THE STANDING SENATE COMMITTEE ON ENERGY, THE ENVIRONMENT AND NATURAL RESOURCES
EVIDENCE
Ottawa, Tuesday June 8, 2021
The Standing Senate Committee on Energy, the Environment and Natural Resources met this day by videoconference at 9:00 a.m. [ET] to examine the subject matter of Bill C-12, An Act respecting transparency and accountability in Canada’s efforts to achieve net-zero greenhouse gas emissions by the year 2050.
Senator Paul J. Massicotte (Chair) in the chair.
[Translation]
The Chair: Honourable senators, my name is Paul Massicotte; I am a Quebec senator and I am chair of the committee. Today, we are holding a virtual meeting of the Standing Senate Committee on Energy, the Environment and Natural Resources.
Before we begin, I would like to remind honourable senators and witnesses to keep their microphones turned off at all times unless recognized by the chair. I would like to remind honourable senators to please use the “raise-hand” function to request the floor. I will do my best to allow everyone who wants to ask a question to do so, but in order to do that, I ask you to be brief in your questions and preambles. This applies to both senators and witnesses.
[English]
In this respect, we are going to apply a six-minute maximum for the combined question and answer. To show that you’ve reached the six minutes, our clerk will put her hand up. If we pass more than 10 seconds, she’s going to put both her hands up. If we pass that, I’m going to jump over the fence and shut the microphone.
[Translation]
If there is a technical problem, particularly with interpretation, please report it to me or the clerk so that we can resolve the issue quickly.
I would like to introduce the committee members who are participating in the meeting today: Senator Margaret Dawn Anderson from the Northwest Territories; Senator Douglas Black from Alberta; Senator Claude Carignan from Quebec; Senator Brent Cotter from Saskatchewan; Senator Rosa Galvez from Quebec; Senator Mary Jane McCallum from Manitoba; Senator Dennis Glen Patterson from Nunavut; Senator Paula Simons from Alberta; Senator Josée Verner from Quebec; Senator David Wells from Newfoundland and Labrador.
[English]
Welcome all of you and the viewers across the country who may be watching.
[Translation]
Today we continue our study of the contents of Bill C-12, An Act respecting transparency and accountability in Canada’s efforts to achieve net-zero greenhouse gas emissions by 2050.
This morning, for our first panel of witnesses, we have Leah George-Wilson, Chief of the Tsleil-Waututh Nation; Bridget Doyle, Environment and Climate Change Group Leader, Neegan Burnside; Lisa Tssessaze, Director, Dene Land and Resource Management, Athabasca Chipewyan First Nation.
[English]
Welcome, and thank you for being with us today. I would like to remind you that each of you has six minutes for your opening comments, and afterwards we’ll take some time to answer any questions. Therefore, you now have the floor.
Leah George-Wilson, Chief, Tsleil-Waututh Nation: [Indigenous language spoken]. Greetings, honoured guests and my dear ones. I have good feelings in my heart to see all of you. My name is Chief Leah George-Wilson of the Tsleil-Waututh Nation here in North Vancouver, British Columbia.
I would first like to acknowledge the grief our communities are feeling alongside our residential school survivors, friends, and families after Tk’emlúps te Secwépemc documented the remains of 215 children.
I would like to thank the Standing Senate Committee on Energy, the Environment and Natural Resources and, specifically, Senator Rosa Galvez for the invitation to address the Senate today. Canada needs to pass a net-zero accountability act. Tsleil-Waututh Nation supports this bill. However, we want to provide our comments and perspective to strengthen the bill. We invite the Senate to see our written submission for more detail.
Indigenous nations have always been leaders in demonstrating climate action through our knowledge systems, laws, governance and place-based approaches. Tsleil-Waututh Nation is working hard to create space for ourselves in this and in other climate-related, legislative, regulatory and planning processes. Indigenous nations must be at the table to ensure federal approaches regarding climate action do not perpetuate structural inequality for our communities.
We recognize and appreciate key amendments tabled by the House of Commons with respect to including Indigenous rights, knowledge and UNDRIP. However, the preamble should read:
Whereas the Government of Canada is committed to advancing the recognition, respect and affirmation of inherent rights and jurisdiction of First Nations rights protected and reflected under section 35 of the Constitution Act and in UNDRIP. Canada is committed to strengthening its nation-to-nation relationship and collaboration with respect to measures for mitigating climate change, including but not limited to, taking Indigenous knowledge into account when carrying out the purposes of this act.
Further, Tsleil-Waututh Nation you would like to see UNDRIP added to the purpose section. This could recognize — along with its international climate commitments — Canada’s obligation to uphold its international commitment to respect and implement UNDRIP.
Canada has never met a single climate target. Unless the bill is strengthened, we have no confidence Canada will meet future, more ambitious targets. We would like to see strengthened accountability measures. Bill C-12 needs to include a right to judicial review and legal consequences if targets or legal duties have not been met. We would like to see legally binding carbon budgets along with the proposed milestone targets. Emission-reduction plans should be based on carbon budgets and targets. Canadian lawmakers should agree on a solution to fill the planning-implementation gap for 2025. We also recommend legislating a cap for the use of carbon credits and international offsets. Reducing domestic emissions at the source must be the central focus for reaching targets.
Tsleil-Waututh Nation commends the inclusion of climate-risk reporting for federal departments and Crown corporations. We would like to see the Government of Canada broaden its requirement for climate-risk reporting to apply to all projects that trigger a review by the Impact Assessment Agency or the Canada Energy Regulator, as well as all federal subsidies for the oil and gas sector, and other emission-intensive sectors: Canada’s airports, ports and large corporations, including transnational corporations operating in Canada.
Thank you again for the opportunity for Tsleil-Waututh Nation to express our views and to make our recommendations for Bill C-12. I would like to reiterate Tsleil-Waututh Nation’s support for this accountability act. Thank you to all of you.
Lisa Tssessaze, Director, Dene Lands and Resource Management, Athabasca Chipewyan First Nation: Yes. Good morning to everyone — [Technical difficulties].
The Chair: We hear you now.
Ms. Tssessaze: I’ll continue.
I’m making this submission today on behalf of the Athabasca Chipewyan First Nation, or ACFN, the Mikisew Cree First Nation, or MCFN, and Beaver Lake Cree Nation. ACFN and MCFN are signatories to Treaty 8 and Beaver Lake Cree is a signatory to Treaty 6.
Our nations support climate actions and strong action on climate change at all levels of government, and we encourage the timely passage of Bill C-12. This is because Indigenous and northern communities are disproportionately affected by climate change. This means our people are doubly impacted. We already feel the impacts. We feel the drying out of the delta and the watersheds, the shorter and shorter length of time each year to access our northern community via the winter road, and the threatening of key species that we rely on, such as the woodland and barren-land caribou.
We wish to ensure that Bill C-12 helps Canada achieve net-zero by 2050 in a way that protects our treaty rights from further impartment of the oil sands industry. Not only is this industry the largest source of greenhouse gas emissions in Canada, but over the last 40 years, this industry has caused the following impacts on our lands: the destruction of entire landscapes; water shortages and contamination; dwindling populations of the wildlife we rely on; restricted access to large parts of our territory; and increased sicknesses in our community members.
