THE STANDING SENATE COMMITTEE ON ENERGY, THE ENVIRONMENT AND NATURAL RESOURCES
OTTAWA, Friday, June 11, 2021
The Standing Senate Committee on Energy, the Environment and Natural Resources met by videoconference this day at 12:00 p.m. [ET] to consider the subject matter of Bill C-12, An Act respecting transparency and accountability in Canada’s efforts to achieve net-zero greenhouse gas emissions by the year 2050; and, in camera, to consider a draft agenda (future business).
Senator Paul J. Massicotte (Chair) in the chair.
The Chair: Honourable senators, my name is Paul Massicotte. I am a senator from Quebec and I chair the Standing Senate Committee on Energy, the Environment and Natural Resources. The committee is meeting today in a virtual session.
Before we begin, I would like to remind honourable senators and witnesses to keep their microphones off at all times, unless recognized by the chair. I would remind honourable senators to please use the “raise hand” function to request the floor. I will do my best to allow everyone who wishes to ask a question to do so. However, in order to do so, I would ask you to be brief in your questions and preambles.
I would also remind you, when you speak, to do so in the language of the interpretation channel you have chosen. If any technical problem arises, particularly with interpretation, please report it to the chair or the clerk, so that we can deal with it immediately.
I would now like to introduce the members of the committee who are taking part in today’s meeting. We have Margaret Dawn Anderson from the Northwest Territories, Douglas Black from Alberta, Claude Carignan from Quebec, Brent Cotter from Saskatchewan, Rosa Galvez from Quebec, Julie Miville-Dechêne from Quebec, Dennis Glen Patterson from Nunavut, Paula Simons from Alberta, Josée Verner from Quebec, and Yuen Pau Woo from British Columbia. Welcome to all of you, colleagues, and to all Canadians who are watching.
Today we continue our preliminary study of Bill C-12, An Act respecting transparency and accountability in Canada’s efforts to achieve net-zero greenhouse gas emissions by the year 2050. From the International Energy Agency, we have Christopher McGlade, Head of Energy Supply. From the Centre québécois du droit de l’environnement, we have Anne-Sophie Doré, Lawyer, and Christopher Campbell-Duruflé, Lawyer, doctoral student and member of the legal committee. We also welcome Mr. Paul Fauteux, Lawyer, mediator and accredited arbitrator, who will speak as an individual.
Welcome to the witnesses and thank you for accepting our invitation. I remind you that you each have five minutes to make your remarks. We will then have questions for you.
Mr. McGlade, you now have the floor.
Christophe McGlade, Head of Energy Supply Unit, International Energy Agency: Senators and distinguished members of the committee, thank you for the opportunity to appear before you today and to present the International Energy Agency’s first-ever global road map to achieve net-zero emissions.
Many governments and companies have given themselves the target to reach net-zero emissions and, in this context, we were requested by the U.K. COP presidency to lay out a vision for how the entire global energy sector can reach net-zero carbon dioxide emissions by 2050. This is important because it is consistent with efforts to limit global warming to 1.5 degrees Celsius.
The pathway to net-zero emissions globally is narrow, but it is achievable. It calls for nothing less than a complete transformation of how we produce, transport and consume energy globally. The number of countries that have pledged to achieving net-zero emissions has grown rapidly over the last year, and they now cover around 70% of global carbon dioxide emissions. This is a huge step forward, but commitments made to date still fall far short of what is required. Most net-zero pledges are not yet underpinned by near-term policies, and making long-term targets for net zero should not distract us from the need for clear policies and targets along the way.
Countries also do not start in the same place or finish at the same time. In our net-zero pathway, advanced economies in aggregate reach net-zero emissions before emerging markets and developing economies, and they assist others in getting there. Globally, the 2020s needs to be the decade where there is a massive deployment of all clean and efficient energy technologies that are already available in the market today, but a full transition to net-zero emissions will require more than that. In our pathway, almost half of the emissions reductions in 2050 come from technologies that are not yet currently available in the market. Major innovation efforts are needed over this decade to ensure that the new technologies needed for net zero are available in time.
Let me highlight some of the major actions that are needed along our global pathway toward net zero. For electricity, there is no shortage of decarbonization options, and the electricity sector is the first to achieve net zero in our global pathway. At a global level, this is achieved by 2040, and it occurs as early as 2035 in aggregate in advanced economies. Renewables become the dominant source of electricity supply by 2050. Almost 70% of generation globally comes from solar PV and wind power alone. Today, these technologies provide less than 10% of generation globally.
In transport, there are no more sales of internal combustion engine cars in 2035 in our pathway. Heavy freight trucks can be more challenging to decarbonize, but technologies are improving rapidly, and by 2030 more than half of all truck sales globally are electric or fuel cell.
In buildings, efficiency standards mean that by 2025, nearly all appliances and air conditioners sold in advanced economies are the most efficient technologies available. After 2030, every new building built around the world will need to be zero-carbon ready, using clean fuels and meeting the highest efficiency standards.
