THE STANDING SENATE COMMITTEE ON AGRICULTURE AND FORESTRY
EVIDENCE
OTTAWA, Thursday, November 23, 2023
The Standing Senate Committee on Agriculture and Forestry met with videoconference this day at 8:58 a.m. [ET] to examine and report on the status of soil health in Canada.
Senator Robert Black (Chair) in the chair.
[English]
The Chair: Good morning, everyone. It is good to see everyone here. I would like to begin by welcoming members of the committee and our witnesses, as well as those watching on the World Wide Web. My name is Rob Black, senator from Ontario, and I chair this committee. Today, the committee is continuing its study to examine and report on the status of soil health in Canada. Before we hear from our witnesses, I would like to start by asking my colleagues to introduce themselves, starting with the deputy chair.
Senator Simons: I’m Senator Paula Simons from Alberta, Treaty 6 territory.
Senator Burey: Sharon Burey, senator from Ontario. Welcome.
[Translation]
Senator Petitclerc: Good day. Senator Chantal Petitclerc, from Quebec. Thank you for joining us.
[English]
The Chair: Thank you very much. For our first panel on loss of arable land and food security, we welcome, from Environment and Climate Change Canada, Catherine Stewart, Ambassador for Climate Change, who is joining us via video conference from Switzerland. Thank you very much. She is accompanied by the department officials, who are here in person: Vincent Ngan, Assistant Deputy Minister, Climate Change Branch; Judy Meltzer, Director General, Carbon Market Bureau, Environmental Protection Branch; Kelly Torck, Acting Director General, Biodiversity Policy and Partnerships; Lindsay Pratt, Director, Pollutant Inventories and Reporting, Science and Technology Branch; and Jackie Mercer, Program Manager, Offsets and Emissions Trading.
Ambassador Stewart, you’ll have five minutes for your presentation. At one minute left, I will raise my hand. When you see two hands, it’s probably time to think about wrapping it up. With that, the floor is yours.
Catherine Stewart, Ambassador for Climate Change, Environment and Climate Change Canada: Thank you very much, chair, for the invitation to be here today. I appreciate this opportunity to speak about my role as Canada’s Climate Change Ambassador, and how the work that I am championing abroad helps improve the well-being of Canadians and of those who are most affected by climate change.
There is no doubt that the science tells us we need to act urgently — immediately — on climate change to make a difference.
[Translation]
As climate change ambassador, my primary role is to advance Canada’s environmental agenda and promote greater global climate ambition.
[English]
There are many ways that I do my role. I attend meeting to share Canada’s experiences and advance Canadian priorities through panel discussions and by delivering speeches and interventions at various high-priority events, ministerial meetings and summits — making sure that Canada takes its proper seat at the table and that our voice is heard. I also work closely with our missions abroad to advance our objectives through various multilateral and bilateral opportunities. I meet with partners and stakeholders to gather information on climate and environment issues, and to garner support for Canadian positions. I also work with my like-minded global counterparts so that we can join forces and advance our priorities as well.
All of these engagements help inform the strategic advice that I provide to Minister Guilbeault and Minister Joly to help advance our national climate objectives.
[Translation]
Next week, I will participate in the 28thConference of the Parties to the United Nations Framework Convention on Climate Change, or COP28, in Dubai to support Minister Guilbeault and Canadian officials in promoting our work on climate change, driving international initiatives and ambition and reinforcing our negotiations objectives.
[English]
I strongly believe that we can’t convince others to do more on climate change unless we can demonstrate that we are taking ambitious action at home. Climate change is also a global challenge that demands a global solution. We need to make sure that everyone is doing their part in taking action on climate change, including the major emitters of this world.
[Translation]
At international meetings, I talk about Canada’s climate change story. and the 130 measures that we are advancing to reach our nationally determined contribution of 40-45% reductions in emission by 2030 from 2005 levels.
[English]
There is a broad interest in also learning about how Canada approaches climate policy development, about the consultations that we do and about how we involve our whole society in building climate solutions.
Related to this, I share Canada’s experience in working with Indigenous communities to advance our climate objectives and reconciliation. I point to recent examples, including the development of Canada’s National Adaptation Strategy. I also speak of Canada’s support to Indigenous-led efforts, including the Prime Minister’s announcement last December of $800 million to support the Project Finance for Permanence initiative, which is an innovative investment model for large-scale, long-term conservation. These models of collaboration serve to encourage other societies to do better, and to be more inclusive and respectful of human rights and Indigenous rights.
We can’t think of climate change in isolation, though. For Canada, our action on climate change must go hand in hand with nature. I use my position to draw linkages between biodiversity loss and climate change and the importance of nature-based solutions. Indeed, the interlinkages with climate change are becoming more and more pronounced. I find myself increasingly engaged in cross-sectoral discussions on the nexus between climate change and a range of issues, such as health, security, oceans and agriculture.
An important element of Canada’s work on climate change is our support to developing countries through our climate finance. The poorest and most vulnerable countries suffer the most from climate change, yet contributed the least to causing it.
In 2009, developed countries committed to mobilizing $100 billion per year to support developing countries in their efforts to deal with climate change. As a wealthy nation, Canada has consistently provided climate finance to support developing countries. I speak a lot about Canada’s $5.3-billion contribution in that regard.
As ambassador, I’m also advancing some very specific initiatives that I would be happy to go into detail about, including the Powering Past Coal Alliance to drive coal power phase-out globally; and the Global Carbon Pricing Challenge, which is a newer initiative to drive momentum on the effectiveness of carbon pricing. I also champion the Global Methane Pledge, which the U.S. and the EU launched at COP 26 in 2021. I also support Minister Guilbeault and Canada’s chief negotiator in advancing our negotiation objectives. I can go into a lot more detail on that later.
Specific to this meeting, I also advance interests on agriculture and the important role that smart agriculture plays in helping to address climate change. I can speak a bit more about that as well.
In conclusion, I recognize that I’m running out of time. I want to thank you again for this opportunity to speak with you today. With the efforts that we’re making here — in Canada, and around the world — Canada is seen as a global leader on climate change. Through our continued advocacy and engagement, Canada can continue to play a critical role in the global fight against climate change. Thank you.
The Chair: Thank you very much, Ambassador Stewart. We’ll proceed to questions from senators. Senators, you have four minutes, and we’ll take multiple rounds as needed. The four minutes include the question and the answer. I’ll begin with our deputy chair, Senator Simons.
Senator Simons: Thank you very much, ambassador. Because this is the Agriculture and Forestry Committee, and you’re here to speak to our study on soil health, I’m hoping that you could tell us more about the agricultural programs that you just touched upon in the conclusion of your remarks.
Ms. Stewart: I would be happy to speak about that. As I mentioned, my role is really to talk about what Canada is doing on climate change internationally. I’m out there engaging on our 2030 Emissions Reduction Plan, and speaking about the efforts that we’re making in investing in clean technology and our regulations.
Senator Simons: I understand that, but you have been invited here today — with apologies — to speak to the Agriculture and Forestry Committee about soil health. Could you focus on what you say about that?
Ms. Stewart: Yes, I was also invited to speak to my role as Canada’s Climate Change Ambassador, so I engage internationally.
Specific to the agriculture file, I speak about how it helps address the reduction of methane internationally, for example. I am a Global Methane Pledge champion. This is an initiative which the EU and the U.S. launched back at COP 26 with the goal to reduce methane emissions by 30% by 2030.
In the oil and gas sector, the waste and agriculture sectors play a critical role there. We have work to do in Canada in terms of driving down methane emissions in agriculture, but I speak about, for instance, the new Agricultural Methane Reduction Challenge and how up to $12 million will be awarded for innovations advancing the low-cost and scalable practices, processes and technologies designed to reduce methane emissions produced by cattle.
I also speak more generally about the impact of methane on agriculture and loss of crops, and how that contributes to food insecurity, so I’m emphasizing the importance globally for everybody to take action on reducing methane — not just in the oil and gas sector, but also in the agriculture sector — and I’m speaking about what Canada is doing domestically to help advance that goal.
I also had the opportunity to meet officials recently from the Food and Agriculture Organization in Rome, in addition to the World Food Programme, to learn about the programs that they are supporting that Canada supports, so these are good opportunities to exchange on the work that they are doing — supported by funding from Canada — and how these two organizations mutually benefit each other.
[Translation]
Senator Petitclerc: Thank you for being here with us today. Ambassador, I am trying to understand your international role. Maybe I’m wrong, but in this role, do you have the opportunity to make contact with members of the international community who can help us?
In other words, is there an opportunity for you to seek out information, to find out about best practices, among other things, in terms of what we’re interested in — best practices for soil health, the use of certain fertilizers? Is that the kind of thing you’re able to do? If not, is it the kind of thing you’re able to synchronize or organize for those players who could do it?
[English]
Ms. Stewart: I come at this also from the negotiations perspective. When we go to a Conference of the Parties, or COP, we are negotiating a range of issues. One of them falls within agriculture. More and more, we are hearing about the role of agriculture in helping to address climate change.
