Proceedings of the Special Senate Committee on the Arctic
Issue No. 17 - Evidence - October 29, 2018
OTTAWA, Monday, October 29, 2018
The Special Senate Committee on the Arctic met this day at 6:31 p.m. to consider the significant and rapid changes to the Arctic and impacts on original inhabitants.
Senator Dennis Glen Patterson (Chair) in the chair.
[English]
The Chair: Good evening and welcome everyone to this meeting of the Special Committee on the Arctic. I am Dennis Patterson. I’m a senator representing Nunavut. I am privileged to chair this committee. Before we go to our witnesses — welcome, all of you. I would like to go around the table and ask senators to please introduce themselves.
Senator Bovey: I’m Patricia Bovey, deputy chair of this committee.
Senator Oh: Victor Oh, Ontario.
Senator Eaton: Nicole Eaton, Ontario.
Senator Dasko: Donna Dasko, Ontario.
Senator Coyle: Mary Coyle, Nova Scotia.
Senator Gold: Marc Gold, Quebec.
The Chair: Thank you, colleagues.
Tonight, as part of our study on the significant and rapid changes to the Arctic, and impacts on original inhabitants, we are continuing our study of two specific topics: economic development and infrastructure. We’ll hear from six federal departments. On our first panel, we welcome from Transport Canada, Craig Hutton, Director General, Strategic Policy; and Martin McKay, Acting Director General, Transportation Infrastructure Program. From Environment and Climate Change Canada, John Moffet, Assistant Deputy Minister, Environmental Stewardship Branch, whom we have seen here before at Senate committees; and Nancy Hamzawi, Assistant Deputy Minister, Science and Technology Branch. And finally, from Fisheries and Oceans Canada, Neil O’Rourke, Assistant Commissioner, Arctic Region, Canadian Coast Guard; and Gregory Lick, Director General, Canadian Coast Guard.
Thank you for joining us. I invite you each to proceed with your opening statements. I understand you have figured out the order. However, I do understand that some of your colleagues are in the gallery and may be asked to come to the table to answer questions. That would be fine of course. I will ask them to please state their name and title for the record. Thank you.
Please go ahead, beginning with Mr. Hutton.
Craig Hutton, Director General, Strategic Policy, Transport Canada: Thank you, Mr. Chair, for this opportunity to address the Special Senate Committee on the Arctic. It’s no surprise that transportation is a lifeline for Northern communities and an essential enabler for resource development projects. At the same time, transportation infrastructure is expensive to build and maintain in the challenging Arctic environment. As a result, basic transportation infrastructure is limited in the North, making it difficult, time-consuming and expensive to move passengers and goods in and out of Northern communities.
The North is unique compared to the rest of Canada. However, each territory is also significantly different from the others. For instance, the Yukon relies most on their highways and roads network; the Northwest Territories depends on a variety of modes including air, ice roads and barging operations; whereas Nunavut is mainly reliant on sea-lift operations and air transport.
[Translation]
In 2016, Transport Canada released Transportation 2030, a strategic plan for the future of transportation in Canada to improve the performance of the transportation system, including in the North.
To that end, in July 2017, the government launched the National Trade Corridors Fund, a $2-billion, merit-based program to support projects that enhance the efficiency and resilience of trade and transportation corridors, including in the North. Under the initiative, a maximum of $400 million is allocated to Canada’s territories. The fund takes into account the unique transportation infrastructure needs in Canada’s North, as well as the fact that crucial investments in transportation have the potential to create new social and economic opportunities for residents.
[English]
In June, an investment of $102.5 million in the Northwest Territories’ Mackenzie Valley Highway project was announced by the federal government, one of the largest investments ever made through the fund. Further investments under this fund reflect the critical role air transportation plays in the North and the capacity for technology to reduce infrastructure operating costs.
We plan to launch this fall a second call for proposals that will be dedicated to addressing the unique transportation priorities in the territories.
Funding contributions under this fund vary to reflect the capacity of recipients. Projects located in the territorial north may receive up to 75 per cent for design and construction costs. This compares to a contribution of 50 per cent for projects in the provinces, or 33 per cent for public-private enterprises. The higher contribution percentage for the territories reflects that capital budgets in the North are often limited.
In addition to trade and transportation investments, Transport Canada’s Northern Transportation Adaptation Initiative continues to support territorial efforts to increase the resilience of the system to climate change. Budget 2017 renewed this initiative through an allocation of $6.9 million over three years to fund R&D on designing, constructing and maintaining infrastructure that face challenges such as permafrost thaw and increasingly variable sea and sea-ice conditions.
[Translation]
Transport Canada is also developing a strategic framework for multimodal transportation in the Arctic to better position the department to meet the needs of Northerners. The framework will contribute to better alignment of Arctic policies, investments and regulations across departments. It will fit into the federal government’s new Arctic Policy Framework, led by Crown-Indigenous Relations and Northern Affairs Canada. Transport Canada has been closely involved in developing the policy framework, which will prioritize transportation infrastructure.
[English]
Other initiatives that have a positive impact on the North include the Oceans Protection Plan and the Airports Capital Assistance Program.
Announced in 2016, the Oceans Protection Plan is the largest investment made to protect Canada’s marine environment. Carried out in partnership with First Nations, Inuit and Metis, and in close collaboration with the scientific community, the marine industry, provincial and territorial governments, and other stakeholders, it includes over 50 different initiatives, with over 30 focused on the Arctic. Financial contributions for its initiatives may be as high as 100 per cent, accepting that the territorial governments contribute the ongoing operating and maintenance expenses.
Some investments to date include establishing an inshore rescue boat station in Rankin Inlet, delivering a marine training program in the North, and investing in safety equipment and basic marine infrastructure to improve Northern communities’ resupply operations.
The Airports Capital Assistance Program, ACAP, is a contribution program that assists regional/local airport owners with safety-related capital infrastructure maintenance to help ensure the continued safety of the Canadian travelling public.
Funding is provided to eligible airports on a cost-sharing basis based on passenger levels. The ACAP will pay at least 85 per cent of approved project costs for airports north of the sixtieth parallel.
Some investments to date have included resurfacing runways and rehabilitating airfield electrical systems. The program also assists with purchasing firefighting vehicles and heavy equipment. The most recent project in the North was a $5 million investment this year to rehabilitate the runway at the Clyde River, Nunavut airport.
Gregory Lick, Director General, Canadian Coast Guard, Fisheries and Oceans Canada: Good evening, chair, and committee members. It is my honour to be here today and have the opportunity to provide you with an appreciation of the Canadian Coast Guard’s important activities in the Arctic and particularly those that impact the peoples of the North.
Attending with me today is Neil O’Rourke. I am proud to say he has just been appointed as the first Assistant Commissioner for the new Coast Guard Arctic Region. He is currently in the process of relocating to Yellowknife and having fun doing that, I’m sure.
I am also joined by my colleague Farhat Khan, Director General, Financial and Materiel Management Operations and Deputy Chief Financial Officer. She currently represents the department on a central agency task force with a focus on Indigenous procurement. She is in the room and able to join the table if you have any questions for her.
[Translation]
I am proud to say that the Canadian Coast Guard is a nationally and internationally recognized symbol of safety and protection for all mariners in our waters.
[English]
Our work has a direct and visible impact on the economic, environmental and physical health of Northerners. The creation of the new Arctic regions for the Canadian Coast Guard and the Department of Fisheries and Oceans will allow for enhanced programs and service delivery in the North to better meet the needs of those communities. We are engaging and collaborating with Arctic leaders, Indigenous communities, stakeholders and Northerners to define the new region and its activities.
In the North and across the country, our work is focused on ensuring a safe and secure marine environment. Our expert crews aboard the ice-breaking fleet ensures safe navigation through ice that assures critical supplies and goods get to communities and those ships transiting the Arctic get through safely.
[Translation]
Thanks to our navigational aids, mariners are able to move safely through our waters.
[English]
Our professional Marine Communications and Traffic Services Officers in Iqaluit during the navigation season identify, monitor and control vessel traffic and ensure mariners of a communication link in times of emergency. Our ever-evolving system of environmental protection equipment, located in strategic locations across the North, defends the Arctic’s sensitive ecosystems.
[Translation]
We can’t do it alone, however. To deliver our marine safety, security and environmental protection systems, we rely on strong partnerships with Indigenous peoples and communities. We also rely on our federal partners for sound regulations to prevent harmful events.
[English]
A robust, layered approach to search and rescue particularly with our partners — the Canadian Armed Forces and the Coast Guard Auxiliary. A strong operational partnership with the Royal Canadian Navy as it brings new capabilities to the Arctic with the Arctic and offshore patrol ships.
Finally, a recognition Arctic countries must all come together when significant events strain a single country’s resources.
As the Coast Guard has learned through decades of collaboration with our Northern partners, the people who live in Canada’s Arctic have a deep understanding of the sea. Their survival, and surely Canada’s future success in the Arctic, depends on that understanding. We are fully committed to engaging with Inuit and other Indigenous organizations about programs that align with the priorities of Northern communities and respect the cultural and environmental significance of the North.
The demand for our presence continues to increase as the shipping season extends due to climate change. To that end, we are investing in the Arctic, including vessel identification and monitoring systems, on-water capabilities, new search and rescue assets and environmental protection equipment.
[Translation]
Under the Oceans Protection Plan, we are extending the icebreaking season in the Arctic. Most Canadians in the southern part of the country do not realize that commercial ships navigating our Northern waters do not have icebreaking capability and cannot deliver their cargo without the icebreaking services of the Canadian Coast Guard. In the absence of roads, our icebreakers serve as the snowplows of the North.
