2014 Legislative Session: Third Session, 40th Parliament
HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

official report of

Debates of the Legislative Assembly

(hansard)

Thursday, October 30, 2014

Afternoon Sitting

Volume 16, Number 10

ISSN 0709-1281 (Print)
ISSN 1499-2175 (Online)

THURSDAY, OCTOBER 30, 2014

The House met at 1:33 p.m.

[Madame Speaker in the chair.]

Orders of the Day

Hon. M. Polak: I call continued committee stage debate of Bill 2.

Committee of the Whole House

BILL 2 — GREENHOUSE GAS INDUSTRIAL
REPORTING AND CONTROL ACT

(continued)

The House in Committee of the Whole on Bill 2; M. Dalton in the chair.

The committee met at 1:34 p.m.

Hon. J. Rustad: I seek leave to do an introduction.

Leave granted.

Introductions by Members

Hon. J. Rustad: It’s a great pleasure today to have a visit from a number of aboriginal students from the Tsimshian Nation. The students have come down to visit, of course, to get an opportunity to learn a little bit but also to participate in some competitions. They had a great visit and a great tour around through the facility.

[1335]

They’re from the Coast Tsimshian Academy. The principal is Kelly Rambeau; the teachers, Anton Tolstoy and Kristen Idiens. As well, a number of students have come down. I’m just going to read their names into the record, so please bear with me: Charlotte White, Tori Alexcee, Laeticia Doolan, Rechee Auckland, Shylie Auckland, Theodore White, Cayden White, Marcus Tait and Skyler Wesley. Would the House please make them welcome.

Debate Continued

On section 1 (continued).

A. Weaver: Hon. Chair, I was just hoping to pass four more amendments on notice to be dealt with at a later time through the Clerk to you.

S. Chandra Herbert: As we wrapped up right before the lunch hour, the minister was forced to give a rather short answer to a question I asked, which I think spoke to a fundamental flaw in the bill. That is that while the government had promised this legislation would bring us the cleanest LNG, liquefied natural gas — the entire life cycle — the bill only focuses on 30 percent of the emissions, leaving approximately 70 percent of the emissions unaccounted for, without legislation to deal with those emissions.

That is a problem, because we would never assume that 30 percent of our life was our entire life. But the government has tried to argue that that’s what they’re doing here. Indeed, it does affect the whole LNG but only focuses, in the end, on the final liquefaction part of it.

The minister, in answer to the question about what was attributable…. I argued in my speech that when we’re talking about cleanest LNG, “attributable” should indeed include the letter L, liquefied; the letter N, natural; the letter G, gas, which goes from wellhead to water line.

The minister did make the point that not all companies are integrated, and I understand that. I guess the point I was trying to make was that integrated or not, the carbon dioxide still comes from the whole process. So I can understand that.

I guess the question would be: in terms of the regulations, is there any thinking that down the road, regulations could also be brought in around pipelines or around the actual plants themselves — the processing plants, the compressor stations — or legislation, indeed, to capture them? What are the plans to deal with the full emissions attributable to LNG, since so far this bill doesn’t speak to that?

Hon. M. Polak: No, there are no plans to develop regulations around that. Again, we have taken the approach — and it’s a portion of this bill — to create incentives to ensure that the investment from industry is encouraged to go right back into the upstream and other aspects of this.

Again, it’s important to note that the regulation that this bill approaches in terms of liquefied natural gas is with respect to the facilities themselves.

S. Chandra Herbert: At what point did the government decide not to consider the full life cycle of liquefied natural gas and instead focus just on the plant?

[1340]

In 2012 the government had said cleanest LNG applied to the entire life cycle of the gas, including the carbon emissions in the entire life cycle. Now with this bill they’ve focused on exclusively 30 percent, and I just heard from the minister there are no plans to deal with the 70 percent by legislation despite what the government used to believe in — the need of hard caps to drive down emissions as opposed to intensity targets, which would allow emissions to continue to rise on into the future.

At what point was the decision made, and what thinking went into deciding to only focus on the liquefaction plants themselves?
[ Page 5080 ]

Hon. M. Polak: It’s important to note that all industry continues to pay the carbon tax at $30 a tonne, including industries that are involved in the upstream.

In terms of this legislation, the legislation is intended to create a benchmark at 0.16 for a new industry in British Columbia — that of liquefied natural gas. The benchmark and the costs associated with that compliance will be in addition to carbon tax, and carbon tax is paid across industry. That will continue.

With respect to this act, though, we’re dealing specifically with the benchmark being placed on liquefied natural gas facilities, or liquid natural gas.

A. Weaver: We’re dealing with the discussion of the definition of the word “attributable.” Here it says: “…in relation to greenhouse gas emissions, means attributable under the regulations to an industrial operation.”

My first question on this topic to the minister is: what regulations are being contemplated as applicable to the industrial operation in regards to this definition?

Hon. M. Polak: The member will be aware, I know, that the cap-and-trade act, which this act repeals and replaces, already contained in it regulations around this for the rest of industry. Our intent is to carry those over.

We would add to that regulations specific to liquefied natural gas plants, which would include electricity generated on or off site for the purposes of those plants.

A. Weaver: Thank you to the minister for the response there.

Further, if I might read this definition again carefully, it says the following: “…in relation to greenhouse gas emissions, means attributable under the regulations to an industrial operation.” But the term “industrial operation” is further defined later in this section as follows: “…means one or more facilities, or a prescribed activity, to which greenhouse gas emissions are attributable.”

We have a circular definition here. We have one definition referring to another definition, referring back to the first definition. So my question to the minister is: to what extent is it possible to clean up these definitions prior to us actually passing section 1?

I think the industry and those reading this would like some clarity as to the actual terms here. Ultimately, this is a very important piece of legislation that government is relying on. There are several examples in here of circular definitions where one definition refers to another definition.

It strikes me that this occurs often when legislation is put together in a hurry. This is one of the reasons why, of course, I brought the hoist motion forward earlier.

[1345]

Again, coming back, to what extent can these circular definitions be fixed prior to the passing of section 1? Is the minister aware of this and other potential problems like that?

Hon. M. Polak: Perhaps I can assist. In case anyone ever wants to know the great and long and tedious process of legislative review counsel, I’d be happy to recount it, but I’ll give you some of what I have learned in going through the definitions on this particular act. I will try not to complicate it more, but it actually does work and isn’t circular.

Taking a look at “attributable,” the member will note that it doesn’t say: “means attributable as defined in the definition of industrial operation.” It says: “…under the regulations to an industrial operation.” The regulations will define “attributable.” As such, they will then be governed by the term “industrial operation.” When we refer to an industrial operation, when it says, “…to which greenhouse gas emissions are attributable,” that’s already defined by the regulation. It’s not defined by “industrial operation.” That’s what then governs it.

Hopefully, I haven’t messed it up even further in the member’s mind.

A. Weaver: With the greatest respect to the minister, I think the point I was trying to make was just illustrated there. If it’s difficult to explain this to a layperson, I suspect that legal teams will have a field day over this, because there may or may not be various interpretations.

This brings me further to what is meant by the term “regulation.” Now, there are a number of international standards out there. One of the most common, of course, is the ISO standard 14064, which ministerial staff will be very familiar with, which has three parts to it. The first part provides requirements for greenhouse gas inventory design. The second part has requirements for quantifying, monitoring and reporting emissions reductions. And the third part of ISO 14064 is with respect to greenhouse gas information, validation and verification.

That’s only one of several that are out there. There’s also the greenhouse gas protocol, which is used internationally by some in terms of providing similar guidance.

Can the minister help me here actually understand: what rules are we thinking about here? They’re left to regulation, but we’re not given any guidance yet as to what regulations are going to be followed. Is it ISO standards? Is it going to be California-based standards? Is it going to be perhaps some made-in-Quebec standard? Is it some made-in-B.C. standard? Is it greenhouse gas protocol? I don’t know. I’m sure my colleagues also don’t know. Certainly, I really don’t think that for such important information we should be waiting at some hypothetical point down the road to see it appear in regulation.

Hon. M. Polak: First, a point of clarification just to be sure that the member understands that in the definition of “attributable,” the regulations referred to there are not the regulations of offsets or of reporting. They’re the regulations that we would draft.

[1350]

In terms of how the reporting will be conducted and under what regulatory framework, we have been guided by the U.S. EPA guidelines for reporting, developed for consistency through the WCI process. The reporting will be done in the same way as it’s done in Quebec, Ontario and also the U.S., including California.

I should say, though — and this will come across…. Well, maybe it’ll be humorous. I’m not nearly as funny as I usually think I am. But in all honesty, I know the member and I, as well, would love to think that the definitions portions of legislation should be easily explainable to the public.

In reality, they need to be explainable and understandable by lawyers. I can assure the member that all of this has been through, in quite a lot of detail, the lens of legislative counsel and the Attorney General and is consistent with their advice with respect to the wording of definitions. But I completely appreciate the difficulty with which we all look through definitions in legislation and sometimes wonder at the mechanics that are advised that we put in place.

A. Weaver: Again, coming to the definition of “attributable,” it does say: “…in relation to greenhouse gas emissions, means attributable under the regulations to an industrial operation.” Now, regulations to an industrial operation would imply — because you’re talking about greenhouse gases — attributable to, but there are some standards being met. It’s not clear to me…. They’re attributable to an industrial regulation.

What I’ve done here is proposed an amendment to try to provide some guidance which actually sets a framework — set by ISO 14064 standards and the United Nations framework convention on climate change regulations — to not allow these regulations to kind of be made up in the absence of other policy, to somehow actually put some constraints on what is deemed to be acceptable. There really is no guidance in this to anybody as to what regulations will be put in place.

It seems — again, I reiterate — that this legislation was brought forward rather rapidly to have a skeleton structure and put anything of substance in regulation to be determined at some later date, presumably in consultation with industry affected. In the meantime there are international standards. There are the ISO 14064 standards. There is the United Nations framework convention on climate change. If government is going to be using EPA standards, if government is going to be using WA standards, surely we should have been told that. Surely it should be in legislation now.

With that intent, I move the first of my amendments, please, which is as follows:

[SECTION 1, by deleting the text shown as struck out and adding the text shown as underlined:

“Attributable”, in relation to greenhouse gas emissions, means attributable under the regulations to an industrial operation;

and in accordance with the ISO 14064 standards and the United Nations Framework Convention on climate change regulations.]

On the amendment.

Hon. M. Polak: I understand the intent of the member. In spite of my inability at law and, therefore, probably not explaining this well enough, I’ll try one more time, though.

If one were to read it as it is intended here in the definition…. This is why I would not be supporting the amendment. First of all, we do actually operate under those standards in terms of the way that we approach the assessment of reporting, etc.

But the term “to an industrial operation” doesn’t refer to the regulations. It’s attributable to an industrial operation in relation to greenhouse gas emissions — right? — under the regulations. So the regulations will define how it’s attributable and what portions are attributable. It’s not that they are regulations to an industrial operation. They are attributable to an industrial operation under the regulations.

I can assure the member that we adhere to those high standards and intend to continue to.

The Chair: Member for Vancouver–West End on the amendment.

[1355]

S. Chandra Herbert: On the amendment, yes.

I understand where my colleague is coming from, being suspicious as I am of the government’s ability to use regulations sometimes. Of course, we’ll remember their attempt to exempt natural gas plants from any environmental assessment, as well as ski facilities. Just a quick stroke of the pen, and what once was covered may now not be.

Putting in a standard, which the minister says the government follows, would give, I believe, greater assurance to this House that we are actually following through and not easily changing definitions of regulations after the fact.

In this case, “attributable…to an industrial operation….” Well, maybe some government — this one, another one — could argue that “attributable” means we count half the emissions, and the other half don’t count. Kind of like how this government has decided that cleanest LNG only refers to 30 percent of emissions, ignoring the majority of emissions — the 70 percent — and deciding that they don’t count, by focusing only on the letter L and neglecting to acknowledge natural gas is required for the creation of liquefied natural gas.

I do support my colleague’s amendment. I think it’s appropriate. The minister says that it’s supportable, as they already do that. I don’t understand why the government would vote against the amendment given that the definition should be clear on exactly what the government means.

B. Ralston: I seek leave to make an introduction.

Leave granted.
[ Page 5082 ]

Introductions by Members

B. Ralston: [French was spoken.] I’m pleased to introduce a class from Ecole Kwantlen Park in my riding. They are led by teacher Dan Read and teacher Shauna Nero, and they’re the grade 11 social studies class.

Would the members please make them welcome here. For many it’s their very first visit to the Legislature and to Victoria.

Debate Continued

The Chair: Seeing no further debate, I’ll put the question.

Amendment negatived on division.

S. Chandra Herbert: The member for Oak Bay–Gordon Head, I know, has more questions. I have a question around carbon dioxide equivalent.