At COP 27, for example, the parties agreed on a Sharm el-Sheikh joint work on the implementation of climate action on agriculture and food security, as an example. This is a multi-year work program on agriculture under the United Nations Framework Convention on Climate Change, or UNFCCC, where we will work together — as a global community — on better understanding and identifying what these climate solutions are in the agriculture space.
At COP 28, we need to agree on elements of what falls under that work plan: Are we going to be having annual reports? Are we going to be conducting workshops so that we can learn from each other and benefit from each other?
Given that agriculture is discussed more and more in this climate space internationally, we are very keen — as Canada — to make sure that we get this work program moving ahead at COP 28. I think the credibility of bringing agriculture closer to that global conversation on climate change is going to be very important this year at COP 28, so, in my role, I underline the importance of our getting that work rolling.
[Translation]
Senator Petitclerc: Thank you very much for your answer. I am trying to get an idea of Canada’s role on the international stage when it comes to drawing inspiration from or spreading the word about what’s being done elsewhere. I’m trying to figure out where we stand. Are we leaders?
When it comes to — and you said it well — making sure that agriculture is part of the climate change conversation, can we say that Canada is a leader or is there still work to be done? I am trying to get a sense of where we stand.
[English]
Ms. Stewart: I think we have some good examples of Canadian entities who have been doing work on climate. It’s important for us to share this internationally. For example, the Dairy Farmers of Canada has committed to net-zero emissions by 2050. It’s important to have these opportunities to be able to share this. In addition, the Canadian Beef Advisors have a 2030 goal of reducing the carbon neutrality of beef by 33%. Setting these targets and this ambition is important for us to bring to the international table in order to show that we are taking initiative, as well as to share these experiences with others and to learn from others.
There are other countries taking other initiatives; I don’t have the specifics. But my role is to engage and have the opportunity for the exchanges that you’re referring to. Specifically related to agriculture and soil health, this is not an area that I have been actively engaging on, but it is certainly an area that I have awareness of, and that is growing in terms of the dialogue and discussion around the importance of agriculture in helping to address climate change.
The Chair: Thank you.
Senator Burey: Good morning, ambassador. Thank you for being here. Thank you for your role and hard work.
I am just going to go back to Senator Petitclerc’s question because your mandate as Canada’s Ambassador for Climate Change is to promote Canada’s clean growth and climate change priorities.
Can you name what Canada’s clean growth and climate change priorities are for agriculture? I know that you just mentioned that everybody is becoming more aware of agriculture’s role in climate mitigation. Do we have priorities for agriculture that you can share with us?
Ms. Stewart: Thank you for your question. In my role, I aim to ensure that agriculture has a space in the discussion that is happening on climate change. I gave the example of the Global Methane Pledge and the fact that we need to be reducing methane across many different sectors — not just oil and gas, but also waste and agriculture. I make sure — in my role — that I am underscoring the fact that agriculture plays a role. That’s one way I use my role to be able to talk about agriculture and make sure it’s not forgotten, and give it some prominence in the international arena.
I also mentioned ensuring that we have a good outcome on agriculture at COP 28 coming up in Dubai. We have huge priorities coming up at COP. We want to make sure that we have a good outcome on this global stock-take under the Paris Agreement. That global stock-take is to tell us how we are doing against the Paris Agreement goals. How are we doing in meeting our mitigation ambition of keeping 1.5 degrees Celsius of warming alive? How are we doing in terms of building resilience and better being able to adapt to the impacts of climate change? How are we doing in terms of supporting developing countries?
When we do this global stock-take at COP 28, my objective is to make sure that we do a proper assessment and are putting solid solutions on the table. All sectors of society need to be coming forward with solutions, so my role is to ensure that we’re talking about all the sectors, including the agriculture sector.
Senator Burey: Thank you so much. As part of our soil health study, we had the privilege of going to Saskatchewan and Alberta to meet scientists from the University of Saskatchewan; cattle ranchers; people involved in clean technologies, such as sensing; and agronomists who looked at carbon, nitrogen, water and uploading the data to the cloud. Canada is doing a lot of extremely renowned research in terms of clean technologies.
Is part of your role facilitating that? You talked about negotiation. Are you trying to advance the work that we’re doing here in Canada in terms of the research on agricultural clean technologies?
Ms. Stewart: My main role is to advance the work that Canada is doing on climate change writ large. We are doing a lot: We have the 2030 Emissions Reduction Plan. We have regulations that we’re moving forward. We have lots going on in the oil and gas sector, including the work to develop an oil and gas emissions cap. We have our carbon pricing policy. I share Canada’s story and Canada’s narrative with everyone internationally, and that story does include what we’re doing on agriculture, but I would like to turn to Mr. Ngan, who is a witness here today to talk about Canada’s narrative and what we’re doing on climate change.
Vincent Ngan, Assistant Deputy Minister, Climate Change Branch, Environment and Climate Change Canada: Thank you. Canada’s 2030 Emissions Reduction Plan, of course, has to work with all the sectors in Canada in order to drive advancement in the reduction of greenhouse gas emissions, and also through Canada’s National Adaptation Strategy to promote resilience and adaptive practices to the evolving impacts of climate change.
Agriculture and Agri-Food Canada is the lead department of the federal family, and, through the 2030 Emissions Reduction Plan, they are focusing on a number of areas. First of all, they include investment in on-farm climate action to help farmers adopt sustainable practices, such as cover crops, rotational grazing and fertilizer management. They also focus on agricultural clean technology to support development and purchase amongst farmers of more energy-efficient equipment. Also, there is a focus on transformative science and in a sustainable sector — and, in a changing climate, to support the sector’s role in the transition to a net-zero economy. These are some of the things that our colleagues in Agriculture and Agri-Food Canada are working on in order to advance this from a mitigation and adaptation perspective in the climate change world.
The Chair: Thank you. I’ll ask a couple of questions. Ambassador Stewart, as Canada’s Ambassador for Climate Change — and you can turn my question to one of your colleagues here in the room — I first want to say thanks for ensuring that agriculture has space in all you do. We do appreciate that.
My question is this: What is the most important piece of information that you would like to see in our soil health report when it is finally written? Feel free to pass that on if you wish. Again, it’s a soil health study report.
Ms. Stewart: Thank you. I will pass that back to Mr. Ngan to see if he has anything to add.
Mr. Ngan: One part that we are working on in the National Adaptation Strategy is to ensure that vulnerable segments of the population are being taken into account when we are developing government policies, fully recognizing that climate change impacts actually have a disproportionate impact on vulnerable segments.
Case in point, in regard to the heat dome of 2021, we know that low-income neighbourhoods and populations that are in a certain age group, such as those in their seventies, or those who live alone, are disproportionately impacted by acute climate events, such as the heat dome. Therefore, one part could be that when we are developing mitigation and adaptation strategies in the agriculture sector, we take into account the impacts on these segments of the population. That being said, maybe I can turn to my colleagues for other input as well.
The Chair: Please.
Kelly Torck, Acting Director General, Biodiversity Policy and Partnerships, Environment and Climate Change Canada: Another related conversation is around the follow-up to Canada’s and other countries’ commitments to the adoption of a new Global Biodiversity Framework, following the Convention on Biological Diversity Conference of the Parties in Montreal last December. Twenty-three new global targets were adopted. The aim is to support a mission to halt and reverse biodiversity loss. When we think of biodiversity, it is biodiversity at all levels, so certainly soil health and soil biodiversity are an important component that is recognized as being important to sustain. We recognize that agriculture is both dependent on and can potentially — if not managed sustainably — have a negative impact on biodiversity.
It’s an active conversation to look at how, in fact, there may be opportunities both internationally and domestically to adopt and advance practices that support biodiversity, including soil biodiversity, while continuing to allow that sustainability in terms of the agriculture sector.
The Chair: Thank you. Would anyone else care to jump in?
Judy Meltzer, Director General, Carbon Market Bureau, Environmental Protection Branch, Environment and Climate Change Canada: I would flag that, in my shop, we lead the implementation of Canada’s Greenhouse Gas Offset Credit System. Certainly, agriculture is a sector where we’re looking to be able to incentivize activities that reduce and remove emissions, including soil carbon sequestration as one tool to help pull these forward, as well as a report that helps us identify what measures are in place and what investments and incentives are already supporting this where there may be additional gaps. We continue to develop protocols for offset credits on an ongoing basis. A good understanding of the current landscape — where there may be gaps and where we may use the tools that we have to help pull forward further measures — is always going to be welcome.
Jackie Mercer, Program Manager, Offsets and Emissions Trading, Environment and Climate Change Canada: As the lead on the offset system, it’s really important to note — and I think it has been mentioned previously in this committee — that you can have unhealthy soil and high soil organic carbon.
