Lawyers in Canada: Davis LLP - Legal Advisors Since 1892

Alberta Leads the Way on Climate Change Technology

We blogged last week that the CCEMC had announced that it had selected projects in which it would be investing a total of $71 million.

Davis LLP attended the press conference yesterday morning in which CCEMC Chair, Eric Newell, announced some of the projects which would be receiving funding.

1. ECB Enviro North America Inc. was awarded $8.2 Million for a biogas co-generation project in Lethbridge, Alberta. Thane Hurlbert, the company's president, indicated that the project will employ approximately 15 people in green jobs and that the plant will be ready to go in 2011.

2. Plasco Alberta and its partner, Red Deer County, were awarded $8 million to builld a plant to convert solid waste into clean fuel gas that can be burned in a combustible engine. A pilot project is already under way in Ottawa, and the first commercial scale project will be built and operated in Red Deer. Plasco Executive Vice-President, Corporate Development, Lynde Coit thanked Red Deer County for their decision to implement this new technology over the establishment of a new landfill.

3. Enmax Corporation was awarded $14.5 million to instal solar or wind power home generation kits to 9,000 homes across Alberta over the next five years. ENMAX Executive Vice President for Smart Grid Technologies, Helen Bremner, indicated that the project will extend benefits of greenhouse gas reductions to the consumer level. The first installation is expected in the spring of 2011 and then will move across Alberta region by region. Green jobs will be created by the ENMAX program.

4. City of Medicine Hat was awarded $3 million for the Medicine Hat Concentrating Solar Thermal Power Project. Concentrating solar thermal technology can produce heat, power, and chemicals, using energy from the sun while avoiding burning fossil fuel and its cost and air emissions. This hybrid energy system will be installed and will evaluate the technology's potential Alberta-wide.

5. Enerkem Inc. was awarded $1.8 million to develop a pilot plant to produce biofuel and utilize CO2. Enerkem's technology converts residual materials, such as non-recyclable municipal solid waste, into transportation fuels and advanced chemicals. Through this project, Enerkem and its partners will use waste, such wood and straw, to produce clean biofuels, and will also incorporate carbon dioxide directly in the process, demonstrating the potential for greenhouse gas reductions in biofuels production.

The projects announced yesterday represent a total of $37 of the $71 million in funding announced by the CCEMC. Chairman Newell indicated that another 11 projects in the energy-efficiency and the carbon capture and storage sectors will be announced in the next two weeks.

These announcements mark a significant step in Alberta's fight against climate change. Both the Alberta provincial government and federal government have indicated that technology and innovation are the pathway to significant emissions reductions.

Since 2007 the Canadian Government has invested in a range of ecoAction programs, many of which promote the use of new technologies. In 2009, Canada's Economic Action Plan included billions of dollars in spending on initiatives like the Clean Energy Fund and the Green Infrastructure Fund. They provide close to $2 billion for the development of promising clean energy technologies and green infrastructure projects.

Alberta's 2010 Speech from the Throne makes direct reference to innovation and technology and the federal dollars are in addition to the clean energy technology initiatives that Alberta has undertaken provincially - the $2 billion Alberta CCS spend is one example. The funding outlined in the CCEMC's announcements are another.

With the 5 annoucements yesterday and more to come, it's clear that Alberta is leading the way on climate change technology.

Renault-Nissan Alliance Signs Zero-Emission Vehicle Partnership in Québec

On June 1, 2010, the Renault-Nissan Alliance announced that Nissan Canada had entered into a memorandum of understanding (MOU) with the Government of Québec, the City of Montréal, Québec City, Hydro-Québec and the Agence de l'efficacité énergétique du Québec which aims to advance zero-emission mobility in Québec.

Under the MOU, the parties are to work together to plan the necessary charging infrastructure and to promote the use of zero-emission vehicles in Québec. The MOU agreement adds Québec to a growing network of zero-emission vehicle initiatives across the world.

Of the agreement, the participants were quoted as follows:

Québec Minister of Natural Resources Nathalie Normandeau was quoted as saying "This agreement brings us a step closer to a governmental action plan on electric vehicles, which will be launched within the next few months [...] we are planning a series of concrete actions that will pave the way for the arrival of electric vehicles in Québec. Since 97% of our electricity comes from clean, renewable resources, Québec presents a number of advantages for the introduction of electric vehicles."

