The damn wrapper with the labelling on it is worth more; or the darn wrapper, sorry.
That is the reality. That is the situation that farmers have always faced. So, if the price of bread went to 20%, that is a 33% increase, if my math is still good. That is a huge increase for farmers. Is that nickel going to affect that $3.00 loaf of bread? It should not. I would think it should not, but the costs of transportation of course are exaggerating the reality of what is going on out there. This is another good reason to move ahead with biofuels where we can start to have a renewable resource that is friendly to the environment and of course much easier to maintain the costs.
We should be looking at ways to make our agricultural processes even more innovative. We are doing that with a little thing called the removal of KVD in western Canada. Saskatchewan alone has 47 million acres of arable land. That is a big number. We run big operations and run big equipment to do it, and of course the overhead costs are all commensurate with the price, so we have seen the price of wheat going up.
We have also seen huge increases in fossil-based fertilizer fuel chemicals. All those types of things are also ramping up as well, so we are pushing a bubble where farmers are starting to make a little more money, but it is also costing a lot more money to make that, so we have to start addressing that and I think biofuels are a great way to do that.
There are opportunities out there now where people can buy a unit that they can actually put on their farms and make their own biodiesel. I talked to a neighbour of mine the other day and he was getting ready to start seeding, and then of course global warming kicked in and we got another 15 inches of snow. That slowed him down a little, but he had gone to town to fuel up his tractor because the roads were too muddy to have the truck come out, so he drove his tractor and it cost him $1,000 to fill it up. The way we farm out there, that lasted about 12 hours, less than a day's shift.
When we look at the young fellow who seeds my ground now, who farms 24,000 acres, he will run 14 or 15 hard days like that with four and five outfits, so he has $5,000 in fuel per day, plus the seed, plus the chemical, plus the fertilizer, plus the manpower, plus the overhead of the equipment and taxes on the land, and all that kind of stuff. Those are the economies of scale we are looking at.
Farmers start to look at the skid units that will actually produce biofuel out of their own canola. There are models like that out there now and it is a great opportunity for these guys to take some canola from their own production, run it through and create their own biofuel, but it does make more sense to do it on economies of scale at larger facilities.
I have always been a proponent of a number of smaller capacity units scattered throughout a province as opposed to one or two big ones. The problem with one or two big ones is the product has to move. The trucking beats up the road and it starts to defeat the whole process, so smaller and locally owned is the right way to go.
I am very fortunate to have in my riding, almost in the centre of my riding, a little town called Unity. There is a North West Terminal there that is owned by farmers. It is a huge success story. It is relatively new on the scene, but in the time that it has been around, some 10 or 15 years since the drawing board, it has doubled in capacity in the grain it has handled. It is now building a 25 million litre ethanol facility next door to the terminal, so as the grain is delivered in, it can slide some of it off to make ethanol right there.
As well there is another innovation. A fellow named Mervin Slater has been the push behind this, and I give a lot of credit to Jason Skinner and the crew out there at North West Terminal for their foresight and their vision, and the guys that were on that committee. Merv dropped in to see me when he was in Ottawa. He was on his way to Germany to look at technology that brings about 10% or 15% chaff in with the wheat.
Chaff cannot be hauled. It is like hauling potato chips or ping-pong balls. There is no weight and one cannot get enough on a truck, but when 10% or 15% chaff is brought in with the grain product, it virtually costs nothing. They are using that as the feed stock to fire the turbines to create the ethanol, then they recapture the heat and use it. It is a tremendously integrated system and I give them a lot of credit for that.
They have not put out a litre of ethanol. They are already looking at the potential and saying it is time to think about expanding the plant already, and that is great news for the farmers of Unity, great news for Canadians, and great news for the environment.
However, we have so many other potentials out there to make great quality ethanol. We have just a tremendous opportunity to show the world this can be done and not affect the food line. There are just any number of ways to point to this and say this is the right thing as we advance forward.
As I said in my speech, it is basic economics. There are so many things that we will gain from these different lines that will be created. There are offshoots from ethanol: the distiller's grain that goes back into livestock feed, the slurry, and the water. Everything that is used is captured and used as protein base for livestock feed.
It is not a zero sum gain. There are benefits from all the differing aspects of ethanol and biodiesel as it goes back into livestock feed. There is a loss of 20% or so but we will make that up. It will be good for the communities, good for the farmers, and good for the environment.