HALIFAX, MONDAY, APRIL 15, 2013

 

COMMITTEE OF THE WHOLE HOUSE ON SUPPLY

 

5:25 P.M.

 

CHAIRMAN

Ms. Becky Kent

 

MADAM CHAIRMAN: Order. I call the Committee of the Whole House on Supply to order. We will now continue with the estimates of the Department of Economic and Rural Development and Tourism.

 

The honourable member for Cape Breton North, with 35 minutes remaining.

 

MR. EDDIE ORRELL: Thank you, Madam Chairman, and I thank the minister and his staff for putting up with me for a little while today. My first question, I know we had a little conversation last week about promotion areas and Cape Breton in general and we talked about the promotion of Louisbourg 300 - can you elaborate a little more on where you will do most of your promotion this year for Louisbourg 300?

 

HON. PERCY PARIS: I think I heard the member correctly, he was seeking information on where we are going to do the bulk of our advertising when it comes to Fortress Louisbourg. One of the things that I said when this was raised before, we're going to be doing a lot of concentration in the Province of Quebec. Our Doers' & Dreamers' is a bilingual publication; we will be doing heavy production in Quebec.

 

We recognize the 300^th Anniversary of Louisbourg and the significant attachment that site has to French and Acadian population, so it seemed to be a good strategy, from our strategy analysis, that we increase the publication in Quebec.

 

We sent $100,000 to Destination Cape Breton to do some advertising. The number that we've dedicated in the Montreal area in advertising is $250,000, which is a significant amount of money when it comes to advertising. Our advertising campaign has already started - it started this month - so we are aggressively looking at the Quebec market.

 

MR. ORRELL: If I may, air visitors were down 3 per cent last year, motor coach visitors were down, and our air traffic from the U.K. and Germany was down. My question is if that's all down, are we doing more this year to promote automobile traffic to the province, compared to years gone by when we might have promoted more air traffic?

 

MR. PARIS: Our advertising campaign is called "Take yourself there." That in itself is an indication of how we are looking to attract more visitors via road. Statistics tell us that road visitors - if I can call them that - spend more money. The number-one market that we are aiming for - we've decreased our Atlantic Canada advertising, we've increased our advertising first and foremost - and I hope I've got the order right - Ontario, we've upped that advertisement, followed by Quebec and then the rest of Canada. The markets in Europe, we've already been advertising overseas, Germany, through the Atlantic Canada Tourism Partnership, we do some advertising overseas in relationship with the other Atlantic Canada provinces. So we've changed our marketing strategy; we want to attract new visitors this year.

 

The member is absolutely right - we want to encourage more road traffic to come into Nova Scotia. And I should add, when we talk about tourism, and I talked about Quebec in my last response, that it should be noted that this is our first time with advertising in Quebec in three years. So it's a market that we're returning to mainly because of Louisbourg.

 

MR. ORRELL: I guess if there are more promotional, let's say commercials, video, information materials, going to be developed in midstream or in the summertime, would we be targeting specific areas such as the Cabot Trail, or some of the more - maybe the Bay of Fundy, or some of the areas that have a specific draw that would bring people into an area and maybe have them stay a little longer, play a game of golf at Highland Links, camp at the campgrounds, go around the Cabot Trail? I'm just wondering if that's a plan for later on in the summer or before the tourist season gets in the heavy - if we're going to do any more promotion would that be the case?

 

MR. PARIS: You know, the answer to that question is that with our advertisement, the answer is yes. We've featured in some of our ads those places that you've mentioned, certainly the Cabot Trail. We recognize, and so does the rest of the world recognize, that the Cabot Trail, Cape Breton Island in itself, one of the most beautiful islands in the world, has been recognized by Frommer's, by tourism media from all over the world as one of the best islands in the world to visit. So absolutely, we want to take advantage of that, we want to advertise, and I guess make hay, so to speak, while the sun shines. So the member, through you, Madam Chairman, is absolutely right, those iconic tourism locations in Nova Scotia, which there are many, but certainly Peggy's Cove, Cabot Trail, are certainly priorities for us to showcase.

 

MR. ORRELL: Just if I could change gears for a second. Nova Scotia, Cape Breton in general, has many, many festivals. I've heard over the last number of years, especially from the couple of local festivals in my area, the Bartown Festival and the Johnny Miles Festival, that some of the funding had been cut for coordinators to organize those festivals. So I'm just wondering, is there any consideration to either a grant, or a one-shot deal, or more money going into certain areas to see if we could somehow fund or try and fund a coordinator or a supervisor or something for these festivals to make them run more efficiently?

 

MR. PARIS: Madam Chairman, the overall funding hasn't decreased. The budget line remains constant, what has increased are the number of festivals. There are festivals popping up, being implemented or being created every year, and so we are trying to meet the demand of those festivals. What we try to do with our festivals is we try to encourage them to be more in the way of self-sustaining. We know that it's quite difficult for some of them, but I think last week I mentioned the Wharf Rat Rally and how the Wharf Rat Rally when they first approached this government when I was the minister and they asked for some money to assist them to take care of a deficit, we did that, but at the same time when they reached out to us what they got from us in return was I had staff work more strategically with them.