"The Renault-Nissan Alliance has committed to being a global leader in zero-emission mobility, which is one of the best solutions for reducing CO2 emissions," said Mark Grimm, President Nissan Canada Inc. "We look forward to bringing the Nissan LEAF, the only mass-market zero-emission car at an affordable price, to Québec. Our partners have already demonstrated their commitment to combating greenhouse gas emissions and we anticipate a productive collaboration."

Thierry Vandal, Hydro-Québec's President and CEO, added that "[this] announcement falls perfectly in line with our Strategic Plan 2009-2013 and other initiatives currently underway at Hydro-Québec. This memorandum of understanding will allow us to work closely with these important partners to carefully plan for the arrival of electric vehicles in Québec."

"Montréal is a true leader with respect to the reduction of greenhouse gas emissions," said Alan DeSousa, Vice-President of the Executive Committee and responsible for finance, sustainable development, environment and parks. "The memorandum of understanding signed with our partners meets the objectives of Montréal's Strategic Plan for Sustainable Development. It will raise our city's profile in North America with regard to electric vehicles and will help us reach our goal of reducing greenhouse gas emissions by 30% by the year 2020."

Québec City's Mayor, Régis Labeaume stated: "This partnership is in line with Québec City's ongoing efforts to develop sustainable transportation. The implementation of the Écolobus service, a fleet of non-polluting, ultra-quiet electric minibuses that travel the streets of Vieux-Québec, is a great success that contributes to maintaining the quality of the capital's environment."

Nissan, along with its alliance partner Renault, is committed to making affordable, all-electric vehicles available to the mass-market globally. The Nissan LEAF, a five-passenger all-electric vehicle, will first be available in select Canadian markets, such as Québec, before the end of 2011.

Hydro-Québec and Mitsubishi Motor Sales of Canada to launch Canada's largest all-electric vehicle pilot project in the fall of 2010

Today, Hydro-Québec and Mitsubishi Motor Sales of Canada Inc. (MMSCAN) announced the signature of a memorandum of understanding that will lead to the launch of Canada's largest all-electric vehicle pilot project this coming fall. In collaboration with the City of Boucherville, Hydro-Québec will test the performance of up to 50 Mitsubishi i-MiEVs, the vehicle which recently won the Japanese Car of the Year award for "Most Advanced Technology" at the Tokyo International Motor Show.

The project, which is evaluated at $4.5 million, aims to test the cars under a variety of road conditions, including those due to Québec's harsh winters and is designed to study the vehicles' charging behaviour, the driving experience and overall driver satisfaction. The project is the first of its kind to include the participation of a car manufacturer, a public utility, a municipality and local businesses that will integrate the vehicles into their existing fleets.

Thierry Vandal, Hydro-Québec's President and CEO declared "This new pilot project is part of our action plan for the electrification of vehicles [...] it will allow us to advance our knowledge of the technology and its integration into our grid, which in turn, will help us plan the necessary charging infrastructure for homes, offices and public places."

The City of Boucherville was selected as the project's host municipality given its proximity to Hydro-Québec's research institute (IREQ), its role in Hydro-Québec's upcoming interactive smart zone trial and the diversity of its local businesses. The availability of a local Mitsubishi dealership to oversee the i-MiEVs' maintenance was also part of the selection criteria.

i-MiEV, which stands for Mitsubishi Innovative Electric Vehicle, is an all-electric, highway-capable, charge-at-home commuter car. Because the battery, the motor and other items are mounted out of the way beneath the floor, the i-MiEV seats four adults and offers surprising interior room and cargo space. Other i-MiEV features include excellent low-speed acceleration and a very low centre of gravity, which contributes to superior handling and stability. Moreover, the i-MiEV is extremely quiet.

"We are very proud to be leading the way to a greener, more sustainable future by developing environment-friendly vehicles fuelled by clean, renewable energy," said Koji Soga, President and CEO of MMSCAN. "Mitsubishi is a leader in electric car development and the i-MiEV represents the pinnacle of our green technologies. In the same sense, Hydro-Québec and the City of Boucherville are demonstrating their environmental leadership by participating in this unique initiative."

The electric vehicle pilot project comes ahead of the government of Québec's soon to be released 2010-2015 Electric Vehicle Action Plan, announced in June 2009 and which is expected to include incentives to get electric vehicles on Québec's roadways, as well as for car and component manufacturers to establish themselves further in the province.