To ensure that climate action is effective and respects our treaty, we recommend the inclusion of a minimum threshold of emissions reductions in Bill C-12 in order to reach net-zero targets. While our priority is the passage of the bill, we recommend that the bill could be improved by including the following provision in section 6: The target of net-zero emissions shall be achieved by reducing domestic emissions at least 90% below 2005 levels.
This type of provision already is implemented in legislation by climate leaders like Sweden. We make this recommendation because of the potential for carbon removal to undermine effective climate action and enable the oil sands industry to continue operating in our territory long into the future —
The Clerk: I’m sorry, I’m going to have to interrupt. Senators, we’re having issues with our French interpretation in the room, so we will need to suspend for a few minutes.
(The committee suspended.)
(The committee resumed.)
The Chair: Ms. Tssessaze, the floor is back to you.
Ms. Tssessaze: We make this recommendation because of the potential for carbon removal to undermine effective climate action and enable the oil sands industry to continue operating in our territory long into the future.
Carbon removal is a very attractive tool to address climate change because it creates the perception that we can keep extracting and burning fossil fuel and simply offset those emissions. Oil sands companies are already planning a large role for carbon removal, as they have made net-zero pledges, but they also forecast continued fossil fuel production long past 2050.
Carbon removal is not an effective, reliable or equitable approach to addressing climate change. If Bill C-12 does not prioritize emission reductions in meeting net-zero, and place limits on the role of carbon removal, then carbon removal will replace emissions reductions in our climate plans.
This will allow the oil sands industry to continue operating. This is a problem for two reasons. First, since carbon removal is risky and an uncertain climate mitigation, continued oil sands operating means continued emissions. Canada will fail to meet its emissions targets, leaving Indigenous communities such as ACFN, Mikisew Cree and Beaver Lake Cree to continue to bear the brunt of climate change.
Second, continued oil sands operation means continued environmental impacts that have already significantly negatively affected our lands, our people and our ability to exercise our rights.
In summary, we support the passage of this bill. We encourage you to prioritize the only effective approach we have to address climate change, which is emissions reductions. This will leave carbon removal to play a supplementary role to address those emissions that cannot be reduced. We can also use carbon removal to exceed our targets. It is important to note we are not advocating for the oil sands industry to be shut down tomorrow, but we are in support of a just transition between now and 2050 that ensures workers and communities who depend on the industry have access to good jobs in more sustainable industries. However, the reality and urgency of climate change cannot be ignored nor can the ongoing impacts of the oil sands on our territories. Mahsi’cho.
The Chair: Thank you very much. Ms. Doyle, did you have something to add?
Bridget Doyle, Environment and Climate Change Group Leader, Neegan Burnside, Tsleil-Waututh Nation: Not at this point, no.
The Chair: If we can, let’s go to question period.
Senator Galvez: I have two small questions, the first to our first witness, and I want to say that I appreciate the leadership, responsibility and position with respect to fighting climate change. They have described how climate change is unfairly affecting Indigenous people in their lands. But I would like to ask them if they want to expand on these impacts, and to talk about why it is so important that they have declared a climate emergency with respect to next and future generations.
Ms. George-Wilson: Thank you, senator. As for [Technical difficulties] coming here to give you our recommendations, I just wanted to say that our Indigenous populations all have a responsibility to our land and our water. It’s so important for us to protect where and however we can, because it isn’t just for us. It’s for the generations that will follow. We can’t leave all of this on the shoulders of our children and our grandchildren. We must act now.
Senator Galvez: Ms. Tssessaze, you seem to know a lot about carbon removal, and you seem to be worried about this. Could you expand on why you are worried about carbon removal techniques? I know they are not up to scale and there are still many years to develop, but I want to hear more about that.
Ms. Tssessaze: Nature-based solutions like planting trees, increased carbon in agricultural soils and wetlands — it’s important we leave our wetlands and peat lands intact so they can keep that carbon. The technologies under way are not proven. It will be some time before technologies that can remove carbon are up to scale and commercialized. More importantly, the oil technologies we see proposed in this region also have effects on our way of life. There are a lot of complications with developing these oil sands in a safe manner, and it is costly.
Senator Patterson: I would like to acknowledge what was said about the recent sad news from Kamloops, which has deeply affected my constituents in Nunavut.
Ms. Tssessaze, you talked about some negative impacts of the oil and gas industry on your environment and people, but I believe that the oil sands is also the largest employer of Indigenous people and has provided significant opportunities for Indigenous-owned businesses in places like Fort McKay, which you would know about better than I.
If well-managed oil and gas projects, with full input of the Indigenous people in their planning and development, as envisioned by UNDRIP, can provide jobs and benefits to help your people get out of poverty, would you say that as we ask for stricter transparency, accountability and higher emissions targets, as you’ve recommended, we should also at the same time be measuring the economic and social impacts which are not spelled out yet in Bill C-12? Would you agree that we should also ensure that this new law will also measure and provide transparency on economic and social impacts from emission targets? I hope that’s clear.
Ms. Tssessaze: If you’re asking about how to measure the benefits, I recall some years back Natural Resources Canada had another bill where the industry was to make public the amounts they are providing to communities such as ours. Are you aware of those?
Senator Patterson: Well, yes, that would be impact and benefit agreements.
What I’m talking about — as we measure greenhouse gas emission targets and lower them as you’ve recommended — should we also not be measuring, with independent evidence from Statistics Canada, how those stricter emission standards also impact economic and social indicators like employment, which I trust you would acknowledge are also important to your people?
Ms. Tssessaze: Hopefully I can respond to your question. Those indicators, there is a lot that needs to happen, and one of them is land use planning. UNDRIP is a really good step in acknowledging that the resources we need to rely on in the future are there.
We rely on this federal oversight, this relationship with a federal department such as yours, but when you get to the working modes of the province, it’s not as strong. If we can somehow ensure that the protections you are putting into federal policy can enable the provinces to act better, we’re not seeing that strong commitment like we have from the federal departments.
What I’m saying is that in respecting our ways and ensuring we can sustain ourselves in the future, those need to be acknowledged by the provinces as well. Those indicators that we need — the fresh water, traditional plants and animals — they need to be sustained into the future. It’s a balance.
With respect to jobs, we’ve recently opened a solar farm in the community of Fort Chipewyan, so that’s creating some new types of employment. That transition for ACFN, the Athabasca Chipewyan, is in place. The Mikisew Cree have also joined in with the new solar farm, so we are transitioning and exploring how we don’t need to rely on the fossil fuel industry.
Senator Patterson: The new technology you described, it also needs capital to make it happen; you need to have investors and partners. Is this something we should consider as we measure the reduced greenhouse gas emissions targets? That is, whether or not we are also, at the same time, able to attract investment for environmentally friendly projects like you’ve described? Bill C-12 does not seem to include those economic and social indicators in measuring how we do in getting to net-zero.
Ms. Tssessaze: I would agree to put as much detail as we can to document and measure those indicators. Yes, I would support that.
Senator Simons: Thank you again to our guests for joining us during times that are extremely early for them.
Bill C-12 is an act for transparency and accountability, and each of you has talked about ways in which you feel the act is not sufficiently holding people to account. I wonder if you wanted to comment on the transparency aspect. Do you think the bill provides enough clear information so that we can track governments and hold them to account?
Ms. George-Wilson: I would like to ask my colleague Ms. Doyle to respond, please.