 

So there are some things that we can do that we would consider as in kind, hence saving that particular organization some money, and not only saving them money but also with all of the resources that we have at Economic and Rural Development and Tourism, we can show them how to move toward sustainability and we've done that with a huge success with that rally in Digby. We also encourage, for all the festivals when they are applying for the money or when they get money, the door always remains open for them to come back to us and certainly have a conversation with us about their needs and about their shortfalls and about anything else that we may possibly do to assist them.

 

MR. ORRELL: The reason, Mr. Minister, why I asked the question is this being Volunteer Week I'm hearing from the volunteers who are helping with the festivals, especially the one in North Sydney, the Bartown Festival, the coordinator's money was decreased or cut two years ago and they are finding it difficult with the volunteers they have because they are getting older and they are finding that they are starting to drop off a little bit, which they're scared and they're nervous that that festival may not continue if they can't get a designated coordinator and designated funding to hire a coordinator for the short period that's necessary.

 

So I'm glad to hear that your doors are open and I will pass that along to the people of the Bartown Festival to contact your office so they can discuss the situation further and maybe find easier or better ways to coordinate some of the volunteers they have, and/or they do get funding for staff - they do run a great festival, a real good job with that on the Northside. I, as a Northsider, and I, as a politician, would hate to see that suffer because of a funding change or shift of funding.

 

I guess one of my final questions would be last year in Yarmouth they had two world hockey championships, and this year coming Cape Breton has been fortunate enough to obtain the World Under 17 Challenge through Centre 200 in Port Hawkesbury and the new Emera Centre on the Northside. I was just wondering, what involvement would Economic and Rural Development and Tourism have in that hockey championship?

 

MR. PARIS: I can say this, with all the events that come across my desk or through the department I am familiar with that hockey challenge that is going on in Cape Breton and I can tell you this - in an event of that nature the province will be involved, we are involved in it. I don't know the number off the top of my head, we don't have it here but staff is frantically trying to get that number for you.

 

I just want piggyback, if I may, Madam Chairman, on something that the member for Cape Breton North said which I agree with 100 per cent - you talked about volunteers as part of your preamble and I agree 100 per cent, certainly in my almost four years as minister I have seen a decline, not in the quality, but certainly a decline in the quantity as far as volunteers are concerned. Having said that and on a comparison basis, when I look at volunteerism in Nova Scotia we don't take a backseat - even with the decline we don't take a backseat to anyone. I can remember, and I'll just mention this very, very briefly, back in the Vancouver Olympics when I think of all of the volunteers from Nova Scotia who went out West, and all the events that I attend over the course of a fiscal year and see the volunteers, it's just enormous.

 

The member indicated that that was his final . . .

 

MR. ORRELL: One of them.

 

MR. PARIS: One of them?

 

MR. ORRELL: I have one more.

 

MR. PARIS: Okay. If that's the case, if you have one more, I'm going to sit down then.

 

MR. ORRELL: This will be my final question because I know we've been fortunate on the Northside to get a new rink and recreation facility over the last number of years, the Emera Centre. I don't know this for sure, but it may possibly need a few simple and minor upgrades to sound systems and ice-cleaning facilities and ice-cleaning equipment and so on and so forth. I was just wondering if the Department of Economic and Rural Development and Tourism are involved in the tournament, would there possibly be some money for a few little minor upgrades to a couple of the rinks that may need them to make it a world-class event?

 

MR. PARIS: I will say - and I think I've already gone on record as saying - I can guarantee to the member for Cape Breton North that the Department of Economic and Rural Development and Tourism will be there to support that event. I was hoping that while I was up - and I couldn't give the member a figure right off the top of my head, and the reason being is because that's not in the public domain as yet, so I trust the member will respect that.

 

Also, what we will do, and what we always do, is we help coordinate with other departments within government that may be of valuable service, whether it be a hockey tournament of significance or any other event. When we sit down with the hockey organizers, we also sit down with suggestions about other places or other avenues where there could be some funding and it could be for that little bit of infrastructure stuff that the member has mentioned and we help coordinate that. I like to think that we're very thorough when we sit down at the table to assist.

 

MADAM CHAIRMAN: I just want to be clear, the member from the Progressive Conservative Party has no further questions for the minister?

 

The honourable Minister of Economic and Rural Development and Tourism, for closing remarks.

 

MR. PARIS: Madam Chairman, before I get into my closing remarks, over the course of the last few days here in the House during estimates, the members from the Liberal Party and from the Progressive Conservative Party were looking for some information. I mentioned to the members who were asking the questions if there was information that I didn't have, I would be more than eager to table that at an appropriate date - I would like to take this opportunity to table those documents.