To Ms. Torck’s point, healthy soil includes biodiversity, nutrients, soil function, water infiltration and several other soil properties. With the development of our enhanced soil organic carbon protocol, we are looking to see the specific farming practices that could generate offset credits that cover the suite of soil health properties. Things like cover crops, changes to tilling regimes, soil amendments and rotational grazing are all being examined. It’s important to have a study that outlines these types of activities; the benefits to soil health; the benefits to increased soil organic carbon; and also — if there have been advancements in how this can be measured and tracked over time — the types of data that you have seen as being helpful to quantify and determine when these activities are additional and can lead to increased greenhouse gas reductions or removal. I think we’re always interested in learning more about which activities are ongoing to move the science forward in that space.
The Chair: Thank you. I would suggest that carbon pricing is something we haven’t heard enough about, and so, if not today — I know we’re limited in time — we might be calling you back, because I think it’s a part of our study that we need to look into further. Thank you very much for that.
Senator Cotter: I apologize for not hearing your presentation. I got pulled away on another matter. It’s really inconsiderate of me to even be posing questions, but I can’t resist. It’s sort of in my nature, I guess.
I have been doing some research of my own — not directly in relation to this conversation and soil health, but in relation to another small matter that has become quite contentious in the Senate of Canada related to Bill C-234. One of the things that I discovered is that, based on the Government of Canada documentation, the level of greenhouse gas emissions per hectare of farming across the country has been calculated. That is a good thing to do, I think, to try to understand. Crop by crop, the greenhouse gas emissions per hectare for every crop grown in Saskatchewan are dramatically lower than anywhere else in the country by multiples, even compared to Alberta or Manitoba.
Senator Simons: It’s not my fault.
Senator Cotter: I’m trying to prepare for Senator Simons’s intervention. These are not numbers made up by the Premier of Saskatchewan or anything like that. They are spectacular. I’m interested in knowing whether you folks are aware of that, and whether — I will say this in my speech — the Minister of Environment and Climate Change, the Minister of Agriculture and Agri-Food or, quite frankly, the Leader of the Opposition should be getting themselves out to Saskatchewan to find out how this is being achieved. It is not possible anywhere else in the world to have this level of success with respect to limits on greenhouse gas emissions.
Can any of you comment, first, on whether you’re aware of this? I was not aware until the last few weeks. Second, what is causing it and what can we learn from it?
Lindsay Pratt, Director, Pollutant Inventories and Reporting, Science and Technology Branch, Environment and Climate Change Canada: My area of expertise is the quantification of greenhouse gas emissions in Canada. Canada does report greenhouse gas emissions and removals from all sources within its geographical boundaries. Every year, we create a rather large 700-page report that outlines exactly how we do that.
Agriculture is a sector that we report on; we have been doing so for years. I would have to double-check your research in terms of the fact that Saskatchewan has particularly low relative emissions from their crops compared to other provinces. I don’t have that data in front of me today, but that’s something we can check. Canada’s National Inventory Report is the authoritative source of greenhouse gas estimates for Canada. There are a lot of sources that are similar in Canada. The National Inventory Report is the one that we report to the United Nations every year. It is the benchmark against which our progress is measured. We can go back and double-check. It will be interesting to see those findings. I wasn’t immediately aware of that particular discrepancy between the provinces.
Senator Cotter: Thank you.
Senator Simons: As a proud Albertan, I am happy to follow up on Senator Cotter’s question. I want to address my question to Ms. Mercer and Ms. Meltzer.
The point that Senator Cotter raises is that Prairie farmers have already made huge advances in terms of minimizing their carbon output, and, in terms of adopting no-till aggressively, they have dramatically reduced not just soil erosion and wind blowing, but have also actually put the carbon back into the soil.
One of the challenges with setting up a functional carbon market is that if you’re only rewarding people for things they do now, the early adopters don’t get any recognition for the pioneering work they have already done in carbon mitigation.
We’re about to hear from some carbon market experts in our next panel, but I want to understand — from Ms. Mercer and Ms. Meltzer — how we would set up a carbon market that is backstopped so that people know what the carbon credits are actually worth. You could have trading in those credits, and you could have some recognition for early adopters and what they have already done to combat climate change.
Ms. Mercer: That’s an important point. We have heard a lot from our stakeholders over the years — as we’ve been developing our system — regarding how we can make both of those things happen. Something to keep in mind with a compliance-based offset credit system, which is what we have, is that each offset credit represents one tonne of CO2 equivalent reduced or removed from the atmosphere.
These credits can be used as compensation by regulated facilities under the output-based pricing system regulation. They actually have to represent an additional tonne of greenhouse gases that has been reduced because they substitute for reductions that should have happened at that regulated facility. To your point, they really do have to represent a real, quantifiable, verifiable, additional, unique and permanent tonne. People have to be able to count on that. There has to be some integrity, robustness and credibility behind the system. That’s why we have developed our system through a regulation. Our regulation was published last June.
In the development of our protocol, we recognize that across Canada, different activities have been taken up by farmers and the agriculture sector in different ways and at different speeds. This is why the enhanced soil organic carbon protocol is taking some time, namely, to figure out which activities are additional and where. For example, conservation cropping, as you point out, has been carried out in the Prairies for a long time. It’s important, and it’s good; it should be acknowledged as such. What is the next activity that needs to be layered on top of that to make that farmer and those credits represent an additional tonne so that the atmosphere sees a reduction when used by a regulated facility? These types of practices have been already adopted early in some spots. We don’t look to penalize, but the system pulls forward those reductions and those activities that would not have happened without the incentive of a credit that they could sell for an amount of money. Also, since this protocol is taking some time because of its complexity, we have introduced the development of two additional protocols in the agriculture sector. One is a livestock feed management protocol. This is looking at reducing enteric methane emissions from cattle. We are hoping to publish this protocol in draft this fall and have public consultation on it, which we’re excited about. Another one is on the avoidance of manure methane emissions through anaerobic digestion and other treatments. We hope to draft and publish this protocol this spring. There are three opportunities for farmers to be able to participate. We will be developing protocols on an ongoing basis. Once these are complete, then we’ll be looking to see which are the next activities to prioritize.
Senator Simons: If someone were in touch with you recently touting a kelp feed that, if you fed to the cows, would reduce their methane emissions naturally, as it were, how would one calculate an offset credit for making one’s cows less flatulent?
Ms. Mercer: That’s a great question. The protocol that we will publish this fall will outline some of the measures that we have identified that could reduce the methane emissions generated through enteric fermentation. New and exciting ideas are always being put forward to help achieve those reductions. One of the important things in a compliance-based offset system is the science behind that. It has to be tested. It has to be approved for use in Canada. It has to undergo testing to determine the actual reductions. It would take some time for some of these newer and novel feed additives, or whatever, to be adopted and incorporated into the protocols. We’re developing them to be able to do that — to keep up to speed on the latest science and, as it evolves, to be able to take a look at it to see if it fits in our system. I don’t know, Ms. Meltzer, if there is anything else.
Ms. Meltzer: Thank you, Ms. Mercer. I would add that we developed each of these protocols for a specific activity, taking into account that particular project type. We consult with a wide range of internal and external experts. For every offset protocol we develop, we set up a team with a roster of technical experts. They include stakeholder sector experts from the agriculture sector in this case; academics; and our colleagues in other departments who bring in the science and the expertise. They are heavily consulted in order to make sure they are robust.
To Ms. Mercer’s point, we often get a lot of outreach and interest from some newer early-stage technologies that may hold a lot of potential opportunities and interest. You may be looking at some of these in your study. The offset space — where we have our compliance-based offset system — is not really the space to credit things that we’re still learning about and experimenting with. It’s the place to give credit for what we can assure are robust, measurable, verified, quantified, additional reductions.
Senator Simons: If people reduce their fertilizer use, is there an offset credit for that?
Ms. Mercer: Currently, that is not a protocol prioritized in our system.
The Chair: Thank you.
Senator Cotter: I’m not supposed to do this, but I want to answer Senator Simons’s question on cows and methane. Senator Black and I had the opportunity to meet with New Zealand’s Special Agricultural Trade Envoy a couple of years ago. They were describing breeding strategies to develop lower methane-producing cattle; I guess you would call it that. It made it possible for them not to have to walk around behind the cow and capture the methane to make an assessment so that they could then, I think, identify that these breeds of cattle were in a lower methane category, which I thought was an interesting way of pursuing it.
I actually have a question for Mr. Pratt. You said that you would look into and assess the information that I was identifying about Saskatchewan. The information comes from work by Raymond Desjardins, who is identified on Wikipedia as a senior research scientist at Agriculture and Agri-Food Canada and, if I might say so, a co-recipient of the Nobel Peace Prize, and it struck me — without knowing for sure — that was not a bad credential. Is Dr. Desjardins familiar to you? He may not be there anymore, but he was with Agriculture and Agri-Food Canada as a research scientist on some of these questions connected to climate change. Is that a name that any of you are familiar with?
Mr. Pratt: Absolutely, Dr. Desjardins is a well-known colleague. He worked at Agriculture and Agri-Food Canada for many years. He has retired recently, but he has definitely been involved in much of the underlying science upon which Canada’s greenhouse gas estimates for agriculture are based. He is definitely an authoritative source.