In industry, new technologies such as hydrogen and carbon capture storage and utilization together contribute half of the emission reductions in 2050. To realize this, each month from 2030 the world equips 10 large-scale heavy industry plants with carbon capture and storage and adds three new hydrogen-based industrial facilities every single month.
Finally, if policies are introduced to reduce fossil fuel demand in line with achieving net-zero emissions globally by 2050, we find that no new oil and gas fields are required beyond those that are approved for development by the end of 2021. No new coal mines or coal mine extensions are required either. Nonetheless, existing projects will require ongoing investment to ensure they can maintain production and to improve their sustainability and reduce their emissions intensity.
I will finish by recognizing that our global route is just one possible pathway to net-zero emissions. It is not the only pathway. Each country will need to design its own strategy, taking into account its specific circumstances. There is no one-size-fits-all approach to clean energy transitions. Thank you.
The Chair: Thank you. Let’s go on to Ms. Anne-Sophie Doré.
Anne-Sophie Doré, Lawyer, Centre québécois du droit de l’environnement: Honourable senators, thank you for having us here today for the consultation on Bill C-12. I would like to introduce myself: I am Anne-Sophie Doré and I am a lawyer with the Centre québécois du droit de l’environnement. I am accompanied by Christopher Campbell-Duruflé, a doctoral student in law and a member of the legal committee of the Centre québécois du droit de l’environnement, the Quebec Environmental Law Centre.
It was important today for CQDE to be present in order to participate in your reflection on Bill C-12. Such a law is necessary in order to act against climate change and to participate in the construction of a society that is resilient in all its facets.
The adoption of climate legislation ensures governmental action in the fight against climate change, sets predictable, gradual and ambitious objectives and allows for the evaluation of the actions undertaken. Climate laws also help to chart a course for tackling climate change, one that is built on a just transition perspective and promotes the development of a low-carbon, sustainable and inclusive economy.
Bill C-12 introduces some of the basic elements of a climate bill, particularly because of the amendments that have been passed. Bill C-12 allows for the setting of predictable greenhouse gas emission reduction targets to achieve carbon neutrality by 2050, the ultimate target that would be set by law.
The bill also ensures some accountability on the part of the Minister of the Environment, who is required to submit action plans and reports on their implementation.
The bill also allows for a pathway to carbon neutrality by adopting intermediate targets that, following an amendment, can only be changed upwards. This predictability in action is desirable and necessary.
Of course, there are still some points that need to be improved. CQDE would have liked to see the establishment of an independent advisory committee with a clear mandate to advise the government as a whole on its climate actions.
In several countries that have already passed climate legislation, the advisory committee has been a driver not only of government action, but also of citizen participation. This is another one of the shortcomings of Bill C-12, which provides very few mechanisms for public participation, either through access to information or by engaging the public in decision-making.
These improvements can certainly be discussed in the Senate and hopefully form part of your submissions to the House.
It is encouraging to note, however, that the House has added a review of the legislation in five years. A climate law must necessarily be improved to ensure that the ultimate goals are met, and we welcome this addition.
Finally, Bill C-12 is more than necessary to ensure that Canada meets its international commitments. I will turn the floor over to my colleague, who will continue on this point.
Mr. Christopher Campbell-Duruflé, Lawyer, doctoral student and member of the legal committee, Centre québécois du droit de l’environnement: Honourable senators, thank you for undertaking the preliminary study of Bill C-12, an important initiative for the fundamental rights of Canadians guaranteed by the Charter, a bill which is also intended to show the international community that Canada is ready to collaborate to meet global challenges.
The Paris Agreement is an international treaty that Canada ratified on October 5, 2016. Under international law — the 1986 Vienna Convention, specifically — we have an obligation to implement its provisions in good faith. With Bill C-12, you have an opportunity to show that good faith by ensuring that the text adopted is at least as ambitious as the Paris Agreement in terms of decarbonization and accountability.
In this regard, I draw your attention to the 2026 interim target, which was added by amendment. This is a step in the right direction, as the Paris Agreement contains in its paragraph 4(2) a legal obligation to submit nationally determined contributions (NDCs) in 2025. We hope that Bill C-12 will enhance the preparation of our 2025 NDC.
Another amendment should be preserved: Bill C-12 now incorporates the international principle of progression from one target to another. However, clauses 7 and 8 of Bill C-12 do not state that our targets must reflect the highest possible level of climate ambition, a guiding principle of the Paris Agreement that appears in paragraph 4(3) and that Canada agreed to upon ratification of the agreement.
Another necessary amendment with respect to the Paris Agreement was to ensure that the advisory body, established pursuant to subclause 20(1) of Bill C-12, assists the minister in the determination of the targets every five years, rather than only in their implementation. Indeed, the targets must reflect the best available science under paragraph 4(1) of the Paris Agreement. In light of that, the advisory body must have an objective and independent selection process to ensure that our targets are consistent with the 2050 carbon neutrality goal.
