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Canadian government announces nineteen successful projects in response to a call for proposals under the Renewable and Clean Energy portion of the Clean Energy Fund

The Honourable Lisa Raitt, Canada's Minister of Natural Resources, today announced support for nineteen (19) projects selected in response to a call for proposals under the Renewable and Clean Energy portion of the Clean Energy Fund. Up to $146 million will be invested over five (5) years to support the demonstration of renewable and clean energy across the country, including integrated community energy solutions, smart grid technology, and renewable applications with solar, wind, tidal and geothermal energy.

Under the Clean Energy Fund, part of the Government of Canada's Economic Action Plan (Budget 2009), the government is to invest almost $1 billion over five (5) years in research, development and demonstration projects to advance Canadian leadership in clean energy technologies. This includes large-scale carbon capture and storage demonstration projects, three (3) of which have already been announced totaling $466 million from the fund, as well as smaller-scale demonstration projects of renewable and alternative energy technologies such as those announced today. Total investments under the Clean Energy Fund for large and small demonstration projects are to benefit Canada's economy by leveraging nearly $3.5 billion in further investments by industry and other levels of government.

The Government is now inviting the project proponents to begin negotiations toward formal contribution agreements to set the conditions under which funding will be delivered. The funding amounts are expected to range from $2.5 million to $20 million for each project. However, until a written contribution agreement is signed by both parties, no commitment or obligation exists on the part of the Government of Canada to make a financial contribution to these projects.

Successful Project Descriptions

A) Projects expected to receive $2.5-$5 million

1. Biomass-based Urban Central Heating Demonstration
Lead proponent: SSQ, Société immobilière Inc.
Strategic Area: Buildings/Community Energy Systems
Location: Québec, Québec
Purpose: La Cité Verte is an innovative real estate project, which combines various initiatives related to sustainable development such as renewable energy utilization, energy efficient design, the management of water consumption, energy and waste management. The funding will support the installation of a biomass and wood-based district heating system. This project combines a variety of technologies and partners.

2. Utility-scale Electricity Storage Demonstration using New and Re-purposed Lithium Ion Automotive Batteries
Lead proponent: CEATI International Inc.
Strategic Area: Electricity Storage
Location: Toronto and Cornwall, Ontario, and Manitoba
Purpose: This project will address electricity storage for renewable and high-density urban applications. The project will demonstrate utility-scale electricity storage systems using new and re-purposed automotive batteries. This concept will reduce cost for electric vehicle batteries providing a future market to meet urban electricity demand using automotive batteries.

3. Energy Management Business Intelligence Platform Development and Demonstration
Lead proponent: Power Measurement Ltd.
Strategic Area: Smart Grid
Location: Commercial buildings in Calgary, Alberta, Ontario and BCIT in Burnaby, British Columbia
Purpose: This project will develop and demonstrate smart grid technology, voluntary load curtailment and peak shaving in a commercial building setting. Most projects of this type to date have focused on residences. This technology will also enable tenants to voluntarily reduce their demand based on real-time price signals.

4. Wind and Storage Demonstration in a First Nations Community
Lead proponent: Cowessess First Nation
Strategic Area: Wind/Storage
Location: Cowessess, Saskatchewan
Purpose: This project aims to demonstrate a combined wind and storage energy system in a First Nation community. The successful demonstration would prove this system as a model for other First Nation's communities across Canada.

5. Bioenergy Optimization Program Demonstration
Lead proponent: Manitoba Hydro
Strategic Area: Bioenergy
Location: Five locations in Manitoba
Purpose: This project is comprised of five different bioenergy systems at five different project sites. The project demonstrates collaboration between utility companies and customers. It is anticipated that the project will help to remove the perceived barrier of technical and operational risk and will promote the wide-scale adoption of bioenergy systems in Canada.

6. Offshore Wave Energy Demonstration
Lead proponent: SyncWave Systems Inc.
Strategic Area: Marine/Hydro
Location: Offshore Central Vancouver Island near Tofino, British Columbia
Purpose: This project will demonstrate the performance, operations and life cycle of a pre-commercial 100-kW wave energy device in ocean conditions typical of British Columbia's open coast. Canada has potentially significant wave energy resources, and it is important for Canada to participate in demonstrations to further the technology, understanding of ocean conditions and the regulatory environment.

7. Demonstration of Waste-heat Recovery at Compressor Stations
Lead proponent: Great Northern Power Corp.
Strategic Area: Hybrid Systems/Northern
Location: Compressor Stations in Alberta and British Columbia
Purpose: This project plans to demonstrate waste-heat recovery systems on a variety of stationary, reciprocating engines greater than 1,000 hp. A successful demonstration has the opportunity to lead to commercialization and wide-scale adoption of this technology at compressor stations and other industrial applications across Canada.

8. Residential Implementation of Solar-thermal Heating Systems
Lead proponent: Enbridge Gas Distribution Inc.
Strategic Area: Buildings/Solar
Location: Greater Toronto Area, Ontario
Purpose: The project will use different types of solar collectors and storage technologies to verify and compare their costs, performance and technical qualities. The project has the ability to validate the technology and provide integrated systems at a lower cost to consumers, thereby allowing greater market penetration.

9. Food and Yard Waste Anaerobic Digestion to Electricity Demonstration
Lead proponent: Harvest Power Canada Ltd.
Strategic Area: Bioenergy
Location: Fraser Richmond Soil and Fibre, British Columbia
Purpose: This project would be Canada's first high-efficiency system for producing up to 1 MW of renewable energy from food and yard waste. If successful, this technology has the potential to be rapidly deployed across Canada as a mechanism to divert food wastes from landfills and produce renewable energy.

B) Projects expected to receive $5-$10 million

10. Demonstration of Heat and Power from Biomass Gasification
Lead proponent: Nexterra Systems Corp.
Strategic Area: Bioenergy
Location: UBC Point Grey Campus, Vancouver, British Columbia
Purpose: This project will showcase biomass gasification integrated with an internal combustion engine generator in a novel, small-scale combined heat and power demonstration suited for on-site applications at public institutions, industrial facilities, and northern and remote Canadian communities. The project has the potential to overcome the difficulty of gas clean up and opens up the possibility of significant replication in Canada and overseas.