[English]
Some examples of our improvements to marine safety in the region include 16 community-based Canadian Coast Guard Auxiliary units that are active at this time with over 350 auxiliary members and 25 vessels. Those numbers will increase in 2019 and in the future. Twenty-two satellite modems have been purchased to replace antiquated and inefficient models to improve data and voice communication capacity within the Coast Guard’s Arctic footprint — very much needed in the Arctic. Network equipment at the Iqaluit Marine Communications and Traffic Services Centre will also be replaced in December to further modernize the network and ensure improved reliability and resiliency.
On June 28 we opened an in-season, inshore rescue boat station in Rankin Inlet, already mentioned, crewed by Inuit and youth. I had the privilege to meet some of those incredibly competent youth during their work to support the G7 summit in June of this year and noticed their valuable contribution.
Through a new community boat program run by the Coast Guard, to date four communities have received funding to purchase a boat for search and rescue capabilities in the Arctic. More will come.
[Translation]
There is increasing interest in the Arctic as it becomes more accessible to marine traffic and economic development as a result of climate change. This enhanced access, which is due to changing ice conditions, does not necessarily mean less risk given that firmer and more dangerous multi-year ice is moving towards southern Arctic waters. Thanks to new investments, we are able to meet the challenge through the various levels of service that define our marine safety, security and environmental protection programs.
[English]
Our commitment to supporting the Arctic is part of our heritage. We remain steadfast in that commitment for the future. Thank you, Mr. Chair, for this opportunity. My colleagues and I are happy to answer any questions that you and the committee may have.
The Chair: Thank you very much to all the panellists.
[Translation]
Nancy Hamzawi, Assistant Deputy Minister, Science and Technology Branch, Environment and Climate Change Canada: Good evening and thank you for the opportunity to appear before you today to contribute to the committee’s study on economic development and infrastructure in the Arctic.
[English]
As the Assistant Deputy Minister of the Science and Technology Branch at Environment and Climate Change Canada, my remarks tonight will provide a broad overview on climate change in the Arctic with a focus on climate change impacts on Arctic and Northern infrastructure.
Alongside my colleague from the Environmental Protection Branch, I am also accompanied by Mr. David Grimes, the Assistant Deputy Minister for the Meteorological Service of Canada; and my colleague Chris Derksen, a research scientist specializing in climate and cryosphere, both of whom are available to answer your questions.
[Translation]
Environment and Climate Change Canada has undertaken a wide range of research and monitoring activities in Canada’s North to collect important data that will help us understand the unique and changing ecosystems of the North. In doing so, we have a mandate to conduct scientific research in order to better understand how and why Canada’s climate is changing and what changes are coming. Surface observations, satellite data and climate models are an essential part of the research. The October 2018 Special Report on Global Warming of 1.5°C, released by the Intergovernmental Panel on Climate Change, estimates that human activities have caused approximately 1 degree Celsius of global warming to date. The report also indicates that vulnerable regions such as the Arctic are experiencing global warming at a rate two to three times higher than the global average.
[English]
This is indeed the case for Canada. Our observational record extends to the mid-1950s. Over this period of record, Canada, as a whole, has warmed by 1.7 degrees Celsius, while Northern Canada has warmed by 2.3 degrees Celsius.
Climate models project further warming across all of Canada, at a rate about twice the global average, with larger changes projected for Northern Canada. The causes of stronger warming in Canada relative to the global average are well understood and are partly related to the loss of snow and ice under climate warming.
Annual average precipitation has increased in Canada, with larger percentage increases in Northern Canada. This pattern is expected to continue in the future, with a decrease in snowfall offset by increases in rainfall.
Over the past 40 years, changes over the North include loss of snow cover and sea ice, and changes to permafrost. These changes are consistent with those observed in other regions such as Alaska, Northern Europe and Russia. There is evidence from climate model simulations these observed changes in Northern Canada will continue in the coming decades.
Climate change can impact wildlife through several mechanisms, including rain shifts, changes in timing of their life cycles, and extreme weather events. Environment and Climate Change Canada conducts long-term research that assesses the impacts of climate change on Arctic wildlife, including polar bears, marine birds and caribou. This includes developing predictive models to project future impacts based on agreed-upon atmospheric scenarios.
For example, ice-dependent species such as polar bears are forced to spend more time on land when the availability of sea ice is reduced. This reduces their condition and ability to reproduce and increases the number of human-bear interactions.
Changes in ocean productivity can negatively impact the breeding and survival of marine birds by changing the distribution of food. The increased frequency of freezing rain or rain on snow in the Arctic makes lichen and low plants inaccessible to caribou, leading to starvation.
Infrastructure in the Arctic faces unique challenges and is subject to significantly higher operational costs and risks. Remote geographic location, long periods of darkness and severe weather require that facilities and communities be fully self-contained for power, potable water and sanitation. Air is the principal means to bring in supplies and people, underscoring the importance of year-round safety of runways.
Specialized equipment is required in remote locations with design features for operating in unique Northern conditions such as extreme cold. Solutions viable in the South, such as shifts to solar power, are not always easily transferrable to the North.
Climate change in the Arctic is also causing additional challenges and some opportunities related to infrastructure. Virtually all of the Canadian North is underlaid by permafrost. The integrity of many Northern ecosystems and built infrastructures are dependent on the stability of the permafrost. Permafrost is undergoing rapid change, which could threaten structural stability and functional capability of existing infrastructure. Changing coastlines and loss of sea ice further increase the risks of flooding from rising sea levels and storm surges in some areas, such as on the Beaufort Sea coastline.
Climate change-driven reductions in Arctic sea ice is a main driver of increased Arctic shipping activity over the past decade. Increased Arctic marine transport is anticipated in coming decades. A reduction in the operational time window of ice roads in the Canadian sub-Arctic is projected due to winter and spring warming.
Environment and Climate Change Canada recognizes the importance of understanding the Arctic’s changing climate and the impacts of warming of climate on biodiversity, snow and sea ice, and freshwater resources. There are science programs in place in all these areas positioned to inform effective adaptation and mitigation, including the development of climate-resilient infrastructure.
I will now turn to my colleague so he can provide the committee with an update on the pollution pricing approach in the North.
John Moffet, Assistant Deputy Minister, Environmental Stewardship Branch, Environment and Climate Change Canada: In the Pan-Canadian Framework on Clean Growth and Climate Change, as you know, the federal government committed to work with the territories to find solutions that address their unique circumstances.
Over the last two years, Environment and Climate Change Canada has worked closely with the governments of the three territories. Together with Finance Canada, and in collaboration with each of the territorial governments, we analyzed the potential impacts of carbon pricing on the economies and households in each of the territories. We provided the final analysis to each of the territories in January of 2018. Each territorial government has published the analysis relative to their jurisdiction.
Since then, we have worked with the territorial governments on the design of carbon pollution pricing in the North. The final result was announced last week, on October 23.
Briefly, the Northwest Territories has agreed to implement its own carbon tax, which will start in July 2019. The federal carbon pollution pricing system will apply in Nunavut and Yukon, and will also start in July. This is a different start date than in the rest of Canada.
In all three jurisdictions, the carbon pollution pricing system will not apply to aviation in the territories, nor will it apply to diesel that is used to generate electricity in remote communities. These are two of the key features of the carbon pricing approach to recognize the unique circumstances in the territories.
I’ll stop there and welcome any questions you might have.
The Chair: Thank you very much to the panellists.
Colleagues, we have just over half an hour. I’ll ask you to please be brief with your preambles and questions. We’ll begin with the deputy chair, Senator Bovey.
Senator Bovey: Thank you all. They were all very interesting presentations. Of course, many of us were in the Arctic about six weeks ago and saw some of what you were talking about.
I have two tight, quick questions. You talked about airports. We tried to land in Nain. The two flights before us had to abort their landing. They overshot the runway. We couldn’t land. I wonder how the airport needs are prioritized. Obviously, that community, as many have said, needs a longer runway.
My second question is for the Coast Guard. I think many of us were absolutely stunned when we found that only 1 per cent of Canada’s Arctic coast has been charted. We were up there just after the cruise ship went on the rocks. That took two of the icebreakers away from other work, which delayed the delivery of goods to a number of communities.
My question is this: Did Cambridge Bay ever get their delivery of supplies for this year? We were told it should have been before we got to Cambridge Bay. It wasn’t there when we got to Cambridge Bay. When I asked a few weeks ago, it had not yet arrived there. I wonder if they got their annual supplies.
Mr. Lick: I’ll start off with the charting element and then I’ll pass it to Neil to talk about the Cambridge resupply.
The charting side of things comes under the domain of the Canadian Hydrographic Service as part of our department. We work closely with the Canadian Hydrographic Service to chart the Arctic. We fully recognize major portions of the Arctic are not charted. We cannot chart the entire Arctic in one year.
One of the main initiatives we’re working on is to look at the corridors that shipping typically uses — and that we want to use, because they are the safest routes to get through the Arctic — either vessels transiting the Arctic or vessels going in to resupply different communities in the Arctic. Much of the prioritization that CHS does is concentrating on those particular routes to make sure we have safe navigation passages.
The other initiative the Coast Guard is working on with CHS is the installation of modern charting equipment aboard our icebreakers. We are beginning the installation — and we have already done some — of modern, multi-beam equipment that will help us to bring a lot of the charting of the Arctic up to modern standards. That’s a particular aspect of what we’re working on right now.
