Natural Resources Canada
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NOTES FOR A SPEECH
BY
THE HONOURABLE RALPH GOODALE
MINISTER OF NATURAL RESOURCES CANADA
AND MEMBER OF PARLIAMENT FOR WASCANA

RENEWABLE ENERGY TECHNOLOGIES IN COLD CLIMATES '98 CONFERENCE

MONTREAL, QUEBEC
MAY 4, 1998

Check against delivery

Thank you, Mr. Filion, and good morning ladies and gentlemen. It's a pleasure to have this opportunity to speak at this important conference, which I understand is the first of its kind in Canada.

I bring you the greetings and good wishes of the Prime Minister and the Government of Canada. And may I extend a special welcome to international delegates. Based on the conference agenda, I think your visit here will be worthwhile. I want to congratulate the organizers for putting together an excellent program on renewable energy technology solutions to cold weather challenges.

In 606 days, 15 hours and about 20 minutes Canada and the world will say goodbye to the 1900's and enter the year 2000. Whether you consider it the last year of the current century or the first year of the next - it will be a momentous occasion, a unique moment in the flow of human events.

As a nation, Canada should turn that corner with three back-to-back-to-back balanced budgets in a row — the first time that's been accomplished in 50 years.

We should turn that corner with a substantial dent made in the nation's accumulated debt.

We should turn that corner with pensions and health care more secure, with child poverty down, with youth employment steadily improving and better access to post-secondary education.

We should turn that corner to the 21st century on the cutting-edge of innovation - the most connected nation on earth, positioned to excel in the modern, knowledge-based economy.

And our ambitions, just around that corner, should include leading the world in sustainable development. In particular, that should mean being smart about energy:

• where it comes from;
• how we produce it;
• how we make it accessible; and
• how we use it.

Energy is fundamental to our very existence and our quality of life. Ours is a northern country with extreme demands for heating and cooling.

Ours is a huge country with vast distances over which to transport people and goods.

Our economy is closely linked to our wealth of natural resources — and their development is energy intensive. Our economy is growing. Our trade is growing. Our population is growing.

And all of that requires more energy.

For all these reasons, we Canadians cannot afford to be anything but the smartest producers and consumers of energy in the world.

The broad participation in this conference is a sure sign of growing interest in renewable energy, its technologies and a rejuvenation of the industry internationally. And the factor driving that rejuvenation, more than any other, is the global problem of climate change.

Greenhouse gas emissions from human activities, particularly the consumption of fossil fuels, are accumulating in the atmosphere and contributing to the warming of the earth's temperatures in ways which could prove extremely detrimental to our collective future. Last December, Canada joined about 160 other countries in agreeing to take decisive action on climate change under the Kyoto Protocol. We officially signed the document last week.

Canada's target is to reduce our emissions to six percent below 1990 levels -- and to reach that target by the period between 2008 and 2012. Other nations have negotiated similar targets. The European Union and many central and eastern European states have a target of minus eight percent. The United States is committed to minus seven. Japan (like Canada) is at minus six.

Many Canadians see climate change as a tremendous challenge — and it is. Reaching minus six means a cut in greenhouse gases of more than 20% from business-as-usual scenarios projected for the year 2010. But I also see climate change as offering real opportunities for economic growth, technological sophistication, new jobs, increased trade and strategic global positioning for Canada.

To meet our targets, we must broaden and deepen the Voluntary Challenge and Registry program in the private sector. This means expanding participation, strengthening the standards, bringing more precision to the definitions, tightening the reporting requirements, and providing appropriate credit for early action.

To meet our targets, we must also accelerate the whole national agenda for energy conservation and efficiency throughout our economy - in business and industry, transportation, homes and commercial buildings, and institutions and governments. This will require a combination of better information, technology transfer, incentives, government leadership by example and regulatory measures where appropriate and effective.

Thirdly, to meet our targets, we will need a focussed and enhanced emphasis upon Science and Technology — to develop relevant innovations (big and small) and to commercialize them as rapidly as possible. Both governments and the private sector will need to up their Science and Technology investments and we need to work in close partnerships to maximize results.

Fourth, we will need to finalize both the domestic and the international rules for the proper use of the flexibility tools we have at our disposal under the Kyoto Protocol — emissions trading, joint implementation with developed countries, the Clean Development Mechanism in the developing world, and the correct use and calculation of Carbon Sinks. These can help us meet our global goals in the most cost-effective manner.

And finally, and of major importance - we need to diversify our range of energy sources - increasing our effective use of alternative fuels and renewable power sources like solar, wind, hydro, earth and bioenergy.

What this means for your exciting sector is an era of growth, investment and innovation. And we can be well-positioned for the opportunities that lie ahead. We have long known in Canada, and Quebec in particular, about the benefits of hydroelectricity and biomass as renewable energy sources, but now many other renewable technologies are market-ready and cost-competitive. You can be very proud of your expertise and achievements in this field.

Your efforts are paying off. Large corporations are committing significant amounts of money to support the development and commercialization of renewable energy. The global marketplace is catching on to something your industry has known for years: renewable energy technologies are reliable, they can be cost-effective, and they are good for the environment and good for the economy at the same time.