11. Energy Storage and Demand Response for Near-capacity Substation
Lead proponent: BC Hydro
Strategic Area: Smart Grid/Electricity Storage
Location: Golden and Field, British Columbia
Purpose: This project demonstrates the integration of energy storage as a mechanism for reducing electricity demand at near-peak capacity substations. This type of solution has the ability to be used in other remote communities where the grid reliability is low and the cost of the transmission line upgrade is uneconomical.

12. Interactive Smart Zone Demonstration in Québec
Lead proponent: Hydro-Québec - Institut de recherche
Strategic Area: Smart Grid
Location: Boucherville, Québec
Purpose: This project will ensure the installation of an interactive network area in a neighbourhood of Boucherville. This will demonstrate different technologies and concepts related to modernization of electrical networks, in particular the deployment of infrastructure for charging electric and hybrid rechargeable vehicles.

13. Biomass and Coal Co-firing Demonstration in Coal Plants
Lead proponent: Nova Scotia Power
Strategic Area: Bioenergy
Location: Coal Plants in Nova Scotia
Purpose: This demonstration project aims to determine optimum fuel blends for the potential co-firing of wood-based biomass with coal as a mechanism to partially replace fossil fuels with sustainable energy sources in coal plants. If successful, there is potential for wide-scale implementation across Canada and the United States.

C) Projects expected to receive $10-$20 million

14. Tidal Energy Project in the Bay of Fundy
Lead proponent: Fundy Ocean Research Centre for Energy (FORCE)
Strategic Area: Marine/Hydro
Location: Minas Passage, Bay of Fundy, Nova Scotia
Purpose: The project plans to validate the performance and resilience of tidal current turbines in the Minas Passage of the Bay of Fundy. This will be the first Canadian deployment of commercial-scale tidal turbines. The project has the potential to advance tidal energy in Canada, provide economic impacts in the Atlantic region and place Canada as a world leader in marine renewable energy.

15. Northern Application of a Geothermal District Heating System
Lead proponent: City of Yellowknife
Strategic Area: Northern/Community Energy System
Location: Yellowknife, Northwest Territories
Purpose: The City of Yellowknife is in advanced stages of project engineering and plans to install a district heating system by extracting heat from the abandoned Con Mine. This project has the potential to provide a cost effective and a more environmentally friendly alternative to fossil fuel based heat. The information that will come out of this project on the effect of extracting ground-source heat from an existing aquifer and its associated long-term heat capacity will help determine if this technology could be replicated in other northern communities.

16. Electricity Load Control Demonstration
Lead proponent: New Brunswick Power Corporation
Strategic Area: Smart Grid
Location: Four maritime communities in New Brunswick, Nova Scotia and Prince Edward Island
Purpose: Traditionally, to accommodate the intermittent nature of wind power, other generation sources are required to follow the net effect of variation in load and wind power production. This project focuses on the integration between smart grid technologies, customer loads and intermittent renewables in a region with potentially significant renewable electricity capacity. It will allow utilities to better understand how customers will react to smart grid and which loads can be controlled by real-time demand balancing in up to 750 buildings, thereby assisting these utilities to capitalize on renewable resources in the region.

17. A 9-MW Wind Technology Research and Development Park
Lead proponent: Wind Energy Institute of Canada
Strategic Area: Wind/Storage
Location: Prince Edward Island
Purpose: The 9-MW wind park proposed will be the first wind/storage combination in Prince Edward Island. The project's research base has a strong focus on information dissemination and would be a good base for supporting additional wind research.

18. Demonstration of Fish-friendly and VLH Turbines in Existing Low-head Water-control Dams
Lead proponent: Eco Joule Inc.
Strategic Area: Marine/Hydro
Location: Mississippi River System, Ontario
Purpose: This project will demonstrate three in-stream hydro technologies including fish-friendly, low-head hydro turbines along an existing water-controlled river system in Ontario. It has the opportunity to prove the technology concept, demonstrate cooperation with a conservation organization, and reduce the barriers to commercialization.

19. Community-based Geothermal Demonstration in a Remote First Nations Community
Lead proponent: Borealis GeoPower Inc./Acho Dene Koe First Nation
Strategic Area: Hybrid Systems/Northern
Location: Fort Liard, Northwest Territories
Purpose: This project will demonstrate how a northern community can use a geothermal resource to generate electricity and heat, thereby reducing the entire community's fossil fuel demand and energy costs. A successful demonstration will provide a model for other northern and First Nations communities with available geothermal resources.

Canada under pressure to turn GHG policy talk into action

A key theme of the federal government's climate change strategy in the past few months has been to align Canada closely with the U.S. In so doing, the government's goal is to ensure that our vital trade relationship with the U.S. is maintained. Harmonization with the U.S. is seen as a key competitive advantage for Canada. However, a new report from PowerUP Canada concludes that "Canada is not matching U.S. efforts, that our delay in doing so already has serious implications, and that every moment we fall further behind increases the cost and missed opportunity for Canadians."

The following are the reports key observations:

• Canada's global warming emissions are growing significantly while U.S. emissions are declining.
• Every moment of delay means that Canada is starting from further and further behind although nominally aiming for the same finish line.
• The U.S. government is providing unprecedented levels of support to clean energy and efficiency while Canada's primary programs are expiring
• The U.S. is outspending Canada as much as 14-1 per capita on renewable energy.
• Moving forward, the U.S. is aiming for deeper carbon cuts than Canada's "target" by orders of magnitude. Although Canadian and U.S. targets proposed at Copenhagen are superficially similar, the U.S. "target" does not include many of the programs before the legislative branch and none of its executive branch programs. Canada has no program to meet its proposed cuts and past policy proposals were deemed inadequate by independent government and academic auditors.
• The U.S. federal government has accelerated to unprecedented levels of action on carbon restrictions, efficiency and clean energy in the past year while the Canadian federal government is "not even trying" to match U.S. efforts.