Over to Neil.
The Chair: Can I stop you right there, if I may? I have a supplementary. It terms of this corridor concept, it has been recommended that regulations should be devised to require ships to follow these corridors you’re charting. Do you have any comments on that concept? Maybe it’s the jurisdiction of Transport Canada; I’m not sure.
Mr. Lick: I’ll pass it to Neil for a quick intro, and then Transport probably has a few things to say about that.
Neil O’Rourke, Assistant Commissioner, Arctic Region, Canadian Coast Guard, Fisheries and Oceans Canada: I’ll start on the corridors piece. The marine shipping corridor is a joint initiative between Transport Canada and the Canadian Coast Guard.
We are starting some of the engagement with Indigenous land claim organizations in the coming weeks. We’re going to be looking at a couple of things. One, what does a co-governance model look like potentially among Transport Canada, the Canadian Coast Guard and Northerners? Second, looking at services. That may include regulations and other recommendations from communities on how best to implement corridors.
There will be more to come on that subject, senator. Craig may have something to add as well.
Mr. Hutton: With respect to the resupply, as you’re well aware, there were three communities that didn’t get their community resupply. The Canadian Coast Guard obviously provides icebreaking services to support industry as they try and resupply communities. Ultimately this year, it’s a service run by the Northwest Territories. The Northwest Territories are working with those three communities to ensure as many of the goods that were meant to come in by barge can be airlifted in.
As you might imagine, this means many flights. It wouldn’t be appropriate for me to comment on where they’re at. We’re definitely continuing to support and plan for future years, as we always do. At this point in time, the actual resupply of the communities is in the hands of the Northwest Territories and their barge service.
Senator Bovey: For clarification, then, you’re saying three communities did not get their delivery of supplies by sea in 2018?
Mr. O’Rourke: Correct. Those are Paulatuk, Cambridge Bay and Kugluktuk. All three were scheduled to have this barge service out of the Mackenzie River. All three unfortunately, because of the multi-year ice conditions in the Northwest Passage, we were unable to provide icebreaking support for them to complete that.
Senator Bovey: This is really clarification. How much of that was held up because the cruise ship went on the rocks and a pleasure sailboat went on the rocks, taking the icebreakers from their other routine work? I gather it took several days for the two icebreakers to get to the cruise ship.
Mr. O’Rourke: It did. Obviously over the course of the season, we always expect there are going to be some search and rescue incidents that our icebreakers are going to need to respond to. From our perspective, that didn’t have an impact on the communities being resupplied or not. What had an impact was the changing ice conditions. We heard in the opening remarks from our Environment and Climate Change colleagues that climate change is definitely changing ice conditions in the Arctic. We’re seeing more complex navigation and ice in places that we haven’t seen before. What happened this year is that multi-year ice from the ice pack broke up and came down to the Northwest Passage at a time of year when we and previously the barge company would have expected to be able to get through.
Senator Bovey: Not being able to land in Nain and other communities not getting their supplies, what do we need to do to deal with these issues in the North? They’re big.
Mr. Lick: That wouldn’t be a tight question, I would say. That is your main question, basically, for this committee, I would suggest.
There are elements that each of us has. We each have a part in that. Certainly I’d like Craig to talk a bit about the regulatory side, particularly around the Northwest Passage, and how we are trying to improve shipping through there and make it safe for traffic to get through. There is an environment piece to this, as to how we best forecast and make sure that shipping is getting through as well as the environment piece on the airport side.
I’ll say a bit on the Coast Guard side. In order for us to best respond to — we’ll just talk about the icebreaking side of things — we need the support of Environment Canada, which we are getting on more than a daily basis ice information, which we pass on to our stakeholders in the North, such as shipping companies, communities and so on. The accuracy of that forecast is vitally important for us to provide our service.
The other aspect is making sure we have proper navigational aids up there. We are working on that aspect of it, making sure if an accident does occur, that we have the communications side of things well set up so people in distress can communicate their needs and we can get assets there as quickly as possible.
The other aspect is the icebreaker fleet itself is aging. We are working on investing in our fleet to make sure we have that capability going into the future. Three vessels are now being worked on in Davie to be able to do that for us. That is vitally important so we have the assets up there that are able to support resupply, support getting navigational aids in, be able to support charting and all of that.
Then Transport has a regulatory side to it, which is vitally important to make sure we prevent all these accidents, I would suggest. Maybe I’ll hand it to Craig.
Mr. Hutton: Thank you. On the regulatory side, Transport Canada helps ensure the safety of vessels operating in the Canadian Arctic through a legislative regime oversight that introduces unique requirements for ships involved in Arctic operations. Through our experience as an Arctic regulator, we played a key role in the development at the International Maritime Organization of the mandatory Polar Code, which came into effect on January 1, 2017. Through that regime, it recognized the uniqueness of the Arctic area, the demands on shipping and what the regulatory regime had to therefore reflect.
In terms of our role at Transport Canada, it is through the adoption of that Polar Code we’ve increased safety environmental standards for vessels operating in Arctic waters.
It also extends, in terms of our role as a regulator, to that oversight piece, which is around the aerial surveillance and which is considered the most effective method for detecting issues such as oil spills. Under the Oceans Protection Plan, Transport Canada will improve Northern operations of Canada’s National Aerial Surveillance Program, which will improve local marine pollution reporting, search and rescue capability and satellite monitoring of offshore vessels.
As Gregory was indicating, a number of us across government but also even within our own organizations, there are a number of steps being taken to ensure that shipping is safe.
I can circle back for a brief moment to the air issue. In terms of needs around airports, the owners and operators of airports, which in the vast majority of cases are provinces and territories, identify where there could be infrastructure equipment needs. There are programs, as I outlined in my opening remarks, they are able to apply to, depending upon prioritization among modes and other infrastructure needs that territories or provinces may have.
They can apply for infrastructure improvements, as was done, for example, in Nunavut, with a number of airport terminal improvements through the first call of the National Trade Corridors Fund or safety improvements at airports through the ACAP program that I mentioned earlier, which is specialized equipment at airports. Again, for the identification of that, we will collaborate with the owners and operators of that infrastructure. They are putting those as proponents forward for those applications.
The Chair: Senator Eaton, I think you have a supplementary question along this line?
Senator Eaton: Yes, I do. I want to pin you down more to the ground.
We spent some time with people who operate the cargo ships that go North, NEAS and the other one. They claim there are no regulations for foreign ships or adventurers; i.e., the people who were in the sailboat that went on the rocks just went off course. They were suggesting if Transport Canada came in with regulations as to who and how you could go through the Northwest Passage, that might help some people in need of your services.
We also heard part of the reason for some of the cargo ships not getting North and not getting back in time to get back up North to deliver stuff to Iqaluit, for instance, was because after you’d rescued those gentlemen in the sailboat and the cruise ship, your crew needed three days off. And the weather changed so they were stuck in ice up there.
Wouldn’t it be helpful if Transport Canada, even as a thing of sovereignty, made regulations as to where can you go in the Northwest Passage? Second, for pleasure boats going through there — and I think there will be more and more people doing adventures — should they not be bonded? The Canadian taxpayer is not paying for you to go and take them off the rocks. If they had to be bonded and put up money ahead of time, they might be more careful.
Mr. Hutton: Senator, I’ve heard those same issues from marine carriers this past summer. When we undertook our consultation we went to Montreal and had a good session. That was raised, in terms of the concern over pleasure craft and other kinds of vessels perhaps creating incidents and taking up resources.
Senator Eaton: That we don’t have.
Mr. Hutton: I think it’s one of those issues we are taking under advisement. In terms of our work as part of the Northern Marine Transportation Corridors Initiative, that governance structure and looking at the issues that arise out of where vessels are traversing, what kind of infrastructure needs is that demanding as we’re seeing the number of vessels increasing. I think it is to look at those kinds of issues and what kind of solution can be put in place.
Senator Eaton: Have you given yourself a deadline?
Mr. Hutton: That work is ongoing. There’s no specific deadline as we work with partners to better understand those corridors, where they exist and what will be expected.
Senator Oh: Thank you, panel, for being here.
My question is for Transport Canada. Northern stakeholders have told us that following previous conversations with your department, indications were made that Transport Canada intends to issue a call for Northern infrastructure proposals under the National Trade Corridors Fund.
Is your department indeed going to be issuing a call? If so, when?
Martin McKay, Acting Director General, Transportation Infrastructure Program, Transport Canada: As announced last summer as part of the National Trade Corridors Fund launched by the Minister of Transport, there was the commitment made to launch that call for Northern projects specifically located in the territories. We expect that call to happen later this year.
Senator Oh: Do you mean before December?
Mr. McKay: Before December 31, yes.
Senator Oh: How much of the $2 billion will be allotted for this next Northern specific round of funding, or are there still parts of the original $400 million carved out?
Mr. McKay: As you alluded to, the National Trade Corridors Fund was announced with a $400 million carve out specifically for projects in the territorial North. As a result of the proposals we received in the first call, $145 million was allocated. There remains $255 million to be allocated to projects in the territorial North.
The Chair: The Northern infrastructure fund will come out of the $400 million; is that correct?
Mr. McKay: It’s the National Trade Corridors Fund, but let’s call it the Northern component. Yes.