 

What I'm tabling here this afternoon is - one of the requests was for the employment impact of NSBI's assistance; also the Yarmouth room nights sold 2009 to 2012; there was also a request for the jobsHere marketing class breakdown; there is also the Ships Start Here marketing cost; and last, but certainly not least, the Yarmouth ferry subsidy cost. So with the permission of the House, I would like to table those documents.

 

In closing, I would just like to touch on a few points I wasn't able to address in my opening remarks. The Department of Economic and Rural Development and Tourism remains fully committed to helping create good jobs and growing Nova Scotia's economy. We are achieving these goals through jobsHere. Our great province is turning the corner and jobsHere is helping us prepare for the opportunities of a lifetime.

 

Nova Scotians want good jobs; they want long-term jobs; and they also want to grow an economy so they can stay and raise their families here at home. That's why we, the Province of Nova Scotia, have invested to win the federal shipbuilding contracts to bring good jobs to Nova Scotia. It's why we are investing in people, in education, in training, and in skills for the good jobs that are the foundation for a good future.

 

Now that Irving Shipbuilding and the federal government have signed the design contract for the Arctic offshore patrol ships, work has begun on $300 million in upgrades at the Halifax shipyard. This work will benefit local companies and workers. We are a little more than a year into a 30-year project and we've already made a lot of progress. Irving Shipbuilding is getting the yard ready and the province is helping people and businesses get prepared to make the most of this huge opportunity.

 

Last year, the province commissioned Duke University to analyze the range of activities to create, produce, deliver and maintain the Arctic offshore patrol ships, polar icebreakers, and research vessels. In early 2013, the study was released and presented to industry. More than 100 Nova Scotia firms were named as some of the potential suppliers for the work Irving Shipbuilding will do in Nova Scotia and Seaspan will do in British Columbia - companies like A.F. Theriault & Son, Hawboldt Industries, Lunenburg Industrial Foundry, MilAero, Target Hydraulics & Machine Works, Instrument Concepts, and so many more.

 

In addition to those named in the Duke University report, there will be many more Nova Scotia companies involved in these enormous shipbuilding projects. The knowledge gained from the study will help maximize the opportunity and potential for our local firms. Nova Scotians are ready to turn the corner; they're ready to turn the corner towards prosperity, and this is another tool to help build the supply chain and the workforce that will get us ready for the opportunity of a generation.

 

We will continue to work with our partners to host company-specific supplier development information sessions across the province, to help make sure local companies are getting ready with the right certifications and requirements. There is a lot to do to get ready and the province is fully committed to help make it happen. Our jobsHere plan and workforce strategy set out the right path to ensure Nova Scotia is prepared for the opportunities the shipbuilding work will bring to the Province of Nova Scotia.

 

And jobsHere is the economic plan that's helping us take advantage of the game- changing opportunities we're about to embark upon. It is a plan that has been in place for a little over three years now and it is working. Nova Scotians are seeing new jobs being created, enjoying increased access to training, and benefiting from more innovative and competitive businesses. We are making great strides in helping businesses of all sizes and in all regions to succeed and to prosper. Through jobsHere, hundreds of businesses from Sydney to Yarmouth, Amherst to Lockeport, Antigonish to Wolfville are becoming more innovative, more globally competitive, and more productive. And jobsHere has helped nearly 1,400 businesses - most of them small - all across the Province of Nova Scotia. Tens of thousands of people have been supported to get the right skills for the good jobs.

 

There are many success stories - LED Roadway Lighting from Amherst; Kohltech International in Debert; Tri-Star Industries in Yarmouth; Great Valley Juices in Port Williams; East Coast Metal Fabrication in Sydney; and Cooke Aquaculture. Average employment hit a record high in 2012 and we've had annual increases ever since 2009. Nova Scotia has the lowest unemployment rate in Atlantic Canada and, last month, Nova Scotia was the only province in the country to see employment increases. And jobsHere is helping to create the winning conditions that attract successful businesses and good jobs to Nova Scotia.

 

In November, Nova Scotia saw its most significant week of job creation in a decade with the announcement of nearly 1,000 good engineering and high-tech jobs. Project Technologies will expand its business in Nova Scotia, creating 440 jobs for new and experienced engineers; and IBM will establish its only Canadian global delivery centre in Halifax, creating 500 new well-paying jobs.

 

Just a few weeks ago, I read in The ChronicleHerald that IBM is ramping up its hiring efforts. The article noted that there is a mix of new and existing IBM employees who are moving back to Nova Scotia or who are moving here for the first time. Nova Scotians are coming home, putting down roots and raising their families right here at home. Companies can choose from many possible locations. Every other province is putting their best foot forward as well, and we are too.

 

BlackBerry has employed hundreds of Nova Scotians at its Bedford offices for years. When there was concern the company may take those jobs elsewhere, the province acted swiftly to ensure that those jobs and the families that they represent were protected. BlackBerry could have picked another place to bring its jobs and to establish a centre of excellence, but they feel the energy, they feel the enthusiasm, in Nova Scotia and they can count on the expertise and professionalism of our people. Working with partners like BlackBerry is one more way to ensure more Nova Scotians can build a great life for themselves and their families right here at home.