If Canada's only goal in harmonizing with the U.S. is to avoid punitive border adjustments (i.e., carbon tariffs), the above conclusions suggest that setting similar reduction targets for the purposes of the Copenhagen negotiation may not get the job done. Even if Canada matches the US's Copenhagen target, the US may make even deeper emissions cuts and may nevertheless be inclined to protect its industry from its (relatively) dirty neighbour to the north. If Canada's goals also include ensuring that Canada competes in a clean energy, carbon constrained world, the above conclusions also suggest that Canada is being seriously outpaced by the US.

In a related note, Green Cross International's Climate Change Task Force and PowerUP Canada (again) delivered a letter to Prime Minister Stephen Harper calling on him to "dispel perceptions of defeatism" about the climate change file and to "rally the Canadian people" to build an economy powered by clean energy.

The letter, which was jointly signed by Mikhail Gorbachev, The Rt. Hon. Kim Campbell and prominent Canadian business leaders, scientists and artists, again focuses on the growing "clean energy" competitiveness gap: "Currently Canada does not have a consistent price signal or sustained national incentives for the deployment of clean energy. Recent studies by the UN and HSBC show that Canada lags the G20 in deploying green stimulus. Canada is missing the economic opportunity of the twenty-first century."

Regardless of what Canada commits to internationally, it appears that the federal government has much work to do domestically on the climate change and green energy file.

First Power Solar Project: Clean Energy for First Nations Communities

Today at the 2009 Solar Conference, the Government of Canada announced an investment of up to $1 million in the First Power solar project through its ecoENERGY for Renewable Heat program. In addition to the federal government's commitment, First Power is also being supported by Solar BC and several financial institutions, including the All Nations Trust Company.

The First Power project will support the installation of domestic solar water heating systems in up to 900 homes, with a focus on remote First Nations communities.

First Power, which will leverage millions of dollars in additional funding to complete its projects, is a partnership between Taylor Munro Energy Systems and the Centre for Integral Economics. This unique hybrid business is designed to support First Nations communities to gain access to and ownership of renewable energy and clean technologies. The project intends to replace diesel power generation by energy systems that deliver all the heat, light and power a community requires through renewables.

Making the announcement on behalf of Minister Lisa Raitt was Senator Linda Frum, who declared: "This investment will generate new economic activity in First Nations communities, while reducing energy costs and greenhouse gas emissions [...] Investing in projects like this will stimulate the growth of a domestic clean energy industry, create high-quality jobs for Canadians and help protect our environment."

Donna Morton, President of the Centre for Integral Economics added: "We believe that First Nations can take ownership of renewable energy and clean technology systems through orally taught training [...] Autonomous energy can give First Nations in Canada both a leading role in building green collar jobs and economic development that respects ancestors, elders and the future."

Minister Prentice Talks Climate Change; PM Says He'll Go to Denmark

Minister Prentice believes that in order for the international community to reach a new framework to deal with climate change, the U.S. must "get on board".

Speaking to a packed room on November 13 in Edmonton, the Minister spoke about climate change on the global stage and about the road to the UNFCCC Climate Change Conference in Copenhagen, which begins in less than a month. The Minister's key message during the speech was that in order for Copenhagen, the "mother of all negotiations" to result in a meaningful frameworks to address the stabilizing of greenhouse gases in the atmosphere, the United States has to "make a substantial effort going forward".

The Minister's other key message hit a bit closer to home:

"If the US does not make a substantial effort going forward, there is nothing Canada can do. Our own mitigation efforts will be futile - as a practical matter, we should probably focus on adaptation.

If we do more than the US, we will suffer economic pain for no real environmental gain - economic pain that could impede our ability to invest in new clean technologies.

But if we do less, we will risk facing new border barriers into the American market.

In short, we need a substantial effort from the United States; and a comparable effort from Canada, so we can create an effective North American climate change regime with national policies that are harmonized, consistent and free from conflict. A continental system composed of national policies and regulations that are equal in value and of similar effect, so we foster fair competition and maintain free trade in the integrated North American market".

The crux of his comments? That a harmonized (although not identical) climate change framework is absolutely crucial for Canada and for the U.S.

Why?

1. We share a common environment;

2. Our economies are integrated. The Minister remarked, "many firms in such key sectors as aerospace and automotive do not so much compete with each other as cooperate, being suppliers to, and customers of each other, somewhere on complex supply chains"

3. Canada's energy supply = security of energy for the United States - "[w]e are not just the single largest supplier to the American market of oil, natural gas, hydroelectricity and uranium - we are an indispensable supplier to the land-locked northern tier states"

4. Our pipelines and power grids transcend the border.

The Minister also pointed to a number of cross border harmonization initiatives, such as identical tail pipe emissions standards, the fact that both countries are busy preparing national cap and trade systems, and commitments on both sides of the border to clean energy technology.

But ultimately, his remarks confirmed that both Canada and the United States, while committed to addressing the effects of climate change, will not do so at the expense of the economy. The Minister's philosophy and one that is shared by his U.S. counterparts is to "do no harm - to avoid measures, no matter how well-intentioned, that would cause Canadian firms to be not just down in 2009, but out by 2010". What does this mean in terms of reductions? The American Clean Energy and Security Act has passed the House, and the Kerry/Boxer legislation has now commenced its journey through the Senate. The former sets the target of 17% less than 2005 levels by 2020; the latter currently talks of 20%. The Minister confirmed "[t]hat Both are similar to our own 2020 target of 20% less than 2006 levels".

Those dectractors who assert that Canada should be reducing its emissions by 25-40% less than 1990 levels are not focused on the economic consequences to our country. Minister Prentice addressed these critics and said "to say the least, reducing 2020 emissions in Canada by 25-40% from 1990 levels is easier said than done. The impact on the overall economy would be dire. In economic context, reductions of that magnitude equal an amount far in excess of all the emissions generated from all transportation sources in Canada".

Are the critics prepared to put away not only their own cars, but the cars of their relatives and everyone else they know, for good? To stop flying anywhere? Stop taking the bus? Probably not. And if the solution is to purchase international offsets to meet our emissions targets, are they comfortable with billions and billions leaving the country every year? We have to have a reasonable response to climate change in Canada - and it is reasonable that our system be consistent with that of our largest trading partner and not cause economic hardship to a nation of 35 million people.