Senator Gold: Welcome everybody. I want to ask you about consultation. You’ve talked a lot, and properly so, about the consultation between the different government agencies and with the territorial governments. You mentioned in passing relationships with Indigenous communities. What would you recommend to this committee to improve the degree of involvement and engagement, whether it’s planning and infrastructure projects, whether it’s search and rescue or any of the other areas that touch upon your work with members of the Indigenous communities in the North? They are the folks who know best because they live the challenges of the vast North, with its limited infrastructure resources and vast natural resources. How can we do a better job of making sure we use Indigenous knowledge and involvement in the development of our plans?
Mr. Lick: I’m going to ask Neil to speak on this aspect. I will introduce it to say, very simply, that solutions from the South don’t always work in the North. The importance of engaging Northern solutions from Northern people is absolutely critical. I think we probably all have a piece of that.
I’m going to ask Neil, from the Coast Guard, to start off.
Mr. O’Rourke: From our perspective, what we want to do is have a permanent engagement. Often we use the term “consultation,” it means we have a project, we have a discussion and then we go away. What we want to do is build bridges where we’re having an ongoing dialogue.
That dialogue we envision happening on several different levels. The Coast Guard has been pretty good at doing some of them over the decades. That’s working with individual communities, working with the resupply companies and making sure we’re there to provide services and support community resupply.
One of the things we’ve, perhaps, not been as good at and has started in the last couple of years is better linkages with the Inuit land claim organizations, other Indigenous organizations, as well as the territories and the provinces with geography in the North.
Over the last couple of years, we’ve heard quite a bit from how Indigenous peoples would like to be engaged. One of the things they asked us was to send senior decision makers to the North and, as Greg pointed out, to have decisions made in the North, with Northerners, about the North.
I think our department has really taking that to heart. That’s why you saw this announcement in the last week about the creation of an Arctic region, where we’re going to take parts not only on the Coast Guard side but on the Fisheries and Oceans side, parts of our existing regions that are all dealing with the Arctic and put it under one umbrella, with a senior person in the North.
My own job in the coming weeks, months and years is very much to be out and engaging with people and trying to build those bridges everywhere from those national organizations to the regional organizations, to the territories and provinces, and also each local community.
Again, that’s something we’ve heard. It’s important to have those dialogues on all those different levels. Some of the work we’ve done over the last year was very helpful during the academic Akademik Ioffe grounding. We had the relationships built with a lot of the partners and that really did help us on the response side.
I can leave the floor for others. That’s a bit of the way the Coast Guard wants to take on engagement moving forward.
Senator Gold: From your lips to the Lord’s ears, making it happen and really engaging is what matters. I know the will is there on both sides.
When I was up North not that long ago with another committee, looking at search and rescue in particular, I won’t say there was frustration but there was a strong appetite for being really involved in the nitty-gritty decisions about where repeater things are based and how to solve some of the communication challenges and so on. We’ll keep an eye on you. We wish you good luck in that. It’s really important.
Senator Eaton: Last week, we heard from the Kivalliq organization about a hydro fibre optic link that would go up the West Coast from Manitoba through to Nunavut. Have you heard them? Are you going to give them an answer before Christmas to build this hydro link? It would be much more environmentally friendly than using diesel.
The Chair: I think that would be directed at Transport Canada, the National Trade Corridors Fund.
Senator Eaton: More infrastructure as opposed to environment, yes.
The Chair: I’m speculating here who may be willing to answer that.
Mr. Hutton: That question is perhaps better directed at our colleagues from Innovation, Science and Economic Development Canada, who work on the connectivity issues.
Senator Eaton: Isn’t that infrastructure?
Mr. McKay: It is infrastructure, you are absolutely correct, senator. However, in terms of transmission of hydroelectricity, that wouldn’t fall under the purview of the Minister of Transport.
Senator Eaton: I think they’re asking for a lot of money. I was wondering if it wouldn’t have come out of the infrastructure fund. None of you can answer that question. Thank you, Mr. Chair.
The Chair: We’ll hold that for ISED.
Senator Coyle: Thank you to all of you for your presentations today. I have two questions, one for Mr. Hutton and one for Ms. Hamzawi.
Mr. Hutton, you spoke about the Arctic Transportation Policy Framework, which you mentioned will align with the larger Arctic and Northern policy framework, which we have been concerning ourselves with here.
Could you tell me a little bit about the point here of consultation? What kind of consultation process is going into the development of that framework? Also, because you talk about regulatory issues, you talk about policy and you talk about investments, what’s the trend? What kinds of new investments are we seeing develop through this framework?
Mr. Hutton: Thanks for the question, senator. The consultation process we’ve been undertaking for the Arctic transportation policy framework has been aimed at visiting the three territories, meeting with territorial governments in each of the territories, as well as Indigenous organizations and the industry, whether it’s operators or the users of transportation services.
We spent the latter part of the summer into September going to each of the territories and holding these consultation sessions. They also included, as I mentioned earlier, a consultation session in Montreal where we had the opportunity to talk to airlines and marine carriers about transportation needs in the Arctic and how they’re broadly seeing the environment changing for their operations.
That has really helped inform. I think to get back to a point Neil had made earlier, was the need for sustained dialogue over time I think was one of the big takeaways from the discussions, how needs do change. Rather than we have specific consultations and go away for a couple of years, there’s a need for an ongoing dialogue.
Luckily, at Transport Canada we have regional offices and our Prairie Northern region which can help with those discussions with the territories on a more ongoing basis. It probably is from that multimodal point of view of users and operators and getting into a more sustained conversation with them about how the needs are changing and what solutions at various times can be implemented. Sometimes it can be a solution that can be facilitated for an operator. Sometimes it’s a barrier government has in the way that we can knock down. Sometimes it’s working with another level of government on a solution where there could be collaborative action undertaken.
In terms of the types of needs that are coming forward, again over time we’re going to see those needs evolve. I think what needs to be remembered is, as you’ve seen from your travels up there, the needs are basic. Small things can sometimes mean a great deal. Often projects can be thought about in grander terms, transformative without remembering that it can be simply a beach area, a lay-down area for resupply, which has the appropriate lighting or fencing to keep it safe in terms of the operations that can make a big difference for the community and the reliability of resupply goods moving in. It can mean weather systems and landing instrumentation at airports rather than every case a paved runway, for example.
These are the kinds of things we’re hearing through the consultations. I think these will matter a great deal in terms of how we think about infrastructure needs in the North and how we have a collective conversation around it. Again, as an earlier point that was made, solutions developed in the South aren’t as sustainable in the Arctic. It’s a collective discussion that needs to happen.
Senator Coyle: My second question was for Ms. Hamzawi.
The Chair: Keep it tight, please.
Senator Coyle: It’s a very tight one and hopefully the answer will be too.
Mr. Moffet mentioned the carbon pricing exemptions around air transportation and diesel, which, of course, was a huge issue we heard in the North. That’s fine and that’s —
The Chair: Power generation only.
Senator Coyle: Exactly, for power generation. I got that. However, diesel is still an issue, whether we’re having to pay extra tax on it or not. What is Environment Canada doing on the alternatives to diesel for the Arctic, for power generation?
Mr. Moffet: I’ll address that. It’s not just Environment Canada, it’s the Government of Canada. It’s primarily our colleagues at Natural Resources Canada.
The Chair: We’re going to have a chance to hear from them in the next panel, by the way, Mr. Moffet.
Mr. Moffet: Briefly, Environment Canada, through the Low Carbon Economy Fund, is making investments in each of the three territories, some in improving energy efficiency of public buildings, but some in helping communities transition from diesel.
The largest investment that’s being made in helping communities transition off of diesel are coming from some of the green infrastructure funding and from the Northern REACHE program which is providing millions of dollars to approximately 50 communities across the North to transition off of diesel-generated electricity, so that there can be more reliance on renewable sources, recognizing that renewable cannot fully replace other sources because of the need for backup at a minimum.
Senator Coyle: Thank you, Mr. Moffet.
Senator Dasko: I just joined the committee a couple of weeks ago. Perhaps this question may have been answered by other panellists.
It seems to me the whole topic of Arctic sovereignty used to be a lot bigger than it is today, if I think about that in terms of the media, maybe a decade ago or so many years ago. My question is a general question, I guess mainly to the Coast Guard and to Transport Canada. Is the issue of Arctic sovereignty a major issue, is it a minor issue, is it almost no issue at all in terms of your activities and priorities? Just a general comment about that as an issue. I mean, we know that environment is important, infrastructure, so many other things we’ve been talking about at this committee over the past few weeks. I’m really interested in how you would answer that.
Mr. Lick: Maybe I’ll try to start off and try not to get into too much of the political realm.
Senator Dasko: Oh, sure.
Mr. Lick: I would suggest Arctic sovereignty is important depending on whom you ask the question. If you ask the question to our colleagues down south, I think you would get a different answer than if you ask somebody in Quebec or Ontario or wherever.
Senator Dasko: You mean our American friends?
Mr. Lick: Our American friends, or other Arctic countries who wish to use the Northwest Passage as an example.
It will depend on who you ask. Forgetting the question, to put that aside for a little bit, the government in and of itself, its investments that it’s making through our three departments here in the Arctic, in my mind, demonstrates the importance to us as Canadians. We’re all Canadians here. That really demonstrate how important it is to us.
That’s my simple answer to your question. It depends on who you ask. But I think the government is demonstrating through very concrete measures, investments and in particular more than anything sovereignty is about being there and having activities and investments and people in the North and doing things in the North. That more than anything demonstrates sovereignty in my mind. I think you hear a lot of the authors who are experts in that realm say the same thing.