Ms. Doyle: We did focus on the accountability piece. I think the transparency piece for us was coming through the various reporting stages that the bill proposes, and I think there have been some key amendments through the House of Commons standing committee to also improve on some of the reporting.
One piece that we were looking to be included in the financial reporting piece was on the transparency for social, racial and gender equity measures that would be in place, as well as investments in clean energy technologies and the transition to a clean economy for the workforce. I hope that answers your question.
Senator Simons: Thank you very much.
Senator Miville-Dechêne: Thank you for being with us and for enduring technical problems. This has been our life here.
I would like a bit more information on why you want to have targets included in Bill C-12. Yesterday we were hearing government officials who basically said that the government could not be sued in a civil suit, and I think the inference here is the targets are not included in the bill. However, if we included targets in the bill, it takes away any kind of ease of adjusting to reality, because we are talking about long periods.
I’m also wondering what you think of the fact that the targets are federal targets, and we have a country with 10 very different provinces and very different challenges. That is to whoever wants to answer.
Ms. George-Wilson: I would like Ms. Doyle to respond.
Ms. Doyle: We would absolutely support the specific targets to be included in this bill. We are also advocating for the inclusion of carbon budgets to strengthen our ability to plan and to see true reductions in our greenhouse gas emissions. As you all know, we’ve missed every target that we’ve had, and our emissions aren’t even going in the right direction. We feel that the combination of legislated targets and carbon budgets would help to achieve those milestones.
As far as the second part of that question, with respect to federal action versus provincial, everyone has a role to play in addressing climate change, and it’s imperative that the federal government take that lead and demonstrate leadership through a strong bill such as this. As you see across the country, Indigenous leaders are also taking local, international and federal action to do what they can with respect to reducing greenhouse gases and increasing adaptive capacity.
As important as it is for provinces to also take equal action, the bill before us is federal right now, and there is an absolute role for the federal government to lead this initiative.
Ms. Tssessaze: Thank you for your question. I will say that without targets, it’s difficult to create a plan and know that you are sticking to it. The reality is that you need to reduce the emissions very quickly.
The federal government needs to show leadership for the provinces and unite them. We have already had an example of a federal plan. It was the carbon tax, and there was opposition right across Canada. We intervened in support, so we know that it’s just a part of the system.
Senator Miville-Dechêne: If I could ask a question to Ms. Doyle. Even if you put targets in the bill, it will probably create lawsuits and a legal battle, and all of that will be taken out of the political realm and will go to tribunals.
I’m wondering if you think this is the way to go, or is this a risk we should take?
Ms. Doyle: I don’t think we’re advocating for creating an environment where everything will just get tied up in tribunals. However, I think there is a balance that could be met with increasing the accountability measures in this bill. At the moment, the accountability is really the democratic process. We would like to see stronger measures in place, whether there are concrete penalties that are listed in the bill where targets are not met. Yes, we would like to see increased accountability.
Senator Miville-Dechêne: Thank you.
Senator McCallum: I just wanted to say I’m from Manitoba, not from Quebec.
I wanted to offer my condolences to Chief Leah George-Wilson about the findings of the bodies of the residential schoolchildren and this is, indeed, a difficult time to try to speak to issues that greatly impact us, while still grieving at the same time.
I wanted to go look at the equity analysis of key industries in a transition to a zero-carbon economy. Declining production will cost jobs in every sector of the economy, but the workers outside of the oil and gas sector — who are more likely to be women, immigrants or racialized, including Indigenous people — will not receive the same private and public supports as oil and gas workers unless a more comprehensive reactive transition approach is undertaken. In the recommendations they make, they said Canadian governments at all levels should adopt and formally implement the principles of just transition where they have already done so. Would you comment on that? It’s open for all.
Ms. George-Wilson: Thank you for that. If I understand it correctly, of course, that we think when we’re looking at, for example, the emissions reduction plans, that they should be developed through the inclusive lens of social, gender, racial, environmental justice and equity, as well as recognition, respect and protection of Indigenous rights. We need to look at it in a more fulsome kind of way, I believe.
Bridget, would you like to add?
Ms. Doyle: I think that covers it for right now. We may provide more detail in our written submission, but that was basically our comment to date was just that inclusion in the emission reduction plans as well as in the finance reporting.
Ms. Tssessaze: Thank you. I agree with the responses as well. In any plans that we’re developing and policies that we are making, I would just encourage that we, as the Indigenous communities, are included in the development of those just transition plans, the implementation of these policies. If we’re included at the onset, then we will have less hesitancy or pushback.
We experience this; just that consideration and being there at the decision-making table.
Senator Patterson: Ms. Tssessaze, I believe you said you didn’t want to shut down the oil sands but rather see a transition to different kinds of jobs. Could you just comment on the jobs and business benefits that are flowing to your peoples, as I understand it. Are they indeed significant and important to your members?
Ms. Tssessaze: We have a group of companies called Acden. They have contracts throughout the industry region. The Acden corporation is its own entity and it has a relationship with the First Nation, such as my department does. There are benefits flowing, and we are always looking to expand and diversify how we’re trying to be less reliant.
A couple of examples I have I already said, we’re trying to explore the solar panel farm, pipeline is another one where we’re exploring. That’s a new one I’m not familiar with. But we do have quite a few corporations contracting with these industries. We understand as well that we need to transition and explore how we can be less reliant on those. It takes time.
Senator Patterson: Thank you.
Chief George-Wilson or Ms. Doyle, you spoke of carbon budgets, and when I think of budgets they include not only spending, but also revenues and sources of income for budgets. I’m wondering if, as we look at emissions, whether we should also be looking at economic and social indicators that will change with our net-zero strategy, such as real GDP growth, employment and other social indicators, so we can measure the impacts on your members.
Ms. George-Wilson: Thank you, Senator Patterson. Are you asking if we would support measuring other outcomes besides what’s in the bill?
Senator Patterson: Other than greenhouse gas emission targets and reductions, as we impose what you’ve recommended are higher, stricter targets and standards, should we also be at the same time trying to measure the economic and social impacts that I believe are also important to the Dene?
Ms. George-Wilson: Thank you, sir. I think it would be important to measure as long as we remain inclusive in what we’re measuring in terms of the various groups of people that we were referring to earlier. Bridget?
Ms. Doyle: Yes, thank you for that question. To be honest, it wasn’t something that we put much thought into with our submission. However, I think if UNDRIP is incorporated the way that we have proposed and the way it was tabled in the House of Commons, if there’s Indigenous participation in co-developing or meaningful consultation and developing the emission reduction plan, I think some of those indicators could be addressed through those planning and reporting processes. It’s absolutely something that I think would be valuable to see and we would support that. However, our priority is to see an accountability act passed. Where those indicators can come into the planning and monitoring of progress, we’d be open to discussion.
Senator Patterson: Thanks very much. It’s about measuring performance but also results and impacts. Thank you.
Senator Galvez: By listening to the questioning of Senator Patterson, I couldn’t help remembering one of the amendments that is proposed by the Canadian Association of Petroleum Producers, CAPP, with these economic impacts being added.
I think there are other places where this has already been done, so it’s not needed here. I think there is a discussion going on in the other house about this.
It’s so important to know about the impacts that some industries’ activities have on young Indigenous people. I remember the witness coming from Amnesty International, talking about how extractive industries have impacted the safety and security of women, and how this also impacts the reconciliation we want to have with Indigenous people. I wanted to ask: Is there a certain type of development that is welcome and if others need to be redressed in one way, because it cannot continue in the way it’s going. My question will go to Lisa. Thank you.