 

Nova Scotia has seen a lot of positive signs when it comes to economic development. With the help of jobsHere, Nova Scotia is on a positive path. With the help of jobsHere, we have the flexibility to quickly respond to changing economic conditions and seize the many opportunities before us. This year we are focusing on small businesses. Small businesses are an important part of our economy and we're committed to helping them grow and succeed. Donald Savoie said "The Nova Scotia government should set out to become the most business-friendly jurisdiction in Canada . . ." We are taking another step along this path helping business slice through red tape, saving them time and money, and letting them do what they do best - provide good jobs for Nova Scotians here at home. For the fourth consecutive year the province is reducing the small business corporate income tax rate for the majority of small businesses. Over four years that's a drop of two percentage points and almost $78 million in savings for small business - money that they reinvest to help them compete, grow, and hire.

 

Businesses have said they need better support and easier access to programs and services. Madam Chairman, we've heard them and we're improving. Now it's easier for small businesses to do business with us - instead of wading through a list of nearly 40 programs, the province is opening five doors as clear entry points to the same range of programs and services; we'll provide additional one-on-one support and more frequent site visits to discuss solutions with business owners; and we'll shorten approval times and help business cut through red tape, supporting them with a range of programs designed to help them hire, to help them be more innovative, to help them expand, and to help them succeed. Small businesses will have access to tools, to resources and services that will ultimately help them improve their bottom line.

 

Regional Enterprise Networks, or RENs, will also provide regional economic leadership and help develop regional economic development strategies while supporting small business. RENs will bring together business communities, the province, municipalities, and other groups involved in economic development. They will improve coordination and bring planning in line with our jobsHere strategy. In partnership with municipalities we will continue to set up the new regional networks so communities across the province can be prosperous and sustainable.

 

Madam Chairman, when these efforts were announced over the last couple of weeks, members of the business community responded positively. President and CEO of the Halifax Chamber of Commerce Valerie Payn, said "Nova Scotia's jobsHere Strategy has assisted small business through many incentives, and we are pleased that the government will continue to fund this strategy . . ."

 

President of the Tourism Industry Association of Nova Scotia, Darlene Grant Fiander, wrote to the department to say that these are "great changes and approach for making it easier for businesses to get support and connect with the right agencies and services." TIANS and the Halifax Chamber are helping to spread the word and both have posted our small business fact sheet on their Web sites.

 

Madam Chairman, you, and certainly many of you, are probably quite familiar with the jobsHere flagship program, the Productivity Investment Program, more commonly known as PIP. It is through PIP the province has helped businesses, the vast majority of them small - we have helped them become more productive, more innovative, globally competitive and skilled, through capital investments and workplace training. This year we are renewing our commitment to this successful program with $14.5 million to help fund new equipment, clean technology, software and hardware for businesses in all regions of the province. Another $10.5 million will help encourage businesses to invest in training, skills development, and certifications, as well as to hire students.

 

As part of our efforts to cut red tape for businesses those applying for less than $15,000 in Workplace Innovation and Productivity Skills Incentive funding can expect faster turnaround times, thanks to our efforts to reduce administration and improve service for small businesses.

 

Since PIP was launched a little more than two years ago, nearly 400 businesses have been supported, making upgrades through the capital investment incentive. There have been 10,000 people trained through the Workplace Innovation and Productivity Skills Incentive, and more than $105 million in private investment has been leveraged for productivity improvements through PIP - that's $5 for every $1 invested by the province.

 

Companies like Akoostix, Allendale Electronics, Engineered Coated Products, Ultra Electronics, Stark International, Eden Valley Poultry, and Mulgrave Machine Works have all benefited from these investments. Because of PIP, Debert-based Kohltech International is saving time, saving money in reducing waste materials as they manufacture high-quality custom windows and doors. The company was able to bring previously outsourced work in-house, saving them thousands of dollars and protecting good jobs in rural Nova Scotia. Eden Valley Poultry in Berwick is increasing its productivity by more than 40 per cent through leading-edge processing equipment with a $1 million investment from PIP.

 

It's clear how investments like these are helping businesses thrive and grow right across the province. Over the past year we've seen great success with the Productivity and Innovation Voucher Program which helps foster innovation in small business throughout the province. Investment in innovation is crucial, it is crucial in today's changing and competitive world.

 

Businesses of all sizes are thriving and striving to become more productive and more competitive. Through the voucher program, small businesses are building and strengthening links with Nova Scotia's many universities and colleges. From research to engineering, prototyping to field testing, those businesses are getting the support they need to take their ideas and products to the next level. Since the program was launched, more than 200 vouchers have been provided to small businesses around the province. To continue innovation and progress, the province added a second tier of vouchers for previous recipients, so that they can maintain momentum and add to the achievements gained from the first voucher.