Senator Cotter: I might quote you this afternoon. Thank you.
The Chair: With that, Ambassador Stewart, Mr. Ngan, Ms. Meltzer, Ms. Torck, Mr. Pratt and Ms. Mercer, thank you very much for your participation. If there are things that you think we should still get, or that you indicated you would send, please send them to our clerk. We would invite you to watch for our final report when it comes out in 2024. We’re looking forward to what this might bring. Thank you very much for your participation.
For our second panel on creating viable carbon credit markets for Canadian agriculture, we welcome our witnesses via video conference: From Deveron, we welcome David MacMillan, President and Chief Executive Officer. From the Canadian Cattle Association, we welcome Duane Thompson, Environment Committee Co-Chair; and Reynold Bergen, Science Director, Beef Cattle Research Council. From Carbon Asset Solutions, we welcome Robin Woodward, Director. From Écobœuf, we welcome Simon Lafontaine, Co-Founder. From the Western Stock Growers’ Association, we welcome William Newton, Governor. And from Biological Carbon Canada, we welcome Don McCabe, Chair; and Graham Gilchrist, Chief Executive Officer.
The floor is yours, Mr. MacMillan.
David MacMillan, President and Chief Executive Officer, Deveron: Thank you, Senator Black, and good morning, esteemed members of the committee. Thank you for the invitation to present to this committee regarding my view of the opportunity around soil health for this country.
Today, I represent one of North America’s largest soil testing companies headquartered in Canada, which provides value-add information tied back to soil health for thousands of farmers across this great country. As the leading provider of services in Canada over the last 35 years, we have a unique perspective of understanding the needs of producers, and also some perspective on how soil health has been implemented across this country from a tool of measurement.
We believe there are three key opportunities for government to support the improvement of measurement of soil health, and provide further testing and benchmarking across Canada.
First, there is no national data set or aggregation of information for all stakeholders to measure, baseline or provide national measurement on how we, as a country, are doing. As a partner with growers for so many years, we have a large anonymous data set that could be helpful in looking at soil measurement and baselines from coast to coast.
Second, today there’s no clear standard of measurement for soil health and what the resulting impacts are for both producers and broader stakeholders who may wish to participate and measure the success of any program.
Third, there is no national and widely accepted incentive for interested parties to begin a journey around soil health so that they can get started with benchmarking data and mapping return on investment back to the decisions they make on the farm.
Soil health has many definitions and multiple technologies — of which we own our own proprietary information — that complicate a national standard that we, as a country, can build good measurement behind, which we ultimately need to provide a clear assessment of why soil health matters.
I would ask this committee to help the industry align on a government standard of measurement and create incentives to accelerate producer adoption of these practices. As a stakeholder, I also believe our large historical data set could be used to build some of these pillars. We — at Deveron — would be interested in participating in further discovery to identify how we can contribute.
The last point I will make is Canada has many opportunities to catch up to other countries. We have been working on soil health and carbon measurements in the U.S. for the last three years. The U.S. Department of Agriculture alone committed over $3 billion to smart farming and sustainable climate initiatives.
In closing, the majority of farmers who are currently testing their soil work with us today. In working directly with these stakeholders, we think that three key things improve Canada’s real potential to be a leader: The first is to create an accessible and national data set; the second is to create a clear definition of what soil health is in this country; and the third is to create a clear and national incentive for further participation in soil health measurement.
With that, I will conclude, and thank you very much for listening to my views today.
The Chair: Thank you very much. We will move to Mr. Thompson.
Duane Thompson, Environment Committee Co-Chair, Canadian Cattle Association: Good morning, honourable senators, and thank you for the opportunity to appear before your committee.
My name is Duane Thompson. I’m a fourth-generation rancher from Saskatchewan with two more generations following me. I have the pleasure of chairing the Canadian Cattle Association’s Environment Committee.
Joining me today is Dr. Reynold Bergen as a technical expert and staff member with the Beef Cattle Research Council.
I am here to speak on behalf of beef farmers and ranchers across Canada, and to share more about our sustainability story and how we are protecting the soil. Simply put, we’re proud to be environmental stewards of the land.
As you may have heard, the Canadian beef industry set ambitious 2030 goals that will further drive our environmental sustainability. We’re already leading the world with less than half the global average of greenhouse gas emissions intensity. We’re not resting on our laurels, though. Our goals include a 33% reduction in greenhouse gas emissions intensity, preserving the 1.5 billion tonnes of carbon sequestered in Canadian grasslands, sequestering an additional 3.4 million tonnes annually and preserving Canada’s remaining 35 million acres of native grasslands.
What does this have to do with soil?
If we work together to achieve these goals, we will build and maintain healthy soils.
The native prairie grasslands are one of the world’s most threatened ecosystems. It is beef cattle that graze and maintain these lands that provide the incredible biodiversity benefits, including birds, plants and soil health.
Each time grasslands are converted to other uses such as cropland, we see soil carbon losses. Yet, pasture and grazing management impact soil health and carbon sequestration in a positive way. We need to work together to ensure producers are incentivized for the positive role we play in conserving grasslands.
Along with my family, I work on the land every day. While our Canadian Cattle Association goals touch on the 30,000-foot level, I also want to give you an example from our ranch that I’m proud of.
Our operation is a mixed enterprise ranch and farm. Forages occupy half our land base for 5 to 7 years on a 10-year to 15-year crop rotation, and provide the feed and grazing for cattle throughout the year. Rotational grazing and direct seeding are management practices that we have embraced over the years. We have been operating under this system for over 25 years, and I’m proud to tell you that we have more than doubled the soil organic matter on the land that we first started this system on. Obviously, this nutrient cycling is enhancing our water cycle, sequestering carbon and providing drought resiliency and insurance for our family.
I thank Senator Simons on her acknowledgment of early adopters. My father was on the initial Save Our Soils, or SOS, board in the early 1980s in Saskatchewan, and they broke the trail for soil conservation. We have had as many failures as we have had successes, but continued to forge on.
As you can tell, soil health is incredibly important to us. In 2022, the Canadian Cattle Association provided input on a proposed project to develop a Canadian soil health education network that looks at the benefits of soil health. Proven societal benefits include cleaner water, enhanced biodiversity and reduced threats from flooding, and, more specifically, farmers benefit from increasing productivity, greater resilience in the face of a changing climate, reduced environmental liability and better overall profitability, while consumers gain in terms of greater food security, fewer environmental concerns and healthier, more nutrient-dense food.
When we look at government programs and policies, we need to look at the whole picture to ensure that there are not unintended consequences. Beef producers are significant contributors to the health of Canada’s soils. Working together, we can ensure producers can continue to provide high-quality protein for Canadians and consumers around the world. We’re contributing to global food security, thriving rural communities across the country and healthy soils through the positive environmental impacts of beef cattle grazing the land.
Thank you for your time today, and I’d be happy to answer any questions.
The Chair: Thank you, Mr. Thompson.
Robin Woodward, Director, Carbon Asset Solutions: Thank you. This morning, we’d like to talk about how Canada can design its carbon market to catalyze a nature-based solution to global warming: soil carbon sequestration.
Agriculture and food security are the lifeblood of an economy. Soils are its beating heart, but soil health has been compromised, and many see farming as contributing to the climate change crisis. The most challenging problem about soil carbon has been measuring it with sufficient accuracy and governance to comply with the standards of financial and regulatory markets. How do you measure what is there? How do you measure incremental gain? And, perhaps most importantly, how do you deliver confidence so that the markets accept and pay for soil-based carbon credits?
Carbon Asset Solutions has developed a measurement, reporting and verification, or MRV, platform to confirm sequestration of carbon dioxide, then create and sell soil-specific carbon credits. A core piece of our business is breakthrough soil carbon measurement that delivers unprecedented accuracy and produces a secure digital record that allows the sale of credits based on measured, verified additional carbon.
Accurate measurement of soil carbon has been accomplished. A true volumetric measurement — 95% accurate to four micrograms per cubic centimetre — is delivered across a large area. The technology has been developed by the United States Department of Agriculture, as well as patented by them, and we hold the global licence. The implications of this are significant: no need for costly soil samples, no need for mathematical models and no need for estimates. It’s a true measure. Now mobilizing Canada’s soil as a climate solution is possible. Canadian agriculture can be transitioned into a climate solution. Our soils and soil biomes will flourish, and today we’re pleased to talk about how our process and corporate design can help with this.
We create and sell soil-based carbon credits. We connect agriculture with financial markets. We are accredited to ISO 14064, and we deliver the required data precision, certainty and integrity to satisfy markets. This triggers capital into the hands of farmers; they can finance the transition to regenerative agriculture, and remove atmospheric carbon dioxide rapidly and efficiently. In return, our credits allow corporations to transition to net-zero emissions with certainty.