The discussion says that it “means the mass of carbon dioxide that would produce the same global warming impact as a given mass of another greenhouse gas, as determined in accordance with the regulations.”

As many have pointed out and as the minister herself acknowledged in a press scrum, putting a quarter of the bill in regulations…. Well, it may be controversial. Certainly, those on this side of the House have trouble with it because it can mean that very important aspects of the bill are decided behind closed doors, potentially weakening the strength of the law, potentially not fulfilling the law at all if the regulations never come into force.

[1400]

I just wondered: given that this definition discusses it being determined “in accordance with the regulations,” what are the regulations that the government is using now to determine these requirements? And what would stop the government from changing these regulations? Are there other laws in B.C. that reference how the reporting of a carbon dioxide equivalent is reported?

Hon. M. Polak: Firstly, the term “carbon dioxide equivalent” is a standard international unit of measure. I would point the member to, in the definition, when it says “greenhouse gas” and then it says “as determined in accordance with the regulations.” It’s talking about which gases….

How do you define a greenhouse gas? It is defined under “greenhouse gas.” The member will see: “…the same meaning as in the Greenhouse Gas Reduction Targets Act.” We have a number of pieces of legislation that refer to greenhouse gases. They all refer back to the definition that is a part of the Greenhouse Gas Reduction Targets Act. Those regulations are used to a standard across the piece.

S. Chandra Herbert: Forgive me, but for those at home who do not have a copy of the Greenhouse Gas Reduction Targets Act, is the minister able to provide that definition as under that act? It’s an important piece. Of course, if you can’t define “greenhouse gas emissions,” and if you can’t define “carbon dioxide equivalent,” as the minister well knows, it’s hard to meet any target and hard to achieve success.

Having a very firm definition of what “carbon dioxide equivalent” means is important, whether it be for methane…. Hexafluoride, I believe, is another one. There’s a range of other greenhouse gases. Of course, most of the focus is on carbon dioxide, but that would be a very helpful thing, I think, for this House to hear — what the Greenhouse Gas Reduction Targets Act says on that question.

Hon. M. Polak: I will read from the Greenhouse Gas Reduction Targets Act. The benefit of electronic technology is that we don’t have to have the binder handy with us.

So “‘greenhouse gas’ means any or all of carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulphur hexafluoride and any other substance prescribed by regulation.” They are the six standard ones. Certainly, if there are others identified in the future, we would be able to add those.

S. Chandra Herbert: Have any others been added by regulation so far?

Hon. M. Polak: No. None have, and we would follow the lead of the international community and, of course, any other appropriate standards.

A. Weaver: On that note, I would like to ask a number of questions with respect to the definition of “carbon dioxide equivalent.” My first question is…. It appears that some of this, again, is being left up to regulations.

[1405]

It says here: “…global warming impact as a given mass of another greenhouse gas, as determined in accordance with the regulations.” I’m not quite sure what that means. Can the minister please explain to me how regulations are going to affect the definition of “carbon dioxide equivalent”?

Hon. M. Polak: They don’t. They would affect the definition of a “greenhouse gas”. So it’s “greenhouse gas, as determined in accordance with the regulations.”

A. Weaver: International standards define “carbon dioxide equivalent” to not only include greenhouse gases but to include all those substances that affect radiative forcing. This definition strikes me as not being consistent with international standards for definitions of “carbon dioxide equivalent.”
[ Page 5083 ]

Here we define it as: “…means the mass of carbon dioxide that would produce the same global warming impact….” That, in and of itself, is deeply, deeply problematic because not all greenhouse…. The global warming impact has got substantive regional manifestations. To actually define it in terms of an impact, a global warming impact, does not make sense, because the impact, for example, of some greenhouse gases is different in different locations than others.

Some would argue that aerosols should be included in this “carbon dioxide equivalent” definition, and their effects are quite local. In fact, this definition doesn’t make sense. It does not make sense to say that “‘carbon dioxide equivalent’ means the mass of carbon dioxide that would produce the same global warming impact as a given mass of another greenhouse gas.”

I think what’s happened here is that the word “impact” somehow, in some legalese language, replaced the word “potential.” “Global warming potential” is a defined international term that’s used in the community, and I suspect that some legal person looking over this saw the word “potential” and thought, “Oh, that doesn’t make sense legally, so let’s switch it to ‘impact,’” and it wasn’t caught. It really does not make sense to have this definition the way it is.

I have quite a number of questions on this, and I have a proposed amendment that I’ll get to later. First off, assuming that this actually meant global warming potential, not impact, what globing warming potential of methane, nitrous oxide and perhaps other greenhouse gases are being used? What time horizon is being used in determining the global warming potential? Is it 20 years? Is it 100 years? Is methane…? Are you just strictly constrained to the Kyoto-regulated greenhouse gases?

Again, there’s nothing in here. It’s all passed to regulation, leaving hypothetical decisions to be made at some point in the future as to what the time horizon for global warming potential is, whether or not the Kyoto-reported gases are going to be included, whether or not aerosols are going to be included, whether or not black carbon will be included. It’s really up in the air. At the very, very least, this definition of “carbon dioxide equivalent” must be changed — at minimum — to replace the word “impact” by “potential,” but later I’ll expand that further.

The first question. What are the global warming potentials of methane and nitrous oxide being used by the government in determining…? In this definition, are they the IPCC — Intergovernmental Panel — 2013 values? Are they the 2007 values? Are they the 2001 values? As we’ve learned more and more…. Please clarify.

Hon. M. Polak: In answer to the member’s question around the gases, these are the Kyoto gases, or the gases referenced in Kyoto. They’re also, of course, the six gases that are of current concern and discussion internationally. In terms of the IPCC, Canada keeps pace with IPCC, and we follow suit.

[1410]

A. Weaver: Which IPCC report? There are many. The global warming potentials have changed as scientific knowledge has expanded, such that right now the global warming potential for methane is, on a 20-year time horizon, 84. That means it’s 84 times, on a molecule-by-molecule basis, more effective at warming than, say carbon dioxide, but over a 100-year time horizon, it’s 28 times more efficient.

In 2007 the numbers were lower than that. In 2001 the numbers were lower than that. As science improves, the numbers within error bars get more and more certain. Is the government going to stick with the 1990 UNFCCC numbers, or is it going to come up with more recent…? Is it going to wait for international standards to be set? What’s the government’s thinking here?

Hon. M. Polak: It is the 2013 IPCC. We follow Canada’s guidance with respect to those gases — the guidelines with respect to global warming impact. I take the member’s point in terms of commonly used language in the field. But as our advice received, this is the appropriate language to give life to the objectives with respect to identifying these greenhouse gases.

A. Weaver: I must confess that I am deeply troubled that the province of British Columbia would seek any direction from the federal government on any aspect of climate policy. But with that said, I would….

I spent my career working in the field of atmospheric and ocean science, climate science. I cannot stand in the Legislature here and see a definition that is inaccurate at such a fundamental level go through without a proposed amendment. I am proposing an amendment which has been extracted directly from a working group 3 report of the Intergovernmental Panel on Climate Change that was published in 2014.

I’m not making this up. This is the international standard definition for “carbon dioxide equivalent.” My amendment, which I so move, is as follows:

[SECTION 1, by deleting the text shown as struck out and adding the text shown as underlined:

“Carbon dioxide equivalent” means the mass of carbon dioxide that would produce the same global warming impact as a given mass of another greenhouse gas, as determined in accordance with the regulations;

the amount of carbon dioxide emission that would cause the same integrated radiative forcing, over a given time horizon, as an emitted amount of a greenhouse gas or a mixture of greenhouse gases. The equivalent carbon dioxide emission is obtained by multiplying the emission of a greenhouse gas by its Global Warming Potential for the given time horizon. For a mix of greenhouse gases it is obtained by summing the equivalent carbon dioxide emissions of each gas. Equivalent carbon dioxide emission is a common scale for paring emissions of different greenhouse gases but does not imply equivalence of the corresponding climate change responses.]

I so move that this replace the definition.
[ Page 5084 ]

On the amendment.

Hon. M. Polak: I will not argue with the member’s acknowledged expertise on the topic. However, I believe, with respect to the intent of the act, that the amendment isn’t necessary to achieve the objectives of the act and won’t be recommending support of the amendment.

S. Chandra Herbert: I appreciate my colleague’s amendment. I think that even in the time I’ve been in this House, we’ve seen quite a change in the science in terms of understanding what the potential equivalent of methane compared to carbon dioxide is in terms of the potential impact on the climate, with many questions of why sometimes methane in this province is not captured — the case of fugitive emissions or venting emissions, as well, are not captured — with legislation and with a protocol to drive those emissions down.

As with any legislation and any counting strategy, you need to be sure that what you’re counting is accurate, and you need to be sure, to the best ability, it is sound. Of course, with science, things change. I know that some in this House will not believe in climate change until, as they say, the science is settled.

[1415]

Well, science is rarely settled. It is always changing; it’s always evolving. We’re learning more every day. To hope that we would have a final definition, I think, does the human brain and the human experience a disservice. We are always learning. Creativity, innate in our beings, allows us to learn a lot more.

I appreciate the member’s amendment, and I believe it is supportable, as it is the definition that is accepted internationally by the IPCC.

V. Huntington: I’d like to ask the minister: if she’s not willing to accept this amendment, will the regulations at least include this amendment or something similar thereto?

Hon. M. Polak: That is partly the point. In constructing legislation….

Point of Order

A. Weaver: Point of order, Mr. Chair. I don’t think when in debate of a motion we can actually have questions addressed and answered.

The Chair: Members, in committee stage members are allowed to ask as many questions as they wish on the motion.

Debate Continued

Hon. M. Polak: The definition is constructed to support the objectives of the legislation. It’s our view that if greater specificity was needed, then that could be put into the regulations. I would note that even in highly technical pieces of legislation in other fields, very often it is the more explicit and specific language that is then placed into the regulations — in part, because over time sometimes that detail changes as the science evolves and the accepted language changes as the science evolves. That’s part of the rationale.

I’m quite certain that trying to take a definition such as the one that has been proposed through leg. counsel would be a losing battle. I’m pretty sure.

[1420]

Nevertheless, I certainly don’t argue the technical validity of the definition the member is proposing — only to say that I do believe, as I said earlier in response, that the definition as it’s included here is sufficient for the objectives of the bill.

V. Huntington: At the risk of another parliamentary procedure debate here, could I ask: does that mean that this definition or something equivalent to this definition will be in the regulations that refer to this definition?

Hon. M. Polak: Sorry. I didn’t mean to be unclear. It isn’t our intention to include that, only illustrating that we wouldn’t ordinarily include a definition of that specificity in the front definition section of a bill. Again, it’s our view and the view of those giving us advice on how to construct the legislation that this definition, for the purposes of the bill, which is to enable us to account for the reporting of greenhouse gases using a unit of measure, is sufficient.

A. Weaver: Given the ruling that we can question on an amendment, please could the minister tell me what "global warming impact" means?

[1425]

Hon. M. Polak: Harkening back to a previous part of our conversation, I’m advised that in the drafting of this, this is one of the rare occasions when we were advised to try and include language that would be more easily understood by lay people. In fact, when we refer to global warming impact, we do not intend to mean anything different than what we would ordinarily refer to as GWPs. You’ll see in other pieces of legislation that we’ve used GWPs in other regulation.

But it’s our advice that for the purposes of this act, the wording here, the definition here — again, understanding that the legislation is to be interpreted by lawyers and those who practise that art — is sufficient for the purposes of the act.

A. Weaver: Might I give you two examples? Let’s suppose you put some carbon dioxide in the air and you put some nitrous oxide in the air. Well, nitrous oxide will
[ Page 5085 ]
interact with soils. That’s an impact that carbon dioxide will not do in the same way.

Let’s suppose you put some methane in. Let’s suppose you put some carbon dioxide in. Well, in fact, there’s respiration. There’s photosynthesis that’s affected by carbon dioxide and not the same way by methane.

So the word “impact” really…. It may seem to…. I mean, the argument may be that it’s done to make things clear, but the reality is that it doesn’t, because it raises questions about the biogeochemical response of the land surface to the greenhouse gas releases, which I’m sure was not the intent of the legislation.

[1430]

I would suggest that perhaps government would like, at some point, to introduce a definition for what global warming impact actually means — and I’d be delighted to provide them with one — if they actually think that they have to keep it here. As it stands, I think it really opens the floodgates as to what it means.

Another example: is a global warming impact…? Does that affect migration of people in the sub-Sahel? That’s an impact. It’s not clear to me that carbon dioxide versus methane will have the same way. Maybe people like the CO₂ fertilization effect of carbon. Parts of the world would be a little happy. Maybe some of the northern agricultural regions are happy by a CO₂ increase, but they really don’t like a methane increase.