So what will happen in Copenhagen? Canada's position is pretty clear. The United States' position is also increasingly clear - everyone, not just the developed nations, has to be a party to an international convention. That includes China and India, whose positions have really not shifted in the months leading up to the conference. Small concessions have been made, but really, the message is still "we're going to do what we want".

But, as Copenhagen draws ever closer, it appears that the international community is taking it more and more seriously. This morning the Edmonton Journal reported that there is increasing pressure on world leaders, including the U.S. President, to attend the conference. Prime Minister Stephen Harper's aides confirmed that if others are there, he'll likely attend as well.

With all these variables, the conference is December is shaping up to be very interesting. Stay tuned for on the ground coverage from Denmark.

Chinese Launch Voluntary Carbon Standard

We have blogged a number of times that if the world is going to make meaningful inroads to the global reduction of emissions, the discussions at Copenhagen in December will have to include real contribution from developing nations, specifically India and China.

China had an interesting announcement today. The Chinese government announced that China will launch a framework for voluntary emissions trading in the global voluntary carbon market. The China-Bejing Environmental Exchange will be a government backed platform for trading carbon in the Chinese voluntary carbon market.

China is the world's top producer of greenhouse gas emissions, in terms of total emissions, although its per capita emissions are far below that of the United States. In previous months, China has been pretty steadfast in its opposition to a global cap on greenhouse gas emissions, excusing itself in the name of opportunity and advancement, much like India has done. Nevertheless, voluntary carbon standards are a step in the right general direction.

According to Reuters, "[t]rade in the global voluntary market, mostly driven by companies looking to reduce their carbon footprints ahead of expected emissions rules, more than doubled last year to more than $700 million". Voluntary carbon standards provide a framework for polluters to get emissions cuts verified and for the creation of credits that can be sold in voluntary carbon markets.

The announcement today comes on the heels of China's assertion on September 22 that it would tie emisions reductions to economic growth. Given these recent announcements and the fact that China seems to be ramping UP to Copenhagen and not down, we'll have to keep a close eye on Chinese climate change policy in the coming months to see how their policy might drive how Copenhagen discussions unfold. More importantly, are these Chinese announcements the real thing or is the Great Wall really just a Great Hype? More tomorrow.

BC's Northwest Transmission Line Project to receive up to $130 million under the Green Infrastructure Fund

Almost one year ago, British Columbia Premier Gordon Campbell announced that the Province would start the environmental assessment process and First Nations consultation on the Northwest Transmission Line, which consists of a 287 kV line which would extend 335 kilometres into the Northwest portion of the province from Terrace to Meziadin Junction and north to Bob Quinn Lake.

The estimated $404 million project which is expected to be ready for construction in early 2010 has been given a serious boost as a result of yesterday's announcement by the federal government that it has been selected as a priority for funding of up to $130 million under the Green Infrastructure Fund, conditional upon the signing of a contribution agreement with the British Columbia government under the fund.

The Northwest Transmission Line will provide multiple benefits:

As the area surrounding the project has a significant potential to generate green power, local communities will be able to access clean electricity in the future, reducing their reliance on diesel generation and resulting greenhouse gas emissions. There is currently an estimated 2,000 MW of renewable energy in the area from small hydro, geothermal, wind and biomass sources and the project could immediately serve a number of potential generation projects representing approximately 500 MW being considered under British Columbia's current Clean Power Call.

The project also provides access to the electricity grid for potential customers, which in turn will support and promote economic diversification in the area. According to the Mining Association of BC, the project has the potential to attract $15 billion in new capital investments and create almost 11,000 jobs.

Lastly, construction of the transmission line will be a key step in a potential interconnection between southeast Alaska and the North American transmission grid via British Columbia.

Western Premiers Sign MOU on CCS Technology and Policy

The Premiers of Alberta, Saskatchewan and Manitoba held a joint cabinet meeting in Calgary on September 11, 2009. During the meetings, the provinces signed two key agreements, including a Memorandum of Understanding on Carbon Capture and Storage Technology and Policy, which "focuses on advancing co-operation on energy research and technology". Also highlighted were the concepts of "strengthening internal trade, innovation and international marketing, further developing Canada-U.S. relations and committing to improvin pension coverage for workers".

Of the MOU, Premier Stelmach remarked "collaboration in the West has best positioned our provinces to lead Canada both economically and in the development of clean energy technologies such as carbon capture and storage. By joining forces with B.C. and Saskatchewan, we can better develop and deploy this innovative technology, helping to meet climate change objectives and making us international leaders in this technology".

The second key agreement, the "Western Economic Partnership" is an interprovincial trade agreement designed to be the largest barrier-free trade and investement market in Canada.

The CCS MOU is the next in a series of steps Alberta has taken to advance CCS technology and deployment. Alberta announced its $2 billion CCS fund in 2008. The monies in the CCS fund are in addition to monies in the province's Climate Change and Emissions Management Fund, which is administered by the CCEMC. For the 2009 Call for Proposals, 30% of available funds may be used to advance CCS technologies and innovation.

When Canada goes to Copenhagen in a few months, this newest announcement by the Western provinces will be another point of climate change achievement.

We will continue to keep you posted about the Memorandum of Understanding among the three provinces. Stay tuned!

A Changing Climate Position in China?

A couple of weeks ago, we reported that a number of US Senators had written a letter to President Obama urging (insisting?) that U.S. climate legislation include a "border adjustment mechanism". In an article for Point Carbon , we also noted that China and India, both of which are classified by the UN as developing nations, were not going to be especially pleased with what really amounts to a US tariff on imports. We also predicted that if one country was to eventually capitulate to international pressure on its climate change policy, it would be China.

Are we going to start to see signs of that?

Back on August 5, China's Climate Change Ambassador (seems like everyone has one of these positions now), Yu Qingtai, said that China is looking to halt its emissions as soon as possible, although not at the expense of pulling its tens of millions of people out of poverty. If this seems like a similar tune the Indian government has been singing, that's because it is. You'll recall that the Indian Environment Minister said basically the same thing on July 31.