Senators, the Paris Agreement affirms that living up to the climate challenge is a common concern of humankind and a matter of equity between peoples. The best way to show Canadians and other peoples of the world that we are acting in good faith is to make sure that Bill C-12 is adopted and that its provisions are at least as ambitious as the Paris Agreement.
Thank you for your attention, honourable senators. We are available to answer your questions.
Paul Fauteux, Attorney and accredited mediator and arbitrator, as an individual: Thank you for this opportunity to contribute to your work.
I served the Government of Canada as a diplomat and senior executive from 1980 to 2010. In particular, I led the Climate Change Bureau and the Canadian delegation to the international negotiations on the implementation of the Kyoto Protocol. As in its original version, Bill C-12 is still grossly inadequate to meet the imperatives of the climate emergency.
The House committee’s work on this important bill was rushed. The amendments that have been made are only superficial and do not address the significant deficiencies that I outlined to that committee on May 19.
There are still many improvements to be made to Bill C-12 and, given time constraints, I will mention only five.
First, the title of Bill C-12 betrays its lack of ambition. The Paris Agreement makes clear that achieving carbon neutrality by mid-century requires that we first achieve a global cap on greenhouse gas emissions as soon as possible. It is these early reduction efforts that Canadians expect from their government and that is the ambition that should be reflected in the title, which would obviously require an improvement to the text of the bill.
Second, Bill C-12 should include, and thus make mandatory, the 40% to 45% reduction target from 2005 levels by 2030 announced by Prime Minister Trudeau on April 22. It should also provide for the establishment of intermediate targets, starting in 2025 and every five years thereafter. Without targets, Bill C-12 serves no useful purpose.
Third, Bill C-12 should provide for the review of the government’s action plan and planned measures by an independent authority. This authority could be the Commissioner for the Environment, who should be given greater independence by becoming an officer of Parliament.
Fourth, Bill C-12 still falls short in terms of expert engagement. Detailed and rigorous amendments in this regard, based on the unanimous recommendations of its expert witnesses, were presented to the House committee. They were not considered on their merits and were all defeated by votes along party lines. Bill C-12 therefore continues to provide for an advisory body to give advice to the minister. This body, which already exists, is only 7% scientific, compared with 67% in the United Kingdom and 85% in France, two countries where real climate legislation is producing results.
Fifth — on this point, I agree with the Quebec Environmental Law Centre representatives — Bill C-12 provides no assurance that the measures to be contained in the Minister of the Environment’s plan, including emission reduction targets, will enable Canada to meet its commitments under the Paris Agreement.
Dr. Corinne Le Quéré told the House committee on May 20 that only the rigorous, independent and science-based work of an expert panel and the Commissioner for the Environment would set the stage for possible success in the fight against climate change.
The reason she spoke of possible success is that Canada’s dismal record of repeated emission reduction failures is now forcing the country to do extensive catching up, within the very short time frame dictated by the climate emergency. Under these conditions, a proper Canadian climate law should assure the public and the international community that Canada will at least meet its own commitments, even if they are insufficient to reach the Paris Agreement goal.
In conclusion, on May 21, the G7 climate and environment ministers, including Canada’s, made the following statement:
[w]e acknowledge with grave concern that the unprecedented and interdependent crises of climate change and biodiversity loss pose an existential threat to nature, people, prosperity and security.
It is too late to stop climate change. The best we can hope for is to avoid its most catastrophic and irreversible effects. Bill C-12 is ridiculous given the size of this challenge. The Senate can and must do better. We speak politely about these things but, as Icelandic poet Andri Snær Magnason recently said, it’s hard to do so without screaming or crying, because it’s a matter of life and death.
Thank you for your attention.
Senator Simons: I have to say, Mr. McGlade, after hearing a lot of very depressing testimony over the last few days, yours is the first that gave me hope because you actually outline concrete plans and strategies to get from here to there.
But your testimony underlined for me my great source of unease with Bill C-12, which is a bill that makes a promise to have a plan without any actual plan or method for accountability. Because I want to cheer myself up, I wonder if you can tell me how the International Energy Agency got from the point of saying this is something that would be nice to have to actually coming up with the very specific, concrete examples you gave of, okay, we need to do this with electricity and that with transportation? How did you set those benchmarks? Is there a way that we can use the very limited foundation of Bill C-12 to get to where we need to be?
Mr. McGlade: Thank you, senator, for the question. The pathway that we constructed started off with the goal to make the global energy system net zero by 2050. Unfortunately, we’re not close to achieving that goal, given what we see in the international space in terms of policies and ambitions.
What we wanted to do was to see how we can get there in terms of the technologies we have available today, where can they be most effective? For example, you mentioned the electricity sector. That’s one of the areas where we know the technologies that can be most effective in reducing emissions from electricity. So in our pathway, it’s the first to come to net zero.