You know, it’s not specific. I don’t think it would stand. I’m not a lawyer, but you know, the old reasonable doubt…. Is there a reasonable doubt that this is not clear? I think there’s a lot of reasonable doubt, because you can make up all sorts of impacts where different gases respond differently.

I think what’s meant here is that the radiative forcing or the global warming potential or…. It’s essentially the radiative forcing that is affected here. So why does the minister not actually put a definition in that is scientifically rigorous as opposed to one that’s open to misinterpretation?

Hon. M. Polak: As happens in legislation, the definition acceptable to those of a certain field where there’s expertise is not necessarily the one accepted by those with legal expertise. Our advice is that for the purposes of this bill, this is the appropriate language to use.

Again, I don’t take issue at all with the specific issues the member raises around trying to have this define something that in many other circles is defined much more specifically, scientifically more accurate. We’re advised that this is legally accurate with respect to what we are attempting to achieve with the legislation.

A. Weaver: Could the minister please provide me with legal evidence of legal precedence where this word has actually stood up, this definition has stood up in the court of law?

Hon. M. Polak: That’s certainly not something that I possess here with me in debate around the bill. As I’m sure the member appreciates, in construction of a bill there are very many — in fact, all — of the aspects of the bill that make their way through the legislative drafters, and there’s quite a back-and-forth that ensues around finalizing language that we want to see, in terms of certain actions that government is trying to achieve, while at the same time that the legislative drafters find acceptable.

I apologize that there’s no way for me to provide anything like that now. If the member wishes, we could certainly work to try and provide information like that for him. But it’s not something that I possess right now.

A. Weaver: Could the minister please provide me with any information as to whether or not any scientists or those with any scientific expertise were part of the legislative drafting process?

Hon. M. Polak: Yes, and that’s where that discussion and back-and-forth takes place.

S. Chandra Herbert: I know that the drafters are eagerly watching this discussion back in their offices, sending notes in, whether it’s by electronic communications or handwritten notes where required.

[1435]

I would hope that it be acceptable to the minister to request…. I don’t want to adjourn debate until we get the answer to this, but it is an important thing if we’re going to be addressing climate change — at least, 30 percent of the emissions from LNG in this bill — that we actually have the definition correct.

I’m not a scientist. I don’t apologize for it. I’m not a lawyer either, and I don’t apologize for that. But I do think it’s important that we get these things right.

My request would be that those watchers who see me right now and hear me make this request would be able to send in to the minister, whether it’s a brief of what the legal and scientific opinion was that led to this definition or some form of it, before we end the section on definitions — and there are a good number of definitions — that would be helpful for me and, I would hope, helpful for my colleague from Oak Bay–Gordon Head.

Hon. M. Polak: I’m sorry if I caused a misunderstanding. I didn’t mean to suggest that in the process of drafting bills there’s all sorts of printed legal advice that goes back and forth. That’s not what I was referring to.

The member asked if there were any precedents in law anywhere else around the term “global impact” or any decisions that have been made — things like that. I don’t know that. When lawyers, when legal counsel give advice…. I mean, they obviously have legal knowledge and understanding and awareness of things that have taken place. They give their advice based on that.
[ Page 5086 ]

But in the legislative drafting process, it isn’t an issue of where there are exchanges of legal precedents and things like that. It’s experts in a ministry, sometimes those from outside, who are coming with the intent of the legislation, and then it is those who are the experts in drafting legislation who give advice as to what language would best bring that to life. I didn’t mean to leave the impression there was perhaps, you know, documentation around this phrase or the use of it. That’s not how it operates.

S. Chandra Herbert: I’m just trying to understand. The legal drafters, experts in drafting of laws, base their laws on their interpretations of Supreme Court rulings, of Provincial Court rulings and their understanding of how law works.

Surely, in making a decision, as the minister suggested, to simplify this, to make it easier, as the minister argued, for people to understand, there was some thought to what precedents existed around the term “global warming impact” versus the much more descriptive and precise term used by the Intergovernmental Panel on Climate Change.

Given that this area of law is very, very specific — it’s not something that the average lawyer would probably get into — I would like a better understanding of how this decision was made to use this term by legal drafters, based on their experience. Surely, they must have thought of something that would give them the impression that this would be the best way to do it, as opposed to using the standard definition that the Intergovernmental Panel on Climate Change uses.

Hon. M. Polak: Those who work in the field of drafting legislation use their legal knowledge and expertise, just as those who are expert in our ministry — or, indeed, outside experts that they may draw on — are experts in their field. It is the same if you are drafting financial legislation or agricultural legislation or advanced education legislation.

Those who have the background in the field are the ones who are putting forward the ideas for the legislation. It is the drafters who then bring it to life. It is a process that hasn’t changed lo these many governments, and it’s not one that involves any passage of briefings or anything like that. It is work around a drafting table by the various experts, who then agree to the language that arrives for us here.

[1440]

There’s nothing I would be able to provide to the member, other than if we happen to have any information or awareness of where it’s been used, I’m happy for us to ask that question. I don’t want to leave the impression that, somehow, there is something I’m aware of. I’m not. That is the process whereby we arrive here.

It was the opinion of the drafters that for the purposes of this legislation, this definition would be sufficient.

S. Chandra Herbert: I appreciate the minister’s willingness to speak about the legislative sausage-making. I know we’re often told that people don’t want to know how sausages are made, for whatever reason. It might turn their stomachs, or something like that.

However, I believe it is important to know how these things come about — how the legislative sausage is made, so to speak — because, of course, what is in a sausage is very important to whether it’s a good-for-you sausage or a bad-for-you sausage or whether it’s edible at all.

In this case we’re going into the question of what global warming impact means, a term that I understand is not broadly used in terms of understanding what a carbon dioxide equivalent is, so I raise this question. I understand the minister does not have that answer at her fingertips. But if you’re sitting around a legislative drafting table or a sausage-making table, you are also wanting to, of course, make sure that it’s not just a word or phrase that’s picked out of the air but is actually grounded in reality so it can stand up to legal challenges, so it can stand up to questioning by folks like us on this side, and so it’s very clear, to those that need to abide by the definition, what it means.

I see a lot of activity at the minister’s table, so I’m hoping we might have a clearer answer on how this term came to be. Because it’s not a term that I’m that familiar with, and if one of the experts on climate change we have in B.C. is not familiar with it, it probably means that it’s not a term widely used in the field and could lead to disagreements or confusion.

Hon. M. Polak: Perhaps this is helpful to the members. If you look at the regulations under the Greenhouse Gas Reduction Targets Act, it defines “carbon dioxide equivalent” in a very similar way.

It says that “carbon dioxide equivalent” means “the mass of carbon dioxide that would produce the same global warming impact as a given mass of another greenhouse gas, as determined using the 100-year time horizon global warming potential set out in column 4 of the Schedule.” Column 4 of the schedule is the regulations to which we are referring when we say “greenhouse gas, as determined in accordance with the regulations.” It is these regulations.

A. Weaver: My question, then, is: why wouldn’t you put that specifically in here? The definition, again, without a time frame, makes no sense. Global warming over what time frame? Is it a 20-year horizon? Is it a 100-year horizon? What is the horizon that the government is thinking of using here in this legislation — 20, 100, 50, 75? Five?

Clarity needs to be there — specifically, clarity with respect to what regulation is being referred to here, not some kind of arbitrary regulations so we have to hunt through decades of legislation to find one that actually defines it. It really should be crystal-clear here.
[ Page 5087 ]

Hon. M. Polak: As often happens in legislation, if you then…. Carbon dioxide equivalent. The definition here refers you to “greenhouse gas, as determined in accordance with the regulations.” If you go to the definition of “greenhouse gas,” it has the same meaning as the Greenhouse Gas Reduction Targets Act. It is those regulations to which we are referring, and those regulations contain the definition that I just read out.

[1445]

The Chair: The member has moved an amendment to section 1. Any further debate? Seeing no further debate, I will put the question.

Amendment negatived on the following division:

[1450-1455]

A. Weaver: Moving on to the definition of “compliance obligation,” which reads: “‘compliance obligation’ means the requirement imposed under section 6 (1) on regulated operations.” Under the definition of “compliance obligation,” as stated in section 6(1), could the minister please confirm that an operator could continue to meet the stated compliance obligation while also increasing overall magnitude of emissions from one year to the next?

Hon. M. Polak: If I understand the member’s question correctly, they have to achieve the benchmark on an annual basis. Perhaps that’s not what the member was getting at.

A. Weaver: Apologies. I probably wasn’t clear. What I’m trying to get at is that the compliance obligation is talking about emissions intensity. So the question I’m trying to get: is there a confirmation that you can meet your compliance obligation but still have your net overall emissions go up even though you’ve met your compliance obligation?

Hon. M. Polak: I think this is answering the question. The calculation of their emissions is based on their emissions net of offsets or funded units.

A. Weaver: Perhaps I’m not clear. I mean, there’s a compliance obligation. There’s the compliance obligation and…. We’ll come to that a little more in section 6(1).

[1500]

My concern here is that given that we actually have a climate action plan which was designed to reduce overall climate emissions, the question I’m wondering is…. If industries in meeting compliance obligations, in doing so, actually allowed their net greenhouse gas emissions — not emissions intensity; net overall greenhouse gas emissions — to go up from one year to the next…. Then how is this consistent? Or is the government concerned, in actual fact, that in meeting a compliance obligation, a company can still emit more and more each year, although do that more efficiently?

My question, then, coming back to the definition, is: why does this definition of compliance obligation not actually constrain compliance in terms of requiring overall emissions year over year to decline?

Hon. M. Polak: It’s because we were focused on the measurement of the amount of greenhouse gases produced in the generation per tonne of LNG so that it’s consistent across all sizes of facilities and gets at the heart of what emissions cost, if you will, per tonne of LNG produced.

[D. Horne in the chair.]

G. Holman: Just to follow up on the question, to be absolutely clear…. I’m clear what the member for Oak Bay–Gordon Head is asking, but I want to just put it in a different way.

You’ve just confirmed it, Minister, which is that the compliance obligation is defined as greenhouse gas emissions per tonne of output. What the member is trying to point out is that while an operator could conform to that per-tonne requirement, if output goes up, then greenhouse gas emissions in absolute terms will go up.
[ Page 5088 ]

In other words, it’s not a strict cap on emissions. It’s a cap in terms of per tonne of output. The member is simply trying to clarify that if output goes up, then so will greenhouse gas emissions. Could you confirm that?

Hon. M. Polak: There are a number of reasons why it was felt that this would be the most effective way to create an industry standard. One of those is the unintended consequences of placing a hard cap on the emissions themselves, the amount of emissions per facility.

[1505]

For example, that could then allow for a company to simply construct quite a large number of small facilities that, therefore, on an annual basis do not emit all that many GHGs. On a per-tonne basis, you don’t end up with that unintended consequence. We also believe that it gives an accurate representation of the emissions impact of the production of that LNG.

G. Holman: Thanks to the minister for the response.

The question isn’t to debate the merits of the approach. The question is simply to clarify that, in fact, if output of LNG goes up, then greenhouse gas emissions will also go up. We’re not debating…. That’s for later in the bill — to debate the merits of the approach. It’s simply yes or no. If output goes up, then greenhouse gas emissions will also go up.

Hon. M. Polak: That’s the nature of any industry. As industrial development expands, the GHG emissions expand.

However, I would draw to the member’s attention, though, the potential for a large number of smaller plants to meet a hard cap and yet, at the same time, have an even greater impact per tonne of LNG produced. So under the member’s scenario, if you increased production but it was based on increasing the number of smaller plants, you would increase the emissions the same way. Using this means of gauging the emissions and gauging the benchmark, using the intensity benchmark, we believe still gives, I think, the clearest picture of what the emissions impact of a tonne of LNG production would be.

It should be noted that although the intensity is what’s used as a benchmark, nevertheless, their emissions still have to be reported. It’s not as though that figure will be lost to us.

A. Weaver: I recognize that probably the last thing in the world the minister wanted to do on her birthday is discuss compliance reporting on this greenhouse gas act. But I do have some more questions here.

There are other ways that the government could have done this. In fact, they could have taken this definition and defined compliance obligations slightly differently. Why is it the government didn’t think about an overall cap of potential future emissions for the industry, let the market define what the price would be and then drive the cap down so that then you would actually have control over net emissions from the industry without prescribing which plant would emit what? There are ways of doing it.

The reality is the question has not been answered. The reality is it is not true to say that all industries that get bigger produce more greenhouse gases. You could have industries running purely on solar power, and they can triple in size — like the BMW carbon fibre plant using hydro power in Washington. You don’t necessarily increase greenhouse gases.