However, the Chinese position may be slightly softer. According to Reuters, Yu Qingtai also said that "China was willing to thrash out emissions-cutting targets for rich nations at U.N.-led talks later this year, dropping an earlier demand for a reduction of at least 40 percent". Although China is one of the nations advocating for climate funds from developed nations, according to Yu Qingtai, "there is no one in the world who is more keen than us to see China reach its emissions peak as early as possible".

Last week, a study published by some of China's top climate policy advisors concluded that it was feasible for China to peak its emissions by 2030. Although the report does not represent official Chinese policy, it is among several reports out of China which estimate emissions reductions in China in the next 20 years. An article from the Centre for American Progress, the D.C. based think tank headed by John Podesta is optimistic that China's position on climate change is moving in the general direction of the developed world.

Julian Wong from the CAP, reports:

China may announce its next five-year plan as early as this year, and many expect that it will contain even stronger commitments and perhaps incorporate some measure of carbon reductions in the form of benchmarks for reducing carbon intensity. China's State Council, led by Premier Wen Jiabao, last week laid down the objective of incorporating climate change considerations into "the medium and long-term development strategies and plans of government at every level." Also, Sun Qin, the vice chief of the National Energy Administration said he expects the government to complete a comprehensive plan for new and low-carbon energy development by the end of the year. A low-carbon strategy will be a central thread in China's ongoing economic development strategy.

China is also hinting at increased flexibility in the negotiation process. Su Wei, director-general of the climate change office within the National Development and Reform Commission, China's main economic planning agency, has signaled a change in tone, saying, "China will not continue growing emissions without limit or insist that all nations must have the same per-capita emissions. If we did that, this earth would be ruined." China maintains its hard line that developed countries are historically responsible for climate change, but climate envoy Yu has also backed off somewhat from China's previous demands that all developed countries commit to 40 percent reductions in carbon emissions by 2020, saying that, "[a] concrete figure has to be decided by the negotiations; we will get a result in Copenhagen."

This doesn't mean that China is all of a sudden going to abandon its domestic policy and international position on emissions reductions, but it does seem to signal that China may be more flexible than other developing nations. With the world's second highest greenhouse gas emissions, it should be.

SDTC announces opening of new round of funding

Sustainable Technology Development Canada ("SDTC") will be accepting Statements of Interest ("SOIs") from September 2 to October 21, 2009.

SDTC was created to fund development and demonstration projects, which SDTC also describes as prokecst that take technologies out of the laboratory and prove them in real-world test situations. SDTC funding is not available for primary research and development or for initial proof of concept projects. Applicants must therefore demonstrate that:

• the proposed project is technically sound and undertaken by an applicant with the necessary technical, financial and management capacity;
• the proposed project will be undertaken in a collaborative and innovative manner;
• the new technology and related intellectual property will be diffused in a timely manner in the relevant market sectors; and
• the funding is necessary to ensure that the project proceeds in a manner to ensure broad benefits to Canadians nationally or regionally

Projects must pertain to one of the following primary sectors of Canada's economy:

• Energy Exploration, Production, Transmission and Distribution
• Power Generation
• Energy utilization
• Transportation
• Agriculture, Forestry and Mining
• Waste Management
• Cross-sectoral

To date, SDTC has provided over $376 million in funding to 154 projects. A breakdown by sector is posted here.

Note that SDTC is also running an open call for projects for its $500 million NextGen BioFuels Fund. To be eligible, projects must:

• be a First-of-Kind facility that primarily produces a next-generation renewable fuel at large demonstration-scale;
• be located in Canada;
• use feedstocks that are or could be representative of Canadian biomass; and
• have demonstrated its technology at pre-commercial scale.

Clean Energy Dialogue Roundtable Meeting Concludes

The Clean Energy Dialogue between Canada and the United States continued this week as meetings between the two nations wrapped up in Washington.

The public-private meeting, held June 29-30 at the Department of Energy Headquarters in Washington, DC, brought together industry and government leaders to expand bilateral clean energy cooperation.

US Energy Secretary Steven Chu expressed optimism following the talks, stating that "by working together to develop clean energy technologies and combat climate change, the United States and Canada can spark an economic recovery that will benefit both of our nations."

The Clean Energy Dialogue was announced in February 2009 following the first meeting between Prime Minister Stephen Harper and President Barack Obama in Ottawa. Established with the intention of expanding clean energy research and development in the United States and Canada, the Clean Energy Dialogue strives to develop and deploy clean energy technology; and build a more efficient energy grid based on clean and renewable energy in an effort to reduce greenhouse gases and combat climate change.

The meeting marks a significant advancement in implementing Canada's Climate Change Plan and Economic Action Plan, both aimed at supporting a cleaner more sustainable environment. Through promised collaboration on specific areas such as biofuels, clean engines, and energy efficiency, the Clean Energy Dialogue will help Canada meet its greenhouse gas emissions reduction targets and aid its commitment to ensure that 90 percent of electricity be provided by non-emitting sources by 2020.

Discussions at the Roundtable meeting involved the initial development of an Action Plan to be presented to Minister Prentice and Secretary Chu in mid-July. The expected deadline to present a finalized joint Action Plan on Clean Energy to Prime Minister Harper and President Obama is August 2009. Consultation with the provinces and private sector leaders will continue over the next few months to achieve such goal. If all of these milestones are met, momentum towards Copenhagen in December will be at an all time high.

We will continue to monitor the Clean Energy Dialogue and will report back to you regarding the Action Plan and provincial consultations as information becomes available.

With assitance from Corie Flett, Summer Student.

Canada's pulp and paper industry receives $1 billion in new funding targeted at green energy initiatives

The federal Natural Resources Minister recently announced a $1 billion Pulp and Paper Green Transformation Program. The program will provide funding tied to the amount of black liquor produced by pulp mills. Black liquor, a by-product of the pulping process, can be used to generate renewable heat and power. Companies will receive $0.16 per litre of liquor on the condition that the money be invested over the next three years in improvements to energy efficiency and other measures of environmental performance.

The program is designed in the hopes of creating a more sustainable, and commercially viable, industry. Natural Resources Minister Lisa Raitt claimed that "[b]y making a smart investment today, we are laying the ground work for a greener, more secure future for the pulp and paper sector and the people who work in it".