 

We will find this important program with $1 million again this year so we can continue to help connect small businesses with the wealth of expertise available from our academic institutions. Businesses like Stomp Labs in Sydney, Ditch Doctor Atlantic in Glenholme, Gravity Communications in Sackville, Louisbourg Seafoods in Cape Breton, and Intelligent Dynamics in Jordan Falls - they are all reaping the benefits of this program.

 

Our province, the Province of Nova Scotia, is on the brink of one of the biggest opportunities in our history. Now more than ever we must embrace innovation and we must support growth to help get our people and our businesses ready.

 

Madam Chairman, speaking of innovation, I'd like to take just a few minutes and talk about tourism and our new way forward. Tourism, as I'm sure everyone in this House knows, is a $2 billion industry, supporting 24,000 jobs for Nova Scotians in every region of the province. To unlock and build on the economic potential that tourism offers, we are working in greater collaboration with industry and recently established the Nova Scotia Tourism Agency, the NSTA. The majority of the Nova Scotia Tourism Agency's approximately $15 million budget goes directly towards branding, marketing, and partnerships.

 

Madam Chairman, by working with the industry, Nova Scotia will have a tourism strategy that will help us compete on the international stage, introduce a compelling tourism brand, and better promote icons like the Bluenose II. The Tourism Agency will provide leadership in a strategic direction that will help build a much stronger industry. It will promote innovation and competitiveness and bring economic benefit to Nova Scotia. NSTA's board is made up of industry, business, and government leaders who bring a range of international marketing and business development experience, and they continue to engage industry and others on Nova Scotia's long-term tourism strategy. The new strategy will focus on leadership and collaboration, strategic marketing, evidence-based decision making, higher quality product and experiences, and improved access to Nova Scotia.

 

We are now getting input on an action plan that will become the long-term strategy, which is expected to be published later this Spring. Tourism plays a significant role in rural economies across the province, and residents depend on the industry for good jobs and the revenue generated to keep their communities strong. The new NSTA will set up shop in Windsor before the end of 2013, and establishing the new agency outside of Halifax will move 34 civil service jobs to the Windsor area. For years, governments centralized jobs in Halifax while other communities struggled. This government is fulfilling its mandate to move good jobs outside metro - 20 years of finishing last by doing things the same old way is no longer acceptable.

 

I'm proud to say that we are doing things differently, which, Madam Chairman, brings me to our approach to tourism. The NSTA, the board, has been working with staff and other partners to accomplish a great deal in a very short time. And the board has fulfilled their aggressive mandate - they've recruited a new CEO, Patrick Sullivan, who has been doing a tremendous job; they have helped develop a long-term strategy for tourism; they've helped recruit a new marketing agency; and they supported staff to develop and launch the 2013 campaign.

 

The 2013 marketing campaign was recently launched to rave reviews. Those of us who are fortunate to call Nova Scotia home, we already know what a great place this is; from Cape Breton to Yarmouth, the Annapolis Valley to the South Shore, Nova Scotians know what our province has to offer. This year's tourism campaign is designed to let the world know what we already know for sure - that Nova Scotia is a world-class destination.

 

The new campaign "Take yourself there" is designed to attract new visitors and to encourage them to travel more of the province. Natural wonders like the Bay of Fundy and the Cabot Trail, hundreds of festivals and events, cultural attractions, historical sites and museums, and one of the best seacoasts in the world are only a few of the many things to experience here in Nova Scotia.

 

One of our greatest assets is our people. The warm, friendly spirit of Nova Scotians is what keeps people coming back year after year. I've said in this House many times, tourism is everyone's business; we are all tourism ambassadors. We want to build on what is already a great reputation, and this campaign will help us do just that. It's no surprise that Lonely Planet, CNN.com and Frommer's Travel Guide have all recently named Nova Scotia as a top visitor destination. Over the coming year, we'll be working hard to add to that list of accolades.

 

I'd be remiss if I didn't take a few minutes to talk about the important work of our five agencies. Nova Scotia Business Inc. is the province's business development agency, bringing Nova Scotia businesses to the world and attracting global investment to the Province of Nova Scotia. The agency works to attract new companies, grow key sectors of our economy, and identify and develop new export markets. NSBI is an important part of jobsHere and we continue to take progressive steps in the right direction. Take Health Outcomes Worldwide as an example - NSBI and Innovacorp have come together to support this innovative New Waterford company, helping it bring new mobile health care technology to international markets, creating good jobs here at home and improving patient care around the world. With provincial support, the company plans to double its workforce, continue to innovate and move its products into the global marketplace.

 

CarbonCure Technologies is also growing its workforce to expand its innovative and green concrete curing process into new markets with support from NSBI and Innovacorp.

 

NSBI was also a key partner in attracting IBM Canada and PROJEX Technologies to Nova Scotia. Homegrown successes in the companies that choose Nova Scotia are providing high-paying, world-class career opportunities for Nova Scotians. They are generating revenue that helps pay for the important services Nova Scotians rely on - things like roads, health care, and education. They are keeping Nova Scotia families here and bringing Nova Scotians home from away.