If we look in Canada — the Alberta oil sands, the fastest-growing sector of Canadian greenhouse gas emissions…. Sure, they’re reducing greenhouse gas intensity. But our emissions are skyrocketing because of it, and we are not meeting our international obligations because of it. Here in B.C. we’ve taken the model — the definition of compliance obligation coming straight out of Alberta and federal legislation, moving away from net emissions caps to emissions intensity caps.

The question, then, is: why is this definition not included in a framework of an overall cap in terms of emissions from the industry instead of an emissions intensity cap on a per-unit basis? There’s less certainty in terms of emissions. There’s less certainty in terms of a market for carbon.

[1510]

Frankly, there is no way in a million months of Sundays — or maybe two million months of Sundays or several blue moons — that we can make our emissions reduction targets in 2020 with this kind of definition and this legislation. To say otherwise is kidding ourselves.

Did the minister or did the government consider an overall cap on industry, to have that overall cap come down and let the market determine the price to have a permit to actually emit greenhouse gases, as the legislation that you’re repealing — and later we’ll discuss that — used to allow?

Hon. M. Polak: We were, of course, trying to balance certainty for the industry in terms of their costs of operation, while at the same time creating a framework that would encourage them to continue to innovate and continue to use technologies that then over time reduce their emissions.

That is why we have put this together with incentives that, we believe, have a sufficient impact on the bottom line of these industries that they will invest in getting below the intensity benchmark and thus over time reducing the emissions that they are generating and, as well, provide them with an opportunity to invest in the upstream and the rest of the life cycle of the product — again, such that technologies are used and that emissions are thus reduced in terms of their operations.

A. Weaver: Moving to the term “compliance period,” my question to the minister is: what period do they have in mind in terms of a length of time? Within, say,
[ Page 5089 ]
reporting it can be ten years in some instances; others have 20 years. Is there a fixed number that the minister is thinking of here? Or is this to be prescribed with regulation? Clarity would be helpful.

[1515]

Hon. M. Polak: We intend to move the regulations that currently exist under the cap-and-trade act, which would be annual. The only change that we have already outlined is the date of their verification deadline, and that was simply to conform to what works better for industry in terms of the date by which that deadline must be met. But the regulations would be the same as are currently used under the cap-and-trade act, which will now be repealed.

S. Chandra Herbert: A compliance period — I appreciate it’s looking at a year, over a year, as we’ve seen before. Maybe it’s a stretch, but I understood that in the tax act — I’m not asking about the tax act; I’m asking about this act, but they are intricately linked — there was a discussion about a potential increase in the tax by 2037. I’m curious. Under a compliance period are we potentially looking at a ratcheting down of emission levels with future dates?

Given what we know about climate change and our requirement as a province to have an 80 percent reduction in greenhouse gas emissions by 2050 — not just a legal requirement but, I argue, a moral requirement if we’re going to do our duty to our children and our children’s children and, indeed, the planet and everybody in the world who relies on the planet, which is of course all of us — we do need to see a plan to ratchet down emissions for all sectors, of course, not exclusive of LNG but all sectors inclusive of LNG.

In terms of compliance periods, is there a thought that as we go, there will be shifts in the amount of emissions through regulation per compliance period? How are we going to get to an 80 percent reduction of GHG emissions by 2050 if we are just to retain the same standard as is in this bill right now for compliance periods?

Hon. M. Polak: That is the importance of the incentive portion of this act. That is the tool that we believe has the greatest likelihood of causing greater investment into technologies that will reduce the emissions produced as a result of LNG production.

A. Weaver: With respect to the definition of “compliance unit,” it says it means “an offset unit, a funded unit, an earned credit or a recognized unit.”

My question to the minister is: are there any conditions when a unit could actually be one of multiple things at the same time? Or, specifically, can there be circumstances where the awarding of different credits might overlap — i.e., could an operator receive a funded unit and an offset unit for a single action? And if not, what is preventing them from doing that?

Hon. M. Polak: First, just to be clear, a funded unit is not what they get. They don’t receive it; they purchase it from us. But an offset has to be a unique emissions reduction. They can’t double-dip on it, if that’s what the member is asking.

[1520]

V. Huntington: I’m interested in pursuing the definition of “director” at this time. I notice that the director is mentioned right away — part 2, section 3. But at no point can I find out when this director is appointed, who this director is, other than from under the Public Service Act. I don’t know what the background is, whether he’s independent of government and industry, how that will be assured, who he’s reporting to, what relationship they will have with the public.

I’m wondering if perhaps the minister could explore with us a little more deeply who and what and how this director is and comes to be.

Hon. M. Polak: It’s a standard definition describing a statutory decision-maker. As I understand it, it is defined under the Public Service Act.

V. Huntington: Does that, too, then define what his or her relationship will be with the public? Are they accountable to the public? Are the reporting requirements that he’s in place to accept going to be made public? Who exactly is he accountable to, or is that also defined under the act?

Hon. M. Polak: There’s an old saying: I was going to write a shorter speech, but I didn’t have enough time.

There is a longer answer that could be given in terms of defining a statutory decision-maker. Pretty much all of our permitting-type ministries have statutory decision-maker roles. In this case, the director would be responsible for the types of things that are outlined, I believe, in section 10.

How they operate is quite distinct from, say, a politician’s decision. They are completely bound by their legislation. They are a public servant. They are an employee of government, but they are restricted to what a piece of legislation allows them to do or not do or on what basis they can make a decision.

[1525]

Trying to think what else I should describe. It is a standard role, if you will, in decision-making in ministries. It’s most often experienced in the permitting world, but there are others. There are occasions when ministers are statutory decision-makers. The difference, for example, for a minister…. When I’m making just a general public policy decision, I may have any conversations or engagement that I wish to have. A statutory decision-maker is limited legally as to what they may or may not consider when they are making a decision. That’s usually spelled out quite specifically.
[ Page 5090 ]

I apologize for the rambling nature of it. We were trying to find something more specific. But I think, in the interests of time…. We can certainly have a further conversation about statutory decision-making broadly in government, but that’s probably the best I can do at this stage.

V. Huntington: I thank the minister for that, but I am very familiar with the concept of statutory decision-maker and a director in the normal role. However, this director has duties which are very specialized in nature. He can accept an emissions offset project. He’s accepting reports on those projects. All through the legislation he has duties that are very specialized.

Is he going to be a director within an independent agency? Is he going to be a director within a ministry? What is his background? Is he going to be an accredited validator, and under what standards will he be accredited?

Hon. M. Polak: Yes, the director would be an employee of the Ministry of Environment. The director themselves may or may not be expert in the field, but as with other permitting-type decisions, the director would have that expertise in his or her employ. Then there are, of course, protocols and criteria prescribed in the act. In terms of validation for offsets, things like that, we’re using external accreditation and third-party accreditation for evaluation of offsets.

V. Huntington: Will the reports that this director is responsible for, the decisions that he’s responsible for, be made public? Is there a requirement on this director to be accountable in any way, shape or form to the public and their interest in the emissions issues?

Hon. M. Polak: Some portions are public. Some portions won’t be. That may be more easily discussed as we get to part 2 and talk about emissions reporting.

S. Chandra Herbert: Under the definition of “emission limit” — “in relation to a regulated operation, means the applicable emission limit under section 5” — I just want to be clear that an emission limit is not a cap on emissions. It’s an intensity limit. Is that correct? You could pollute a lot, and it could continue to rise, even though the intensity limit is in place. Is that a correct interpretation?

Hon. M. Polak: For LNG, as we’ve discussed, we chose an intensity benchmark.

S. Chandra Herbert: I would like to ask why the decision was made to set a target or a benchmark as opposed to a hard cap long term. Understanding the need to reduce our emissions by 80 percent by 2050 — that would seem to suggest, as former Minister of Environment Barry Penner quite strongly and passionately argued for, a hard cap on emissions, which would be lowered over time. Of course, in this bill we’ll come to that later. But what was the decision for doing a target as opposed to a hard cap?

[1530]

Hon. M. Polak: The question isn’t whether or not it’s a cap. The question is: what are you capping? What we’re capping is the amount emitted per tonne, which I’m not trying to argue is the same. So it’s not a target. They actually have to meet the benchmark. The benchmark is a measurement of intensity.

As discussed earlier, we were working to balance certainty across the industry — so a standard that could be applied across — and also at the same time recognizing that we needed to have incentives that would then drive the behaviours we wish to see, which are continued innovation and addition of technology that would ultimately result in the reduction of those emissions.

S. Chandra Herbert: Something the minister has said — I just wanted clarity. The minister suggested that the companies would need to meet the benchmark. But to be clear, they don’t need to meet the benchmark. They would just have to pay offsets or technology funds in order to get to the benchmark. They could be 0.28 but pay to get up to the 0.16. Is that correct?

Hon. M. Polak: This simply comes to whether or not one accepts the use of offsets in order to meet those benchmarks. We do accept the use of offsets. Internationally the use of offsets is accepted. There are those, though, who take the view that offsets are not sufficient and that, instead, one should simply have to meet that benchmark without the purchase of offsets. That’s fine. They’re welcome to that view. It’s not one that we share.

We also believe that the use of offsets can drive change in the upstream and along the life cycle of the production as well.

S. Chandra Herbert: Again, to be clear, though, there’s no requirement that they purchase offsets. They could also purchase technology fund credits. They could be at 0.28 and not be anywhere close to the benchmark. But just by technology fund units, which do not reduce climate change impacts, necessarily, given the experience in Alberta, depending, of course, on how the technology fund is created…. It’s not created yet, so I can’t say whether it will reduce climate change emissions or whether it won’t.

I know that the minister has said there still needs to be consultation done to decide what that looks like, but I just want to be absolutely clear that you don’t have to meet
[ Page 5091 ]
the benchmark. You have to pay to meet the benchmark, whether it’s through offsets or technology fund units.

Hon. M. Polak: Yes. There’s also the purchase of technology fund units. The idea there, as we described in the technical briefing, is that that technology fund is envisioned to be contributing to the kind of research and development into technologies that could assist.

I should also remind members that the industry will also be paying the carbon tax. It saves them significant money if they manage to improve their technology in these ways — far and away, or even apart from, what we’re talking about in terms of penalties, if they’re above a certain intensity of emissions or, indeed, savings, if they’re below. The carbon tax is already there, as well, as a cost for them if they do not improve their technology.

A. Weaver: In going through this legislation — with the beauty of word search tools we have nowadays — we notice that the words “emission intensity” do not appear anywhere. So my question is: in light of the fact that this legislation is really all about emissions intensity and not really about emissions, why did a definition not get included here as to what emissions intensity meant?

[1535]

Hon. M. Polak: This is where the act, of course, doesn’t just cover LNG, although that has become the focus of our conversation. The act covers industry broadly. In the schedule of regulated operations and emissions we’ve used the term “emission limit,” so this enables emissions limits. The limit we have chosen for LNG is the 0.16 tonnes per tonne. That’s why you don’t see “emissions intensity.” It’s meant to cover industry broadly with an intensity benchmark used as the limit for LNG, but it enables us to use other limits if we were dealing with other industry.

A. Weaver: I promised the member for Columbia River–Revelstoke that I would never be cynical in this place, but the cynic in me is suggesting that the word “intensity” was not included because this piece of legislation is all about emissions reductions when, in reality, we know this is all about emissions increase. It’s about emissions intensity reductions. We had, as legislation, the cap-and-trade legislation, which was about emissions reductions. That was there on the books as being repealed. We’ll discuss that later.

Again, I reiterate the question. Why, if this is all about…? The only changes that this legislation is bringing forward are changes to requirement with respect to emissions intensity reductions. I recognize there’s a schedule, but that can be changed just as a matter of cabinet decision; it’s not a matter of legislation. This is the legislation, and this legislation does not mention the word “intensity” anywhere, nor does it define it. It just pushes it off to a schedule, and that can change any time.

In fact, we could change, at the flip of a pen, the schedule so that we could actually allow coal-burned intensity now. We could just make coal burning now occur in British Columbia. It requires a definition here for certainty that this legislation is actually dealing with emissions intensity, not emissions.

So again, why is there no definition of emissions intensity, and why are the words “emissions intensity” excluded in the entire piece of legislation?

Hon. M. Polak: It’s as a result of a choice not to have stand-alone LNG legislation but instead to create legislation that would cover industry broadly, including LNG. Therefore, the definition used or the term used, “emission limit,” needs to be broad to enable us to deal with different sectors within industry.

S. Chandra Herbert: The definition of “facility” includes “all buildings, structures, stationary items and equipment that (i) are located or used primarily on a single site, contiguous sites or adjacent sites, (ii) are controlled and directed by the same person, and (iii) function as a single integrated site.”