Renewable energy today accounts for about 17 percent of Canada's total primary energy supply. Most of this is in the form of large-scale hydroelectricity. But Canada's immense renewable energy potential is largely untapped. The numbers will vary in other countries, but the end result is the same — there is exciting potential for renewable energy to capture a much larger share of energy markets.

Renewable markets are inhibited by the lack of information, knowledge and awareness about renewable energy systems, as well as a shortage of technical expertise.

Partnerships are essential if we are to overcome these issues, and I am pleased that my department has enjoyed a good working relationship with your industry. Through science and technology partnerships, we have worked together to move promising renewable technologies from the laboratory to the marketplace.

Our commitment to partnerships was confirmed in our Renewable Energy Strategy, released in October 1996. The strategy has three pillars: enhancing investment conditions, supporting research and development, and pursuing markets for renewable energy technologies. We have made progress in each area.

For example, we have taken steps to improve the tax treatment of renewable energy investments by making certain expenses eligible for flow-through share financing. Through our energy R&D activities, we invest some $9 million a year in renewable energy technology development. Most recently, however, we have taken action on the third pillar — the development of markets.

In December, shortly after the Kyoto conference, I announced the Renewable Energy Deployment Initiative, or REDI, a three-year, $12-million program to support investments in renewable technologies for heating and cooling. As we work with other governments, business, the commercial and institutional sectors and individual Canadians to meet our Kyoto Commitments, our Government will continue to look for ways to enhance federal support for renewable energy technologies.

By encouraging the market deployment of these technologies, REDI will contribute to greenhouse gas reductions, as well as job creation and export sales. Today, I am releasing the details of this program. First, NRCan will, in full cooperation with the renewable energy industry, undertake the development of a marketing strategy and implement marketing campaigns.

Second, a 25 percent financial incentive, of up to $50 thousand, is available for businesses purchasing and installing certain solar and biomass systems in their facilities.

Finally, under REDI, NRCan will fund certain activities aimed at further developing the industry's infrastructure, such as technical training programs. The department has already started discussions on this subject with the Canadian Solar Industries Association.

Additionally, I am pleased to confirm a second initiative to support the deployment of renewable technologies — the Renewable Energy for Remote Communities Program.

This new program will focus on more than 300 remote communities in Canada which are not connected to the main electricity grid or to natural gas networks. About half of these communities are located in the North. Many are Aboriginal communities, and some are mining or forestry towns. They all have at least one thing in common — energy costs that are anywhere from two to 10 times higher than those in communities linked to the main power grid. That makes them a prime near-term market for renewable energy technologies.

The Renewable Energy for Remote Communities Program is intended to help your industry tap this market. Over the next three years, my department will invest $2.4 million to provide community decision makers with the tools, information and knowledge needed to assess the feasibility of renewable energy systems, to select the most cost-effective technologies, and to implement projects. The program will also provide technical training and support policy-related activities in these communities.

The Renewable Energy for Remote Communities Program addresses a commitment in our Renewable Energy Strategy to help the renewables industry explore niche markets in Canada. Its development was based on extensive input from a wide array of stakeholders. Some of the organizations represented here today have participated in this process, and I want to thank you for your contributions.

I am also pleased to be releasing today the newest version of RETScreen™ — a software tool that helps evaluate the energy performance, cost and financial viability of renewable energy

technologies. Developed by my department's CANMET Energy Diversification Research Laboratory in Varennes, Quebec, RETScreen allows energy decision makers to conduct pre- feasibility studies at a fraction of the cost of previous methods.

RETScreen will be used as a training tool by the Renewable Energy for Remote Communities Program. International delegates may be interested to know that this software can be used anywhere in the world to determine the technical and financial impact of a renewable energy project.

My department is sponsoring a seminar on RETScreen later in the conference. We are also holding a separate session at which officials of my department will further explain the Renewable Energy for Remote Communities Program. I invite you to drop by our booth for more details.

In closing, I would like to return to the issue of partnerships. Many companies represented in this room are long-time and valued partners of NRCan. We want to continue to work with you to overcome the remaining barriers to renewable energy technologies in Canada. We also need to further explore the tremendous new business, export and job creation potential of your industry. And we must continue to work together strategically to address climate change.

In our 1998 federal budget, we created a three-year, $150 million Climate Change Action Fund – on top of the $70 million per year which NRCan invests in Climate Change solutions year-over-year, and on top of the 3-year, $60 million increments in federal funding which we announced last year for initiatives like the REDI program.

The Climate Change Action Fund will help us all build a more solid short term foundation for sustained long term progress, while also supporting "quick starts" and "early action" in the meantime.

I would welcome and I specifically solicit your advice and your collaboration on how some of the new dollars we have committed can trigger faster results for renewables – working in partnership.

This conference is an excellent forum for strengthening partnerships. I thank our partners — the Solar Energy Society of Canada, the Canadian Wind Energy Association, the Canadian Solar Industries Association, Énergie solaire Québec, and the Québec Ministry of Natural Resources. This type of government-private sector cooperation is critical to moving the industry forward for the benefit of all Canadians, our environment and our economy.

Together , we can ensure that renewable energy is a core element of Canada's move toward a more sustainable energy future.

Thank you all for joining us this week in Montreal.

Good luck with this conference and in all the work you do to build renewable success stories — for yourselves and for Canada as a whole.