There are other areas where we know the kinds of technologies that will be required. However, they aren’t necessarily yet available in the market. They might be in the demonstration or prototype phase. In our pathway, we assumed a huge level of effort over the next five to ten years to make sure those technologies become available.
So in those difficult-to-decarbonize sectors, like heavy industry and long-distance transport, that’s where we need work to make sure that we get those technologies coming through. That’s how we developed our milestones: on the basis of the technology we have available, on the basis of the policies that we see countries have around the world and the technologies that will become available later on that we will need to get toward net zero.
Senator Galvez: I will follow along the same line of questioning as my colleague Senator Simons.
Listening to Mr. Fauteux, he says we are not where we want to be. The question is why. There is still climate change denial and people who don’t want to face the reality of the dangers of climate change.
Some days ago, we had a witness come to this committee who quoted the Bank of Montreal, which is a financier of the oil sands. They said that the report of the International Energy Agency was like “Fantasy Island.”
Can you please explain and expand on the data, evidence and approach you used to arrive at your projections that make you, as my colleague said, positive? Also, what do you think will happen if we keep delaying the passage of this type of legislation in the Canadian Parliament?
Mr. McGlade: Thank you, senator. The genesis of this report came about because this is what governments have pledged to do as part of the Paris Agreement. We wanted to translate that into real goals and action, but one of the things we found when developing this pathway is just how challenging it is. We really need to stretch everything that we have available to us. We need to put every technology that we have available on the table, and we need all policies and all countries to be on board.
It was clear as we were developing this pathway that, without exception, all countries need to increase their ambitions. Wherever there is a national determined contribution or a net-zero pledge, we need to increase the ambition for all of them, whether that’s having near-term interim targets to make sure we can achieve those net-zero dates, whether it’s bringing those net-zero dates forward in time so they’re achieved earlier or whether it’s actually generating or producing net-zero goals. Governments will be key to achieving this, and it’s only by increasing that level of ambition that we will be able to realize the goals.
In constructing the milestones, and in pushing these really stretched targets that we have, we wanted to make sure that nothing is beyond the laws of physics. This is all achievable. Yes, it’s ambitious and goes well beyond what we’ve seen in the past historically, but if we have the right policies put in place, if we have the right investments and money flowing to the right places, this is still a narrow but achievable path.
Senator Galvez: What are the consequences if we don’t do that?
Mr. McGlade: If we delay, the scientists have told us we will suffer even worse with temperature rises and climate change damages. We should recognize that this is not a do-all or do-nothing situation. We shouldn’t say that if we don’t achieve net zero by 2050 we should just give up entirely. Every 0.1 degree of temperature rise makes things worse. It increases the risk of climate damage, whether that’s heat waves, extreme weather, floods or sea-level rise — all of the damages that scientists have told us get worse as the temperature rise increases. So absolutely we should aim to keep the temperature rise as low as possible to minimize the risks, but if we can’t achieve the most ambitious 1.5 degrees we shouldn’t give up at that stage.
What is clear is that we need ambition now to get emissions down as quickly as possible. The pathway says we have technologies in the market today to bring about those really rapid reductions that are required over the next 10 years to keep the window open toward getting closer to net zero globally.
Senator Carignan: I’d like to hear your comments on those that are absent vis-à-vis the provinces, the private sector and businesses. The bill should target each of those players to leverage their participation, don’t you think? Should businesses have individualized environmental assessment plans, similar to measures recommended for individuals? For example, a household’s energy consumption and greenhouse gas emissions could be mapped out, along with suggested behavioural changes.
Doesn’t this place the responsibility at too high of a level, when the focus should really be on provinces, municipalities, businesses and individual households, to bring about behavioural changes? Is Bill C-12 insufficient and unambitious because it fails to put forward a comprehensive approach?
Mr. Fauteux: Thank you for your question, Senator Carignan.
It was probably clear from my opening statement, but you are right: I don’t think Bill C-12 is anywhere near sufficient. I believe Senator Simons put it well when she said this was —
— a bill to make a promise to make a plan.
— and that is why I don’t consider this a proper climate law.
I mentioned countries that had passed good legislation, including the United Kingdom in 2008. This is 2021, a whole 13 years later. More recently, France passed a climate law. Our two mother countries — historically speaking — have set the example for us to follow. Obviously, the details get in the way.
I do not think the problem with Bill C-12 is that it’s overly broad or too high level. The problem is that it is not ambitious enough. The purpose of a climate law is to create momentum, to give the appropriate direction. To use Mr. McGlade’s words, I think the purpose of a law like this is —
— to stretch targets and raise the level of ambition.
We need to raise the level of ambition in Bill C-12 so that it can transfer to all the areas you mentioned. Talks with the provinces should come after — not before — climate legislation is passed. As I see it, the federal government must establish the overall framework for the federation, and talks with the provinces should flow from that framework. The same is true for businesses and municipalities.
Basically, the federal government needs to set the tone with an approach that is a good deal more ambitious than Bill C-12.