Under that definition, an LNG facility which was an integrated company from wellhead to waterline, controlled by the same person, whether that be a corporate person or a single individual, from my reading of this would be a contiguous site or adjacent sites — a pipeline coming from the well, through the compressors through the processing plants — not necessarily in that order — all the way through to the LNG facility itself.

[1540]

What would stop that definition from being correct? I’m just wondering. Legally, they might not be an integrated company. I get that. But if they are an integrated company, as we know Petronas and a number of others are, how would that definition differentiate the meaning of “facility” — as they are contiguous, and they are controlled and directed by the same company, person, and in a sense, function as a single integrated site in that you need the gas from the well through to the waterline?

Hon. M. Polak: It’s because the transmission of natural gas through a pipeline is a different activity. The extraction of natural gas at a frack site is a different activity. Therefore, they are not functioning as a single integrated site. It’s the function that matters here, the activity that matters.

S. Chandra Herbert: Does facility also include off-site power operations for a site inside the fence or outside the fence?

[1545]

Hon. M. Polak: With respect to the electricity that they might generate, for example, off site, they’re responsible
[ Page 5092 ]
in terms of accounting for emissions for the electricity that they generate on or off site for the purposes of liquefaction — right? — for operating a plant.

For the sake of argument, if they constructed an LNG plant in Kitimat on Douglas Channel…. I’m not saying anybody’s planning to do this. I think it would probably be fairly uneconomical. But say they built a natural gas–fired power plant in downtown Vancouver and wanted to run a transmission line all the way up to Kitimat.

To the extent that they used that electricity for the purposes of the facility, they would have to account for those emissions — right? — but only the electricity that they used for that. If they generated more and sold it into the grid, they wouldn’t pay for that. Now, they have to account for the emissions, but that plant doesn’t become part of the facility by virtue of the fact that there’s a transmission line running to it.

A. Weaver: Would the same apply if the emissions factory was built in Langley? I’m just joking.

Seriously, can the minister verify whether or not an LNG barge — such as in Douglas Channel, where there’s an idea of this so-called Douglas Channel energy project — would be included in the definition of a “facility” — that is, an offshore LNG facility?

Hon. M. Polak: Yes, that would be included.

A. Weaver: Just a quick question on the term “foreign jurisdiction.” Could the minister clarify, please, if foreign jurisdiction means either a state, a province elsewhere, a country, a city, a town, a municipality? Is it broad to include any category of a foreign area, or is it specific to the size of a state, country or whatever?

Hon. M. Polak: It’s any of those — national, subnational, local government, what have you.

A. Weaver: I’m moving to the definition of the word “industrial operation,” which says means “one or more facilities, or a prescribed activity, to which greenhouse gas emissions are attributable.”

Is it not fair to expect government to have mapped out exactly what will be emitting-GHG facilities in an LNG facility? So the question is: is government going to be the one that’s determining what is or is not included in terms of the mapping of the emissions from an LNG facility?

Hon. M. Polak: Again, this refers back to regulations that exist under the cap-and-trade act. There are currently over 200 facilities that are already described, as they are in operation in B.C. They’re described under the reporting regulation in the cap-and-trade act. We would intend to move those over to this act and construct a description specific to LNG, as we have done for the other sectors.

[1550]

A. Weaver: I’m familiar with the term “facility” as applied to national reporting of greenhouse gas emissions. Can I assume, then, that the definition here of “facility” is similar to that, with the inclusion of LNG plants? Is that essentially where this is coming from?

Hon. M. Polak: The member is correct. It’s consistent, with the exception, I’m told, of a couple of instances where we’ve actually expanded that with respect to certain sectors.

A. Weaver: In reading the definition, I get troubled by the words “or a prescribed activity” without such a definition of what such a prescribed activity is. Could an industrial operation be prescribed as, say, a composting facility in someone’s backyard? I don’t know. Could the minister please provide some guidance as to what a prescribed activity is, or is there a definition of that in some other piece of legislation somewhere?

Hon. M. Polak: Probably the easiest example to give would be that of an electricity importer. They don’t have direct greenhouse gas emissions in British Columbia, but we assign those to them.

A. Weaver: Coming back to what I believe to be circular definitions, if we take the definition of “industrial operation,” it says it “means one or more facilities, or a prescribed activity, to which greenhouse gas emissions are attributable.” Now I go back and input what the word “attributable” is to be defined as, and this is how it reads: “‘industrial operation’ means one or more facilities, or a prescribed activity, to which greenhouse gas emissions are attributable” under the regulations to an industrial operation. It’s entirely circular.

I’m wondering if the minister might be able to provide some clarity on that, because, again, it’s difficult to really understand what’s going on here when you’re going around in circles with definitions.

Hon. M. Polak: I’ll have another go at it. I think where the confusion comes in is if you read it as “regulations to an industrial operation.” In other words, you’re attaching the word “regulations” to the industrial operation. We’re not referring to regulations as defined by industrial operation. It’s attributable under the regulations. They’re attributable to an industrial operation. The regulations there refer to the regulations that describe the six greenhouse gases.

A. Weaver: Moving to the definition of the term “inspector,” which “means a person, or a person in a class, designated under section 21.” This definition and the corresponding text it directs us to in section 21 provides
[ Page 5093 ]
very little clarification about the kinds of qualifications that will be needed in appointing an inspector or a class of inspectors. Can the minister please clarify what, if any, qualifications exist for such a person or persons?

Hon. M. Polak: The qualifications required would vary depending on the nature of the inspection that was involved. That’s why it is given to the director to designate a person or class of persons. You will find this left to the director in many other fields, especially given the nature of classes of certification that also can change over time and new areas of expertise that can emerge that didn’t exist in the past. That’s why that is enabled under the powers of the director.

[1555]

A. Weaver: I’m asking if the minister could provide me with a little bit of clarification as to what it means to appoint “a class of persons as inspectors.” I don’t understand what a “class of persons” is. If some clarity could be provided.

Hon. M. Polak: A couple of good examples would be the conservation officer service. They could be designated as inspectors of a certain type of activity. It could be natural resource officers. Those would be the best examples that come to mind.

A. Weaver: These inspectors — are they thought to be new positions? If so, is there training or a set of standards, which they’re going to be expected to uphold, to be put in place at some point?

Hon. M. Polak: It would depend on the nature of the inspection activity. For example, in other parts of the ministries that have responsibility on the ground, ourselves and Forests, Lands and Natural Resource Operations being the ones most active…. If there is something very specific for which there is no expertise represented on permanent staff, there are occasions when someone may be hired under contract, for example, for a specific purpose.

The same is true here. It could be a member of the conservation officer service in some cases. It could be a member of Natural Resource Operations. It could be a new permanent hire, or it could be a temporary hire under contract. There are any number of ways in which that could unfold. It all depends on the nature of the inspection activity.

A. Weaver: Under this act, the inspectors are given enormous powers, hence the questions leading up to this final one.

My question to the minister is: what are the checks and balances in place to ensure that (a) the inspectors have the appropriate power to enforce and comply; (b) there are sufficient numbers of them; and (c) they operate and are held accountable and properly execute their powers? Are these inspectors to be government employees, or are they to be third parties?

Hon. M. Polak: It’s impossible to say at this stage what that may mean in terms of, potentially, full-time-equivalent employees. If we look at other compliance areas of government, it typically means a director and their staff — however many would be appropriate. Obviously, that could range, depending on the amount of activity on the ground. It could range in the case of something unusual occurring in an industry where suddenly there is a need for increased presence.

I think of recent events in terms of what happened at Mount Polley. No one ever expected that, and, of course, it required the deployment of people from all around in different areas of expertise.

In terms of what ordinarily governs those activities, there is a range of different compliance acts that are present on the books and on statute, and those are what govern the activities of those who act in a compliance role within government.

[1600]

A. Weaver: Moving on to the term and the definition of the term “operator.” There it reads: “in relation to an industrial operation, means a person considered under the regulations to be the operator of the industrial operation.” Again, not very helpful in terms of a definition. It strikes me as being incredibly vague and leaving everything to definition in regulations.

I was wondering if the minister might be able to provide some clarification as to why the definition of what an “operator” is must be deferred to regulations, as opposed to being specifically outlined here in section 1 of the act.

Hon. M. Polak: There has to be someone, ultimately, in law that would be liable for any consequences of a non-compliance. There has to be somebody to be held accountable. The operator of a facility is, therefore, the one who would be accountable. Further on, it outlines what happens in the case of there being one or more, and how you define which one. For the purposes of the regulation, it simply refers to the fact that someone is going to get regulated, and the operator, in this case, is the person who will be accountable for complying with regulations.

A. Weaver: That was very helpful, and I appreciate the response there.

Moving on to “project proponent,” here I notice the words “prescribed criteria,” as in definition (a) — that is, a “‘project proponent’ means a person who (a) meets the prescribed criteria, if any.” My question to the minister is: what does “prescribed criteria” mean? What are they? Where are they? Where might we find them? When might we be able to have access to them?
[ Page 5094 ]

Hon. M. Polak: This, again, is a result of the fact that this act covers industry broadly. In some cases it might be appropriate for the project proponent to be a landowner. In some cases it might be another identifying feature. It depends on the offset that is being submitted. It could depend on the project itself. But it allows us to clearly define, again, who’s responsible in a given case.

A. Weaver: What are the prescribed criteria? I guess I’m missing something. What are they referring to — the prescribed criteria?

Hon. M. Polak: The member will note that in sub (a) to the definition it says “if any.” There may be many circumstances where there’s really no reason to have to prescribe who’s responsible. But in some cases there will be.

[1605]

It would be on a case-by-case basis for the purpose of accountability with any conditions that were placed on it. If someone came with a particular submission of an offset and it required us to place some restrictions or conditions, this would enable us to then define who’s responsible for that and how it is we identify them.

A. Weaver: We’re trying to unpack the logic here. Let’s suppose there are no prescribed criteria, if any applies. My question, then, is this. If an operator, as defined in the act, neglects to submit to the director, as defined in the act, a plan for an omission offset project, does that imply that the operator is not a project proponent? And if so, does that imply that this act would not apply to such operators?

The reason why I ask this is because it appears under section 8 of the legislation that an offset unit may only be credited.

The Chair: If the member could repeat.

A. Weaver: Sorry, I’ll repeat the whole question.

Interjection.

A. Weaver: The last bit? I ask this because it appears that under section 8 of the legislation, an offset unit may only be credited.

Hon. M. Polak: We may be talking at cross-purposes here. I’ll see if we can sort that out. The operator is the operator of a facility. The project proponent is the proponent of an offset project. Then, when you get to section 8, the director would determine the credit, etc. They direct that. But the operator is not….

I know we typically use “proponent” to describe somebody who’s bringing forward an industrial project of some kind, but in this case “project proponent” is the offset project. The operator is responsible for the operations of the plant. They could purchase an offset, but it is the director who then would decide whether something is credited, etc.

A. Weaver: That was very helpful. Again, with respect to the definition of “project report,” this infamous word “prescribed” is in there. I was wondering if the minister could please provide some clarification as to what this means: “…that meets the prescribed requirements.” What are they? Where are they? When will we see them? Where are they coming from? How will we know what’s gone into the creation of them?

Hon. M. Polak: The director would determine what those prescribed requirements might be, in the same way that the director of the environmental assessment office can prescribe conditions in an environmental assessment certificate, for example.

S. Chandra Herbert: A “‘recognized unit’ means a unit of another jurisdiction that under the regulations is, or is deemed to be, the equivalent of an offset unit for the purpose of meeting compliance obligations.” There’s a lot packed into that definition. A unit of another jurisdiction that under the regulations…. Just so I can understand this, is this suggesting that if another jurisdiction, another place in the world, as we discussed earlier, has a…?

[1610]

Is it an offset that could be purchased to meet compliance obligations? Is this suggesting that at some point, again, if an LNG operation wanted to purchase offsets in California or anywhere, any other place in the world, as long as the B.C. offsetting non-profit organization agreed that that was a legitimate offset, that would be a recognized unit? Is that what this is trying to get at?

Hon. M. Polak: This relates back to the discussion we had earlier that our intent, at this stage, is simply to allow for what may be a future in which it makes sense to have more broad participation around the world. We can’t imagine what’s going to happen 25 years from now, but that is our intent right now, though. Staff have been directed to develop regulations that require the purchase of B.C. offsets.

S. Chandra Herbert: Are there other jurisdictions currently that staff have looked at which have similar offset schemes or similar offset requirements which might qualify them under B.C. law?

I do understand that under another set of law we cannot count reductions in emissions elsewhere towards our own B.C. climate change reduction goals and legal requirements but that that might still be credible under the offset scheme to bring a company into compliance with the benchmark. That’s not what I’m asking. Just specifically, are there other jurisdictions that might be considered in this?
[ Page 5095 ]

Hon. M. Polak: We haven’t considered that at this time. It is not something that we intend to act upon in the short term or even the near term. It’s not something that we’ve evaluated at this time.