This is based on two priorities: The first is farm-focused and ranch-focused carbon credits. There are no enrolment fees, and 60% of the sale proceeds are delivered to the client. They get maps to maximize carbon sequestered through regenerative agriculture adoption, and a carbon intensity score that will keep them in the markets as these become part of long-term supply chains.
The second is improving soil health. We don’t tell a farmer how to farm. It’s not needed as part of any regulatory market, and certainly not well received. We ask them to proceed with agronomic advisers and work with best interests.
We have a few things that we see as good best practices for Canada: deliver a framework that supports the global sale of credits by recognizing ISO 14064 as an accredited standard; open the door to market response once the simple standard is met — delivering 95% accuracy of the data that markets demand; be agnostic of change of practice; and support and promote regenerative agriculture relationships between the landowner and the specialists, as they know how best to handle their farm or ranch, and do what’s best for them.
Over the next few years, we’re going to be scanning millions of acres of land in Canada. Perhaps Canada wants to be part of that.
Thank you for your time today. We will be presenting our technology at COP 28 in a few weeks. Senator Black, I’d love to meet you there. Thank you.
The Chair: Thank you, Mr. Woodward.
[Translation]
Simon Lafontaine, Co-Founder, Écobœuf: Good day to all committee members and to everyone here today. It’s an honour for me to present Écobœuf’s work and my perspective on the subject.
My name is Simon Lafontaine. I’m a fourth-generation farmer, agronomist and professor of environmentally responsible beef production at the Abitibi-Témiscamingue campus of the Université du Québec.
During my doctoral studies in animal science, I co-founded Écobœuf, a start-up company based in Dupuy, in the Abitibi region of northwestern Quebec. Its mission is to reduce the diversified environmental footprint of boreal agriculture and make it sustainable. To achieve this, the company intervenes throughout the value chain to encourage agricultural practices that resolve ethical and environmental issues in beef production.
Écobœuf works on two aspects of greenhouse gas reduction in agriculture: technical feasibility and financial feasibility.
Our company aims to develop a portfolio of clean technologies and techniques that can be applied in the context of peripheral boreal regions.
Écobœuf promotes farms’ greenhouse gas reductions through a production model that markets their agricultural products using food brands that have environmental value added. That way, the benefit of greenhouse gas reductions stays in the value chain of the marketed product — an approach known as insetting.
In our case, the environmental value added of marketing grass-fed, carbon-neutral beef helps fund best practices on farms. In this way, consumers play an active role in accelerating agriculture’s green transition.
Our approach is to rethink the production model, drawing on the basic principles of physics, biology and ecology, with the aim of achieving extensive decarbonization of the agriculture sector. We quickly turned our attention to agroforestry: the thoughtful integration of trees and agricultural production.
We believe agroforestry is the practice that has the greatest potential impact on carbon sequestration, but also on climate change adaptation for farms. Trees can also be a perennial crop with high potential for agricultural diversification and value added, including the production of wood fodder, fruit, nuts and timber.
Agroforestry, when combined with grazing animals, a practice known as silvopastoralism, is all the more synergistic because it protects animals from wind and sun while creating a favourable microclimate for grass growth.
Our research, in collaboration with UQAT, has enabled us to set up silvopastoralism research plots, which are the only ones in North America. This project aims to quantify carbon sequestration and biodiversity following improved pasture management and the integration of agroforestry hedges.
We also have several projects aimed at optimizing the implementation of large-scale silvopastoral systems.
Because boreal agriculture is dominated by forage crops, we are also looking to optimize their management, for example by testing alternative strategies for grazing and prairie renovation to avoid tillage, thus improving soil health.
These initiatives to promote carbon sequestration are part of our holistic approach, which also includes efforts to reduce emissions at the source, such as enteric methane from animals and manure.
There are still many scientific, technical and financial challenges to overcome for the full decarbonization of the agriculture sector, but Écobœuf is determined to meet these challenges, with many collaborators.
I’d be pleased to answer any questions you may have. Thank you very much.
[English]
The Chair: Thank you very much, Mr. Lafontaine.
William Newton, Governor, Western Stock Growers’ Association: Good morning. The Western Stock Growers’ Association is a voluntary membership organization representing livestock producers in Western Canada since 1896. In the tenure of our organization, the majority of grasslands in Western Canada have been converted. The conversion continues and is predominantly driven by economics. The reality is that too often there is no business case for grazing as a land use when other potential uses exist. It is time to stop the bleeding of grassland conversion. Conversion can be either physical or functional. Functional occurs with improper disturbance — either too much or too little — in this disturbance-dependent ecosystem. Too often, governments and non-governmental organizations, or NGOs, overuse the tool of rest, as initially happened in Grasslands National Park with the removal of all grazing. Converted grasslands release at least one third of their soil-stored carbon and perform less effectively in water, nutrient and energy cycles. Grassland conversion has contributed hugely to Canada’s soil degradation.
We live where glaciers existed 25,000 years ago, and where there’s documentation of a 12,000-year history of grasslands sustaining Indigenous peoples. In the 13,000-year interval, natural processes must have created the marvel of a grasslands ecosystem, complete with its soil, micro-organisms, plants and animals. What were those processes? What have we done since settlement to interfere with them, and why did we do that? If we wish to conserve and potentially restore grasslands and their ecological function, how should we proceed?
The Western Stock Growers’ Association conducted a pilot project — Grasslands Capital X, or GCX — to investigate market approaches to grassland conservation. Well-managed grasslands produce many ecological goods and services valued by society, but for which there’s no market return. GCX developed an index to assess the degree of ecological function of any parcel of land. Inputs to the index include assessments of biodiversity, water cycle function, soil health, range health and culture and people. To date, we have not completed any commercial transactions utilizing the index. We have, however, investigated potential partnerships with multiple companies whose business is aggregating and marketing carbon credits. But thus far, we’ve been unable to negotiate a satisfactory agreement with any of them. Interestingly, the carbon contracts that most of those companies present to landowners claim the co-benefits of carbon credits for themselves.
We have yet to review a contract that we can recommend to our members. Additionality is a barrier to enrolling well-managed grasslands in offset programs. Additionality entails change of management practice to qualify. It serves as a disincentive to existing good management.
We believe the problem is beyond atmospheric greenhouse gases. It is beyond carbon. It includes desertification, loss of biodiversity, loss of habitat and decreased efficiency of water and energy cycles. It includes a more extreme climate. For primary agriculture, it involves land management decisions that must include economic along with social and environmental outcomes. Essentially, the problem is loss of balanced ecological function. If the problem is beyond carbon, then surely the solution is as well. Stock growers believe firmly that the solution needs to be market-driven rather than regulatory in nature. The degree of grassland conversion is a testament to the power of the marketplace. Regulation can — and does — influence the economics of the market. For example, current federal and provincial business risk management programs significantly favour annual cropping over grazing.
I will close with questions. If the market parameters were such that the highest economic returns from land management were derived from the production of a balanced suite of ecological goods and services, should that qualify as protected under the 30% by 2030 initiative? What should be the parameters of such a market? Can we create that? What could that do for Canada’s soils?
The Western Stock Growers’ Association has some ideas in that regard. Thank you for your consideration.
The Chair: Thank you very much. We’ll move on to Mr. Gilchrist.
Graham Gilchrist, Chief Executive Officer, Biological Carbon Canada: Mr. Chair, Don McCabe will give the presentation.
Don McCabe, Chair, Biological Carbon Canada: To the chair and senators across Canada’s landscape and, most importantly, its carbon sink, thank you for the opportunity to speak today.
Biological Carbon Canada is the trade name for the Canadian Institute for Biological Carbon. We’re a non-profit based in Alberta, and our mission is to ensure all farms and ranches across Canada can participate in the carbon marketplace.
The Chair: I’m going to interrupt, Mr. McCabe. Our interpreters are saying that your sound is not good enough for translation. Is it possible for Mr. Gilchrist to give your presentation because our translators can’t hear you well enough?
Mr. McCabe: I believe Mr. Gilchrist is quite capable of giving the presentation.
Mr. Gilchrist: I’ll continue then.
Soil is alive. Soil breathes, and that cycle over time immemorial has built the sink that we enjoy today. In some years, that sink change is positive; in others, it’s not so much. Over time, the sink becomes property, divided into lots and sections.
In the agriculture sector’s context, soil is now there for business reasons. As Senator Sparrow noted, we have had challenges in the past with keeping that soil healthy. We grow food from it, but it also holds up houses, roads and has other non-agricultural uses.
There’s not much of it left. About 10% of our soil sink is private now; two thirds of it in Canada are residential and urban.
In our recent work with Agriculture and Agri-Food Canada’s Sustainable Agriculture Strategy, we’ve got 22 billion megatonnes of soil carbon in our sinks across Canada. The challenge is that since 2001, we’ve lost just over a thousand square miles every year to the conversion and to other non-agricultural uses. At today’s pace, that means soil sequestration from the farms and ranches across Canada can’t maintain that sink, let alone keep up with it.