Ms. Doré: I would add that, obviously, Parliament’s actions still have to respect the division of powers. In contributing to climate action, the government has to work in cooperation with the provinces. Obviously, the division of powers has to be respected, and so does jurisdiction, whether it be provincial or municipal.
Climate action has tended to be placed on the shoulders of individuals, especially those who have been asked to take concrete action on a daily basis to protect the environment. However, we are past that now. The state has to be the one to show leadership and establish an action plan, to bring about behavioural changes in individuals and families more naturally. In this case, an action plan is necessary to support more concrete measures to protect the environment in the day-to-day lives of individuals and families.
Clearly, a climate change action plan has to target businesses and the private sector, but that is actually what the plans already do. The legislation can provide more details, but I don’t think the biggest problem with Bill C-12 has to do with the details, or the fact that it should focus on individuals, sectors and provinces to make them behave in a predetermined way under the law.
Mr. Campbell-Duruflé: In a few words, whether it’s businesses or families, I think what Canadians need is a clear signal.
The United Nations Framework Convention on Climate Change was adopted in 1992 with the goal of preventing the dangerous impacts of climate change on people. The Kyoto Protocol was adopted in 1997, but it seems that people and businesses have lost confidence that governments, including the Canadian government, will take ambitious action to reach the goals. I feel people need to regain confidence that our governments are going to take those actions.
There a plenty of ways to do it through Bill C-12. Mr. Fauteux suggested including the 2030 target in the legislation. Bill C-12 could also require that certain actions be taken, so that the Minister would have to do what it takes to meet the targets.
As Senator Simons said, this is a very procedural framework where we lay down plans to meet targets, but we have no legal obligation to proceed with those plans at this time, whereas paragraph 4(2) of the Paris Agreement includes a requirement to take action to meet the targets.
Individuals, families and businesses could also be involved in setting targets under clause 13 — the clause about public participation — and the Senate could reinforce it.
I refer you to Article 12 of the Paris Agreement. I can come back to it later; it’s very detailed in terms of public awareness and education and it goes well beyond clause 13 of Bill C-12, which only provides the opportunity to make submissions on setting targets.
Senator D. Black: Panellists, thank you very much for your extremely interesting presentations this morning. My short question is for Mr. McGlade.
Sir, I want to thank you very much for the work that you have done here and the work your agency has done in graphically illustrating for anyone who chooses to read your report how extraordinarily difficult it is going to be for the world to achieve the goals that we all want to achieve. Much attention has gone global, and global media attention has gone to your so-called scenario. You have indicated that, obviously, if there is one scenario there must be others. You have talked this morning — and there has been much comment on it — about the scenario you outlined for us which is onerous before we even get to cost considerations. What other scenarios are there, in your view, to achieve the goals set out in Bill C-12?
Mr. McGlade: Thank you, senator, for the question. The net-zero scenario is, as you say, just one possible scenario, but it’s the only scenario that the International Energy Agency has produced that achieves net zero by 2050. We have other scenarios.
We have looked, for example, at a scenario whereby we just take at face value what governments have already stated in terms of their policies and what they would like to bring into legislation. We did this for around the world. What this leads to is that emissions keep rising. They don’t fall to net zero in 2050, and we estimate that would lead to a temperature rise globally of about 2.7 degrees. That’s just taking what governments have in place. Now, 2.7 degrees is a very long way away from 1.5 degrees.
We also looked at the scenario where we take all those countries that have made an announcement about achieving net-zero emissions. We said, let’s assume that those countries achieve the net-zero targets or pledges. What does that lead to? In that scenario, the temperature rises about 2.1 degrees. So that’s better, but it’s still a long way away from 1.5.
Senator D. Black: So if I understand, your position would be that the scenario you have laid out — with all its uncertainties, new technologies and costing — is the only one that that your agency believes can achieve the goals that we all wish to achieve.
Mr. McGlade: Thank you. I wouldn’t characterize it that way. I would say the scenario we have is our best judgment, given all the uncertainties that exist.
However, there are other sensitivity cases, other alternatives that we look at where we ask questions. For example: What happens if carbon capture and storage doesn’t work? What happens if we can’t expand it at the scale we have in our net-zero pathway? What does that mean? What we find, for example, is that it is significantly more expensive to reach net-zero emissions, and it may well make the pathway to net zero incredibly difficult by 2050.
We also look at what happens if there are no behavioural changes from people. Behaviour change plays an important part in our scenario, but it is uncertain if that will happen. We have looked at what that might mean. Again, without it, it becomes incredibly difficult to achieve net-zero emissions.
Senator Miville-Dechêne: Thank you, everyone. I have a technical question for Mr. McGlade first; it’s a neophyte question.
I come from Quebec, a province that prides itself on the fact that it generates 95% or more of its electricity with its massive hydroelectric dams. Did I understand you correctly when you said that, to meet the targets, 70% of electricity would have to be generated by solar and wind power? Is that what you said? If so, then we have a very long way to go in that respect.