Might I ask, Mr. Chair, with the agreement of the House, that we have a short recess?

The Chair: This committee will recess for five minutes.

The committee recessed from 4:12 p.m. to 4:19 p.m.

[D. Horne in the chair.]

The Chair: Shall we pass section 1?

S. Chandra Herbert: I don’t think we should pass section 1 right now. I’m standing to make sure…. My colleague had more questions on "recognized units."

[1620]

A. Weaver: I have a number of questions on the term “recognized unit.” The first one is: under this definition, would it be theoretically possible for regulations to designate — suppose in another jurisdiction; let’s say some country or some state somewhere — half a tonne of emissions reduction. Because there is a regulation put in place, that could be credited, because of different accounting standards, as one tonne of emissions reduction in British Columbia.

What’s there to stop different accounting mechanisms in different countries and regulations being put in place here in B.C. from actually just kind of artificially inflating the value of offsets produced outside of our province?

Hon. M. Polak: Actually, the situation that the member describes is the reason behind including a requirement that we not simply accept on face value the determination of another jurisdiction. In fact, we have to recognize that those units are valid, and that would put you back to the criteria and the validation process that we use.

This enables us to apply our validation process rather than allowing a company to come to us and say: “Hey, look at this, such-and-such country says that my units should be valid.” We say: “Well, no, they have to be a recognized unit under our definition.” That gives us the power to put them through our lens in respect of validation.

However, as I said before, all of that is not something that we feel is appropriate at this particular time and place. It would be something for the future.

A. Weaver: I have an overarching concern over this. My understanding is that when you start to talk about foreign jurisdictions, it starts to get very fuzzy in terms of accounting and rules and who’s reporting what and is there trust, etc.

My question is: does the minister feel that in fact this undermines some of the recognition of these foreign entities as being able to create these recognized units? Is it somehow undermining the desire to create offset projects in British Columbia to ensure that those products actually stay within the province so that our provincial dollars stay within the province and aren’t exported to foreign jurisdiction to buy, in some cases, hot air?

[1625]

Hon. M. Polak: Of course, the concerns that the member outlined and the variable nature of the consistency and accuracy of the guidelines and approach in other jurisdictions is precisely why we don’t contemplate entering into this kind of arrangement, in respect of right now. It may be, in time, that things evolve to a different place. Therefore, we would be enabled at that time to develop regulations around it. But it’s not something that we feel is appropriate at this time, for precisely those reasons.

S. Chandra Herbert: I’m just curious what the thinking is about why we would potentially allow the purchasing of offsets outside of B.C. The reason I ask that question is that if we are going to meet our climate change reduction requirements, our legal and moral requirements as a province and jurisdiction, we will not be able to count emission offsets outside of British Columbia under international treaty obligations.

Why would we consider allowing this if, potentially, down the road, should somebody decide to create regulations that created this…? Maybe this government. Maybe there’s a new minister who thinks this is a great way, and you can buy them cheaper elsewhere, so why buy them in B.C.? What’s the thinking behind that, given that it wouldn’t help us meet our requirements under our treaty and legal obligations?

Hon. M. Polak: One of the situations that is potentially applicable would be if down the road we entered into some kind of a cooperative agreement with a jurisdiction. Cooperative is maybe the wrong word, but some kind of an agreement — for example, through WCI or something like that. We would want to be able to require that we had the ability to determine whether or not a unit was recognized by us and therefore would want to further define it in regulation.

Perhaps that helps. It isn’t always about whether or not you would allow a company to purchase elsewhere. It could be that you enter into an agreement with a few other jurisdictions around you and, again, need the ability to designate what a recognized unit would be for the purposes of that type of an agreement. It’s a challenge, as I’m sure the member appreciates, to try and create a hypothetical, but that’s maybe the best example.

[1630]

A. Weaver: With respect to this recognized unit. As I mentioned earlier, there are clear international stan-
[ Page 5096 ]
dards that govern how emissions offset units are calculated and governed, etc., through the ISO. I won’t repeat all the ISO standards.

I’m wondering why in this bill none of this has been brought forward into the actual act in the definition. It’s all left to regulations. Again, why are we not actually specifying the protocols, the standards that we’re going to use, in the actual act as opposed to leaving it up to the whim of some regulation down the road?

[M. Dalton in the chair.]

Hon. M. Polak: Take a gander at section 44, where it talks a bit about agreements and the potential for that kind of interaction with other jurisdictions that I spoke about earlier. You then would be in a case where perhaps two or three jurisdictions may join together, may wish to create some guidance as to mutually recognized guidelines. It could be that ten years from now the names of organizations that are providing the same guidance that the member references now under ISO…. It could change. That’s the reason why those would be determined in regulation and are only empowered or enabled by the act.

It’s to allow for what we’ve seen in the past, which of course is change and evolution throughout the sector. Anticipating that that could well be the case, one tries to construct legislation that will stand the test of time. That would be the reason why we wouldn’t include the specifics in the legislation itself but instead have created powers to create regulation under those types of circumstances.

A. Weaver: I will not move the amendment that I gave on notice in light of the answer I received from the minister.

With that said, though, it’s a bit of the Wild West out there in terms of everybody coming up there with their own standards. There are internationally recognized standards there. The United Nations framework convention on climate change has very clear mechanisms in terms of reporting, in terms of what falls under the joint implementation mechanism, the clean development mechanism, etc. There are very clear ISO standards. There are others. I recognize this.

My worry, by the fact that this is not being prescribed here, is that we’ll just create another bunch. We’ll just be the Wild West out here with our standards that’ll be different from the east which will be different from Europe which will be different from…. I was hoping to see some clarity in the legislation.

I accept the minister’s response that the intention is not to limit right now but perhaps revisit this down the road through regulation.

In terms of then moving on, the next definition is “registry.” Now, here I’m wondering…. It’s leaving it very unclear to me. Is the registry that the government is thinking about WCI Inc., which presently holds the registry for the now quasi-defunct Western Climate Initiative? Or are they thinking of the creation of another registry in association with this new organization of Pacific climate partners? Or is it a registry like the voluntary carbon standards?

[1635]

What does the government mean by “registry” here? Where would it be? Who’s got the oversight? Is it international, independent, arm’s-length? It is government? Is it ministerial? Is it national? Some guidance, please, on what they mean by registry?

Hon. M. Polak: At this stage it’s difficult to tell which will be the best means by which we work with the registry, whether that will be one within government or one through WCI. It has been less active than originally envisioned. However, I can say that a recent visit that I had from the Minister of Environment from Quebec tells me there’s still interest and still interest in seeing what we can make out of it.

Because we don’t know what will unfold and what will prove to be the best type of registry to have, we have enabled either the construction of a registry within government or the use of a registry outside. We’ve also, though, because of the concerns…. We share the concerns that the member raises. That’s why, within the act, what we do is prescribe what a registry like that would have to have in place.

A. Weaver: My question then is: in light of the fact that there has not been a formal decision made as to the type of registry, does this actually serve the purpose of what this act is trying to do — to give the LNG industry certainty as to where we’re heading? It strikes me that this is uncertainty, and this is not what the LNG industry that the British Columbia government is trying to attract will actually want to see.

They don’t know where it’s going to be registered, and it really matters where it’s registered. They don’t know if it’s going to be in the U.S., in Canada. They don’t know who’s going to be in charge. They don’t know who the board is.

The question back to the minister is: does the minister believe this definition is tight enough to give the LNG industry that the government is trying to attract to British Columbia the certainty that they need to feel comfortable in actually investing in British Columbia?

Hon. M. Polak: Where the registry resides won’t have any impact on the benchmark, on their compliance. It shouldn’t have any impact on the industry itself. Instead, that’s a matter for ensuring that we are able to accurately track and validate what is being presented as an offset. But it shouldn’t have any impact at all on the industry’s compliance or the benchmark.

A. Weaver: I guess my concern is that industry likes to know what the rules of the game are. These definitions that we’ve been discussing here today have been, in many
[ Page 5097 ]
cases, somewhat vague, suggesting to me that the government put this bill together rather rapidly, did the best they can in the short time period they have and left many of these definitions to regulation to be determined at a later date. Now, in my mind that does not give the industry the certainty that they want.

For example, we go on to the next definition, “registry administrator,” which means “the person responsible for administering the registry in accordance with this Act and the regulations, and if applicable, an administration agreement.”

[1640]

Does this mean, for example, that the person who’s the registry administrator…? Could that be a board like, for example, in WCI Inc., where the board is made up of British Columbia, California and Quebec, I think — they are the administrators? Is it a person? Who is the registry administrator as defined in the act here? I am very uncertain as to that. Could the minister provide some clarification?

Hon. M. Polak: That’s why, under the act, one would have to enter into an agreement in order to do that — say, through WCI. That’s why we have a prescription around the registry itself and what it would entail, because it does need to provide credibility, validity of offsets, etc.

Again, though, with respect to industry, the certainty comes in with respect to cost of compliance. They know where the benchmark is. They know what price they’re going to pay into the technology fund. Over to them to determine what they’re going to pay in terms of offsets versus technology fund.

The location of the registry, be it inside or outside of government, is…. The operations of it would be limited to that which we would put into an agreement, and that’s described in the act, and also the operation of the registry and criteria for that, which is also prescribed in the act.

A. Weaver: I don’t mean to belabour this point. But again, I would argue that it does matter where the registry is located, who is actually administering it. The reason is that different registries have different criteria for what they consider to be something registered under them.

If, for example, the registry is a B.C.-owned entity, then we would have control over what is available there. If it’s not, we may not have control and we may not know what, for example, is considered an offset. Is the Darkwoods project considered an offset in B.C.? It may be that one wouldn’t stand up to the standards of another jurisdiction where the registry might be. Is planting trees in Botswana considered an offset? It may be, but it depends on which registry or what protocol you’re using.

Again, I really am troubled by the fact that there is a lack of certainty in this legislation with respect to the whole offsetting process, and I fear that that actually will undermine industry attempts to seek the certainty they want as to what the regulatory regime will be in British Columbia with respect to what is or is not considered an offset, in light of some of the problems that we saw that arose with the Pacific Carbon Trust.

So will the government have direct oversight into the registry or the registry administrator, yes or no?

Hon. M. Polak: Here’s how this would work, and I’m referring to section 16. The registry provides a number under which that offset would be registered. It doesn’t interfere with our ability as government to control what we consider to be a valid offset. That would still remain entirely under our control. They would have to have that in order to get a number for their offset, or identifier for their offset, from the registry.

A. Weaver: Can the minister please help me with a brief discussion with respect to the definition of “regulated operation,” what the difference is between a regulated operation and a reporting operation?

[1645]

Hon. M. Polak: If you are a regulated operation, then you are captured in the schedule of regulated operations and emissions limits. If you are a reporting operation, it means that you are over the reporting threshold. So it’s different criteria.

A. Weaver: Does that mean one is a subset of another? Does that mean that, typically, you might find that a regulated operation is also a reporting operation?

Hon. M. Polak: Not subsets. You could be either, or you could be both.

A. Weaver: I’m really confused by this definition. I would honestly say that it doesn’t make any sense. I’ll read it to you: “‘reporting operation’ means an industrial operation that is prescribed as a reporting operation.”

Can the minister please describe to me what it means when you define “reporting operation” as something that’s prescribed as reporting operation?

Hon. M. Polak: I’ll have a go at this one as well.

You could be a regulated operation, but if you don’t reach the reporting threshold, you’re not a reporting operation. By the same token, you could be above the reporting threshold, but you might not be a regulated operation under the schedule.

A. Weaver: I do greatly appreciate the minister’s attempt to describe that. But again, coming back to this, it says “reporting operation” basically means you’re prescribed as a reporting operation. Where is that prescribed? Who determines that? How is this even a definition, when you say “reporting operation” means an industrial operation that’s prescribed as a reporting operation?
[ Page 5098 ]

It’s a circular definition. If I were to read this to you, I would say it means an industrial operation that is prescribed as an industrial operation that is prescribed as an industrial operation that is prescribed as an industrial operation that is prescribed as an industrial operation. And I would do that in perpetuity because the definition is entirely circular. It defines itself as itself.

Can the minister please help me try to understand this and give me an example where this prescription is occurring?

Hon. M. Polak: When it talks about “that is prescribed as a reporting operation,” there isn’t a list. Instead, there’s a threshold. If you meet that threshold, then you are required to report. We prescribe what the threshold is.

A. Weaver: What prescribed criteria are anticipated for a reporting operation?

Hon. M. Polak: We’ll be continuing with the existing criteria in the reporting regulation currently in the cap-and-trade act. That threshold begins at 10,000 tonnes.