Ms. Tssessaze: Definitely, we do see impacts to our women in our community. We’ve witnessed hundreds of missing and murdered Indigenous women, and it still occurs right here in this region. I don’t know how to propose development or industries that wouldn’t do that. It’s unfortunate that we live in a society where — there was an incident all over the news yesterday about a family being hit — violence is everywhere. It’s not welcome in our communities, and I’m not sure how we can protect our women in these industries.
We have regular discussions with these companies, and we hold them accountable if we feel that systemic racism is present. If we feel our members are not protected on those sites or are being racially discriminated against, we bring it up. We don’t let the companies get away with it. We don’t tolerate any of that, but it still happens. I’m not sure how to address that — it’s society. We try to control it the best we can on the sites.
[Translation]
Senator Carignan: I have read a lot about the issue of targets. I see Bill C-12 as an attempt to make the government somewhat more accountable, but it comes with a lot of timidity in the system, the process, the transparency, and the reporting. I figure that the biggest sources of pollution and emissions come from activities carried out by private sector companies.
I will draw the following parallel: When we wanted to deal with work accidents issues, we made sure businesses had accident prevention plans. When the goal was to reduce fires, fire prevention plans were set up that called for installing sprinklers in industries, to prevent fires. When we wanted to reduce the disparity between women’s and men’s wages, we provided for pay equity plans within companies to correct the situation. Have you looked into the possibility of having greenhouse gas reduction plans within companies, so that each company can draw up its own reduction plan? This could be an incentive for companies to do so, and it could be included as a target in the government plan. Are these things that you have looked at?
My question is primarily addressed to Ms. Doyle, but also to the entire group.
[English]
Ms. Doyle: Thank you for the question. In our comments and in Chief Leah George-Wilson’s testimony, we did mention the need for expanding the climate finance reporting requirement to large corporations and transnationals operating in Canada. We are trying to find where the federal leverage piece may be in addressing the role that large corporations do have in the emissions of Canada.
Again, yes, we would absolutely support more action at the corporate level to reduce emissions across sectors. However, we’re going to need so many tools in the toolbox. What’s before us right now is a federal act to address federal jurisdiction. We would be supportive of where we can try to push the boundaries of how that applies. We’ll look for opportunities to, I guess, pressure corporations to do the same over time.
The Chair: Senator Patterson, I see you had your hand up — very short question, please.
Senator Patterson: It’s okay. We’re out of time.
The Chair: Let me thank all three of our very good expert witnesses. I think we learned a lot, and we have lots to learn. We appreciate your opinion and will definitely consider that in our report. At the same time, from all of us, our deepest sympathy for the Kamloops massacre incident. We have a lot to be sorry for — our sympathies and our deepest condolences. Thank you very much and have a good day.
[Translation]
Colleagues, from the Canadian Association of Petroleum Producers, we have Shannon Joseph, Vice President, Government Relations and Indigenous Affairs, and Dan Wicklum, Chief Executive Officer of The Transition Accelerator. Welcome, and thank you for accepting our invitation on such short notice. I would like to remind you that you each have five minutes to make your remarks, and a question and answer period will follow.
[English]
Shannon Joseph, Vice-President, Government Relations and Indigenous Affairs, Canadian Association of Petroleum Producers: Thank you, senators. I would like to thank the committee for the opportunity to be part of your study of Bill C-12. I’m speaking to you from Ottawa, the traditional territory of the Algonquin and the Anishinaabeg people.
The Canadian Association of Petroleum Producers represents Canada’s upstream oil and natural gas industry, which has operations in British Columbia, Alberta, Saskatchewan, and Newfoundland and Labrador.
CAPP and our member companies are strong supporters and investors in environmental performance and innovation. We want to work with the government to achieve its climate change goals. We also believe that this legislation must create transparency and accountability for all aspects of Canada’s pathway to net-zero emissions, including economic outcomes for Canada.
We took note of Prime Minister Trudeau’s comments, on the occasion of April 22, 2021, at the Leaders Summit on Climate, that our climate change response can be our “greatest economic opportunity.”
As the Canadian Chamber of Commerce noted in their remarks to the House of Commons on Bill C-12:
. . . not all pathways to net-zero are created equal. . . . some of them will achieve the desired environmental outcomes, but at the unnecessary expense of other social and economic factors.
Bill C-12 provides for transparency and tracking of Canada’s performance in reducing greenhouse gas emissions, but without amendments, the bill lacks the mechanisms to ensure that the pathway is informed by the right expertise, regional diversity and an understanding of required social and economic performance to guide approaches and trade-offs in achieving net-zero.
If the path to net-zero is to create growth, investment and jobs, then as a companion to environmental performance, we need economic targets and economic performance metrics to be built into this legislation.
Beyond this, pathways to net-zero will look different in the diverse regions of our country. We know as an industry that is regulated both federally and provincially that different governments have their own climate ambitions and perspectives on opportunities for policy measures to achieve those ambitions. Often different orders of government develop policies targeting the same activities and the same emissions, and this creates policy inefficiencies that drive away the capital needed for Canadian industry to innovate and deliver environmental results.
Bill C-12 must create the framework for us to do better. It should be amended to enhance integration and collaboration between federal, provincial and territorial governments in the way strategies are developed and evaluated.
Canada is an exporting country, and oil and natural gas is our number one export, contributing more $101 billion annually to Canada’s economy. We employ over half a million women and men in well-paying, skilled jobs from coast to coast, including over 63,000 jobs in Ontario and 18,000 jobs in Quebec. Our national supply chain outside of Alberta includes over 2,700 different firms, with annual purchases of over $4 billion.
In addition, we purchase over $2.4 billion annually from Indigenous-owned businesses, representing 11% of procurement in the oil sands alone. We are one of the largest employers of Indigenous Canadians in well-paying jobs. The oil and gas sector plays an important role in reconciliation, including economic reconciliation. We hope to preserve and enhance this role, as well as the other benefits I’ve just described.
Industry also has ambitions related to addressing climate change and its own view of opportunities both locally and globally. The oil and natural gas sector in particular has been taking action through technology innovation. According to a 2018 study by Global Advantage Consulting Group conducted for the Clean Resource Innovation Network, about 75% of all clean technology investment in Canada comes from the natural gas and oil industry.
Our leadership in innovation will not only help reduce emissions here at home, but through technology sharing and export, Canada can help reduce global emissions around the world. An example of this is carbon capture, utilization and storage. The Weyburn-Midale project in Saskatchewan is one of the world’s largest and longest running. We hope to see more of these projects, and we want to benefit Canada through the export of this technology.
Our emerging liquefied natural gas industry in British Columbia also has a role to play in reducing global emissions and in generating internationally traded mitigation outcomes or carbon credits for Canada under the Paris Agreement. China alone is adding one new large coal-fired power plant to its grid every two weeks. Coal-fired generation continues to grow in India and Southeast Asia, all with a focus on improving living standards for their citizens. If these facilities ran on Canadian liquefied natural gas, they would generate significantly lower air pollutants and significant lower GHG emissions. Canada is uniquely positioned to have the lowest GHG-emitting LNG in the world because of our grid and the [Technical difficulties] of our industry.