Part of the federal government's current efforts to pull Canada out of the recession, this new funding is just one of several programs available to members of the forestry industry, as well as those operating in other economic sectors. Canada's Economic Action Plan makes cash available to support the development of innovative technologies which can enhance the competitiveness of Canadian companies internationally. Further, the Community Adjustment Fund and Community Development Trust, both created under the Economic Action Plan, contain $1 billion each to help "mitigate the short-term impacts of restructuring in communities." The federal government has also made cash available to extend work sharing agreements, which are aimed at helping employers avoid temporary layoffs, while waiting for an economic turnaround.

Posted by Sarah Robicheau, Summer Student (Toronto)

The Harmonization of Climate Change

Since you've been waiting with bated breath to find out what we had to say next about the federal and provincial climate change policies, we didn't want to keep you in suspense. We blogged on Monday that the provinces are throwing together climate change legislation faster than you can say "greenhouse gases".

In related news, yesterday the Globe and Mail reported that the Alberta Conservatives are taking their federal counterparts to task over energy and environment, treatment of the oil sands and other federal government policies. The controversy arises after speaking notes prepared for Conservative MLAs to raise with federal MPs in their home ridings found their way into media hands.

A significant bone of contention for Alberta's governing party appears to be with respect to the federal government's climate change policies as they relate to coal-fired electricity. In a meeting with media on April 29, Minister Prentice was asked about what types of regulations Canada would be rolling out with respect to climate change, and specifically what its policy around thermal-coal would be. The Minister replied that any new coal-fired plants will have to be neutral in terms of emissions, (which means they must have the ability to inject the carbon dioxide at the source underground). He also indicated that once coal-fired electricity plants that have come to the end of their useful lives, and have been fully depreciated, they will be decommissioned and replaced with more environmentally friendly options.

Unfortunately, the announcement appears to have been the first time the information was relayed to Alberta. Why is this so significant for Alberta in particular? Alberta relies on coal for electricity. Virtually all of the country's 27 coal plants are here. We do not have hydro in Alberta and we rely only minimally on renewables, so thermal coal is rather important for keeping the lights on. A policy such as the one outlined by the Minister means that Alberta may "shoulder the biggest burden in complying with these regulations - and depending on how they are formulated, they could have a significant impact on the health of the provincial economy". Premier Stelmach may agree. He was quoted in the Globe article as saying "You cannot ask Albertans to carry the burden of equalization, and then also penalize them for producing the wealth that allows us to make such a massive contribution to the programs that Canadians enjoy".

While the Globe story points to the issue as being one of a frayed relationship between Alberta and Ottawa, really the problem is one of harmony of regulation, not relationship.

As Canadians, we are seeking solutions to climate change at the provincial level - this is good. But it's also challenging. Each province's emissions profile is different from the next and given its industry, Alberta's situation is particularly hard to address. Intraprovincial carbon trading, for example, is a desirable mechanism, but regulations in BC are so vastly different from those in Alberta or Ontario that they will be difficult to align. You could be trading apples for oranges. The longer the provinces have to grow and develop their own programs, the harder it's going to be to allow the various systems to operate in concert.

What will drive harmonization? Probably not climate change, but rather industry (national corporations are the same whether they are operating in PEI or Saskatchewan after all) and intra-provincial trade. Degrees of harmony have to be created.

We're just beginning to explore this topic here on the blog. Stay tuned to see our thoughts on how harmony will be achieved and how the constitutional issue will be addressed.

Canada Continues to Co-operate on Climate Change

We have blogged many times about Canada's commitment to address climate change both continentally and internationally. Today we explore how the co-operation continues.

May 24, 2009 represented the official commencement of the international energy efficiency framework. Energy leaders from around the world met in Rome for the G-8 Energy Ministers Meeting to launch the International Partnership for Energy Efficiency Cooperation (IPEEC), a high-level forum for facilitating improvements in global energy efficiency and encouraging market implementation of key energy efficiency technologies. The signatories included the entire Group of 8 (G8), which consists of Canada, France, Germany, Italy, Japan, the Russian Federation, the United Kingdom, and the United States, as well as key emerging economies, including Brazil, China, India, Mexico, and the Republic of Korea.

Discussions about IPEEC began in June 2008, when the G8 countries, China, India, South Korea and the European Community decided to establish the International Partnership for Energy Efficiency Cooperation, at the Energy Ministerial meeting hosted by Japan. The signing of the IPEEC terms of reference on May 24, 2009 put the discussions into action.

The purpose of the partnership is to facilitate those actions that yield high energy efficiency gains in recognition that improving energy saving and energy efficiency is one of the quickest, greenest, and most cost-effective ways to address energy security and climate change and ensure economic growth.

IPEEC will provide a forum for discussion, among developing, transitional and industrial nations to engage in consultation and exchange of information on a voluntary basis. It will not develop or adopt standards or efficiency goals for the partners.

It was decided at the May 24, 2009 meeting that the first order of business for IPEEC would be to establish a Sustainable Buildings Network, a compilation and summary of national energy efficiency action plans, an inventory and review of international energy efficiency initiatives and improved methods for measuring and verifying progress towards domestic energy efficiency goals.

The launch of IPEEC comes in response to conclusions at G8 Environment Minister's Meeting that countries begin processes with the ultimate goal of a global platform on low CO2 impact technology.

Canada's participation at the IPEEC meetings is further evidence of its commitment to co-operation on a global level to address climate change. Copenhagen is 6 months away - wonder what impact this co-operation will have by then? We'll keep you posted.

Jennifer Cleall and Corie Flett, Summer Student

Canada announces details of $1 billion clean energy fund

The government of Canada announced the details of the $1 billion clean energy fund it announced in February. A statement issued by the Minister of Natural Resources Lisa Raitt revealed that the fund will be allocated as follows:

• $650 million to support large scale carbon capture and storage ("CCS") demonstration projects;
• $200 million to support smaller-scale demonstration projects of renewable and alternative energy technologies; and
• $150 million to support research and pre-demonstration pilot projects "ranging from next generation renewable and cleaner energy systems to new technologies to address environmental challenges in the oil sands such as water use and tailings"

Additional details are available on the Ministry of Natural Resources website. The government has already issued a request for proposals for smaller-scale demonstration projects.