 

The province must ensure Nova Scotia companies succeed and grow while continuing to attract new investment. In the coming year, NSBI will work to develop key sectors, including oceans technology, financial services, information and communications technology, defence security in aerospace, and life sciences. The agency will also maximize client growth and sustainability by working with our partners to attract, to grow, and to retain companies that will result in the greatest economic benefit for Nova Scotia. In 2013-14, NSBI will work proactively to achieve results for the province and grow Nova Scotia's economy.

 

Innovacorp, as Nova Scotia's early stage venture capital organization, is another important part of the province's jobsHere plan. Entrepreneurs and innovators ignite great ideas and turn them into reality, finding new and better ways of doing things. Innovacorp invests in young, knowledge-based companies that are innovating, competing, and creating good jobs. Entrepreneurship, innovation and start-ups are important to any economy and that is certainly the case here in Nova Scotia.

 

In the past, too many emerging Nova Scotia companies haven't had access to the programs and services they need to get started, to grow, and become more competitive. Madam Chairman, that is changing. The province is supportive of new and emerging businesses now more than ever. From offshore exploration to shipbuilding - never before has Nova Scotia seen such opportunity. We want companies and people to be innovative and build ideas around these opportunities, to attract and train the best minds, and create good jobs for our future. Through Innovacorp, we're giving companies in Nova Scotia and, I will add, in Atlantic Canada, better access to start-up and venture capital, and encouraging and attracting innovation.

 

Nova Scotia led the way to create a regional venture capital fund to make sure our new and emerging companies have access to the funds they need to grow and become more competitive. Nearly $50 million has been raised to help new and emerging Atlantic Canadian companies involved in clean technology, life sciences, information technology and other high-growth sectors. Patrick Keefe, the fund's new manager, has been working to attract further investment and take the fund's development to the next level.

 

Nova Scotia's start-up scene is vibrant and it is flourishing. The reason, the region has had some recent home runs, including last July's sale of Halifax-based Go Instant to the America Cloud computing giant, Salesforce.com. Innovacorp will work to build on that momentum in the year ahead. Last year alone, through Innovacorp, the province made seed investments in 12 promising technology companies. This year, the agency will hold another provincial I-3 Technology Start-Up Competition to find and support early-stage companies, and encourage entrepreneurial activity across the province.

 

Since the pilot completion in 2006, I-3 has received more than 400 submissions, reflecting the level of entrepreneurship in Nova Scotia. Through the Early Stage Commercialization Fund, Innovacorp provides go-to-market expertise and funding to post-secondary research projects across the province. Last year, Innovacorp supported 14 promising projects and this important program will continue in 2013-14. The province is committed to building an entrepreneurial culture in Nova Scotia - a culture that will help ensure great ideas are born here at home and given the opportunity to grow.

 

Madam Chairman, we have Trade Centre Limited - or TCL. TCL creates economic and community benefits by attracting people to Halifax and to Nova Scotia. Connecting people through events contributes to a prosperous economy that benefits the entire province.

 

In 2013-14, Trade Centre Limited will continue to attract and host events that drive economic activity. An estimated 800 events will attract 750,000 attendees and generate significant economic benefit for the province. This year, TCL will continue those efforts, hosting a broad range of events, including Rush, Leonard Cohen, and Great Big Sea concerts; of course there's the Halifax Mooseheads 20^th season, which kicks off this September; the 35^th Royal Nova Scotia International Tattoo; a musical production of Beauty and the Beast; the Biomarine Business Convention; the Canadian Association of Chain Drug Stores Convention; Canadian Association of Critical Care Nurses Convention; Confederation of Music Teachers Association; and the 50+ Expo. Those are just a few of the events that will be hosted by TCL.

 

The year 2013 marks the 35^th Anniversary of the Halifax Metro Centre, attracting and hosting world-class events. The Halifax Metro Centre has launched a year-long campaign to celebrate this milestone and highlight the many legendary musical performers, local acts, top-ranked sports teams and special events it has hosted throughout its rich history. The new convention centre offers renewed opportunity to revitalize our downtown and reaffirm our position as the capital of Atlantic Canada.

 

As construction continues, sales and marketing activities will be focused on attracting national and international meetings and conventions. The new convention centre means jobs for Nova Scotians and many new exciting opportunities to host events that will attract even more visitors to our hotels, shops, and restaurants. Working with our partners and stakeholders, TCL will continue to position Nova Scotia as Canada's East Coast event destination, driving economic and community benefit for the entire region.

 

Then we have 28,000 Nova Scotians who work in the arts and culture industries, generating almost $1.2 billion. To fully harness and develop that potential, Film Nova Scotia's mandate was expanded to advance the development of the creative industries in Nova Scotia. A new agency, Film and Creative Industries Nova Scotia, was created and will help the province's creative businesses expand into new markets, create more jobs and build stronger cultural communities - something very important to all Nova Scotians. The expanded agency will act as the lead business development agency for the sector and will work to improve access to government support programs and provide businesses with development services and support for creative enterprises.