I’m not sure if there’s anybody else who could add.
Mr. Hutton: It’s hard to add to a good answer from a person in uniform on that question.
I think in terms of the Arctic and Northern Policy Framework that’s being developed, there is a reflection there in terms of some of the work that’s being done, both in terms of the global context and ensuring that there’s an international rules-based order in the Arctic that responds effectively to new challenges and opportunities. Also to the fact the Arctic and its people are safe, secure and well defended.
Those are thematic areas you will see articulated. It’s not that it’s gone away. It’s part of a wider picture in terms of how you articulate the importance of the Arctic region.
The Chair: Thank you very much. Just to wrap up, there was mention of a central agency task force on Indigenous procurement. Was that the Coast Guard that mentioned that? I wonder if the committee could get some more information about the terms of reference.
Mr. Lick: Would you like it now, Mr. Chair, or after?
The Chair: Now or later.
Mr. Lick: Farhat, our expert and representative on that committee, can introduce it now. We may be able to provide some further information later on, depending on how much time we have.
The Chair: We have a short time to hear from your colleague.
Farhat Khan, Director General, Financial and Materiel Management Operations and Deputy Chief Financial Officer, Fisheries and Oceans Canada: Good evening. We will provide the terms of reference, as Greg has mentioned. The task force is a DM task force. It’s comprised of several federal departments. It’s three streams: procurement and investment, authorities and agreements, and human resources.
The task force on procurement, which I am part of, is looking at modest quick hits, quick wins, we can examine to look at the barriers to improve and promote Indigenous procurement and come up with some next steps.
The Chair: That’s very good. Thank you.
Colleagues, I’m afraid we have run out of time for this panel. I thank the panellists and their supporters for being here this evening after hours, and for your answers to our questions. It is much appreciated.
For the second panel, I’m pleased to welcome, from Natural Resources Canada, André Bernier, Senior Director, Renewable and Electrical Energy Division, Electricity Resources Branch; and Linda Richard, Director, Northern Canada Division, Geological Survey of Canada. From Infrastructure Canada, Sean Keenan, Director General, Economic Analysis and Results; and Nathalie Lechasseur, Director General, Programs Integration. From Crown-Indigenous Relations and Northern Affairs Canada, Wayne Walsh, Director General, Northern Strategic Policy Branch; and Mark Hopkins, Director General, Natural Resources and Environment Branch.
Thank you for joining us. I invite each of you to proceed with your opening statement, after which you can expect questions. Please go ahead.
[Translation]
Nathalie Lechasseur, Director General, Programs Integration, Infrastructure Canada: Good evening. Thank you for inviting me to participate in this meeting today. My name is Nathalie Lechasseur, and I am the Director General of the Program Integration directorate at Infrastructure Canada. I’m joined today by Sean Keenan, who is the Director General of the Economic Analysis and Results directorate at Infrastructure Canada.
Our department is responsible for delivering the more than $180-billion Investing in Canada infrastructure plan, in coordination with other federal partner departments. The plan was designed to support five key areas: public transit; green; social, trade and transportation; and rural and Northern communities’ infrastructure. These were the areas that our provincial, territorial, municipal and Indigenous partners identified as key to the health, success and sustainability of their communities.
Infrastructure Canada has signed bilateral agreements with all provinces and territories to deliver $33 billion through four funding streams.
I will focus my remarks today on the investments that Infrastructure Canada is making to benefit rural and Northern communities.
In many ways, our approach reflects what this committee is hearing about the changing landscape of Canada’s North. That is why the Investing in Canada plan includes $2 billion in dedicated funding through the rural and Northern communities’ infrastructure funding stream to address their unique priorities.
We know that Canada’s rural and Northern communities have unique needs that require a more targeted approach. Issues such as road access, Internet connectivity and the reduction of communities’ dependence on diesel can make a real difference in people’s lives and contribute to Canada’s overall success.
Our approach is designed to take into consideration the needs of rural, remote and Indigenous communities, while helping to grow local economies, build stronger, more inclusive communities, and help safeguard the environment and the health of Canadians.
The rural and Northern stream will provide smaller communities with funding to address infrastructure projects such as local roads, broadband, air and marine infrastructure, and food security. It will also provide funding for the improved health and education facilities that support the Truth and Reconciliation Commission’s calls to action.
In addition, the new $400-million Arctic Energy Fund will support renewable energy and improve existing energy systems in the territories, including Indigenous communities.
Under the rural and Northern communities’ stream, we have increased the federal share of project funding to 60 per cent for communities with populations of fewer than 5,000. As well, for communities in the territories, the federal share of project funding can be up to 75 per cent.
For Indigenous project funding recipients, the federal cost share can be up to 75 per cent. Indigenous project recipients can also combine federal funding up to 100 per cent from all sources, meaning that projects led by Indigenous organizations can advance local priorities with this increased access to federal funding.
Rural and Northern communities can access funding programs administered by other federal departments, as well as the other funding streams under the Investing in Canada plan. Rural and Northern communities also benefit from existing and legacy program funding managed by Infrastructure Canada, such as the federal Gas Tax Fund and the New Building Canada Fund.
We are working with the provinces and territories to support the projects that will contribute to the health, sustainability and success of Canada’s rural and Northern communities.
Thank you, Mr. Chair, for the opportunity to participate in today’s discussion and for your efforts in ensuring Canada’s approach to the Arctic’s development is sustainable. Sean and I are happy to answer any questions you have.
[English]
The Chair: Thank you.
Mr. Walsh or Mr. Hopkins, please go ahead.
Mark Hopkins, Director General, Natural Resources and Environment Branch, Crown-Indigenous Relations and Northern Affairs Canada: Thank you for the opportunity to discuss infrastructure investments related to climate change in the Arctic.
Climate change is having a profound impact on Canada’s Northern and Indigenous people and communities, including on the efficiency, safety and reliability of Northern infrastructure, such as buildings, roads, airports, and ulitidors. The pace of these changes far exceeds the capacity of Northerners to adapt and respond on their own.
While territorial governments have overall responsibility for infrastructure as part of maintaining the social and economic well-being of their regions, Crown-Indigenous Relations and Northern Affairs Canada has a mandated responsibility to support Northern and Indigenous communities, and to build capacity to manage ongoing environmental risks.
CIRNAC has historically worked with Northern communities and governments to fill gaps and cost-share projects that are led by other partners by providing investments into Northern and Indigenous infrastructure. In many cases, this initial support allows communities to be prepared for and access large federal infrastructure investments in the North that are delivered primarily by Infrastructure Canada through bilateral agreements with territorial governments, and with provinces in the case of Nunavik and Nunatsiavut.
CIRNAC has provided climate change programming in the North since 2001. Budgets 2016 and 2017 committed funding to continue this work through five climate change programs under the Pan-Canadian Framework on Clean Growth and Climate Change. To date, since 2016-17, these programs have invested more than $50 million in close to 350 projects in Northern and Indigenous communities across the country, for a range of infrastructure and related projects in clean energy, climate change adaptation, climate monitoring and flood mapping. Over 200 of these projects are directly supporting communities in Canada’s North.
Investments include a mix of capital infrastructure funding and capacity engagement funding to undertake planning and feasibility studies. It includes risk assessments, mapping, climate monitoring and development of decision support tools. The projects equip communities to protect and support their infrastructure by implementing mitigating measures, such as relocating housing in Tuktoyaktuk away from the eroding coast or constructing small- to medium-scale renewable energy projects such as solar micro-grids in the Yukon.
CIRNAC works directly with communities in developing proposals that improve access to federal funding and support communities when they are ready to implement projects. This collaborative approach to program delivery has led to strong connections with communities, Indigenous governments, territorial governments and utilities, which leads to positive project outcomes where the federal government is viewed as a partner, and communities see the connection between, for example, clean energy, healthy communities and economic well-being.
Now I would like to turn to my colleague Wayne Walsh.
Wayne Walsh, Director General, Northern Strategic Policy Branch, Crown-Indigenous Relations and Northern Affairs Canada: Thank you for the invitation to appear before the committee today.
[Translation]
Today, I will outline what we are learning about the priorities of Arctic residents as we continue working towards a new policy framework for the Arctic and the North.
In 2016, the Prime Minister announced that Canada would be co-developing a new Arctic Policy Framework with Northerners, territorial and provincial governments, First Nations, Inuit and Metis people. The process to co-develop a new framework will be based on the engagement work of the minister’s special representative, Mary Simon, as well as the contribution of band councils, to support a new leadership model for Canada’s Arctic. Ms. Simon identified infrastructure deficiencies as a key priority in her report.
Since 2016, we have engaged in a process of consultation and collaboration with Northern residents and leaders, as well as other interested parties, to support the development of the framework. More than 30 departments and agencies have also participated in the process to ensure a whole-of-government approach. This is essential given the role that numerous departments and agencies play in infrastructure development, as they do in other sectors.
[English]
The most distinctive aspect to the process, relative to previous approaches, is the degree to which we are working directly with territorial and provincial governments; representatives of Nunatsiavut, Nunavut, Inuvialuit and Nunavik; and other partners to draft policy goals and objectives to guide the federal policies and programs to 2030 and beyond.
In doing this, we have been directed to look beyond the creation of a federal policy framework and to build toward a true shared leadership approach. The balance of my comments today will focus on what we heard and have learned so far through this process.