The framework created by Bill C-12 needs to create the space for a conversation around how industrial strategy and [Technical difficulties] et cetera.
Bill C-12 should articulate the role that economic sectors and other stakeholders will play in the development of plans and in achieving targets. It should ensure that expertise in the technologies and opportunities are brought to bear on Canada’s advisory panel and overall decision process.
We recommend a greater role for the Governor-in-Council in the development of targets, plans and supportive policies under the act, particularly given their potential effects on the whole of Canada’s economy and society. By working together, industry and government can accelerate innovation and develop technology that reduces emissions while delivering responsibly produced energy to meet global energy demand. We hope our recommendations to this committee can support Canada in this process. Thank you very much.
Dan Wicklum, Chief Executive Officer, The Transition Accelerator: Hello, senators. Thank you very much for the opportunity to appear before you. I’m here in two capacities.
First off, I am the CEO of a new, non-profit charitable organization called The Transition Accelerator. We were launched about 20 months ago, bringing in new methodology, we believe, in terms of how to frame emissions reductions and achieve net-zero. We work with Canadian academics and groups across the country to develop very specific transition pathways to a net-zero future, but we do that by harnessing disruptions. We’re in the middle of disruptive forces in our society such as technology, a business model or social disruptions. Instead of seeing these as a threat, we see them as a tool. We don’t want to slow them down; we want to speed them up by directing these disruptions where we start with, solving business and social challenges but also building emissions reductions into those solutions. That’s one hat I’m wearing before you today.
The second hat is I am a co-chair of the Net-Zero Advisory Body that was launched by the Minister of Environment and Climate Change and is contemplated in Bill C-12. I would be happy to answer any questions you have.
The Chair: We’ll proceed to questions.
Senator Patterson: I would like to ask Ms. Joseph, would you agree there are many pathways to net-zero? Maybe you could give some concrete examples of a good pathway for Canada to net-zero that would benefit the country and your industry.
Could you elaborate as to your recommendation that there be economic and social indicators that could guide us and why they should be put in the bill, as you’ve recommended?
Ms. Joseph: Thanks, senator. I apologize that my connection is choppy. I’ve been informed by the clerk to try to speak clearly.
I’ll answer your second question first. I think as [Technical difficulties] and the government is creating accountability for itself, which [Technical difficulties] on how to achieve net-zero. But if we look at what happens —
The Chair: I think Senator Carignan was next.
[Translation]
Senator Carignan: You are a Transition Accelerator specialist. How long do you think it would take for companies — especially large emitters — to put transition systems in place if they had individual targets or plans? Particularly in the case of oil companies — because I see you have a lot of expertise in this area — how long would it take for them to reduce their emissions and meet the targets that are set for 2050?
I know that some companies — Suncor in particular — have bought wind power fields. I know that they are investing in hydrogen. Companies like Occidental Petroleum are doing that. They’re moving more and more into that kind of energy and they’re going to change their system. They are moving towards electric vehicles. Companies have to rethink their energy distribution system and plan stations accordingly for the new types of fuel. Can you give us a time frame, and whether it’s realistic and achievable?
[English]
Mr. Wicklum: I understand your question asks if it is realistic or doable to get a net-zero society by 2050, and the answer is absolutely. At the advisory body —
[Translation]
Senator Carignan: Correct. For the individual industries.
[English]
Mr. Wicklum: Getting to net-zero means what we have to do as a society is create a transition pathway. All the changes we need to make to society are not going to happen overnight, next week or even next year. We need a pathway so that over the next 29 years, between now and 2050, we can get to net-zero. That is absolutely possible.
The onus is on individual sectors and individual companies to understand, do the analysis and articulate how they fit into a net-zero world. For many decades, around the world, institutions and people have pointed to national governments as having the sole responsibility for driving emissions reduction and now emissions elimination under a net-zero definition. That’s one of the big changes here. We are actually all in this together. The private sector has just as much responsibility as a national government or subnational government. The people who can answer that question are actually the individual companies and sectors.
However, governments have critical roles. One is requiring sectors and companies to report more transparently, not just that they have an ambition to get to net-zero, but that they have a plan, which is made public, and that has steps in terms of investments, technology and the business model changes they’ll make to be a part of a net-zero world. Those corporate plans require the reporting not just of emission-intensity reductions but absolute emission reductions, and that those plans are independently verified. For the longest time, when we wanted companies to report on things we valued, for example, their financial performance, we have had legal requirements that they be audited. Now that emission reductions are as important as financial performance, one of the great tag lines that has emerged is “financial risk is climate risk.” Emission-reduction plans should be verified by independent third parties as well.
Whether or not that’s something that should be in the act is a separate issue. We have quite a detailed financial regulatory system for companies, and it seems to me that might be the best place for that type of requirement.
[Translation]
The Chair: I see that Ms. Joseph is with us. Senator Carignan, do you have a question for Ms. Joseph?
Senator Carignan: Yes. I fully agree with the proposal for liquefied natural gas to replace coal plants in China. However, on a global scale, the problem is that you have to go by country. So a company that chooses to use liquefied natural gas in Canada would be increasing its greenhouse gas emissions here and reducing them in China. On a global scale, this does not appear to be calculated or offset in this way. What solution should Canada consider to get some type of offset and help other countries, including India and China, reduce their greenhouse gas emissions?
Ms. Joseph: Thank you for the question, senator. The Paris Agreement has created mechanisms to recognize the fact that we can work closely with other countries to use our resources to meet international GHG reduction targets. Under article 6 of the Paris Agreement, we can generate credits for GHG reductions achieved in other countries, through the export of our energy or technology, and share these credits. I think we need to ask the questions: What pathway does Canada need to take to meet its targets? What is the role of our energy in terms of global GHG emissions, and how are we going to recognize the GHG reductions that can be generated through mechanisms established by countries under the Paris Agreement?
Senator Carignan: So we should include a provision in Bill C-12 to take that into consideration?
Ms. Joseph: It is important that Bill C-12 create mechanisms to ensure that solutions are sought to preserve economic growth while recognizing global and regional aspects. If we take this approach to achieving zero emissions, we are bound to look at several types of solutions, including this mechanism.
[English]
The Chair: Senator Patterson, I don’t think your question was fully answered, so you have the floor for 30 seconds.
Senator Patterson: Yes, regarding pathways to net-zero and why we need economic indicators in Bill C-12, my colleague suggested they are already available. Why does it, then, go into Bill C-12?
Ms. Joseph: They are not available in any specific way anywhere else.
If the government is creating an accountability framework for itself in terms of net-zero, which Mr. Wicklum pointed out is connected to economic activity, then we need to measure how our approaches to achieving net-zero impact Canadian employment, Canadian ability to attract private sector investment and real GDP. That will lend itself to an analysis that looks at a range of solutions. We cannot be myopic about how we approach this.
Industry is operating in national and international contexts. We need solutions that achieve our climate aims while preserving and growing Canadian opportunities and benefits to citizens, some of which I outlined in my remarks. The liquefied natural gas, or LNG, opportunity, specifically, is one where there have not been clear signals. Many important LNG projects have been cancelled in Canada, even the Kitimat LNG project is at risk. One of its major owners is seeking to sell and invest elsewhere. If we don’t have an approach on this issue that marries our industry, and not just my industry, with what we are trying to do about the climate and recognizes the mechanisms that are key to making that happen — which includes tracking investment to support innovation — then we will not have an optimal solution. Canadians need one.