Québec applies California Standards to Light Vehicle GHG Emissions

On December 29, 2009, Ms. Line Beauchamp, Québec's Minister of Sustainable Development, Environment and Parks, announced that the Regulation respecting greenhouse gas emissions from motor vehicles, whose standards are equivalent to those in force in California, was to come into effect in mid-January 2010. Québec thus becomes the first Canadian province to apply North America's strictest automotive emissions standards and joins an ongoing North American movement that has seen some fifteen (15) American states, including a majority of the province's northeast neighbours, follow California's lead. The U.S. federal government has also announced its intention to adopt California-equivalent standards in 2012.

The Regulation applies to all cars and light trucks sold, leased or marketed in Québec from the 2010 model year onward and most notably sets out a table of gradually diminishing maximum GHG emissions standards for large volume manufacturer vehicles for model years 2009-2016. In addition, the Regulation establishes a system of credits and debits whereby beginning with the 2010 model year for large volume manufacturers and the 2016 model year for other manufacturers, a fee of $5,000 per vehicle equivalent is payable for any excess over the maximum emissions standards. All sums thereby obtained are paid into the province's Green Fund, established by section 15.1 of the Act respecting the Ministère du Développement durable, de l'Environnement et des Parcs.

At 40% of the province's total GHG emissions, of which nearly half are due to Light Vehicles, the transportation sector is Québec's most important emitter. The Regulation's coming into effect thus constitutes an important step towards realizing the goals of the province's 2006-2012 Climate Change Action Plan, and is a determinant factor in reaching its 2020 GHG emission reduction target as well.

It is expected that in addition to encouraging the large scale use of more energy efficient technologies in the transportation sector, such as electric or hybrid vehicles, the Regulation will foster a more rational use of non-renewable petroleum resources, thereby decreasing Québec's overall dependence on fossil fuels.

World's first concept tires made of renewable biomass arrive in Copenhagen in time for United Nations Climate Change Conference

The world's first concept demonstration tires made with BioIsoprene technology, a breakthrough alternative which aims to replace a petrochemically produced ingredient in the manufacture of synthetic rubber with renewable biomass, made their debut in Copenhagen, Denmark, this week. One tire will make appearances at several special events during the United Nations Climate Change Conference in Copenhagen (COP 15), while the other tire will be on display at a lounge in the common departure area at the Copenhagen International Airport throughout December 21.

The tires made with BioIsoprene are the result of a collaboration between Genencor, a world leader in industrial biotechnology and a pioneer in enzyme innovation and division of Danisco A/S, and Goodyear, one of the world's largest and well known tire companies.

Beyond tires, BioIsoprene offers a huge potential in all kinds of other applications where petroleum-based rubber products and adhesives. The market for isoprene could reach up to 11 billion pounds per year by 2012. Genencor plans to bring the technology to pilot stage within two years, followed by commercial production.

Philippe Lavielle, Executive VP of Business Development for Genencor declared: "We're building advanced biorefineries of the future through strategic collaborations, such as our work with Goodyear and our joint venture DuPont Danisco Cellulosic Ethanol, as well as public-private partnerships. By joining forces with other industry leaders and leveraging our cutting edge biotech capabilities, we're able to accelerate development and deployment of breakthrough technologies like BioIsoprene."

The development by Goodyear of its first concept tire manufactured using a bio-based alternative to the petroleum-derived raw material isoprene is a good example of how traditional industry has taken notice of the consumer's pursuit for more environmentally friendly products and of the growing importance of corporate social responsibility, a part of which results from lessening one's impact on the environment.

Québec announces its GHG reduction target: 20% below 1990 levels by 2020

Last week, Québec Premier Jean Charest and Minister of Sustainable Development, Environment and Parks, Line Beauchamp, unveiled the province's target to reduce greenhouse gas emissions (GHG) by 20% below 1990 levels by the year 2020. Seeking to be recognized as a Canadian leader against climate change, Québec has decided to set an objective similar to that established by the European Union.

In making the announcement, Premier Charest acknowledged that the province's target is very ambitious, especially given that 48% of its total energy requirements are currently satisfied by renewable energy sources. At approximately 11 tons per capita, or half the Canadian average, Québec already currently holds the best GHG emissions record in Canada. If it can achieve its 20% reduction target by 2020, the province would have the lowest level of emissions per capita in North America.