 

In the coming year, the new agency will consult with industry partners to develop a new five-year strategic plan. Film and Creative Industries Nova Scotia will be the lead agency for Nova Scotia's creative businesses, providing better access to programs, expertise, funding and other supports. Just a few weeks ago, Lisa Bugden was named president and CEO of the new agency. She will begin her new role later this month. Under Lisa's leadership, Film and Creative Industries Nova Scotia will work with the industry and provide the support needed to help grow Nova Scotia's creative economy, and expand opportunities for all Nova Scotians.

 

Waterfront Development's goal is to get Nova Scotia and visitors as close as possible to the beauty, experience, and opportunities offered where the land meets the sea. The agency develops their strategic potential of the Bedford, Dartmouth, Halifax and Lunenburg waterfronts, helping to drive economic opportunity, enhance tourism, and reflect and protect our marine heritage. Over the past year, all four of these waterfronts offered residents and visitors a range of events to enjoy, including Tall Ships, the TD Halifax Jazz Festival, World Junior Beach Volleyball, the Halifax International Buskerfest, Bedford Days, regattas and so many others.

 

Nova Scotia ports gained international attention for success in hosting Tall Ships in 2012, receiving the North American Port of the Year Award from Tall Ships America. This year Waterfront Development will take advantage of a strong residential market outlook to accelerate two major developments - Cunard Block in Halifax is a $75 million commercial development, the largest in the history of the Halifax waterfront . . .

 

MADAM CHAIRMAN: Order please. With the minister's indulgence, there has been a request for an introduction.

 

MR. PARIS: By all means.

 

MADAM CHAIRMAN: The honourable member for Hammonds Plains-Upper Sackville.

 

MR. MAT WHYNOTT: I thank the minister for allowing me the opportunity to recognize some people in the gallery today.

 

With us today - they raised $17,000 for an orphanage in Mexico and they just came back with the Nova Scotia International Student Program. They're young people from across the province, and I'll ask them to rise as I say their name for the record: Samantha Dickson from Middle Sackville; Daniel Kim from Bedford; Hannah Tobin from Eastern Passage; Juliana Ali from Lyons Brook in Pictou County; Christine Ingham from Lyons Brook; and also Ben MacKeil from Elmsdale, who was their chaperone. They have done Nova Scotia very proud while they were down there over the two weeks they were there showing what our young people in Nova Scotia really are about.

 

I ask the House to give them a warm welcome. (Applause)

 

MADAM CHAIRMAN: I welcome all of our guests for today's proceedings.

 

The honourable Minister of Economic and Rural Development and Tourism.

 

MR. PARIS: Thank you, Madam Chairman. Armed with feedback from the 2011 public consultation, the agency will complete the design and tender the development opportunity for WDC-1, a mixed use residential building in Dartmouth. Construction is scheduled to begin in 2014. Just last week the agency announced new food and clothing shops along the Halifax waterfront that will offer our visitors and residents a variety of local flair, products and experiences. Waterfront Development will continue to identify and implement activities that make innovative use of waterfront locations and make it easy for people to do business.

 

I'm going to change gears a little bit now, because I want to touch on African Nova Scotian Affairs. As the Minister of African Nova Scotian Affairs, I want to take a moment to talk about the department's recent events, activities, and accomplishments. In February, Nova Scotia celebrated African Heritage Month. This opportunity to celebrate the accomplishments and heritage of our African Nova Scotian communities continues to grow in importance and scope. This year, over 100 events were held in communities across the province with African Nova Scotian Affairs continuing to play a coordinating role. This is the largest number of events since we began marking African Heritage Month and shows the growing level of interest in sharing the stories and experiences within our communities.

 

The ground-breaking project called Project LEAD will continue in the coming year. African Nova Scotian youth in communities across Nova Scotia will be exposed to the justice system and become good citizens as a result of their experience with this program.

 

Project Brotherhood is a joint initiative with the Department of Health and Wellness and focuses on the health and well-being of African Nova Scotian men. Fitting with government's commitment to Better Care Sooner, Project Brotherhood is one more way that African Nova Scotian Affairs is advancing the interests of the community in the programs and services of government. African Nova Scotian Affairs continues to collaborate with government departments on initiatives designed to improve the quality of life for African Nova Scotian communities. I'm very proud of the work African Nova Scotian Affairs does on behalf of all Nova Scotians, and I look forward to another positive year ahead.

 

In closing, I continue to be proud of the work our staff do every day on behalf of Nova Scotians. I've said it before and I'll say it again today, I am the luckiest minister in all of government. I have a great team of dedicated and hard-working staff at the Department of Economic and Rural Development and Tourism, and African Nova Scotian Affairs and at all the agencies.

 

A great deal has been accomplished over the past year and there is a lot more to look forward to. Nova Scotians have much to be optimistic about. This budget will help us advance along the path forged through jobsHere. Nova Scotia is starting to turn the corner and we will keep that progress moving forward in the year to come.

