Mr. Speaker, with respect to (a), the proposed clean fuel regulations, referred hereafter as the proposed regulations, will result in an increased demand for lower carbon intensity, CI, fuels in Canada, which could be met by increased imports and/or increased domestic production. The government has established a $1.5 billion clean fuels fund to support the domestic production of lower CI fuels to help regulated parties come into compliance under the proposed regulations at lower cost and to incent domestic investment. The regulatory impact analysis statement that will accompany the final regulations will include quantitative estimates of the volumes of renewable fuels that will be used to comply with the regulations. These estimates will be based on the final design of the regulations, which are expected to be published in spring 2022.
With respect to ethanol in gasoline, current levels of domestically produced ethanol are insufficient to meet E15, where gasoline is blended with 15% ethanol at a national level, in Canada in 2030. It is expected that domestic production will increase. It is also possible that Canada could import the additional volumes of ethanol needed.
With respect to biodiesel and hydrogenation derived renewable diesel, HDRD, in diesel, it is possible that domestic production of biodiesel could meet the additional volumes of lower CI diesel needed. Canada currently produces enough biodiesel domestically to meet domestic demand; however, Canadian producers export a significant portion of domestically produced biodiesel to the United States.
With respect to (b), the regulatory impact analysis statement that accompanied the proposed regulations used interim national average life-cycle assessment carbon intensity values in the calculation of credits. These life-cycle assessment carbon intensity values were determined based on Canadian data and other life-cycle assessment tools, and were compared to fuel pathways submitted to the regulators in British Columbia and California. The regulatory impact analysis statement that will accompany the final regulations will include quantitative estimates based on the final design of the regulations. The final regulations are expected to be published in spring 2022.
With respect to (c), the proposed regulations would require liquid fossil fuel primary suppliers, i.e., producers and importers, to reduce the carbon intensity of the liquid fossil fuels they produce and import for use in Canada from 2016 CI levels by 2.4 grams of carbon dioxide equivalent per megajoule of energy, gCO2e/MJ, in 2022, increasing to 12 gCO2e/MJ in 2030.
With respect to (d), the clean fuel standard is expected to have a significant impact on greenhouse gas emissions by 2030. The regulatory impact analysis statement that will accompany the final regulations will include quantitative estimates of GHG emission impacts based on the final design of the regulations. The final regulations are expected to be published in spring 2022.