To support engagement, a discussion guide was co-developed with partners that identified six themes as a starting point for conversations on the future of the Canadian Arctic and Northern policy, including comprehensive Arctic infrastructure. The discussion guide, and our conversations at round tables and other engagements, started with an acknowledgement of the gaps and challenges. These acknowledgements were and remain important for our co-development partners who live these challenges daily.
We acknowledge Canada’s Arctic has a significant infrastructure deficit, one that is posing significant challenges to socio-economic growth, emergency management, resource development, and fundamental safety and quality of life of Arctic residents. The harsh environment, changing weather patterns, short construction and shipping seasons, lack of building resources and a small tax base create significant challenges and risks to building and maintaining infrastructure in the Canadian Arctic.
Climate change is also accelerating threats to existing infrastructure. Thawing permafrost is directly impacting the integrity of building foundations, roads, runways, pipelines and coastal infrastructure. It is also highlighting a design and innovation gap. Traditional projects, which largely tried to adapt Southern approaches to conditions in the North and Arctic, are failing in the face of climate change.
However, we also agreed that investments and improvement in infrastructure are linked to improved outcomes across many sectors. For example, enhancing transportation infrastructure would reduce the cost of living, create better access to and between communities, and foster opportunities to strengthen and diversify the economy.
There was also a consensus around a broad definition of infrastructure, encompassing the big infrastructure areas, such as energy, transportation, communication; community infrastructure, including housing; knowledge infrastructure in support of navigation; and emergency response and weather surfaces.
Most important, we asked: What are the key priorities for your regions? Infrastructure concerns were common themes in engagement. Whether with territorial, provincial and Indigenous partners in the co-development; or in discussions with stakeholders from other sectors, including local government, social, educational, business and industry, we heard broad consensus around infrastructure as a priority. Participants and partners emphasized the need for transformative investments in Arctic and Northern infrastructure rather than remedial approach that only perpetuates the states of crisis.
Almost everyone who spoke about infrastructure mentioned reliable broadband Internet access as a priority, enabling business, research, education and access to health services. Other infrastructure needs included navigational aids and emergency response; and better transportation between North and South, as well as among different parts of the North and Arctic, including international transportation networks.
Community infrastructure and housing. Northern communities and organizations emphasized their desire for partnership and opportunities to play a constructive role in infrastructure but pointed to limitations of program design that hinder this. For example, proposal driven processes and programs designed for a Southern market made up of many competing players may not be transportable to the North and Arctic. Territorial governments, through their participation in the co-development process and strategic documents such as the Pan-Territorial Vision for Sustainable Development, have pointed out large-scale infrastructure investments as foundational for creating economic opportunity and prosperity for Northerners.
While co-development and co-drafting process is ongoing, partners have a shared ambition for infrastructure to 2030 and beyond. Strengthened Arctic infrastructure meets local, regional and national needs. Proposed infrastructure objectives are wide-ranging and include transportation, energy, connectivity, housing, community infrastructure, mapping, navigation and waste management. Significantly, work is not only focused on the “what” of the infrastructure priorities for the North, but also on the “how.”
Co-development partners are seeking policy commitments to support new approaches to infrastructure development, including funding models, leveraging partnerships and combining infrastructure projects to achieve multiple outcomes.
They are also focused on innovations to increase sustainability and resiliency of infrastructure, both in relation to climate change, but also, given past experience with shortage of material and expertise, to support maintenance on a long-term basis. In this context, addressing the design gap means addressing the design of a building or road or generator, but also the plan to operate it and maintain it locally. The “local” in the element is key. In the area of infrastructure, as in other themes, Northerners are seeking a framework with people at the centre.
In closing, Mr. Chairman, our discussions with partners started from an immediate challenge and gaps, but quickly moved to the needs for long-term approaches to meeting those challenges and addressing the gaps together. Nowhere is this need for long-term, partnership-based approach more evidenced than in discussions on infrastructure. Thank you, merci.
The Chair: Thank you, Mr. Walsh.
[Translation]
Linda Richard, Director, Northern Canada Division, Geological Survey of Canada, Natural Resources Canada: Good evening and thank you for inviting us to participate in today’s discussion. My colleague André Bernier and I will be presenting on behalf of Natural Resources Canada.
My name is Linda Richard, and I am the Director of the Northern Canada Division at the Geological Survey of Canada. I represent the Lands and Minerals Sector.
[English]
Mining is the primary economic driver in the North. In 2017, mineral production in the territories totalled $3.5 billion. That same year, $425 million was invested in exploration to find new mines. The North represents a huge potential for the discovery of a number of mineral commodities such as gold and diamonds and strategic minerals including rare earth elements, uranium and tungsten.
Mining contributes to Northern communities and territorial economies by providing well-paying jobs. For example, in the Northwest Territories’ diamond mining and Nunavut’s gold-mining industry, many jobs pay more than $100,000 per year.
Mining increases economic opportunities. It sets the stage for Northerners to create businesses, develop skills, and gain experience that enhances their quality of life and helps build communities that are more resilient.
Leveraging the significant mineral potential of Canada’s North must be done in a way that promotes the participation of Indigenous peoples, respects the environment, and benefits local communities, while also ensuring Canadian mines can compete in the global mining economy.
These are the pillars of the Canadian Minerals and Metals Plan, which has the singular goal of establishing Canada as the leading mining nation in the world.
Collaboratively led by Natural Resources Canada, the plan will be forward-looking, taking into account the views of industry, society, and Indigenous peoples across Canada. Engagement on the plan is currently being conducted with regional stakeholders across the North.
Mining requires enabling infrastructure. In the North, capital costs of a mine are 2.5 times higher than in the South. Our Northern stakeholders have told us they need government support for infrastructure.
The resource gateway in the Yukon and Taltson Hydroelectric expansions in the Northwest Territories are examples of Northern infrastructure projects that could lead to mining-related economic development.
NRCan has been involved in the co-development of the new Arctic and Northern Policy Framework. The framework will provide the road map to a self-reliant, vibrant and sustainable North.
The Geological Survey of Canada is a key contributor to delivering on both the Canadian Minerals and Metals Plan, and the Arctic and Northern Policy Framework through its public geoscience.
In the North, where exploration costs can be up to six times higher than in the South, our geoscience will reduce risks associated with discovery and development of tomorrow’s mines and will contribute to sustainable development.
Public geoscience also helps address the unique challenges of working in the North in the context of a changing climate, including understanding the thawing permafrost and coastal erosion.
In short, Natural Resources Canada, through its policy and science capacity, improves land use and infrastructure investment decision-making by Northerners, for Northerners.
[Translation]
Thank you. Now, I will turn the floor over to my colleague.
[English]
André Bernier, Senior Director, Renewable and Electrical Energy Division, Electricity Resources Branch, Natural Resources Canada: Thank you. My name is André Bernier, Senior Director, Renewable and Electrical Energy Division, Electricity Resources Branch, Natural Resources Canada. I know from the earlier panel that Mr. John Moffet of Environment and Climate Change Canada indicated our department is active, looking at ways to help remote communities reduce their reliance on diesel. I’ll be focusing my remarks there. This is something identified as a priority under the Pan-Canadian Framework as well as a priority under the Canadian Energy Strategy.
There are about 200 or so communities across Canada that are not connected to the continental energy grid, many of those in the Arctic. They rely on it for electricity but also for heat. In some cases heat is a bigger source of diesel usage. There are a lot of reasons for these communities to be looking at alternatives to diesel fuel: There is a very high cost for transportation to get it to the North; there is the risk of spill; there is the local air pollution and, of course, greenhouse gas emissions. Worth noting that across Canada, two thirds of these communities are Indigenous. From the perspective of these communities, not only is moving to a source of clean energy seen as a way to reduce costs, minimize environmental impacts, but also it’s an opportunity for greater economic autonomy in some cases where ownership of the energy project is an option.
Budget 2017 announced $220 million of funding for Natural Resources Canada for the Clean Energy for Rural and Remote Communities program. My team plays a lead role on that at Natural Resources Canada. We are making investments through this program in projects to help remote communities in Canada increase their use of renewable energy. That would be investments in wind, solar, biomass, hydro, sometimes energy storage microgrids. As you can imagine, this links to a number of different government priorities, clean growth, helping to address climate change and reconciliation as well.
We are at an early stage with the program. It launched earlier on this year. We have selected a first wave of 43 projects. Only one of those has been announced and that quite recently. We’re not at a stage where we could really authoritatively discuss results. Keeping in mind that two thirds of the communities are Indigenous, we really tried to orient our programming so it’s accessible to Indigenous communities. Of the 43 projects we’re proposing to support, 40 will be in Indigenous communities and 28 of those will be led by the communities themselves.
As my colleague mentioned, as we implement this program looking at opportunities for those communities to be full partners in these projects, that these really are things seen as part of their future is a key consideration for us.
It is in an area where you can tell from this one panel there are a lot of different federal angles. We work closely with our colleagues at Infrastructure and also CIRNAC. Our teams meet regularly, at least every couple of weeks. They are frequently in touch on a more regular basis. That’s to ensure our activities are coordinated, that we’re able to help projects find the federal program or support that would best fit them.
We see the relationship we have with the territories and the provinces as another key part. For a project to be successful, we think the community has to want it. It needs to have a capable developer and, of course, the province or territory needs to view it as part of its future.
It’s certainly a long-term endeavour from our perspective. What we’re hoping is these projects we’re able to support can serve as models for other communities, effectively help create a business case and show that hybrid systems that include both renewables and diesel make sense from a financial perspective, an environmental perspective. We are excited about the early results we have in terms of project selections but still early days from an implementation perspective.