We presented a brief to you, Mr. Chair, in written form, providing four issues that we’d like you to consider. However, there’s one issue that we want to talk about. In his report, Senator Sparrow considered the economics of soil conservation, but the idea that soil health is a commodity was not on the horizon then, as it is now. Please consider this issue: Canada needs a carbon regulator for the buying and selling of certificates, and a market regulator to keep Canada on pace with the people in our competition — the United States and our other trading partners around the world.
As of last year, the United States has one. Their marketplace is scaled much quicker now because they have the market framework that Canada doesn’t have.
We’ve come a long way from Bob’s best red wheat and the questions that a farmer might ask such as, “Is the cheque good?” We now have today’s framework, where we have the number one Canada hard red spring with payment security.
You’re going to hear testimony today that entrepreneurism is very positive and people are putting capital at risk. However, whether that business claims to have the accounting to be carbon neutral, or that business sells a carbon-based index, or just sells carbon data, the challenge is that the monitoring must be the same, the measurement must be the same and the verification must be the same. It’s not sufficient to have our securities administrators tell Canada’s businesses that the commodity of carbon on their balance sheet and note to investors has to be materially real. If it doesn’t, that means we’ve got a price risk.
As we speak today, the voluntary nature-based contracts are sitting right around US$1.20. We noted that in Alberta this year, there were shenanigans in verifying carbon credits. As a result, there was a rejection and restatement of 2 million tonnes in our Alberta market, and it won’t be the last.
Soil-based Canadian carbon is already in our marketplace, as you’ve heard today, but it is a commodity. Canada’s carbon marketplace deserves to have the legislation it needs to grow and thrive.
Thank you very much for your time, Mr. Chair. We welcome any questions.
The Chair: Thank you very much, Mr. Gilchrist, and thank you to our witnesses. We’ll proceed now with questions. Again, please keep your questions and answers to four minutes per senator. We’ll have multiple rounds as may be needed. I’ll move to questions from our deputy chair.
Senator Simons: Thank you to all of our witnesses for being here. This has been a remarkable panel. I wanted to hone in on something that Mr. Gilchrist and Dr. Newton both mentioned: the verification of carbon credits. Setting up a system that is “transparent” may not be the right word, but a system where you know what you’re trading is worth something, and it’s going to be worth the same something for the person at the other end.
First, Mr. Gilchrist, could you explain to us what happened in Alberta with the rejected carbon credits? Dr. Newton, we talked earlier that you had hoped there would be a Texas model that worked, but it didn’t work. Could you explain to us why that didn’t happen? I’ll start with Mr. Gilchrist.
Mr. Gilchrist: Thank you. Senator, what happened in Alberta, and behind the scenes, is that Alberta finally put into their legislation the ability to lay a charge, which we didn’t have earlier. Because of that, there was a verifier who wasn’t licensed, and wasn’t capable of doing the verification. As a result, when Alberta Environment figured out that they had credits that could not be verified because the verifier wasn’t meeting the standard, they had to reject them. With the standard that Alberta finally set this last year, they were able to lay a charge. Prior to that, Alberta didn’t have that legislation in order to ensure that the verifiers working in the market met the standard as prescribed.
Senator Simons: Dr. Newton, you said that you had not seen a contract yet that you would recommend to your members to adopt. Is part of the problem that we don’t have enough verifiers? Is part of the problem that the token that you’re trading isn’t sufficiently fungible?
Mr. Newton: I think the problem is that there are no standards for measuring and verifying. Where do you measure? How deep do you measure? What is the protocol for handling the sample? All of those things aren’t standardized. Beyond that, the problem is that it’s very expensive to assess your carbon baseline and your incremental carbon.
Some of the new technologies that we heard about today may address that in some soil types, but they haven’t been proven in all soil types, and they haven’t been proven at depth. For example, in a grassland, part of its advantage is that it stores its carbon so deeply when compared to annual crops. We don’t have the scientific evidence to demonstrate that some of these technologies are capable of measuring down to a metre or more of depth for the carbon content.
Then, beyond that, carbon is just so variable. It depends so much on the climate, the rainfall precipitation you received that year and your management practices. As soon as we start entering into carbon markets, and we have, for example, a five-year enrolment period, if I hit five years of drought, I may have projected sales of carbon that I’m not actually able to sequester. With all of those, we have been very hesitant to recommend any of these contracts to our members.
Senator Simons: Thank you. I just want to say for the record that several of us on this committee had the unique privilege of visiting Dr. Newton’s ranch this past summer, which was a really remarkable experience. Thank you for sharing your knowledge then and now.
Mr. Newton: That was a very fun experience for us as well. Thank you.
The Chair: Thank you very much.
Senator Cotter: I want to ask Mr. Newton about his observations about the challenges around grassland conversion, and choices needing to be market-driven rather than regulated, if I understood your point, sir. This strikes me as a dilemma in the sense that if people see value in converting grasslands to growing grain and other crops because of market conditions, you lose or we lose; I guess that’s the point.
It seems to me that one of the lines of argument here is that we need to actually price the full value of grasslands, which seems — to me — to incentivize its value with respect to contributing to sequestration and moderating greenhouse gas emissions. Is that possible to achieve in your view? That’s my first question.
My second is a question for Mr. Thompson. You identified in your remarks, Mr. Thompson, the need for incentives. Thinking about the role of the Government of Canada on these questions, do you see a role for the Government of Canada to create, encourage or facilitate incentives that can achieve the goals that we’re all after? Thanks.
Mr. Newton: Thank you, Senator Cotter. Certainly, I think it’s possible to incentivize the conservation of grassland through a marketplace, but not through the existing marketplace. We can’t do it when what we produce on our grasslands is feed for livestock. We sell the cattle that comes from that, but we also produce water capture, which is incredibly important given our more extreme climate.
On the evening after the senators visited — here at our ranch — we experienced a very heavy thunderstorm, with four inches of rain in just a few hours. The way the grassland functions is that each grass plant acts as a little micro-dam that slows down the movement of the water across the surface and gives it time to infiltrate into the soil. Of course, the combination of plants, micro-organisms and soil health determines how fast water can infiltrate into the soil. All of those things lead to us capturing that water instead of it escaping and causing erosion, as we could demonstrate after that evening.
If we have a market that rewards this balanced suite of ecological function, producing a variety of ecological goods and services — everything from biodiversity to food, carbon capture and water capture, as well as an effective energy cycle where the nutrients are cycling back onto the land — then I certainly think it’s possible to incentivize the conservation of grasslands through a marketplace.
My concern with the regulatory approach to this is that regulation tells you what you cannot do, but it doesn’t reward you or incentivize you to go beyond, to manage effectively and to drive this ecosystem and the biology in order to actually do a really good job of capturing carbon and other ecological goods and services.
The Chair: Senator Cotter, you had a question for Mr. Thompson, is that right?
Senator Cotter: I did; it’s regarding incentives. It was tied to the Government of Canada’s role in all of this.
The Chair: Recognizing that the time is running out, Mr. Thompson, you can have some time to answer.
Mr. Thompson: Thank you, Senator Black. I appreciate the question because governments certainly play a significant role in incentivizing or, in fact, disincentivizing grassland and livestock production. For instance, in regard to our crop insurance program, because we’re a mixed enterprise, we have a crop insurance that has subsidized 60% on the premiums, but, on the livestock side, there is none. Or there are programs where they only incentivize native grasslands. There has been a lot of land that has been taken out of grass that previously was native. It was broken and attempted to be annually farmed, but it never should have been broken, yet is deemed tame. The programs don’t recognize that land — in many of the programs where people can get funding — to get it back into grasslands, and create the good grasslands, whether it be tame or native. A lot of times, we’re ignoring the tame species of grass, but we provide a significant ecological benefit with tame grasses as well. Those are just a couple of examples that I would bring to light.
The Chair: Thank you very much.
Mr. Gilchrist: Just to advise the senators, there is a retention of grassland protocol already in the voluntary marketplace.
The Chair: Thank you for pointing that out. I was going to mention that you had put that on the chat. I want to advise my colleague that Mr. McCabe’s headset is now working — it appears — so he is open for questions as well.
Senator Burey: Thank you so much for being here. I’m going to give a shout-out to Dr. Newton. Thank you for hosting us and showing us so much courtesy. We learned a lot; I certainly did. It was fun.
Now I’m going to really hone in on some of the barriers. Barriers seem to be a question that I always come up against, not just in this committee — but I heard about no national data sets. I think I’m speaking to you, Mr. Woodward. There are no clear definitions of standards, and, as Senator Cotter alluded to, there are incentives or disincentives that we heard about. What do you think is the cause of these barriers to collaboration and moving this file forward?
I know the chair is going to ask about recommendations for this committee, but how can we create a forum where all of these ideas and all of these suggestions — as well as the great work that farmers and scientists do — can be moved forward? Speak to the barriers. Anyone is able to jump in and talk about it. What can we do, as a committee, to move this file forward?