That the majority of the money is allocated to CCS is not surprising given the quantity of emissions from coal-fired generation and oil sands projects, particularly in the province of Alberta. The US has recently hinted that it may ban or impose large tariffs on oil imports from carbon-intensive sources like the oil sands. CCS could effectively clean up the emissions profile of upgraded and refined bitumen and preserve the export market.

The fund is also consistent with Canada's Clean Energy Dialogue with the US (discussed here, here, and here).

Federal government may phase out coal-fired generation; impose cap-and-trade on existing plants

The federal government intends to enact regulations to phase out coal-fired generation in Canada. In an interview with the Globe and Mail, federal Environment Minister Jim Prentice indicated that government's "concept is that, as these facilities are fully amortized and their useful life fully expended, they would not be replaced with coal."

Any new coal-fired plants will have to include carbon capture and storage ("CCS") technology to make them emissions free. However, CCS technology is unproven and expected to be prohibitively expensive. The CCS requirement may therefore render coal uneconomical.

Mr. Prenctice also said that the federal government plans to impose absolute greenhouse gas emission limits on existing coal-fired power plants. Utilities would be able to purchase additional credits to cover emissions that exceeded the prescribed caps. It is unclear whether this cap-and-trade system will apply only to coal-fired generation, to electricity generation more generally, or to industry as a whole as part of a revised Turning the Corner plan.

As with many proposed climate change policies, the impacts of the above would not fall evenly on the provinces. Quebec and British Columbia are powered predominantly by hydro. Ontario relies on hydro and nuclear for its baseload and has already legislated the phase-out of its coal plants. Alberta and Saskatchewan are likely to be hit hardest, both because of their higher dependence on coal-fired power and because they sit atop huge coal deposits.

Nevertheless, the Globe and Mail quoted Brian Vaasjo, VP of Alberta-based Epcor Power LP as saying that they "are absolutely supportive" of the proposal. Epcor has already invested millions in new combustion technology and has applied with Enbridge Inc. for government funding of two proposed CCS projects (see our posting).

Mr. Prenctice did not specify exactly how the regulations would be implemented. However, the federal government has previously indicated that it would implement climate change regulations as amendments to the Canadian Environmental Protection Act ("CEPA"). If any of the provinces take a dim view of the regulations, they may seek to challenge the constitutionality of the federal government's plan. The Supreme Court ruled in R. v. Hydro-Québec that the federal government can regulate environmental matters under its criminal law power. Noted constitutional scholar Peter Hogg has opined that Hydro Quebec would apply to cap-and-trade regulations enacted under CEPA. However, the economic regulation of emissions (i.e., in part through market-based mechanisms) may not fit as neatly into the criminal law power as did the prohibition enforced by a penal sanction that was considered in Hydro Quebec.

More ecoENERGY money available for energy efficiency improvements

The Government of Canada substantially increased ecoENERGY incentives available to indivdiuals and businesses.

Under the ecoENERGY Retrofit-Homes program grants has increased by 25%, effective March 30. The ecoENERGY Retrofit - Homes program provides homeowners with grants of up to $5,000 to offset the cost of making energy-efficiency improvements to their homes. Grants apply to a range of measures that reduce energy consumption, from increasing insulation to upgrading windows and doors to installing solar systems.

Under the ecoENERGY for Renewable Heat program, the maximum payment for solar hot water projects has increased from $80,000 to $400,000, effective March 1. The ecoENERGY for Renewable Heat program encourages users in the industrial, commercial and institutional sectors to install active energy-efficient solar air and/or water heating systems.

Canadian Climate Change Themes

The Clean Energy Dialogue between Canada and the United States was sparked in February after the Prime Minister met with President Obama. The President's Climate Change advisor, Carole Browner, met with the Minister of Environment to discuss Canada's approach to climate change during those meetings. A couple of weeks later, Canadian Ministers, including the Minister of Environment, traveled to Washington to meet with their American Counterparts. Since then, Jim Prentice has been busy speaking about Canada's response to climate change. A number of themes are emerging from the Minister's remarks:

1. Environment Policies are Instruments of Economic Renewal and Security : The Minister confirmed in a speech to the Institute of Corporate Directors on March 6, that Canada's environmental approach is to "make our national environmental policies positive instruments of economic renew and of national development". Environment policy and energy policy are inexorably linked. Canada has a history of environmental stewardship and has a responsibility to maintain that what at the same time creating wealth and building industry. Maintaining environmental integrity while enhancing our North American energy security is going to be a priority for the Federal government. We will start to see more overlap between Energy policy and Environmental policy.

2. Canada/U.S. Co-operation on Climate Change: This is no surprise. Since the President's visit in February, both the Prime Minister and the Environment Minister have said that Canada and the U.S. need to work together closely to address climate change. Minister Prentice has confirmed that Canada and the U.S. must work closely to build a new carbon economy and to ensure that "our policy and regulatory frameworks are coherent and supportive" and has called the relationship with the United States crucial in the context of the transformation to clean energy. There are a number of subthemes:

(a) Cap and trade: In a speech on February 27, Minister Prentice confirmed that Canada has committed to pursue a North-America-wide cap and trade system and that we will "work closely with the new U.S. administration to build the North American low-carbon economy". He is optimistic that Canada and the United States will arrive at a workable solution that defines "common or similar carbon reduction targets, that creates similar mechanisms to allocation emissions and...provides for the trading of credits on a North American basis".

(b) Fuel efficiency: Minister Prentice told the CBC on March 1 that Canada is prepared to go in the same direction as the United States and that he supports one fuel efficiency standard for the two countries.

(c) New technologies: The Minister remarked that Canada and the United States have a strong and shared interest in promoting the development and deployment of clean energy technologies. The Clean Energy Dialogue will include discussions about Carbon Capture and Storage, an interconnected electricity grid, nuclear energy, wind, solar, hydro and other "more remote renewable sources of energy". Canada's action plan has Canada "on course to reduce domestic greenhouse gas emissions by 20% by 2020 and by 60 to 70% by 2050". In order to achieve these goals, Canada must invest in new technologies.