The Chair: Is your question for Mr. McGlade?
Senator Miville-Dechêne: Yes.
Mr. McGlade: Thank you, senator. At a global level, you are correct: 70% wind and solar PV. However, of course, it is the case that different countries have different circumstances. We wouldn’t, for example, expect that would be 70% in every single country. In a country like Canada, where already today the majority of electricity across the whole country comes from hydro, it may well be the case that that can continue. That won’t be replaced entirely by wind and solar. Hydro will continue to play an important role in Canada’s pathway toward net-zero emissions.
Given that there will be a very large increase in electricity demands in this scenario at a global level — for example, electricity demands increases two and a half fold between today and 2050 — Canada’s electricity demand would likely also increase significantly in this scenario. You are using electrical vehicles, heat pumps for heating and you are electrifying lots of different areas, so parts of the energy system will require more electricity, but wind and solar PV can be cost-effective ways of meeting that increase in electricity demands while also ensuring there is no increase in emissions.
Senator Miville-Dechêne: I have a little side question for Mr. Fauteux. I can’t help but notice that you are a former diplomat. However, your comments on what Canada needs to do are extremely pointed and not diplomatic. Have you considered the politics, since you have been doing that your whole life? We have a bill that, as my colleague said, sets out to establish and carry out a plan. It’s a compromise, given that we have a minority government and we’re in a somewhat unstable political situation. So that’s as far as we can go, as I understand it. If we insist on having a perfect bill, then what happens? So I’m asking you to make a political analysis.
The Chair: Please keep your response as brief as possible, Mr. Fauteux.
Mr. Fauteux: Yes, a very short answer. I did work in the public service for 30 years. So I’m well aware of the political constraints. If this bill is passed as is, people would be able to improve it. I believe it would be better to pass it later and get things done right.
Senator Patterson: Thank you to the witnesses. Mr. McGlade, you’ve allowed us to look at the global situation. Thank you very much.
The biggest emitters include China and India, and they seem committed to coal, which, as we know, produces heavy emissions. India, as I understand it, has shown over 300% increase in emissions between 1990 and 2018, and are forecast to increase a further 25% above 2019 levels to 2030. Then there is China, which some say is building one big coal-fired power plant every week.
You said electricity is a key area for reducing global emissions. Can you give us a picture of how some of these very large emitters, namely India and China, are forecast to help in the global struggle, and have those two countries pledged to net zero? Thank you.
Mr. McGlade: Thank you, senator. To take your last point first, have they pledged net zero, China has announced an aim to achieve net-zero emissions by 2060. India does not yet have a net-zero target, but has some interim targets over the next 10 years.
The way in which those countries reach net-zero emissions in our scenario is different from advanced economies where economic growth is slightly slower, where the population increases are not so large and where there aren’t necessarily the same development issues.
If we look, for example, around the world today there are 790 million people who don’t have access to electricity. There are 2.6 billion people who rely on unclean solutions for their cooking and use traditional bioenergy. A large proportion of those people are in India, especially for cooking.
It is important in our scenario that not only do those countries reduce emissions, but they can also meet other sustainable development objectives. What the pathway aims to do is to show how this can be done in a comprehensive manner, how it is possible to achieve those goals while reducing emissions. Here are some of the concrete milestones that we’ve laid out, and one key one since you mentioned coal-fired power plants. There are no unabated coal power plants approved for development after today in our net-zero pathway.
Globally, I mentioned that net-zero emissions for electricity is achieved by 2040. This means that all unabated coal-fired and oil-powered plants are phased out by that date. There are ways of achieving this, and there are ways in which those countries can assist in global efforts and also the help that they will require. For example, China is a major source today of the solar panels which will be required. They can also be a major source of a number of other clean energy technologies. But investing and ensuring that there is clean energy financing going toward developing economies is a crucial part of the net-zero pathway we set out.
Senator Black was asking about alternative pathways. We looked at a case where there isn’t international collaboration. What happens if there is no coordination between countries working together toward an objective? What we found is that it is not possible to reach net-zero emissions globally by 2050. The date of net zero will be delayed significantly if we don’t have international cooperation. It is key that all countries work together to achieve our collective climate goals.
The Chair: Thank you. If I could permit myself, I have a question for Mr. McGlade also. Not to pick on you, but your report made reference to the fact that the world does not need the development of any more oil fields whatsoever; the supply is adequate for our needs.
In our market economy, governments don’t decide what economic activity is desirable. They set pricing, if you wish, and the carbon tax is an example. Are you suggesting that the government should ensure that nobody else builds another oil field? You may have noticed that in the world a lot of people took that comment to suggest that, no, we don’t need any other oil and gas at all. But if I’m correct, in your report you see a significant reduction of oil and gas from now to 2050, but there is still a significant amount of oil and gas by 2050. Could you clarify that comment? What is the number of barrels today and what do you see by 2050? And what is your proposal? Perhaps you could clarify.