Mr. Woodward: Thank you, senator. First, my apologies; I had sent in a report in conjunction with my speaking notes today, but I did not get it translated in advance. It is there, but only in English.
In terms of barriers to widespread adoption, I think that what we have been dealing with for the life cycle of the carbon question is an inability to measure anything, and to get to a place in a market where you can have confidence globally that what is being delivered to market actually has value.
If there is something for Canada to look at, I would say there are two pieces: One is to work toward global standardization of a soil protocol for soil-based credits. Having something that is unique to Canada limits the Canadian ability to sell onto global markets. Look to doing a straightforward adoption of standards that exist today. They exist through the International Organization for Standardization, or ISO. They exist through international accrediting organizations, which Canada has well invested in for decades. We sit at the ISO, and they deliver standards that meet a lot of the challenges that are before us.
The other piece is if there is a way to generate a better Canadian understanding of all of the methods of regenerative agriculture adoption. Getting a skilled advisory group that can tell farmers and ranchers how to adopt is an absolutely essential part of this. Thank you.
Senator Burey: I want to give an opportunity to other guests to talk about barriers.
Mr. Gilchrist: Let me take this on to your question. I agree with Mr. Woodward, but there are 13 different standards in the voluntary market — not just one. In the Canadian regulatory perspective, we do have the ISO. The other barrier is that today we have an unregulated commodity. The challenge is in market certainty and market transactions across all of the markets, whether it’s regulated, in the volunteer protocol space or in all the various iterations of the voluntary marketplace, as businesses across the world look to buy and sell carbon.
For the purposes of market certainty, we certainly enjoy it in other markets, for example, with the sale of wheat and cattle. However, we don’t have that here in Canada, so there is a lot at risk if the protocol doesn’t work, if the data that Mr. Newton has doesn’t exist, and if, at the end of the day, you have a business buying it that is at risk for misleading investors because, ultimately, the carbon is not real or it fails an audit. Those are the big barriers in having the marketplace connect buyers and sellers across the world.
Senator Burey: Thank you.
The Chair: Thank you very much.
[Translation]
Senator Petitclerc: My question is for Mr. Lafontaine from Écobœuf. I don’t know if I should declare a conflict of interest, but I have a cut of beef from Mr. Lafontaine in my freezer.
We haven’t talked much about what you’re doing in this soil study, but I’m trying to understand and I’d like you to explain it to us. If I understand correctly, this principle of agroforestry, where trees are integrated into an agricultural system, benefits livestock health, soil health and carbon storage. Mr. Lafontaine, I’d like you to explain how this works.
Could you explain, if possible, whether this model is feasible on a larger scale, or is it something that works well on a smaller farm like yours? What is it? Can it be applied on a larger scale? Is it something that works well in Abitibi in a boreal system, or something we should try to export to other environments, if possible? So, I’m asking three questions in one.
Mr. Lafontaine: Thank you for the question. Firstly, with regard to agroforestry and, more specifically, silvopastoralism, which we’re trying to develop for beef production, the most effective way is to plant trees in rows in the pastures so the animals can graze nearby.
In terms of carbon storage, consider the concept of ecological succession. We start from an annual plant system where the plants have to be replanted every year, as opposed to a grassland, in which the plants are perennial, which means they photosynthesize more, the soil is less disturbed, and the plant invests a significant portion of its resources into developing its root system and the soil around it.
This process goes a step further with trees. Trees can also be seen as perennial plants with an even more developed root system, that can store carbon both beneath the soil surface and in their wood. There is a progression, and we can go further than with grasslands by starting to integrate trees.
The goal is not to change the agricultural purpose of the area, but rather to find a suitable arrangement that will make agricultural production more efficient, while at the same time reaping some of the carbon sequestration benefits of trees.
As for the potential of this technique, several challenges remain at different levels, challenges that relate to the way farmers think. In our case, as we are focusing on the more boreal regions, much of that land has only been cleared for a few generations. It’s counter-intuitive to replant trees. In my case, it was my great-grandfather who uprooted the trees; it’s a challenge to get people to accept that.
There’s also the investment required, because it takes effort to plant trees and maintain them until they can benefit the crops. It takes some form of compensation to pay for this transition. I don’t think it’s realistic to ask farmers to invest their time and money, which they don’t currently have, for one more practice, that of integrating trees.
Therefore, it takes support, and that’s what Écobœuf is trying to do by developing simpler tree-planting techniques, but also by financially supporting this integration.
I hope that answers the various aspects of your question.
Senator Petitclerc: Yes, indeed, and it’s something we haven’t talked much about. I’m very grateful to you for that.
[English]
The Chair: I have a question. It’s to each of you. Now that we have all our witnesses able to speak, you have 55 seconds to answer this. I’m extending my time a bit.
As we wrap up the soil study, what is one specific recommendation or action you would like to see us emphasize in our report that will be drafted in the new year? We’ll start with Mr. MacMillan, followed by Mr. McCabe, followed by Mr. Woodward, and then we’ll move on.
Mr. MacMillan: Thank you for the question. The main thing for us — from a standpoint of transparency to the agriculture community that we work with — is many people are soil testing today. They are doing it to improve the operations on their farms, whether it be from a standpoint of fertility management or other inputs — and looking at the general return on investment of what they are trying to measure at the end of the day. Soil health can be a specific way to include a return on investment measurement that is good for farms, as well as good for the environment and healthy soils across this country.
As a central place where this data is being aggregated, the faster we can get to a specific definition of what soil health is, the faster Deveron can be an advocate for benchmarking that data and helping provide an aggregate public data source that we can help this country, from coast to coast, measure at an aggregate, because that data is already being collected.
Mr. McCabe: Thank you, senator, for the question, and I would start with my invented definition of a “farmer”: A farmer is a manager of the carbon, hydrogen and phosphorous cycles, with the input of the water cycle, to produce starch, oil, fuel, fibre, energy and protein, while preserving animal habitat, and improving air quality, soil quality and water quality — I just got to get paid for something. The reality comes back to this: I cannot manage what I don’t measure.
Some of the presentations and some of the people here today — and some of the numerous people whom I run into on this file — are trying to sell me a brand. I don’t need a brand. Principles are out there already. There’s only one carbon atom on the periodic table, and it’s universal. There are no politics to sell carbon. It is in the soil, and it will be varying as soil breathes and lives. We can do this in Canada, but you’ve got to bring me a business case — not a bunch of “Is it real? Is it additional?” Farmers know what they’re doing. They just need to be recognized for what they’re doing now. Thank you.
The Chair: Thank you, Mr. McCabe.
Mr. Woodward: To build somewhat on Mr. McCabe’s comment, you can’t sell what you can’t measure. If you are looking to systems that are broad-based methodologies or protocols or applications that are going to be top-down delivered, I would suggest those are wrongly informed. Build a system that has a market-based incentive to it that is focused on being able to measure what’s there, and giving the farmers the money for doing the change of practice that they’ve been doing for years — which is putting carbon in the soil in a way that increases soil health and long-term productivity. Build a market system for Canada that fits the globe.
The Chair: Thank you. Mr. Lafontaine, what is one recommendation you would like to see us include from your perspective?
Mr. Lafontaine: The previous comments were about how agnostic we should be about practices, and that, in the end, the retribution should be outcome-driven, and I think that’s one key aspect.
I think there are a lot of ways to achieve reduction; trees are a good one — maybe it can be very impactful to integrate on farms. Soil can also be a solution, but, in the end, there’s a lot of science still to do, and a lot of variability, as was touched upon by other witnesses. There’s still a lot of work finding regional carbon assessments, assessing soil type and climate, and also the vast diversity of practices that can be implemented.
The Chair: Thank you. Mr. Thompson, what would you like to see as one recommendation included in our final report?
Mr. Thompson: I think it’s well recognized that forages, whether they be tame or native, are tremendous sequesterers of carbon. When we think of soil health, many times we immediately think of the annual farming land that is out there, but we have to bring to light that the grasslands are such an important contributor to soil health and the environment. With that, of course, comes the incentivizing of the production of livestock on the land. We battle every day the vilifying of livestock production. If we could encourage livestock production on the grasslands, it would go a long way toward soil health.
The Chair: Thank you. Mr. Bergen, what’s your recommendation?
Reynold Bergen, Science Director, Beef Cattle Research Council, Canadian Cattle Association: Thank you. I’d like to reiterate what Mr. Thompson just said: Cattle do have a role to play in soil health.
I would like to point out that not one size of best management practice is going to fit all situations. There are going to be variations between agro-ecological zones, soil types, production systems and the rest of it. There are still a lot of things that we don’t know. Soil changes are long term. There’s still a lot of data that needs to be collected to evaluate the potential impact of management practices on soil health and soil carbon. That takes research, funding and people to do the work. Ultimately, once that knowledge is gathered, that needs to inform policy, practice and change on the ground. We can’t lose sight of the fact that economics will override all of this stuff. Thank you.
The Chair: Dr. Newton, what’s your recommendation?