Senator Patterson: Thank you.
Senator Galvez: My third question is for Ms. Joseph.
A recent report by Professor Carter from the University of Waterloo stated:
From 2000 to 2018, while oil and gas production grew by 47%, royalty revenues fell precipitously by 45%. Effective taxes from the oil and gas sector to government dropped from 15% to 4% over 2006 and 2018. As for jobs, in 2018 the oil and gas sector represented just 1% of direct employment in Canada.
To save costs, the industry has aggressively cut jobs by 23% over the 2014 to 2018 period even as oil and gas production increased by 44%, reaching record highs. Put simply, before the COVID-19 pandemic, Canada’s oil and gas sector shed workers and provided far less revenue to the provinces as oil and gas production reached unprecedented levels.
When you say we should have economic targets and they should be set, I would like to ask you if you can expand on that. How do you expect your members to meet them under these circumstances?
Ms. Joseph: Thank you for that question, senator. I’m not familiar in detail with that research, but looking at those numbers, they cover periods of decline in the price of oil and periods of height in the price of oil. There have been time frames in there where the government has been getting $12 billion in revenue on average from our sector, and right before the pandemic, it was getting closer to $7 billion on average in terms of government revenues.
Those numbers that I provided on the half million jobs are from right before the pandemic and the years before. Someone can trivialize those jobs, but they are certainly important to those people.
I would say that a key piece for our members is also our access to markets and our ability to get fair price for our product. As the senator may recall, there were a lot of constraints on our ability to access markets for oil and for gas, and those constraints remain in place until the line 3 expansion and the Trans Mountain pipeline are completed, and for the LNG industry until the Coastal GasLink is completed. All of those things require certainty in the policy environment, which is linked to industrial strategy, which is linked to Canada’s overall climate and economic strategy.
Industry can perform in a context of certainty, and our industry generates significant benefits for Canada. Despite what this particular researcher says, there are many other sources including Finance Canada that might beg to differ.
Senator Galvez: Thank you very much for touching on the international aspects. Only two weeks ago, we have heard about landmark decisions in court about the importance of tackling climate change, and courts are stepping are up to forcing oil and gas companies to declare their climate risk and reducing emissions.
The International Energy Agency published a report saying that no new projects in oil and gas should be conducted if we want to avoid an increase in temperature of 1.5 or even 2 that will be detrimental to human life.
In the times when this is happening and insurance companies are not wanting to insure pipelines, how do you see the future of your industry and its role to play in cutting emissions?
Ms. Joseph: I think, senator, you can see from much of the reporting that my members do that they are all committed to action on emission reductions. They have invested significantly in technology and other areas to achieve those reductions. The court decisions we’ve heard have not changed that. That said, our members need certain contexts in which to be able to innovate, and that remains important.
You asked a question about the IEA report, which was responded to by the Bank of Montreal Capital Markets groups as a “fantasy island” type of report. This is one scenario among many to achieve certain outcomes, and our industry believes that we can play an important role in the context of the world’s pathway to this.
I would remind everyone at this table that before the pandemic, the world was consuming 100 million barrels of oil per day. At the low point in the pandemic with high lockdowns, people were consuming 91 million barrels a day. Today, it’s at 95 million and it will go back 100 million later, because this is the energy system we have. The energy system can transform and diversify, and we all have a role to play in that, but the suggestion that we don’t need this energy is not reflected in the IEA’s data, other data or the current facts around what supplies our food and the global supply chain.
I would highlight for senators that these are the some of the facts on the ground, and we don’t want signals to be sent that cause investors to lose sight of this or discount this, because Canadian producers are the most committed and have the highest environmental performance in the world compared to our competitors, and the competitors will eat that market share if Canadian industry does not play that role.
Senator Simons: In our last round, we heard from Ms. Tssessaze, who raised concerns that we might be moving toward accountability and carbon reduction, not by reducing actual emissions, but with a variety of offsets, from carbon trading to counting wetlands to using carbon capture and storage. I understand her argument because it can sometimes seem like a bit of a shell game to figure out what we are actually counting and how.
I wanted to ask both Ms. Joseph and Mr. Wicklum whether it is possible to get to net-zero without those kinds of offsets and captures. If not, how do we make sure we are holding people accountable for really sequestering carbon or reducing the amount of global emission?
Mr. Wicklum: I’ll start with just unpacking what net-zero means. Net-zero is an equation. You have a net-zero state when you add up all the emissions going to the atmosphere and subtract all the emissions coming out of the atmosphere. If the first figure minus the second equals zero, then you have a net-zero situation.
We’ve met with 14 groups across the world that have modelled out full society net-zero pathways, and all have come up with remarkably similar conclusions, saying this is difficult, but we can absolutely do this. That’s the number one conclusion.
The second conclusion is that we can’t rely on removal technologies to get to net-zero. We will have to do everything we possibly can to reduce actual emissions.
For the residual emissions that are difficult to negate, that’s where removal technologies can come into place. There are three kinds of removal technologies. One is carbon capture and storage from a point source, a concentrated fuel gas like the oil sands operation, for example. You can also capture emissions directly from the atmosphere; it’s called “direct air capture.” The third is nature-based removals. All of those three are real technologies. None is any more or less real, and the reality is we are probably going to have to rely on all of them to attain net-zero in 2050.
Ms. Joseph: The only thing I would add is that when we look at our industry, we don’t have tons of low-hanging fruit. A lot of technology and investments that are needed are not currently economically efficient. So having certainty around credit generation as a way to manage cost is the way to encourage innovation and technology buildouts. To generate those credits where it is more affordable to generate them will be important in preserving the economics of doing some of those deeper cutting emission-reducing measures in our industry and others.
Senator Simons: Thank you both.
Senator D. Black: Thank you very much, witnesses, for being here and thank you for the ongoing work that you continue to contribute.
Mr. Wicklum, I’m very impressed that you are able to balance these incredible responsibilities you now have with the accelerator and as the chairman of the advisory panel — tremendous responsibility that I know you will discharge.
I want to step way back from this. There are thousands of Canadians listening to us this morning because people understand the significance of what we’re talking about. So I would ask both of you to paint a picture: What does this legislation mean for Canadians, Canadian business and Canadian social organizations? Let’s get beyond the words and aspirational objectives, with which we all agree, to come right to ground. What does this mean for Canadians, folks who are listening? I’m interested if you could paint that picture in language that will be appreciated by those who are listening.
Ms. Joseph: I think the opportunity is to create a framework for us to work together with the different regional expertise and opportunities, and with the different industries and their sense of technologies and opportunities, to carve a pathway that will get results. A lot of people have raised concern around results. However, we would do it in a way that is sustainable, because we’ve also observed that when the policies are not done in a way that is sustainable, and you get big energy cost increases and things like that, there are pushbacks, rollbacks and all kinds of things. This is an opportunity for us to work together to look at the things that are important to all of us and use that knowledge to carve a way forward.
Senator D. Black: Ms. Joseph, I take from that comment that your view is that Bill C-12 is half a loaf — that it does not allow us to achieve what you just identified.
Ms. Joseph: It’s missing some ingredients in the loaf. Some of what we’ve proposed put in accountabilities, not just for economic performance — looking at measures like employment and investment — but also for how that looks nationally versus regionally. Different parts of the country have different economies. They have different energy mixes today. It costs them differently to change their industries or energy supply. Each of them have different roads. Working together is how we’re going to get a result that is equitable.