In announcing its target, the government stated that the proposed measures to be taken would show flexibility from one economic activity sector to another, notably by taking into account each one's overall reduction potential, international competitiveness, available technology and required transition measures. As an illustration of one particular sector's progress to date and to demonstrate that climate change does not necessarily have to come at the expense of economic growth, the Premier noted that the province's industrial sector had already achieved emissions reductions of over 7% in 2006, as compared to 1990 levels, despite the fact that Québec's GDP had increased by 41% over that same period.

As transportation accounts for 40% of Québec's GHG emissions, the government stated that it would be paying particular attention to that sector. In order to achieve the 2020 target, the government expects to make major investments in mass transit options and will take measures to encourage the increased use of intermodal transportation of goods. It also plans to introduce a GHG emission standard for light-duty vehicles equivalent to that in California. Also, as Québec-based corporations have demonstrated expertise in electric vehicle technologies, the government will encourage the development of that industry, as well as the use of such vehicles.

Lastly, through its participation in the Western Climate Initiative, the province will contribute to implementing the largest GHG cap and trade system in North America in 2012. The government expects that these actions will set the stage for a flourishing green economy by the year 2020 and will gradually reduce Québec's economic dependence on foreign oil. It will also lessen the economic impact of the anticipated oil crisis in the decades to come and improve Québec's trade balance.

With less than a week to go before the December 2009 climate conference in Copenhagen, the province of Québec has now clearly announced where it stands on climate change. In a statement aimed at her federal counterpart, Minster Beauchamp declared that "Through this ambitious target, Québec is showing its partners and the international community that it is fully committed to assuming its share of responsibility. By continuing to demonstrate strong leadership, we hope to change the position of the federal government leading up to the Copenhagen Conference."

International Energy Agency launches World Energy Outlook 2009 in London

The International Energy Agency>International Energy Agency ("IEA") today launched its annual flagship publication in London. The World Energy Outlook 2009 (WEO 2009) looks at the impact of the economic downturn on energy use, CO2 emissions and energy investment and what will be required at the UN climate conference in Copenhagen to put together an agreement that stops global temperatures rising at a price that is affordable. The WEO 2009 also focuses on the natural gas resource base, current trends and the role gas will play in the future energy mix. Finally, the publication includes a review of energy in Southeast Asia, looking at that fast-growing region and its implications for global energy markets.

The IEA's Executive Director, Mr. Nobuo Tanaka declared that "World leaders gathering in Copenhagen next month for the UN Climate summit have a historic opportunity to avert the worst effects of climate change. The World Energy Outlook 2009 seeks to add momentum to their negotiations at this crucial stage by detailing the practical steps needed for a sustainable energy future as part of a global climate deal" and added that "WEO 2009 provides both a caution and grounds for optimism. Caution, because a continuation of current trends in energy use puts the world on track for a rise in temperature of up to 6°C and poses serious threats to global energy security. Optimism, because there are cost-effective solutions to avoid severe climate change while also enhancing energy security - and these are within reach as the new Outlook shows".

In conjunction with the WEO 2009, the IEA has also released an Executive Summary which provides an overview of the publication's key findings and topics, as well as a Fact Sheet, which provides data in a bullet-point format on the following questions and issues: (1) The sustainability of our current energy pathway; (2) The Impact of the financial crisis on Energy Investment (3) Natural gas' role in the global energy mix; (4) What a low-carbon energy future might look like; (5) The impact of the financial crisis on the outlook for CO2 emissions and global climate; (6) Assumptions on Energy Prices, volatility and the future of cheap energy.

Copies of the World Energy Outlook 2009 can be ordered from the IEA Bookshop.

223 Proponents Apply for CCEMC Funding

The Climate Change and Emissions Management (CCEMC) Corporation ("CCEMC") issued its 2009 Call for Proposals: Initial Expression of Interest Stage (the "EOI") on August 5, 2009. The response to the EOI has been, to say the least, overwhelming. According to the CCEMC website, 223 proponents have requested funding from the CCEMC for a total ask of $1.6 Billion Dollars.

This is astounding news. Why you ask? Keep reading.

What Does It Mean?

1. The response to the EOI has been overwhelming. Remember that the CCEMC was only incorporated in February. The Climate Change and Emissions Management Fund Administration Regulation, which delegates the powers, duties and functions of the Minister of Environment (Alberta) to the CCEMC was only enacted in May, 2009. That in less than a year the CCEMC has been able to request EOIs and receive responses from 223 proponents is staggering.

2. The sheer number of proponents and amount of the ask demonstrates how interested Albertans and Industry in Alberta are in climate change technology and initiatives. There's a lot going on in Alberta right now in the area of climate change initiatives as evidenced by the fact 223 proponents have applied for funding.