A. Weaver: In terms of the reporting period, I was wondering if the minister could please provide some clarification as to how long a reporting period would be.

Hon. M. Polak: That’s one calendar year.

A. Weaver: In the following definition of “retire,” which means…. There are two — (a) and (b). In section (b) of the definition, the retirement of the unit is left entirely up to regulation, as is the definition for “recognized unit,” as I described earlier, which would be retired. How would the retirement of a recognized unit from another jurisdiction differ from the retirement of an offset-funded or earned unit?

[1650]

Hon. M. Polak: It might not differ, if one considers some of the hypotheticals we were exploring. If you entered into an agreement with another jurisdiction around some kind of equivalency or mutual recognition, you might arrive at a place where you have the same process and you have the same understanding. It may not differ.

A. Weaver: On the other hand, it may differ. Could the minister possibly provide some examples of how this might be dealt with?

Hon. M. Polak: In a case where there were different requirements, for example, this would enable us to make regulations that would apply and exert our authority over whether or not it actually had been retired.

Perhaps in the case of another jurisdiction and an agreement we entered into, it may be that they’ve maintained their own criteria for retirement. We may have additional requirements, maybe additional information, additional evidence, that something has been retired. This enables us to create that regulation.

S. Chandra Herbert: Regarding “retire,” “retirement account,” it’s interesting to think of an emission or an offset being retired. Of course, we know that emissions up to the atmosphere have different lengths until they are retired — unfortunately, many of them hundreds of years or many, many years.

That’s why the need to reduce emissions now is so important, as we’re still having to deal with the emissions from generations ago, in effect, that are not yet retired. They’re still up there harming us to this day and making it more challenging and more important for us to act.

In terms of retirement, I’m curious. If we learned that, let’s say, the impact of methane was actually a lot greater in terms of climate change, as we’ve been finding out recently, what does that do in terms of emissions? How does that change the calculation in terms of a retirement account or really, I guess, in regards to the whole legislation? If a company thinks that it’s doing well because it’s only producing X units of carbon emissions, carbon pollution, when the reality is we find out that it’s actually much greater, how do you deal with that circumstance?

Hon. M. Polak: The international convention is to make the change going forward, not retroactively. It has happened already with respect to calculations around the impact of forestry, for example, and how that’s calculated. It’s not new. It does change, and it is updated. But the international convention is that you do that. You calculate that on a go-forward basis, not retroactively.

S. Chandra Herbert: We get to the reference to “technology fund,” defined as “a non-profit corporation that (a) is outside the government reporting entity,” and of course, it goes on. We’ll go through that bit by bit because there isn’t a lot in the legislation that really speaks to the technology fund.

[1655]

I know a lot of it, the minister has argued, will be left for the future, through consultation, through discussion. Of course, payments would only be made into the technology fund after the first full year of operation of an LNG facility, as I understand it.

If the minister is able to explain the thinking behind the technology fund…. Alberta’s technology fund seems to have not succeeded in reducing emissions. Emissions continue to skyrocket in that province. Indeed, many of the technologies they’ve invested in have a very far-off horizon in terms of them ever becoming commercially viable.

Many have made the case that you need to invest in technology that has a shorter turnaround time for cli-
[ Page 5099 ]
mate change emission reduction, given that we need to be drastically reducing our emissions now, rather than pushing them off down the road, and that in B.C. our legal and moral requirement, I believe, is to reduce our emissions by 80 percent by 2050.

If the minister could share a bit of her thinking around the technology fund, that would be helpful.

Hon. M. Polak: The aim of the fund is to achieve longer-term emissions reductions through research and development of technologies. To be clear, what happens in terms of the operation is that the companies would not pay to the fund. The companies pay to government, and then government puts the dollars into the fund.

S. Chandra Herbert: And for what reason has the government decided to make this a non-profit corporation? What was the thinking in terms of establishing it in that form?

Hon. M. Polak: Perhaps the best example to point to is the Sustainable Development Technology Canada operations. We had them with us at a round-table discussion at GLOBE. Certainly, the work that they’ve undertaken is quite impressive, and we believe that this type of model can serve us well in the same regard.

S. Chandra Herbert: Is there a reason why there was a decision to make it a corporation as opposed to a society?

Hon. M. Polak: The requirements on a corporation for both public reporting and reporting to government are far more rigorous than for a society.

S. Chandra Herbert: So does that mean that this non-profit corporation will be able to be audited by the Auditor General of British Columbia?

[1700-1705]

Hon. M. Polak: Sorry to take so long. We were hoping to be able to get some firm confirmation specific to this. What I will say to you is this: we believe, based on the wording of the Auditor General Act, that it would fall under his jurisdiction, being as he can audit when there has been a grant or a transfer under agreement. We believe it would fall under his jurisdiction, but we’ll commit to come back with confirmation on that.

S. Chandra Herbert: I appreciate the answer. I didn’t think I could stump the minister. Hopefully she is correct, as I think the Auditor General should be able to, of course, audit the funds. They are, in a sense, public, in the sense that we’ve made a requirement that they be brought into government and then distributed back to the technology corporation.

Of course, Pacific Carbon Trust was audited. In the end, recommendations were made, and it was eventually folded into government. I think it was important that it was able to be audited, as we learned many things at the time about the challenge offsets can pose.

If the minister, of course, learns that it is not under the Auditor General Act, would she be able to make a commitment that there would be an amendment to this legislation to ensure that it did fall under the Auditor General Act?

Hon. M. Polak: I’m not prepared to engage in that speculation at this point, but we will get back with a confirmation as to whether or not he has that jurisdiction, or would.

S. Chandra Herbert: I don’t want to belabour the point, and I do want to be respectful of the minister, but I find it surprising that the minister is not aware if the technology fund — which could potentially, if you look to Alberta or other jurisdictions, have a lot of money in it — is or is not auditable under the Auditor General Act.

I’m also more surprised that the minister will not stand in the House and commit to ensuring that it is auditable under the Auditor General Act. It seems to me a pretty simple thing. We need to protect the dollars. We need to protect good policy and good practice if we’re going to see technology be brought in that actually does make an impact on climate change and that that money is used wisely. There’s only so much money.

[1710]

If we have had legislation brought in to audit municipal governments, if we’ve had auditors help us save money — which, indeed, we have over many years in this House — I would like to know why the minister will not make a commitment that this technology fund will be under the Auditor General’s purview. I don’t understand why that commitment is not possible. If she thinks that it is but is not entirely sure, why wouldn’t she commit to ensuring it is if it’s not?

Hon. M. Polak: I’m only suggesting that we cross that bridge when we come to it. We’ll have confirmation by the time we come back to this House to continue on, and at that stage we can debate the merits of the position of the Auditor General vis-à-vis the technology fund. I would just think we’d wait till we have the answer for certain.

S. Chandra Herbert: Yes, as the minister rightly points out, we will not be completing the bill tonight. There are more questions, I’m sure.

Interjections.

S. Chandra Herbert: Oh, I know the members are disappointed. They wish that we could move on. But alas, it
[ Page 5100 ]
is our job here to be members of this Legislature, ask the tough questions and ensure we get the correct answers. I’m quite happy to do that job, and it would be great if others did that as well in their collective roles in their own caucus too.

If I’ve got that correct, we would have a notice to myself, and I know other members would be interested. If the minister tomorrow or the next day can let me know before we get back into debating this, I’d appreciate it. Monday would be great, when we come back here. Friday — it’s okay. It’s Halloween. I can understand that folks’ minds may be somewhere else, but that would be great — to know that by Monday. The minister has been helpful in the past in ensuring I get the information I need. I appreciate that.

Will this non-profit corporation fall under freedom of information?

Hon. M. Polak: I think I know the answer, but I don’t want to put on Hansard something that I just think I know. We’ll commit that on the matter of FOI and the matter of the Auditor General we will have confirmation of those things when we return to this debate.

I appreciate the member offering for us to simply provide a note to him. But I think, given the discussion, it’s probably important to have it on Hansard. So we’ll commit to nailing that down and bringing that back for you. I apologize. We don’t have that information.

S. Chandra Herbert: Yes, free the information, let it go free, and let the sun shine in. I think that’s a good policy. I think the minister is correct that it should, of course, be shared here. If I received the note, you can bet I would be happy to share it here.

I see the Minister of Education doing a dance and singing a song. He’s welcome to get up. It would certainly enliven the place at this late hour. Maybe he’s preparing for this weekend.

Anyways, I wonder. It discusses under “technology fund” that it should have “a board of directors that includes persons with expertise in clean technologies or the commercialization of new products, processes, services or technologies.”

[1715]

Given that the technology fund is supposed to be focused on new technology or improving technology to address climate change, is there any thought that there should be members of the board of directors who have knowledge of climate change and of technologies that specifically focus on climate change?

I ask that because “clean technologies” is a phrase that is kind of like “green” or “sustainable.” It’s something that people can start to apply to many things. “Organic” was certainly something that had been applied to many things before it had a real definition, although within B.C. we still have a challenge with our organic products in that regard.

I’m just curious. Will we have experts in climate change — not just clean water or clean air — on this? Is that what the minister is thinking for this board of directors?

Hon. M. Polak: Wow, I’ve got to watch I don’t stand up halfway and change my mind.

It’s not our intent to be that specific with respect to very scientific expertise. It may be, and I think it’s likely, that you’ll find some crossover with respect to people who are experts in clean technology and also are knowledgable with respect to climate change. But that certainly would be what we are looking for.

S. Chandra Herbert: Is it my understanding that this board of directors would be appointed by the government of British Columbia, by the minister?

Hon. M. Polak: At this stage it could be that they are appointed by government. We could decide that there’s maybe a representative or two appointed by government and then there are representatives appointed by others. That hasn’t been determined yet.

S. Chandra Herbert: Under (c) it discusses publishing “an annual report that includes financial statements and any prescribed information.” It may be that that prescribed information hasn’t even been thought of yet, but I’m wondering if the minister would consider also putting in information about how many carbon units, how much success, the technology fund has had in fighting climate change.

It’s possible you could have a technology fund that invested in technology, none of which really made much difference aside from making a profit for somebody who was pitching it. Of course, that wouldn’t be the intent, but unless you have a firm set of principles, what you think technology funds should do, and you actually record and have them report on it, on their success towards that goal, there’s no guarantee you’ll get anywhere close to that goal.

[1720]

Of course, technology, like science, is something that you cannot always guarantee will come out, but certainly, I think there needs to be more rigour than just a focus on the dollars and cents when what this is supposed to be doing is driving down climate change.

Hon. M. Polak: It’s actually fairly standard language with respect to the construction of boards. You want to specifically require them to have the financial information, and then for each organization, the requirements for inclusion in an annual report would be different. What we would want the technology fund to report to us is going to be different than an organization that deals with children and their well-being.

This is strictly enabling and ensures that government has the authority to be able to require elements of an annual report. That hasn’t been developed yet.
[ Page 5101 ]

S. Chandra Herbert: The challenge with some of these organizations can be — and I hope that this isn’t the case with this one, if it’s designed well; of course, much more is to be done in the days and months and years ahead — that you could have a situation where the technology fund could be captured, so to speak, by a certain set of interests.

Maybe they’re industrial interests that have decided that they think they should get the benefit of the dollars to put towards their own set of pet projects and, as they are the majority on the board, structure things in such a way to ensure that they get what they want. That may be good for them and their shareholders but may not get the benefit you want in terms of real technological advances that limit, or actually, in the best case — in the case that we should be focused on — reduce climate change emissions.

What sort of protections is the minister looking to build to ensure that we are getting the best for British Columbians and not just for a private set of self-interests?

Hon. M. Polak: That’s where we get to sub (d), where they have to have “an objective, fair and rigorous process, independent of government, the applicant and the technology fund, for reviewing funding applications.” Also, (e) is important: “is focused on accelerated market adoption of innovative clean technologies that result in lower greenhouse gas emissions.”

I meant to point that out after the other question. But yeah, there’s a requirement here that those be independent of government and independent of the applicant.

S. Chandra Herbert: Would I be correct in expecting the same answer that I’ve had around the Freedom of Information Act and the Auditor General Act in asking: will this non-profit corporation will fall under the conflict-of-interest act and the purview of the Conflict of Interest Commissioner?

Hon. M. Polak: First, it’s important to note that it’s not organizations that are placed under the conflict-of-interest act. It would be individuals. Most often, individual organizations, just as government does, have their own conflict-of-interest policy, guidelines, etc., and this organization would need to have that as well.

[1725]

S. Chandra Herbert: Under sub (d) it discusses that the technology fund must be “considered by the minister to have an objective, fair and rigorous process, independent of government, the applicant and the technology fund, for reviewing funding applications.”