The Chair: Mr. Wicklum, did you hear Senator Black’s question?
Mr. Wicklum: I think I did. Let me just clarify. Was the senator looking for me to take a step back and comment on what this really means for organizations, companies and people in Canada ?
Senator D. Black: Bingo. Paint a simple picture. What does it mean for my aunt?
Mr. Wicklum: The reality is that there will be massive changes going on in the next 29 and a half years. Frankly, that is required if Canada is going to play its role in avoiding the worst consequences of climate change, and if we are not going to leave the planet to future generations with permanent changes that our scientists tell us won’t make us happy.
The reality is that there are many ways to reduce emissions, and we have been trying to reduce emissions for 30 years, since 1992 when the [Technical difficulties] was signed. There are actually very few ways to have a net-zero energy system that’s functional for Canadians — delivering services to Canadians — and be net-zero. This is one of the other commonalities that is emerging. Pathways are being developed by a whole host of groups and countries. The reality is, we’re going to see massive electrification. We are going to see a great decrease in the prominence of fossil fuels in our sector. We are likely going to see a massive switch to hydrogen; hydrogen is a zero-emission fuel. Things that you can’t electrify — like moving trains, big buses or ships around — are probably going to use hydrogen as a zero-emission fuel. If you wake up in the morning in a net-zero society, you’re probably going to be able to do exactly the same things as you are doing now, using different energy sources.
Frankly, there is some upside. The world will be cleaner. We will save massively on health care costs. If we do this redesign correctly, we think the world could be a fairer and more just place for the disadvantage groups that have been essentially excluded from economic activity as the current energy system based on fossil fuels evolved. That’s something we could consciously address, and the world could be a more just place.
If your aunt wakes up in the morning in 2050, and we have done a deliberate, conscious job of building a good transition pathway, she will like the world better than the world she wakes up in this morning.
Senator D. Black: That’s wonderful to hear. Would it be of help to you and your group if there were, as a number of witnesses suggested, some economic targets or placeholders or stakes in Bill C-12?
Mr. Wicklum: I’ll comment on the concept of measuring. If you don’t measure things, you don’t manage them. I ascribe to that as a scientist and a manager. There definitely has to be some diligent, comprehensive tracking of economics, both of the sectors that are likely going to play a much less prominent role in the future energy system — like fossil fuels — but also of the economic upside. Bill C-12 is in the right place to have those economic indicators. I would leave it, frankly, to people who are more familiar with the specific machinery of government, including people at StatCan. However, measurement is important.
The Chair: Senator McCallum, I apologize to you for referring to you as from Quebec instead of Manitoba, but I thought given last night’s hockey game, you would have been pleased with that result.
Senator McCallum: I’m referring back to the preamble, where it says that Canada wants to contribute to making Canada’s economy more resilient, inclusive and competitive. My question is for Mr. Wicklum. Canada has adopted that target of carbon neutrality by 2050. To meet this ambitious, long-term goal, the country must accelerate its transition away from the production and consumption of fossil fuels and ramp up its transition into lower-emission alternatives.
While the transition to a net-zero economy is both necessary and desirable in the long run, there is no guarantee that it will be an inclusive, productive or fair transition for workers and communities across Canada. There is concern that in the absence of proactive government policies to ensure inclusivity, the burden of moving away from fossil fuels may fall disproportionately on marginalized communities and exacerbate existing inequities.
How do you see that we can achieve a managed transition to a lower-carbon economy that minimizes the potential harms and maximizes the potential benefits for workers and their communities?
Mr. Wicklum: Thank you. What you’ve stated eloquently is one of our great challenges at the scale of the world and the country. How do we make sure we attain the net-zero outcome that we need in order to safeguard the planet but at the same time minimize economic disruption to existing groups and maximize the upside for everyone? That is the issue.
In our work at the Net-Zero Advisory Body, we have met with several groups internationally that, through independent modelling, have said that there is actually a net economic increase in the pathways to get to net-zero, not a decrease. The reality is that there are great changes in emphasis so that some sectors will absolutely play a less prominent role in future economies, and other sectors will play a more prominent role. Even though it is net-zero benefit at the scale of the country, how do you figure out how to make sure that specific regions and groups are not disadvantaged economically? My answer to that question is, “Very deliberately.”
For example, if you add up all the spending that the Government of Canada announced in investments to get to net-zero now, it’s many billions of dollars. There are almost certainly going to be many more billions of dollars from the public and private sector. Taking steps very explicitly and diligently to make sure that those funds are disbursed from governments in ways that benefit historically disadvantaged groups is very important.
There is another engineering fix as well. We talk about oil and gas not having a role in a net-zero future. That’s not necessarily correct. The problem is not oil and gas companies or the great people who work for them. The problem is the emissions associated with oil and gas. Finding ways to actually keep an oil and gas sector alive — while making sure the emissions associated with using oil and gas do not go into the atmosphere — holds great promise.
I’ll just flag one thing — this concept of hydrogen. You can make hydrogen as a zero-emission fuel by splitting water or by upgrading natural gas. You can keep producing natural gas, but you upgrade it into hydrogen that’s zero emission at the point of use. Not only do you have a fuel that is compatible with the net-zero world — made from natural gas — it’s actually probably required for a net-zero world. We have diligence in terms of disbursing public funds and incentivizing private investment, but we also have to look carefully at the specific engineering fixes or elements of what will make up a net-zero energy system, in this case, in 2050. Both tools can be used to ensure that historically disadvantaged groups assume their rightful spot in Canadian society and get equitable economic benefits.
Senator Cotter: Thank you to the witnesses for some really insightful presentations. I appreciate it.
I have two questions for Mr. Wicklum. Building on Senator McCallum’s question, you indicated that getting to net-zero can be done but it will be difficult. I think you acknowledged in response to her that this difficulty will vary from some sectors to others; it will be more difficult for some than others.
Given this is a commitment by us all but driven by the Government of Canada’s commitment, do you see a Government of Canada responsibility to ameliorate the consequences to those for whom the transition will be more difficult and burdensome?
Secondly, you mentioned modelling done elsewhere about how to get to net-zero and the significant need for reductions in greenhouse gas emissions as opposed to removal. Do those models have a balance? We’re going to have to deal with the reductions at 70% and removal at 30%. Is there a working formula for thinking about that in the research you and your colleagues have done?
Mr. Wicklum: Your first question, does the Government of Canada have a responsibility to help communities, organizations and regions to transition, the answer is absolutely yes. I also qualify that by saying we’re entering into a new paradigm where, for decades, people have pointed to national-level governments around the world and basically said, how are you going to fix this? I think what’s happening now is everyone is understanding that all leaders and all Canadians have a role. Investment decisions matter. Individual consumer spending choices matter. Individual Canadians and companies have just as much of a responsibility to help transition as governments do, including the federal government.
In terms of modelling capacity, a model is basically an artificial abstraction of the future. No one can predict the future, we all know that. Otherwise we would put our money in the right stocks and with the increase in value, we’d be retired.
Models are a way of understanding how the world might work and the idea where you essentially game play. Could you get 70% emission reductions from this sector or 40% from this sector and understand the relevant contributions of sectors to get to net-zero, on what timelines, and the relative proportion of reductions versus removal. That’s exactly what the models do.