Mr. McGlade: Thank you, senator. Let me put some numbers on this, first of all. In 2020, oil demand globally was around 90 million barrels a day. It is likely to increase significantly in 2021. Obviously 2020 was an abnormal year for oil demand.
In our net-zero pathway, oil demand falls to around 25 million barrels per day in 2050. So from 90 million barrels per day last year, likely increasing this year and then down to 24 million barrels a day.
Natural gas demand also falls significantly. It was around 3,700 billion cubic metres last year and it goes down to about 1,700 billion cubic metres. Oil demand drops by about three quarters and gas demand by about 55%, but, you are correct, there is still oil and gas that is required in 2050. What the roadmap does not say is that there is no investment in any oil and gas. It is clear, and it says that there is no investment in new oil and gas fields.
I mentioned in my opening remarks that there is investment required into the existing fields to reduce their emissions intensity and ensure that production can be maintained. Let me emphasize this point: Our scenario is demand led. Governments put in policies in line with net zero by the 2050 target. If they do that, you will have a surge in clean energy investment: in electric cars, in hydrogen, in carbon capture and storage — in all of the clean-energy technologies. As a result, fossil fuel demand will start to fall. Then we will see, if that fossil fuel demand starts to fall, that we can meet that level of fallen demand given the existing sources of production. We don’t require any new oil and gas fields. That’s the flow of logic of this scenario.
The Chair: But to be consistent with all your past scenarios, the solution lies with controlling and influencing demand. There has never been any assumption that we would miss oil and gas. There has always been a surplus of supply, and the market is going to dictate who wins and who loses. But the focus is very much on influencing demand, if I am correct. Is that accurate?
Mr. McGlade: That is accurate. We talked about how to ensure this happens. In this scenario, the market inspires how this happens. Because you have this fall in fossil fuel demand, you will have a fall in fossil fuel prices. The oil price, for example, falls to $35 per barrel in 2030. That’s the level at which it is sufficient to maintain production of existing fields but does not incentivize new developments.
Let me be clear: It is perfectly possible that new developments could happen, but what this scenario is saying is that those developments would be at risk of not recuperating the investment that goes into them. If you have those demand-side-led policies, prices fall and there will be increasing risks for those developments.
The Chair: Thank you.
Senator Galvez: My question is to Mr. Campbell-Duruflé. We have said that we keep waiting for the perfect legislation, but somebody said that if our legislation doesn’t make anybody happy it is a good sign, because that means there was pull from every part.
One of the arguments for a delay in the adoption of this type of legislation is that Canada doesn’t contribute much; it is very little. But that is taking a picture of emissions today and saying that Canada emits little, but not taking into consideration our upstream emissions. You talk about a fair share. Can you tell us why Canada needs to act, and what is our fair share so that we start reducing our emissions as soon as possible?
Mr. Campbell-Duruflé: Thank you for the question, senator. It makes me think of Senator Patterson’s previous question about the dynamic between China, Canada and India, because climate change is a global challenge. The Paris Agreement was negotiated just as this bill was negotiated. The spirit of the Paris Agreement — and that’s the text we agreed to — is that the targets must reflect the highest possible ambition, progression, equity, fairness and common but differentiated responsibilities in light of national capacity. That’s the wording that we negotiated, that’s the wording we ratified and that’s the spirit we agreed to when we pledged to fight climate change.
The figures may be debated, but currently Canada’s emissions are around 16 tonnes of greenhouse gases per person per year. Compare that to China, where they sit around 6 tonnes. Compare that with India, where they sit around 1.8 tonnes. So what does equity and fairness demand of us? Do we stay at the same level and let China and India reduce? Or do we look to try to meet in the middle and find an equitable and fair solution?
The spirit of the Paris Agreement is clearly the latter option. From a legal point of view, that is what must go into Bill C-12: legal mechanisms so that we make sure that our targets are based on science, reflect the highest possible ambition and reflect equity and fair shares. According to many observers, that means they have to be way more ambitious than our current 40% to 45% reduction by 2030. Some say a fair share would be 60%. There can be a debate about that, but those principles need to go into Bill C-12 so that we can tackle climate change together. We won’t win the fight against climate change alone in Canada. We need to signal to other countries that we are all in this together and that we will do our part in good faith.
The Chair: Thank you.
Senator Anderson: Thank you to the witnesses. My question is open to all. I could not agree more on the urgent need to move on greenhouse gas emissions, but I am thinking about applicability. Realistically, what’s the applicability of a move to implement healthier options for the environment in smaller northern communities that deal with many challenges, including climate change, global warming, outdated infrastructure, high cost of living and the use of and reliance on wood because of the expense of fuel for heating?
