Agriculture committee  Thank you, Mr. Chair and members of the committee. It's an honour to present to you today. My name is Fred Ghatala. I'm the director of carbon and sustainability with Advanced Biofuels Canada. We are the national voice for producers, distributors and technology developers of advanced biofuels.

Agriculture committee  Thank you for the question. Yes, as I mentioned in the remarks, the farming community is fundamental to the tremendous growth opportunity that is before us for advanced biofuels. We estimate there's a two- to three-time increase coming, which is a Canadian opportunity to fill the demand created by the clean fuel standard, so 2.5 billion litres up to 6.5 billion litres.

Agriculture committee  That's right. The Greenhouse Gas Pollution Pricing Act includes in it an exemption approach whereby renewable fuels are blended to a certain limit. In a sense, the Greenhouse Gas Pollution Pricing Act does well to exempt renewable fuels. Growers and farmers producing feedstock for renewable fuel production to meet the clean fuel standard have the added impact and market pull from that carbon-price exemption plus demand from the clean fuel standard, so it's really important that these policies can work together.

Agriculture committee  Thanks. We support anything that allows growers to participate in producing advanced biofuels, and Canada's agriculture has extremely low carbon intensity due to the practices they do, so allowing them to participate is fundamental. Anything that helps them invest in on-farm advanced practices is very supportable—

Agriculture committee  Yes, I understand that renewable natural gas and even clean hydrogen can be used and mixed in the pipelines with natural gas, so it's certainly foreseeable that could be part of the energy mix for grain drying.

Agriculture committee  Yes, clearly I would expect that this could be a good creation of on-farm offsets in a federal offset system, something that would encourage low-carbon natural gas, RNG, renewable natural gas, to be used.

Agriculture committee  Yes, I think efforts are quite under way to incorporate renewable natural gas. The representatives from the Canadian Canola Growers, Mr. Ammeter and Mr. Carey, referenced farmers wanting to pursue innovation to drive down emissions on the farm. The nice thing about using RNG and other renewable natural gas sources is that they can integrate with the current systems that are in place.

Agriculture committee  I think up to 15% renewable natural gas would be achievable pre-2030. Some of these things will definitely be incentives-based in order to maintain the competitiveness of Canadian farmers to provide that feedstock. I think an incentive approach rather than a requirement that increases the on-farm fuel cost is part of the way to aid that transition.

Agriculture committee  I'm supportive, yes.

Agriculture committee  Primarily, biofuel feedstocks are produced on the farm. In the case of canola oilseeds, they are crushed, refined and then are able to turned into biodiesel and eventually renewable diesel that can then be used in farm equipment. There's clearly a loop to enable on-farm biomass products to be used on the farm in the form of diesel.

Agriculture committee  I'm not able to specifically comment on the feasibility of it. I would expect that it is possible. I would also suppose that if grain needs to be dried very fast—if it's a wet harvest year and that impacts the bottom line of the farm—then you're absolutely going to want to use the high BTUs that natural gas and eventually RNG will provide.

Agriculture committee  It's certainly an integrated market. Biofuels trade north and south across the border. Certainly, a lot of the renewable fuels produced in Canada go to the United States, where their carbon intensity is valued. That's why policies like the clean fuel standard and other efforts try to keep some of that advanced renewable fuel production here in Canada—

Agriculture committee  Thank you. By incorporating biogas, the clean fuel standard I mentioned would reflect the reduced carbon intensity of Canadian-produced feedstocks that are turned into advanced biofuels. There's a clear signal to continue to drive improved agricultural practices on the farm, which could include RNG.

Agriculture committee  Yes, absolutely. This is crops. This is forestry residues. This is coprocessing those products in refineries. This is in all of the above strategies. The clean fuel standard, if designed correctly, reflects the ability of all those teams to participate. Modelling by ECCC shows that low-carbon fuels provide 45% of the compliance credits.