The Chair: Thank you very much, panellists. We’re going to turn to questions. We have just half an hour or so. I’m sure my colleagues will want to be brief in their preambles and questions.
Senator Bovey: Thank you. No preambles. Two quick questions.
Many of us are wondering where the framework policy is, having expected it by now. Maybe that’s my preamble.
The Chair: Shall we stop there with that question?
Senator Bovey: I’d like to ask my other one, too.
The Chair: Of course.
The first question was about where we are with the Arctic Policy Framework.
Mr. Walsh: We’re in the process of co-drafting the framework. We’re well advanced. It is certainly the ambition to be making an announcement on the framework very soon. I think the planning assumptions at the rate we’re going right now is early winter 2019.
Senator Bovey: Early winter 2019.
Mr. Walsh: Early to mid-winter. I guess winter goes to March 21.
Senator Bovey: We’ve been expecting it in the late summer, 2018.
Mr. Hopkins, you mentioned eroding coasts and Tuktoyaktuk. My question is what about the projections and realities of losing a number of coastal communities due to the melting sea ice across the North? How are you dealing with that?
Do the 30 departments and agencies that Mr. Walsh mentioned help or complicate the situation? Thirty sounds an awful lot.
Mr. Hopkins: I’ll address the first question quickly. Tuktoyaktuk is most urgently vulnerable to coast erosion. If you’ve been out there, you’ve likely seen how the storm surges are eating away at the coast. The community itself is in the process of slowly retreating from that coastline.
The program we have provides something like $8 million a year available across the North. Therefore, it’s not making big infrastructure investments but it’s helping with the planning, mapping and identifying the areas of coast which are vulnerable to flooding and those which are not. It’s foundational to other investments, which are going to have to come from other sources, the territorial government, in particular, but others as well to address the issue in a substantial way over time.
Senator Bovey: We’ve heard 40 communities could well be submerged as a result of the melting sea ice.
Mr. Hopkins: There are a lot of communities that are vulnerable and are built in low-lying areas. The Inuit communities tend to be coastal communities. In many cases, our program funds hazard assessments, which, as I said, are the first step to identifying just what exactly is vulnerable. I can’t speak to whether entire communities are at risk. Certainly portions of communities are at risk. That applies elsewhere in the country as well.
Step one is marshalling the science to draw those lines on the map to identify just where under different scenarios the waters will rise to. Step two is the infrastructure investments needed to retreat from the coastline.
Senator Bovey: Are the 30 departments effective? Is it too many, too few, too what? I don’t know where I’d go if I was looking for help.
Mr. Walsh: In our engagement process, through the engagement phase of the development of the framework, many of those departments were present. There was an overwhelmingly positive reaction from Northerners to have that level of engagement from the Government of Canada.
It might not be easy, but it heartens Northerners that the Government of Canada is paying attention. And it’s not only CIRNAC.
Senator Oh: My question is for Infrastructure Canada. The infrastructure bank is an entity that often comes up but remains a bit of an enigma for all of us. The bank, when it was proposed, was touted as putting in $35 billion in investment in Canadian infrastructure.
Is the bank up and running? If so, have any projects been funded through it since it was established in June 2017?
Sean Keenan, Director General, Economic Analysis and Results, Infrastructure Canada: The bank is up and running. It has its first CEO, Mr. Pierre Lavallée, who was appointed earlier this year in June, July or August — I’m not exactly sure. They also announced our first project which is funding for the Réseau express métropolitain project in Montreal. That’s a public transit project. It is there and open for business. It has a mandate to partner with private sector entities and attract private capital into the infrastructure space and also to be a source of expertise for developing a project pipeline of available projects that could be funded by both private sector and public sector partners.
Senator Oh: Do you know how big the funding is in Montreal? Are there any projects up North?
Mr. Keenan: They only have the one project right now. I want to say it’s $1.28 billion, but it could be 1.128. It’s in that range, 1.1 or 1.2 billion.
Senator Oh: There is nothing in the Arctic?
Mr. Keenan: Not yet.
The Chair: If I may, I think the issue about the Infrastructure Bank of concern to the North is we understand that market returns are part of the eligibility criteria calculations based on a 20-year return period.
There is a concern that the North lacks the economies of scale required to satisfy those criteria. Does the Infrastructure Bank recognize that? Is Infrastructure Canada working to consider whether Northern projects based on economic returns, such as revenue from mining projects or tax generation or overall GDP boost, could help those projects to qualify?
Mr. Keenan: I can’t speak with any authority on those particular details. I know there’s nothing in the bank’s mandate that would exclude its involvement in the North. That would be a question we would have to take back and provide you with an answer.
The Chair: If you would be able to provide us with more detail on the criteria, that would be appreciated.
Senator Eaton: It’s been suggested that an Indigenous infrastructure fund be created and that it be modelled on the Alaska Industrial Development and Export Authority, which makes private capital available; however, the federal involvement is required to offset commercial risk. I guess the federal government is there if something goes bad, but initially it is private capital.
Have you considered anything like that? Have you looked at the Alaska model for infrastructure for the North?
Mr. Keenan: I don’t have an awareness of the Alaska model.
Senator Eaton: It’s called the Alaska Industrial Development and Export Authority. It’s a model where different levels of government along with industry come together to develop roads and ports and suggest that such a vehicle could be used to finance social infrastructure and communities.
Mr. Keenan: I know that is the basic principle behind the Canada Infrastructure Bank as a tool.
Senator Eaton: But you must admit the communities in the North with tiny populations and no tax base are hardly like Montreal, which is very densely populated with a huge tax base.
Mr. Keenan: I would agree, yes. The principle behind being the bank is there shouldn’t be an impediment; or where there is an impediment, for private capital to be involved in the development of infrastructure. If the returns are not great or there’s a risk the private sector entities are not willing to take, then is there a role the bank can play to push the project along?
That is kind of its model. Again, as I said, I’m not sure there’s anything in the criteria or terms that preclude it from operating in the North. I will get back to the committee on that.
Senator Coyle: Ms. Richard, I have a question for you on the mineral potential in Canada to feed the renewable green tech sector. We learned, when we were up in the Northwest Territories, that we have some strategically important metals here in Canada. Has there been a good mapping of that and what the potential is for Canada to be a supplier to its own green tech industries, but also to the world? That’s my first question.
Ms. Richard: Thank you for your question. Essentially, the challenge in Canada’s North is we are in the early stages of mapping, of understanding the mineral potential.
To give you a sense of the work we’ve been doing, for the last decade we’ve had a geo-mapping program, a $200-million initiative, which is ending in March 2020. When we started the initiative, we didn’t know very much about the North. Basically, people were heli-hopping from mountaintop to mountaintop. During the last decade we’ve been working with our territorial and Northern provincial partners and have been delivering modern geological knowledge for the North.
When we complete our initiative in 2020 — we like to talk about an analogy of a haystack and a needle. What we do is we find a haystack so that industry can then follow up and find a needle. That is the deposit.
We are at the stage, in terms of our understanding of the mineral potential of the North, where we will be able to deliver a sense of where those major haystacks are and where that big development may be. We need to continue to do some work in the North to catch up, if you like, with the rest of the country in terms of the understanding of the geological endowment.
That’s our challenge. The North is believed to have a tremendous economic potential. General geology tells us it has as much potential as the South. We can expect to find a lot of these very important deposits as we continue our research in the North.
Senator Coyle: My second question is for Ms. Lechasseur. Last week we heard from the mayor of Iqaluit, Madeleine Redfern. They had quite a crisis this past summer with water availability, et cetera. She mentioned the Disaster Mitigation and Adaptation Fund and its focus on large-scale disasters related to climate. This was a problem matching their needs. Even though they are the largest community in that part of Canada’s North, they still weren’t matching up with the criteria.
Are there programs able to help these smaller communities in the event of disaster? How do those small communities learn about those programs?
[Translation]
Ms. Lechasseur: Thank you for that very important question. Bilateral agreements have just been signed. We have merit-based funding for disaster mitigation, so that means projects are evaluated against merit criteria. Under the bilateral agreements, however, specific amounts have been allocated for the territories. Nunavut, for instance, has funding for different categories of infrastructure, including green infrastructure, so that money can be used for water treatment projects.
Does that answer your question?
Senator Coyle: Thank you.
[English]
Senator Gold: Thank you all for being here today.
When you travel up North, the needs are so obvious. They are so obvious in terms of the infrastructure gap; they’re so obvious in terms of the need to involve and engage the Indigenous peoples and residents of the North. Yet, in all of your comments — it’s not a critical question — you’ve talked about it being early days and about the planning process.
The question is this: What is a realistic time frame within which we can start to see real change on the ground for the benefit of the communities in the North? As I said, it’s not an impatient question, in the sense I think it can happen overnight. How do you explain the fact we’re in such early stages of trying to address these issues, which have been obvious for some time, I would have thought.
[Translation]
Ms. Lechasseur: In recent years, since 2007, actually, several funding programs have been created: the Building Canada Fund, which set out programs to fund infrastructure; the 2014 New Building Canada Fund; and the new Investing in Canada plan, which makes funding available to assist these communities.
[English]
Mr. Hopkins: As I commented in my opening remarks, we have been delivering programs for a long time, for over 15 years. What’s happening as far as climate change goes is the impacts are accelerating and happening so quickly that there’s a gap, in effect, that’s growing. We have been running. We have not been running fast enough to respond to the pace of the change that is happening.