We have really smart people around the world, including Canada, using those models to play out those scenarios, yes.
Senator Cotter: But there’s no optimal number of the mix?
Mr. Wicklum: It’s the kind of thing where you create a model, you put data and assumptions into it and it pops out an answer, but the computers can’t make decisions. We have to make decisions as people, and frankly, elected and appointed officials.
There is absolutely no optimal mix, but you can ask questions like: What is the most likely pathway to get to net-zero? Or how can we optimize the creation of a pathway to reduce this type of effect or maximize this type of effect? There is no optimal solution. Computer models are really just tools to allow real people to make decisions.
Senator Cotter: Thank you very much.
Senator Bovey: I would like to add my thanks to the witnesses. As a stand-in to this committee, I find it very interesting.
Mr. Wicklum, my question is for you and it’s about the advisory body that’s being created by Bill C-12. I want to thank you for taking on its co-chairmanship.
Is the structure and framework of this committee and the mandate you’ve been given specific and helpful enough for the committee to prove useful in achieving the goals this bill lays out? Can you tell me how that might be the case or what you need to make it the case?
Mr. Wicklum: Thank you, senator. Bill C-12 is still in front of our houses for decision, but there are other countries that have launched this type of legislation and have this type of body, and have had it for some time. Led by the U.K. and France, the leaders of 20 bodies analogous to the Net-Zero Advisory Body here in Canada convened representatives from 20 countries about three weeks ago, really for best practice and knowledge sharing. One of the key themes that came out was that it’s very difficult to use a cookie-cutter approach in order to design a net-zero advisory body. There was remarkable diversity in terms of mandate, how they were enshrined in legislation or they weren’t, and their resourcing. The one thing that I learned was that each of these 20 bodies seemed to make sense based on the strategic variables and drivers in those countries.
I think what we have to do in Canada is really look at the unique strategic environment that we operate in, which is that we have quite a complicated Constitution. In terms of different levels of the government, we have very strong and hopefully stronger Indigenous presence in our pathways to net-zero.
So that’s really a process answer, senator, but so far, what we’ve seen in the three months since the Net-Zero Advisory Body has been set up is that we’re quite functional, and we think we will be able to deliver our mandate with the resourcing we have. I would say we’re quite happy with the way the terms of reference are framed and the work we’ve been able to do so far.
Senator Bovey: And your make-up is sufficiently diverse that you’re able to receive and accommodate multiple viewpoints and advice, as we’ve heard this morning?
Mr. Wicklum: We have two co-chairs, myself and Marie-Pierre Ippersiel from Quebec, and then we have an additional 12 members that, frankly, represent — our job is not to represent a constituency or a region, but we’re from different regions. We have quite a diversity of experience, and that experience is being brought to bear as an integrating function so that all of the advice going inside government and outside government is essentially integrated by this Net-Zero Advisory Body.
Senator Bovey: Thank you very much.
Senator Patterson: Ms. Joseph, you talked about the importance of measuring economic indicators along with GHG emission target indicators, and you talked about the importance of Canadian competitiveness in the world. Could you give some examples of how Canada is doing with respect to competitiveness in attracting capital with other energy producers in the world?
Secondly, I have a very focused question. You mentioned the need for Governor-in-Council involvement in setting these targets and reviewing them, not just the sole discretion of the minister. Could you elaborate why you’re recommending that?
Ms. Joseph: Sure. Thank you. On the first question, I’ll just give an example. Canada has lost about $150 billion in energy projects over the last few years, including a number of LNG projects. In 2020, we attracted about it $28 billion in capital, which is kind of low for our sector.
If I compare us to Norway, which has very similar climate objectives and companies with similar commitments, Norway attracted $20 billion in investment that same year, so very close to Canada, but they are a fraction of the size of Canada’s industry. So it speaks to the confidence that Norway has provided in terms of their tax measures and other measures, and making investors know that they have found a way to integrate the industry and the industry’s climate innovation with the way they want to approach it. We haven’t quite landed that here. I think having these indicators will support those types of conversations.
To your second question around the Governor-in-Council, the legislation has five measures that are exclusively under the jurisdiction or decision making of the minister, including the terms of reference for the advisory panel, setting and changing of targets and a number of other measures. Our lawyers have indicated that the way these bills are written, you either have a minister with discretion and they get advice or you have decisions that are made by Governor-in-Council, which is a consensus of all the ministers.
We think that given the importance of this legislation, which is effectively making a new plan for the economy every five years, to achieve these goals, you need the expertise and the accountability of all these ministers to reach strategies that strike the right balance, achieve the goals on the environmental side, but also achieve the goals on employment, economic growth and so on.
Senator Patterson: Thank you very much.
Senator Galvez: Mr. Wicklum, you said that the U.K. and France have good models that we should follow, and these advisories in France and the U.K. are composed by scientists. In Bill C-12, we say the targets we want to attain must be science-based. The government chose not to have an expert scientific panel but people coming from different sectors and regions.
How do you plan to work together and get to science-based targets with this diversified panel? Could you also tell us more about who is on this panel and what their backgrounds are and the sectors they’re coming from?
Mr. Wicklum: My position on France and the U.K. is not that we should follow them; it’s the opposite. We can learn from them, but we should not use them as a cookie cutter.
In terms of science-based, there are several PhD scientists, including myself, on the NZAB, but the reality is the government has launched a completely separate, fully scientific entity called the Canadian Institute for Climate Choices that will work in lockstep with NZAB. We have the pure science advice, and then we have the science advice and then the advice that is given by people with a huge diversity of backgrounds, from economics to innovation to technology to biology. Looking at those 14 members, there is basically a full suite of expertise represented, including a scientist like myself.
Senator D. Black: Thank you, Mr. Wicklum, for a tremendous presentation.
Are you concerned, based on all you have seen and heard, that Canada will be constrained in raising the funds, private funds, necessary to effect this transition — likely, as you say, hundreds of billions. I would suggest trillions of dollars. Do you have any concerns about our competitive position and our investment position?
Mr. Wicklum: The whole world is going through the same transition. There are over 121 countries now that have a net-zero objective. Most of the G20 countries are going through the same process as us, putting in accountability legislation, advisory bodies and so on.
We’re in the early stages of this transition, but the finance community is fundamentally changing how they approach net-zero. They’re seeing it as one of the biggest investment opportunities in generations.
It’s early, but once we get past the tipping point where the world continues to understand how important it is that we not treat net-zero as a debate on whether we should do this or how easy it is, but as a state that we must exist in, in 30 years, in order to leave the planet to our descendants in the way we want to. As we continue to get to that tipping point, by all accounts, it’s one of the best investment opportunities we’ve seen in generations. Because of that, I’m comfortable the investment will flow.
Senator D. Black: So you’re optimistic. Do you have someone on your panel who is alert to these financial issues, competitive issues?
Mr. Wicklum: Yes. We have an economist on the panel.
Senator D. Black: Thank you, Mr. Wicklum and Ms. Joseph.
The Chair: Thank you, Ms. Joseph and Mr. Wicklum, for sharing your knowledge and expertise. It is much appreciated. We had a good session. If necessary, we may be contacting you in the future as we develop our report, because you’re very resourceful.
Thank you to my colleagues for being with us this morning. I apologize to you and our guests for the technical delays, but we’re doing good work.
(The committee adjourned.)