It is fine to say — and I’ve heard this a couple of times — that families and communities need to do more. It is fine to say that we should do more, but in the Arctic, where our social determinants of health are already a challenge in terms of housing, water, food and basic needs that are not being met, it is difficult to focus on the larger picture, including greenhouse gas emissions. I would like to know from you what else is needed from the Government of Canada, besides legislation, to support a move to reducing greenhouse gas emissions for families and communities, especially in the North.
Ms. Doré: I would point out very quickly that we had precisely recommended taking into account the impact of climate change on adaptation and the capacity to act for the various communities, which have very diverse regional realities. So that must be taken into consideration in the action plans. Obviously, our great Canadian landscape has major regional diversities to consider in carrying them out. If we take regional particularities into account when determining what action needs to be taken, that will be a step forward for us.
Mr. Campbell-Duruflé: Once again, from the perspective of the Paris Agreement, we can’t look at the energy transition objective in isolation. The Paris Agreement contains provisions on sustainable development, human rights and the involvement of Indigenous peoples and, in Canada’s case, respect for their rights.
We clearly can’t meet the targets while ignoring other social, economic and equity objectives within Canada, in addition to equity between countries.
Senator Simons: I represent the province of Alberta, which is a fossil fuel-dependent economy. We are the engine that has run the economy of Canada, literally and figuratively, for a long time. For my province to make this transition is not an easy task, and we need to know that there will be the investments and incentives to move us away from conventional fossil fuel production to blue hydrogen or solar power, which is something at which my province excels. What I’m looking for is to see what kind of legislation is needed to give the correct market signal to investment that says that Alberta needs to prepare for a new kind of economy so my province is not stranded and hugely disadvantaged.
Mr. Fauteux: You raise a critically important question, and thank you so much for doing that. Ms. Doré spoke about the importance of a just transition. Clearly, for a country that is a major oil and gas exporter, and the province within Canada that is the largest oil and gas exporter, a just transition needs to take care of everyone who is invested in the oil and gas industry.
My short answer to your question is that an ambitious climate law would be the beginning of a series of market signals. As Mr. McGlade has pointed out, governments set policies; markets respond to government price signals. Lest I be misunderstood, I’m not recommending that the Senate and the House of Commons — the Parliament of Canada — not adopt a climate law. I am recommending the kind of ambitious market signal that would be provided by a climate law and will go in the direction of the evolution that the International Energy Agency has demonstrated that we need — a very ambitious effort internationally as well as in Canada. I repeat that it is critically important that the just transition include all of the workers in the oil and gas sector in Alberta and elsewhere across this country.
Senator Carignan: I’d like to ask Mr. Fauteux for a clarification. You said that if the bill passes now, it can’t be amended later, so it would be in our interest to pass a better bill later; I’m paraphrasing, but that’s what I understood from what you said. Can you explain to us how we couldn’t improve the bill later if we pass it today? There seems to be a trade-off here, in that it’s better to have flawed legislation than no legislation at all. You’re telling us not to pass it.
Mr. Fauteux: Thank you for the opportunity to clarify my thinking. I believe that climate legislation is important and I believe that Bill C-12 could become climate legislation worth passing. I hope that the Senate will play its traditional and constitutional role to reflect, and make amendments to the bill. So when I said that the bill could not be passed later, I probably misspoke. Once it passes, the bill will not be amended anytime soon; once it passes, the legislation will set a framework that will likely stand for at least five years. As Ms. Doré noted, an amendment has been passed providing for a legislative review in five years. The problem is, we can’t afford to wait another five years to give the market the signal — to address Senator Simons’ concerns — it needs to be given now, that the transition and the significant effort it requires must begin immediately, because we’re already lagging behind.
The Chair: Thank you. We have a very short question from Senator Miville-Dechêne, and a very short response, if possible.
Senator Miville-Dechêne: I want to ask you to clarify why you want the government to send clear signals to the markets. Give me some examples. Once again, I need you to bring it down a notch.
Mr. Fauteux: Thank you for urging me to do so, Senator. I am going to come back to what my colleague Mr. Campbell-Duruflé said earlier: Markets are made up of people and businesses and, as my colleague was saying, people and businesses have lost faith in the concept that the governments in Canada — starting with the federal government, because we are a federation and we have a division of powers, but the federal government has a key role to play — are really going to engage in the transition. That’s the kind of signal I was talking about, that’s how ambitious the bill should be. For example, if you take Canada’s new target, which Prime Minister Trudeau announced in Washington a few weeks ago, and include that in the bill, it shows how serious the matter is. As your colleague was saying, it’s not just a matter of promising to establish a plan; if you want to show that you’re serious, you have to make a commitment and put it in the legislation.
That’s one amendment, and others would be in order too. I have mentioned the main amendments, but I believe Bill C-12 can be improved and I feel it would be good to take the opportunity to improve it. Thank you.
The Chair: Thank you very much to all of our witnesses. It was quite fascinating, and I think that’s why everyone had a lot of questions. This is a very important subject and you are very experienced people. Thank you very much for accepting our invitation. Your comments will no doubt be discussed internally by the committee.