3. Canada Must be a Leader : Canada is one of the top ten energy consumers in the world. Our challenge is to "stand among the world's elite as a clean energy superpower" and to demonstrate that Canada is a user of clean energy. The Minister told his March 6 audience that the government is "committed to ensure that Canada is actively and constructively engaged in the [Clean Energy Dialogue]" and that it "intends to be a leader and a responsible partner in defining the way forward".

4. International Agreement : both the United States and Canada seem to be setting their sights on Copenhagen in December and both countries believe that in order for climate change policies to be effective domestically, international co-operation is required. Canada's climate change policy is "based on a clear desire to include all of the major emitters in the world". Major emitters would include China and India and other developing nations.

5. Climate Change is Everyone's Responsibility : Although the impetus for climate change has to come from government with active participation and engagement of industry, the responsibility extends to all citizens "from all walks of life". Canada's climate change strategy will involve "how we consume and conserve energy in our homes and in our offices". In his February 27 speech, Minister Prentice remarked:

Thirty years ago, drunk driving was tolerable. It's not anymore. Twenty years ago, it was acceptable to drive without a seatbelt. It's not anymore. Up until a few years ago, Canadians could smoke anywhere in public. They can't anymore. Attitudes shifted. Behaviours changed. The same needs to happen with the environment.

Watch for these themes to start emerging in other departments of the federal government. Climate change is one of the most important issues facing governments today. We'll keep you posted on new developments in Canada. Stay tuned.

Ottawa's GHG offset system to include a "fast track" project approval system for first 6 months

submitted by Grant Boyle

On August 9 the federal government published a draft Guide for Protocol Developers for Canada’s Offset System for Greenhouse Gases. The draft Guide will undergo a 60 day consultation period before a final Guide is published. The Guide is intended to provide details on the requirements to complete an Offset System Quantification Protocol and the steps that must be followed to create offset credits under the federal GHG emissions framework.

Projects must take place in Canada, must have started on or after January 1, 2000, must be surplus to all legal requirements (federal, provincial/territorial and regional) and go beyond what is expected from the receipt of other climate change incentives (federal, provincial/territorial). Credits may be issued for reductions achieved after January 1, 2008.

The quantification requirements in the Guide are based on the ISO 14064 standard. The Guide does not provide or recommend an approach to quantify GHG reductions from specific project types and will rely on project proponents to develop and submit their own protocols to Environment Canada for approval, unless the protocol type has already been approved by the Ministry. The approvals process is expected to take 5-8 months.

During the first six months of the operation of the Offset System, Environment Canada will implement a modified and accelerated process to review and approve Offset System Quantification Protocols that are derived from a list of 40 “external protocols” from other systems, including: the Clean Development Mechanism, Alberta’s Specified Gas Emitters Regulation, the California Climate Action Registry, the Greenhouse Gas Abatement Scheme in New South Wales, France’s Offset System, and the Regional Greenhouse Gas Initiative. The Guide includes a proposed list of external protocols for “fast track” approval:

Agriculture
*Including Edible Oils in Cattle Feeding Regimes (Alberta)
*Reducing Days on Feed of Cattle (Alberta)
*Reducing the Slaughter Age of Cattle (Alberta)
*Anaerobic Decomposition of Agricultural Materials (Alberta)
*Livestock Project Reporting Protocol Capturing And Combusting Methane From *Manure Management Systems (California)
*GHG Emission Reductions From Manure Management Systems (CDM)
*Innovative Feeding Of Swine and Storing and Spreading of Swine Manure (Alberta)
*Tillage System Management (Alberta)

Energy Efficiency
*Waste Gas Or Waste Heat Or Waste Pressure Based Energy Systems (CDM)
*Residential Buildings (Alberta)
*Commercial Buildings(Alberta)
*Waste Heat Recovery Projects (Alberta)
*Waste Heat Recovery Project - Streamlined(Alberta)
*Energy Efficiency Projects (Alberta)

Forestry
*Afforestation Projects (Alberta)
*Forest Management (California)

Fossil Fuels
*Industrial Fuel Switching From Coal Or Petroleum Fuels To Natural Gas (CDM)
*Switching From Coal And/Or Petroleum Fuels To Natural Gas In Existing Power Plants For Electricity Generation (CDM)

Geological Sequestration
*Acid Gas Injection (Alberta)
*Enhanced Oil Recovery (Alberta)

Methane
*Landfill Gas Capture And Combustion (Alberta)
*Landfill Project Reporting Protocol Collecting And Combusting Methane From Landfills (California)
*Landfill Gas Project Activities (CDM)
*Coal Bed Methane, Coal Mine Methane And Ventilation Air Methane Capture And Use For Power (Electrical Or Motive) And Heat And/Or Destruction By Flaring Or Catalytic Oxidation (CDM)
*Aerobic Composting (Alberta)
*Aerobic Landfill Bioreactor Projects (Alberta)
*Coalmine Methane and Abandoned Mine Methane Capture and Destruction Projects (General Electric AES)
*Waste Water Treatment Methane Capture and Destruction Projects (General Electric AES)

Renewable Energy
*Biomass to Energy from Biomass Combustion Facilities (Alberta)
*Electricity Generation From Biomass Residues (CDM)
*Run Of River Power Generation (Alberta)
*Solar Power Generation (Alberta)
*Wind Power Generation (Alberta)
*Introduction Of A New Primary District Heating System (CDM)
*Grid Connected Electricity Generation From Renewable Sources (CDM)

Transportation
*For Gravel And Lightly Surfaced Road Re-Surfacing Projects (Alberta)
*For Freight Modal Shifting (Alberta)

Waste
*Recovery & Utilization Of Gas From Oil Wells That Would Otherwise Be Flared (CDM)
*Non-Incineration Thermal Waste Management (Alberta)

Other
*Biofuels Productions And Usage (Alberta)
*Catalytic Reductions Ofn2o Inside The Ammonia Burner Of Nitric Acid Plants (CDM)