The investments we are putting in place relative to scale of the challenges — I agree the gap looks large. There are a lot of concrete examples that could I throw out there. For example, this summer we invested in and there’s a groundbreaking for a 300-kilowatt wind farm being put in Kluane First Nation, which is the first wind farm that will be community-based and community owned north of 60 degrees. That’s one example of concrete results.
There are a number of others as well. Take the example of the water situations. The climate change preparedness program has provided substantial funding for the City of Iqaluit to put in place flexible couplings so the permafrost, a cause of a significant amount of leakage in the water system, can be managed.
These are small relative to the challenges of communities at risk of being substantially flooded. They’re nonetheless concrete and building towards progress.
Mr. Bernier: To offer a parallel to Mark Hopkins’ remarks: In the case of renewable energy, the options we’re looking at today are ones we couldn’t really have looked at 10 or 20 years ago. As the cost of the technology has come down, its efficiency has gone up. Critically in a Northern context, we have seen these technologies prove their reliability in a more rugged environment.
We’re now in a position to look at an option set that is larger than we might have before. We’re not at a point where you could entirely replace a community’s energy supply with renewables. It will take more advancement and storage technology. One of the reasons we’re not seeing progress in this area until quite recently is that technologically it wasn’t an option.
Senator Coyle: I have a supplementary. It’s not a long one, but it’s a big one.
It’s so obvious, to this point, we are so far behind and there are huge needs and, as you’ve said, significant infrastructure deficit in the North, and also opportunity. There are needs and opportunities, great nation-building opportunities for Canada. Are we going to see a bold, significant investment accompanying this new policy framework for the Arctic?
Mr. Walsh: First of all, I don’t want to leave the wrong impression. The gaps are tremendous, but also the North has made incredible progress over the last 40 or 50 years.
In fact, a lot of progress has happened in the North that are examples for the South, particularly when it comes to governance and Indigenous reconciliation. We don’t have a system in the North where we have a reserve base. The Indian Act largely does not apply.
I think it’s not all doom and gloom. I think Northerners have bandied together and have been very resilient.
It’s the ambition of all the participating partners in the development of the Arctic Policy Framework that the framework is ambitious and bold and that the government commitment moving forward — I think that’s why all the partners have agreed that a framework that makes sense and is not just a three- or four-year cycle but will be out for 10 or 15 years. This gives an opportunity for governments to then do the proper planning and investments moving forward for that transformative change.
Senator Coyle: You mentioned 2030. Am I right?
Mr. Walsh: Yes, 2030 and beyond.
Senator Coyle: Would it align with the SDGs?
Mr. Walsh: Absolutely.
Senator Coyle: Thank you.
Senator Dasko: Thank you. I want to get back to the Infrastructure Bank for a moment. I understand you’ve established the Infrastructure Bank but you’re winding down the Public-Private Partnerships Crown corporation.
There’s obviously an evolving model of private sector engagement that the government is evolving, developing or changing. Could you describe what that is? Is it a change in philosophy? Is it a tweaking of the model that you had? Can you enlighten us as to why the change, why the evolution?
Mr. Keenan: I’m not sure I can enlighten you on why the change. There is the P3 Canada Fund that was announced. There are projects that were funded under that model federally. Some of those are still under way. All of the commitments under that fund will be realized. There are people at Infrastructure Canada who are working on ensuring those commitments are followed through.
The expertise is there. The idea was we would develop an expertise in Canada for public-private partnerships and that other various levels of government would be able to undertake those. Many of those types of projects are in play under the projects that are funded by Infrastructure Canada. Where the federal government is providing funds, the local partner may be doing it through a public-private partnership. The model is there. It’s well under way.
The bank itself, the Canada Infrastructure Bank, is another tool that is trying to attract private investment in this space and use the public sector to determine, where necessary, the kind of investment tools we could use as the federal government, as the bank, to encourage private sector investment in the infrastructure space and also be a source of expertise and develop a project pipeline.
Senator Dasko: But they are both partnership models, correct?
Mr. Keenan: I don’t think the bank necessarily — I can’t speak authoritatively on this — is limited to a certain type of model. What it’s saying is it’s going to look at ideas coming forward from private sector proponents and then determine the type of financing arrangement that will make this work. Or is it a good idea? How can it be structured in a way, and then what is the type of investment on the part of the bank?
Senator Dasko: A little more flexibility than the previous model?
Mr. Keenan: I can’t speak authoritatively on what that provides. It’s a newer model, yes.
Senator Dasko: Does anyone have anything else to add? Mr. Walsh?
Mr. Walsh: Whether we’re talking about infrastructure, food security or housing, all the issues are very complex. We need to focus on more than one solution. The Infrastructure Bank could offer a good model, but Northerners have asked us to be innovative and to look at all kinds of different things.
One of the most resonating comments — and I’ll leave this with the committee — is had we approached infrastructure development in the early days of nation building, the railway would not have made it past Toronto because a lot of the formulas are based on population, on need, et cetera, that would not have been a national railway project. These are things Northerners are telling us. They are challenging us, as was mentioned by Senator Coyle, to look at it from a nation-building perspective. I think that will be our ongoing challenge moving forward.
Senator Eaton: I want to get back to the Kivalliq Hydro fibre link. Would that fall under the Investing in Canada Plan, which has $2 billion for Northern projects? What would that fall under? That’s hydro, as you know, going up the western side of Hudson’s Bay, with a fibre-optic line as well.
Following on that question, we spent quite a few hours listening to representations from the mining community in Yukon going through how rich the Yukon was. We also heard from several Indigenous communities, telling us how they wanted to be able to develop the mines, the resources. This is where their independence was going to come from.
Are you working with them in terms of infrastructure? We went to Meadowbank mine, and they had to build the roads and all their infrastructure, which was very tough on them financially. They’ve just started to turn a profit now.
To make Canada an attractive mining place, do you have a plan, say in Yukon or the Northwest Territories, where you will work with mining companies to develop roads and fibre-optic cable?
Ms. Richard: I think that would be more of a question for Transport Canada.
Senator Eaton: No, they told us it was a question for you guys.
Ms. Richard: For Natural Resources Canada. I can speak to —
Senator Eaton: You are natural resources. You have a stake on whether there are roads and fibre-optic cables, no?
Ms. Richard: Well, it does impact whether or not the resources can be exploited, yes, absolutely. I mentioned earlier the Canadian Minerals and Metals Plan we are currently developing in collaboration with the territories and provinces. This is looking at all of the different barriers the mining industry has in terms of being able to develop mines in the North.
One of the challenges the Yukon has is that, you’re correct, they have a lot of mineral deposits. They have some major discoveries that have been made over the years. A lot of these deposits are what we’re calling stranded deposits in the sense there needs to be an upgrade in the infrastructure.
There has been funding provided, as announced by Prime Minister Trudeau, that will be developing the gateway project for the Yukon that will be developing roads and improving the infrastructure so those mines can be developed.
One of the challenges the Yukon has is their electrical grid is maxed out. They need to increase their ability to generate electricity. Otherwise, they have to rely on diesel to run their new mines, which makes it very costly.
Senator Eaton: I agree with you. With respect to this gateway project, has the money been set aside to put it into shape, to go ahead with it?
Ms. Richard: My understanding of the project is yes, the federal government has committed I think somewhere around $240 million. There are also private funds, but I don’t know more details. I could get them to the committee. I could ask my colleagues.
Senator Eaton: That would be very nice. Could you tell us what it entailed, when it would start and what the idea is?
Ms. Richard: I would be happy to provide that to the committee.
Senator Eaton: Thank you. In this Investing in Canada Plan, there is $2 billion in dedicated funding to rural and Northern communities. Is that something that would look at the Kivalliq Hydro fibre optic plan?
[Translation]
Ms. Lechasseur: All public infrastructure is eligible for funding. We have to work with our partners, in other words, the territories. We signed an agreement with the Yukon government. It was announced on May 3. The Yukon is currently reviewing its priorities.
Senator Eaton: I’m talking about Manitoba.
Ms. Lechasseur: We also signed an agreement with Manitoba. All the agreements have been signed. Manitoba sets its priorities and submits the project it wants to pursue under the agreement. When it comes to public infrastructure, the provinces and territories are the ones who determine what their priorities are, and then they submit their projects to us.
Senator Eaton: Thank you.
[English]
The Chair: We’re drawing to the end of our panel. I would like to thank the panellists very much. I have a couple of questions I’m just going to leave on the table and ask you respond, if you could, to the committee through the clerk.
The first is to Crown-Indigenous Relations and Northern Affairs Canada. Gentlemen, when we were in the Arctic region, we heard there was much confusion over whether CIRNA or Intergovernmental Affairs or the Northern Program, which is now with another minister, would be the point of contact for organizations. I wonder if we could ask you to provide a simple breakdown of the roles and responsibilities for the North for each department. Not now, but that would be very useful to us.
Second, we have heard about the Northern REACHE Program of CIRNA, formerly INAC; the Emerging Renewable Power Program of Natural Resources Canada; and Infrastructure Canada’s Arctic Energy Fund, all of which are of great interest to this committee. I wonder if I could ask the respective departments to please give us an outline of where those funds are at in terms of projects approved and funds available. We would be specifically interested in projects approved in Northern Canada in our Arctic study framework.
I will leave that with you. I thank all panellists again for being with us tonight. We got a lot of information.
Colleagues, there has been a request for a very brief in camera meeting after we adjourn. I would ask you to kindly remain. I promise not to keep you much longer.
(The committee continued in camera.)