The reason I raise the question of conflict of interest is: is it up to the minister to decide, in a sense, if they’re under conflict? Sometimes boards’ processes are less rigorous than others. Sometimes you could have a situation where a staff member may be a relative or a good personal friend of somebody who has made an application of that group.

I just want to know: is that then up to the minister to have to deal with a complaint, should the board not appropriately deal with it or should their process not be rigorous and independent and not be in conflict? Or would it be better if the Conflict of Interest Commissioner had the ability to also take complaints from a staff member or applicant or something like that, should there be a potential conflict?

What’s the process to ensure that there isn’t a conflict of interest in a situation with large amounts of dollars and potential subsidies to private corporations to produce technology?

Hon. M. Polak: With the presence of sub (d) in the act, the minister isn’t given a wide latitude of discretion. It places a requirement on the minister to ensure that this is the case, in terms of the independence, etc., and the rigorous nature of the process.

I’m missing a second part of your question. Sorry. It’s late in the day.

S. Chandra Herbert: The second part was: would the minister consider, or is it just not normally done, having the Conflict of Interest Commissioner be the one that that kind of complaint would go to? Or, in fact, is that separate, and instead a complaint would go to the minister or whatever kind of process that the minister set up?

Hon. M. Polak: Of course, all of this will be developed. I’m going to put my amateur lawyer hat on, which is dangerous to do. Most often with outside organizations, it would be the organization that would then develop its own conflict-of-interest guidelines. Most often organizations get legal advice when they do that. Of course, the concept of conflict of interest doesn’t just exist within that organization. It exists broadly as a legal principle.

I hope that answers the member’s question.

S. Chandra Herbert: Given that sub (d) focuses on the minister having that very, very important role to play, is the thinking that the minister would have to approve such a set of guidelines, such a process, given that it’s the minister’s job that it be an objective, fair and rigorous process?

Hon. M. Polak: Yes, because I am told to consider that, or that it is considered by the minister. It would mean that I would need to review that and be satisfied that they had met that criteria.

S. Chandra Herbert: Sub (f) talks about meeting prescribed criteria. Given that a lot of this…. Part of the challenge that I have as a critic is that so much of this is
[ Page 5102 ]
still to be discussed, decided and developed. I wonder if the minister might be able to share what the plan is to develop this technology fund, what the plan is for public engagement and cooperation to ensure we get the best technology fund possible that really does fulfil the broad goals as outlined in the definition of technology fund.

Hon. M. Polak: Sub (f) is enabling and provides us with the authority to create additional criteria that don’t currently exist there.

[1730]

For example, if it turned out that the minister wished to, in fact, place the organization under the auspices of the Conflict of Interest Commissioner, the minister could create such a requirement.

As we develop the technology fund, as we engage in consultation around it, it’s entirely possible that we may have suggested to us further criteria that we should place on the fund, and this would allow us to do that.

S. Chandra Herbert: At this time, though, the actual timeline, the plan to develop that prescribed criteria, to do the consultation is as yet unformed. Is that correct? Or are there plans? So that we get a sense of when these prescribed criteria might be developed and how people might be able to participate in ensuring that it is a relevant and a successful organization.

Hon. M. Polak: Sub (f) doesn’t require us to construct additional prescribed criteria. It simply enables us to if, in fact, there are suggestions that we wish to adopt. But there’s no requirement that we add any more criteria.

S. Chandra Herbert: Yes, I understand that. I think my question was: what is the plan to actually create the technology fund? Is there a consultation process in the works? The minister spoke of the potential of consulting people who might give ideas which might end up in the prescribed criteria. My question is: what is the plan to do that?

Hon. M. Polak: I suppose the timeline depends on how successful our minister is in seeing that companies get to final investment decision. There are no plans as yet outlined, but if we see the act pass through the Legislature, then we would be constructing a process based on the requirement to have the technology fund in place within or before the end of the first year of operations of the first plant.

A. Weaver: I have a number of questions. My colleague from Vancouver–West End did an admirable job addressing most of what I was going to ask.

I would like to ask the minister: with respect to this definition of “technology fund,” when it says it means “a not-for-profit corporation,” is it required to have a presence in British Columbia or to be registered in British Columbia? Or could that corporation be something like a tech fund in Alberta or a tech fund handled by Canada or a tech fund in some other, foreign, jurisdiction?

Hon. M. Polak: That’s not prescribed, but it’s certainly our intent that it would be in British Columbia.

A. Weaver: Why would the minister not want to prescribe that? Again, there’s concern that this would be money leaving the British Columbia economy and perhaps going to a foreign entity when there is no prescription that a technology fund should actually be here in British Columbia.

[1735]

Hon. M. Polak: Again, getting to speculation about the future…. But if we entered into some kind of an arrangement through WCI, for example, with Quebec and California, it may be that at a certain point it becomes advantageous — for British Columbia, for climate change, for the advancement of technology — to have a fund for the three of us. If it was Quebec and California and B.C….

There are no discussions underway. Just for the sake of argument, it may be, at that point, advantageous to be able to have a fund that manages all of our operations in terms of a technology fund. That’s not our intent at this stage, but certainly, we wouldn’t want to close the door on those types of arrangements if they were advantageous in the future.

A. Weaver: Where I’m going with this is…. I’m trying to get a sense, as my colleague from Vancouver–West End did, as to the accountability of this technology fund. In light of the fact that we’re not prescribing it to maybe be registered in B.C. or to have a presence in B.C., to what extent can the conflict-of-interest act, the privacy act, the Freedom of Information Act…? How can these acts, which are defined specifically — Auditor General’s, within his purview…?

How can they be applied to a technology fund unless it has a presence in British Columbia?

Hon. M. Polak: I know that the member appreciates that we’re going to get confirmation on the answer. Our read of the Auditor General Act…. Remember that the Auditor General is entitled to audit when there has been a grant given by government or a transfer under agreement.

That would make the entity described here subject to the Auditor General, but we will look to confirm that for Monday. That would be our thinking as to why that would be the case.

A. Weaver: What does the minister envision to be the accountability process for this technology fund if set up?
[ Page 5103 ]

Hon. M. Polak: Certainly, the requirement for financial reporting is very important, and a published annual report as well. We can prescribe all sorts of requirements within that, and I’m sure that we will hear many suggestions as to what should be prescribed in that.

And then, of course, sub (f), as we’ve discussed, enables us to prescribe any other requirements that we think would be necessary for the accountability. Given the nature of the companies themselves and the large investments that they’ll be making, I would imagine that the scrutiny they will desire, as well, will drive toward a requirement for accountability that is able to be seen and shown.

A. Weaver: Are there any mechanisms envisioned to stop a company from investing in the technology fund so that money in the technology fund could be reinvested directly back into the company through some kind of defined clean tech that is under this rather arbitrary prescribed criteria?

Hon. M. Polak: That’s the purpose of sub (d).

S. Chandra Herbert: Will the government be making any direct contributions to this fund for setup, seed money, that kind of thing?

Hon. M. Polak: That is yet to be determined.

[1740]

S. Chandra Herbert: Is it also not to be determined yet who will be able to draw from this technology fund? Would it be only contributors to the fund, or could it be open to anybody with a good technology?

Hon. M. Polak: They would have to make application to the fund, and of course, they would have to develop a criteria by which they could evaluate those applications.

S. Chandra Herbert: At this stage, though, it’s not determined whether or not it would be open to everybody or just contributors to the fund. I’m curious. The question I have is whether or not those who are required to pay into the fund will be the only ones who can benefit from the fund. Or will there be others? Maybe it’s a green power corporation, or maybe it’s a university science department that comes up with a great technology that needs investment. I just want to make sure that they are also eligible for the fund, not just those that contribute to it.

Hon. M. Polak: The contributors to the fund are those who are operating facilities. The applications to the fund in order to receive funds that they could then deploy to research, development, etc. — that’s open to anybody to apply.

S. Chandra Herbert: Could public sector agencies…? Let’s say a school board has a need for reducing carbon and offset fees. Would they be able to potentially, if a project is in partnership with somebody, access the fund and make an application — or should I say, be considered for access to the fund?

Hon. M. Polak: As long as they met the criteria, I don’t see that there would be anything to prohibit it. I’m put in mind of…. For example, I’m familiar with a number of school districts who have partnered with other companies — some with Fortis, for example — to engage in the deployment of new technology and research around it. If they could meet the criteria set by the technology fund, I don’t think there would be anything that would prohibit them.

S. Chandra Herbert: I asked the question as, of course, I think it rubbed people the wrong way when public schools, health care facilities, hospitals, those kinds of things had to pay into an offset fund that they at one point didn’t have a lot of access to, instead having the money go to…. I think the example that I’ve used is a hospital or a school having to pay into ensuring you had better, fancier hot tubs that used less power and less gas to heat them at a fancy hotel. That’s the kind of thing that rubbed people the wrong way. I want to make sure that public projects could get that same access.

I appreciate the minister’s answer because I know of a number of school boards who have ideas for engaging the very best in building technology so that they don’t have to spend a lot of money paying for gas to heat the school or to light the place — passive technologies. One that’s been argued for…. Of course, there are others that could, with a little bit of a top-up, become possible and allow solutions to some of the challenges they have to make them successful. So I appreciate that answer, and I hope to, as it goes forward, see that fleshed out in the years ahead.

Hon. M. Polak: I should just clarify so there’s no misunderstanding. The fund, though, is going to be, if you look at sub (e), “focused on accelerated market adoption of innovative clean technologies.” What the member was describing might better fit under an offset that a school might create, for example. But certainly, as long as this was about what is envisioned in sub (e), there’d be no prohibition. I just didn’t want to leave a misunderstanding.

[1745]

A. Weaver: I have two questions on validation and verification bodies, and I’ll come back to one on the technology fund if there’s time.

Both the definition of “validation body” and the definition of “verification body” yet again say: “…means a person that meets the prescribed requirements.” My question to the minister is: where are these prescribed
[ Page 5104 ]
requirements? Are they coming from previous legislation and previous regulations? If so, which regulations and which legislation are they coming from?

Hon. M. Polak: Once again, these exist under the current regulation under the cap-and-trade act, and it is our intent to simply bring those over into this act.

A. Weaver: Going back to the technology fund, I was hoping to get some guidance as to the criteria that the minister will use to determine whether the not-for-profit corporation has an objective, fair and rigorous process for reviewing the technology fund applications. That is, what criteria…? Under what lens and through what lens will the minister look at this not-for-profit corporation to determine whether or not the process is fair, rigorous and objective?

Hon. M. Polak: As applied in other areas when a minister is required to consider certain things, the test is one of reasonableness. Would a reasonable person accept the minister’s judgment as to the nature of this criteria? Has it met that criteria? The test for a minister is one of reasonableness: would a reasonable person meet the same conclusion?

The Chair: The member for West…. Vancouver–West End.

S. Chandra Herbert: Thank you, hon. Chair. The member for West Vancouver–Capilano might want to switch with me, or I might want to switch with him. We’ll see. Maybe that would be interesting. A day in the life of another MLA. Wow. That would be quite interesting — to be the member for West Van–Capilano.

Validation and verification — of course, that’s really the crux of it. I know the minister has spoken…. When we speak about offsets, when we speak about ensuring that “an emission report, a compliance report or an accepted emission offset project report, which statement includes the prescribed information, statements and signatures,” that would be under the verification statement.

Can the minister explain to me the real difference between a validation statement versus a verification statement?

Hon. M. Polak: The difference is time. The validation statement relates to the plan that something is going to be a valid offset, and is that approved? The verification statement comes after the fact. It has now been implemented. Was it accounted for properly? Are the statements around it verified? All those kinds of things.

S. Chandra Herbert: So the verification statement, if I’m to understand that correctly, comes later to verify that what indeed was said would happen, did happen.

[1750]

Given the challenge with offsets…. Let’s just say we have a forest that has been protected or maybe replanted. What happens in the sense of…? How do you assure that that forest, 50 years down the road, doesn’t go up in smoke with a forest fire? All of a sudden that offset is no longer legitimate, as the carbon is now in the atmosphere. You do not, any more, have additionality in the sense that there is now double pollution compared to what was there before.

How does that work? How do you make sure — a year later we verify it — that five years later it doesn’t all of a sudden get chopped down or something like that changes?

Hon. M. Polak: Every year they have to account for their statements. The verifier, in the case of a verification statement, is an independent third party.

Noting the hour, I would move that the committee rise, report progress and seek leave to sit again.

Motion approved.

The committee rose at 5:51 p.m.

The House resumed; Madame Speaker in the chair.

The Committee of the Whole, having reported progress, was granted leave to sit again.

Hon. M. Polak moved adjournment of the House.

Motion approved.

Madame Speaker: This House, at its rising, stands adjourned until 10 a.m. Monday morning.

The House adjourned at 5:52 p.m.

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