Mr. Newton: Thank you, Senator Black. One action that I would recommend is that governments and NGOs look at their policies, and remove the disincentives to retaining grasslands and the incentives for converting them.
I’m going to talk specifically about Moisture Deficiency Insurance — a program available here in Alberta — to insure against a lack of precipitation. On my native grass, I can insure that for $53 per acre, at about a 7% premium. On my improved grass — the grass that has previously been farmed, and is now in perennial forage of agronomic species — I can insure that for about $73 per acre. But if I break the land and seed it to silage or green feed, I can insure it for $282 per acre at a lower percentage premium. These are disincentives we need to remove.
The Chair: Thank you very much, Dr. Newton. Mr. Gilchrist, what’s your recommendation?
Mr. Gilchrist: If you hold a carbon certificate side by side with a share certificate, that share certificate has a long history of regulation — who can buy it, and who can sell it — and, ultimately, there’s a guarantee attached to the quality of that certificate. In our carbon market, we are not there. It is to the point where it’s only as good as the providers, as my chairman would say about brand.
What is missing in the recommendation on soil health is understanding that if you want soil health to move into the commodity market, you need all of the trappings and trimmings of a regulated marketplace in order to drive the value from our producers here online — who create that change in soil health — ultimately to the soil certificate that provides value to some other part of our supply chain in Canada.
The Chair: Thank you very much, gentlemen, for your suggestions. Moving on to round two, we have our deputy chair, Senator Simons.
Senator Simons: I want to pick up right where we left off because, as I’ve been listening to all of you, Canada has such a diverse agricultural tapestry. You’re growing maple trees in Quebec, potatoes in Prince Edward Island, fruit trees in the Okanagan and grain and beef on the Prairies. Our stock exchanges and our security commissions are provincially regulated. There have been attempts by the federal government to have some kind of federal ambit, which have not worked out.
We have federal offset credits. We have provincial exchanges. I’m realizing that I’m completely ignorant about how our carbon markets actually work. Is the bulk of it happening provincially? What is happening federally? Since we’re the Senate, we can’t advise the Government of Alberta or the Government of Saskatchewan how to set up a carbon market. What do we say that can be done in the federal space? I’ll start with Mr. Gilchrist, and anybody else can hop in.
Mr. Gilchrist: If we treat it like a commodity, then I believe it fits the federal space, just like the selling of grain across Canada. You are correct; there is only one market in Canada in the agriculture space, and that’s in Alberta, with several protocols that are available to trade between farms and ranches in Alberta and our emitters. The Canadian space is not yet up and running. The protocols are slow to come out, and, at some point, the backstop provinces will be able to participate when the ministry gets their protocols published.
Beyond the regulated space, we have a plethora of other volunteer markets that farms and ranches can participate in. Mr. Newton was certainly talking about one of them. We have protocols that deal with the retention of grasslands, as well as the buying and selling of straight carbon data, which Mr. Woodward is involved in. All of those need some sort of guarantee of the certificate, ultimately, of what they’re trying to produce.
Senator Simons: I think we were all listening to our previous panel of witnesses — the department officials — and they talked about carbon offsets, and how those can be traded to a company that produces carbon as an offset. How does that work, and have any of you participated in that federal carbon offset program?
Mr. Woodward: Our product that we take to market is actually a certified carbon credit, according to the ISO standards, and it’s third party validated through global accounting companies. We have sold carbon credits as offset credits into the Canadian oil industry. We are about to crystallize our first set of credits over the next couple of weeks. It’s not being done according to a Canadian standard. I think the panel previous to ours said that it is still to come. We are building this according to the global standard for accountability, verification and accuracy of the data that proves that there has been carbon added to the soil in an incremental way, and measuring it.
That delivers a fundamental question around whether you can measure the gain in soil-based carbon to the point that there is confidence in the markets. The markets for offset and inset credits are global. They’re not specifically tied to any Canadian market structure. We’ve positioned ourselves as a company that sells credits created in Canada to global markets from the farm and ranch community.
Senator Simons: I have one last question related to this. The expert witnesses from the federal government talked about potentially having methane credits based on reducing methane emissions from cattle.
Mr. Thompson, do you think something like that could be appealing to cattle producers if one could quantify their methane reduction? I mean, there’s something deliciously bureaucratic in the idea of setting up a system to measure cows’ — can one say “farts”? Is that parliamentary language? — methane emissions; we’ll say that.
Mr. Thompson: I think I’m going to refer to our expert, Dr. Bergen, on some of this, but I want to start by saying, absolutely, cattle are methane emitters. But also, the sequestration of all greenhouse gases is under-researched, and there is considerable evidence to suggest that in a grazing system, there is a lot of sequestration of all the greenhouse gases.
I’m going to ask Dr. Bergen to comment on that further, please.
Senator Simons: For methane credits.
Mr. Bergen: Thanks. What I can clarify a little bit is that the protocol that your experts were referring to earlier was developed primarily for the cattle feeding sector, and it was aimed at the cattle feeding sector because there’s much more control over what the animals eat. You can provide a feed additive and have a predictable impact on emissions. That’s the big challenge on the grasslands side of it. They’ll eat grass, but if you provide a supplement, some of them might eat it and some of them won’t.
I’m going to carry on a little bit here. One of the things that we know from our past research is that when we can improve the growth rate of cattle, and when we can improve their performance, efficiency and reproductive performance, all of those things have incremental additions to each other that reduce the amount of methane per pound of beef that we produce, and we’ve actually quantified that. Over the past 30 years, we’ve reduced our emissions per pound of beef by 15%, and that was without even deliberately trying to reduce GHG emissions. That was just simply trying to improve productivity.
Senator Simons: Thank you very much.
Senator Burey: Thank you, again, so much for being here. I’d just like you to talk about the development of carbon organic matter and the assessment of soil health, and how these markets can improve food security. Are they an essential component of improving food security both in Canada and globally?
Mr. Woodward: I think the unequivocal answer is yes, they’re definitely linked. If you can design the right market structure to get farmers and ranchers to add carbon and soil organic matter in a conscientious, planned way — that improves their bottom line from the carbon, as well as what they’re growing on their farm or ranch — you do this by improving the health of the soil. Improving the health of the soil will lead to higher productivity, better production across that land and, in all likelihood, lower amounts of inputs required. You’re able to fundamentally improve what the farm and the ranch are doing, because the soil itself is improving because you’re adding carbon. The right market design for the carbon system here in Canada will deliver multiple benefits, knock-on effects from carbon through to increased productivity across that same acre or hectare, and perhaps lower input costs at the same time. We can win on multiple fronts, senator.
Senator Burey: Thank you so much. Are there other comments?
Mr. Gilchrist: Senator, I would lay out the fact that you’re going to change the revenue structure of the farm or ranch across Canada. It’s not that you’re always guaranteeing profit, but you’ve increased the revenue picture, for which that farm or ranch can take advantage.
Please understand, if we’re dealing with an offset, there is a disconnect between that and the question you asked about food security, because an offset is going into a business’s change in their emissions framework. There’s a disconnect in your question between how carbon markets work and the ultimate user of those offsets — regulated emitter or non-regulated emitter. They may not be in the food system. They may be in the transportation system, they may be in the oil and gas system or they may be in the technology system. There is a gulf between the farm and the ranch interacting with your food and the emitter trying to buy an offset to reduce their footprint, and that may not be in the food system.
Mr. McCabe: As a farmer, I can tell you that I have the best plans laid that you can possibly have until I open that seed bag. After that, essentially, for 2023, Ontario had a very robust year in weather events: drought until the middle of June, and then essentially excessive rainfall. I can plan all I want, but the reality is that healthy soils will help my system get through better, and that’s hinged on organic carbon and on food security. The larger issue in food security is distribution and greed.
The Chair: Thank you.
Mr. Thompson: I would just like to say that, as you continue forward and look to develop policy, I think it’s critical that you look at results-based programming rather than practice-based because, as has been alluded to numerous times by all the presenters, there are so many variables. All of us are operating on our land bases to optimize our own systems. Results-based programming is really critical. Suggested practices are okay, but to really promote practices is a challenge because there are so many different landscapes. I felt it’s important to echo that.
The Chair: Thank you.
Thank you very much to all our witnesses: Mr. MacMillan, Mr. Thompson, Mr. Woodward, Mr. Lafontaine, Mr. Gilchrist, Mr. McCabe and Dr. Newton. Thank you very much for your participation today.
We can tell you’re passionate about the topic. Whether you had the chance to talk often or not, we know you’re interested in our study, and we will encourage you to keep track of our study as we complete it in the coming months and have a report written.
With that, folks, I want to thank the committee members for your very active participation and thoughtful questions. I also want to thank all those folks who support us behind us and off-site. We couldn’t do what we do without your support in so many ways.
Our next meeting is scheduled for Thursday, November 30, at 9 a.m. — a week from today — where we’ll continue to hear from witnesses on the committee’s soil health study. Senator Simons will be chairing that meeting.
(The committee adjourned.)