3. The number of proponents and the success of this first EOI shows that Alberta Environment and the Government of Alberta were absolutely right in anticipating and recognizing the importance of establishing a climate change technology fund and the structure of the CCEMC. (For more information on the importance and uniqueness of the Climate Change and Emissions Management Fund, click here.

4. The CCEMC has up to $120 million for project funding for the 2009 Call for Proposals. Up to 50 percent of monies will be invested in green energy production, 20 percent in energy conservation and energy efficiency and 30 percent in implementing carbon capture and storage. Although there is only $120 Million available at this time, there will be further rounds of calls for proposals as more funds are received from the current and future compliance years. The CCEMC will consider the EOIs and the funding envelopes outlined above and select the very best for the full proposal stage.

5. The fact that the CCEMC is through the first stage in its process for calling for projects is a first in Canada and is clearly the most significant event in the world of climate change innovation in this country. The model for climate change funding in Alberta is working to create action.

The evaluation of the EOIs received by the CCEMC is currently in progress. Proponents whose projects are being selected to submit full project proposals will be notified by November 13, 2009. An annoucement of those selected to submit full project proposals will be made shortly thereafter....just in time for the UNFCCC Conference of Parties in Copenhagen in December. Alberta will truly have the technology fund showpiece at the conference and has much to be proud of.

BC Green Agenda Hits Big Bump

British Columbia's Energy Plan: A Vision for Clean Energy Leadership hit a bit of a wall yesterday when it was rejected by the BC Utilities Commission as being "not in the public interest" - in other words, it's going to cost a lot of money and we're not interested. British Columbia, which is a member of the U.S. based Western Climate Initiative, had set aggressive GHG emissions reductions targets of 33% below 2007 levels by 2020. The Globe and Mail reported that "[s]ome analysts say the ruling - which shocked the government and the stock market - indicates B.C. has been over-estimating the amount of power the province needs in order to justify the development of independent power projects". A spokeswoman for the Canadian Office of Provincial Employees Union, COPE, stated "[w]e have a very flawed energy plan in this province ... the government cannot continue to exaggerate the need for power".

The BC Energy Plan claimed to put British Columbia at the forefront of environmental and economic leadership, by looking to all forms of clean, alternative energy in meeting British Columbians' needs in the provincial economy. The Plan called for a number of green initiatives, including:

• Zero greenhouse gas emissions from coal fired electricity generation
• All new electricity generation projects will have zero net greenhouse gas emissions
• Ensure clean or renewable electricity generation continues to account for at least 90 per cent of total generation
• Achieve electricity self-sufficiency by 2016
• Generate electricity from mountain pine beetle wood by turning wood waste into energy
• Invest $89 million for fuelling stations and the world's first fleet of 20 fuel cell buses through a federal-provincial partnership

What the report doesn't say is that a massive capital (read: expensive) outlay is going to have to be made in order to implement the plan. But before the plan could be truly put into action, the BC Utilities Commission had to essentially approve it. The Utilities Commission Decision includes a refusal "to allow BC Hydro to downgrade the Burrard Generating Station. Burrard is a conventional thermal plant fuelled by natural gas that supplements hydroelectric generation in years of low water flows". As part of its Energy Plan, BC Hydro wanted to rate that station as capable of producing a maximum of 3,000 gigawatt hours annually. The Utilities Commission disagreed, concluding said the figure should be 5,000 GWh. If the Burrard potential is rated 2,000 GWh higher, then the need for private power would have to drop by the same amount.

It wasn't all bad news for the BC Government. The Commission approved all but $2 million of the $630 million spend requested by BC Hydro, including $418-million on demand side management. The Energy Minister downplayed the significance of the decision and confirmed that the province is committed to producing clean, renewable energy through independent power producers.

However, the decision raises a couple of issues:

1. BC is going to have to take a long look at its targets, whether they are reasonable and whether the need for power is as stated.

2. What does the Utilities Commission's rejection of the clean energy call mean for the future of green energy in BC? What is the tolerance level of British Columbians in terms of the spend? The Utilities Commission doesn't think it's as high as the government does.

3. What's more important - reducing emissions and using "clean" energy or ensuing the economy is stable and humming (no pun intended) along? Not to mention that sustainable/renewable/clean energy projects don't come without their own high environmental cost.

We'll keep you posted on how this is all playing out.