 

I would also like to take this opportunity to thank the members from the Official Opposition and the members from the Progressive Conservative Party, the Third Party, who asked me questions during this debate. I want to express my sincere thanks to them for the respect that was displayed by those asking the questions. It served as an indicator that we can accomplish so much more by working together and by being a little bit more cordial to one another, so I certainly want to acknowledge that. I also want to acknowledge that they were insightful questions and I know that they put a lot of time into it, and though I did table some things, if members from the Opposition, if there was anything that I missed, please don't hesitate to let me know and I'll make sure that it's tabled.

 

MADAM CHAIRMAN: Shall Resolution E4 stand?

 

Resolution E4 stands.

 

Resolution E26 - Resolved, that a sum not exceeding $22,370,000 be granted to the Lieutenant Governor to defray expenses in respect of Nova Scotia Business Inc., pursuant to the Estimate and the business plan of Nova Scotia Business Inc. be approved.

 

Resolution E42 - Resolved, that the business plans of Film and Creative Industries Nova Scotia, the Nova Scotia Innovation Corporation (Innovacorp), the Trade Centre Limited and the Waterfront Development Corporation Limited be approved.

 

Resolution E49 - Resolved, that the business plan of ReNova Scotia Bioenergy Inc. be approved.

 

MADAM CHAIRMAN: Shall resolutions E26, E42, and E49 carry?

 

The resolutions are carried.

 

The honourable Government House Leader.

 

HON. FRANK CORBETT: Thank you, Madam Chairman. We'll be calling the estimates of the Department of Energy and the Department of Natural Resources.

 

MADAM CHAIRMAN: Thank you. We will now take a brief recess to allow the staff to leave the Chamber and the others to set up.

 

We will proceed momentarily. Thank you.

 

[6:36 p.m. The committee recessed.]

 

[6:41 p.m. The committee reconvened.]

 

MR. CHAIRMAN: I call the committee to order. We will be doing the estimates of the Department of Energy.

 

Resolution E6 - Resolved, that a sum not exceeding $26,136,000 be granted to the Lieutenant Governor to defray expenses in respect of the Department of Energy, pursuant to the Estimate.

 

MR. CHAIRMAN: The honourable Minister of Energy.

 

HON. CHARLIE PARKER: Thank you, Mr. Chairman, and good evening to you and to everyone here this evening.

 

I want to start by saying I'm pleased to have a few minutes here tonight to talk about the Department of Energy here in Nova Scotia. There are some exciting things going on within our department, and I'm going to introduce the two gentlemen on either side of me - to my left, our Deputy Minister of Energy Murray Coolican, and on my right is our Manager of Financial Services for the Department of Energy, Remi MacDonell. They will be my assistants as we go through these estimates and I'm sure they'll be able to provide some help to me from time to time.

 

I also want to recognize some other staff in the gallery this evening who are here supporting me, and I know will be of some help as we go through the estimates over the next day or two as we talk about the budget for 2013-14.

 

I want to start by mentioning the fine work that all of the staff within the Department of Energy do and they're all dedicated, talented, and an engaging group of individuals who are committed to advancing the energy agenda here for Nova Scotia - and I believe they bring their "A game" to work every morning. In fact, some members who work within the Department of Energy, I want to recognize because they were recognized recently for their outstanding service by receiving the highest honour a public servant can attain and that is the Premier's Excellence in Public Service Award. Their vision and unwavering commitment to the Play Fairway Analysis has produced detailed offshore information that is garnering interest around the globe and has already realized commitments of more than $2 billion in offshore exploration. I certainly commend those folks who worked very hard on the Play Fairway Analysis.

 

That's not the only Premier's award that was received by Energy staff this year and I want to recognize also Nancy Rondeaux, who is a manager in our electricity and renewable energy group, who also received this impressive distinction for exceptional contribution at the mills table, as did our own Donna Chislett, who also worked at the mills table and is with us here in the gallery this evening. I recognize all those people and everybody in the Department of Energy for their tireless efforts in making sure we have very up-to-date, and the latest, information within the department.

 

This past year the Department of Energy has seen much activity as we continue to transform our energy future. We're making progress in key areas and I want to highlight some of those in my comments here this evening.

 

I will now turn my attention to the estimates for the Department of Energy for 2013-14. These highlights in the budget estimates have undergone considerable change within our department in recent years.

 

The Department of Energy is responsible for managing and promoting energy resources to achieve optimum economic, social, and environmental value from Nova Scotia's energy sector. Our priorities cover five areas - first of all, moving towards a cleaner energy economy; maximizing the benefits of a diverse energy economy; further developing the petroleum sector; encouraging social responsible development of Nova Scotia's energy sector; and last, but not least, encouraging innovation and strengthening partnerships through strategic collaboration.

 

These priorities focus on what it takes to position Nova Scotia as an efficient and sustainable consumer and producer of energy, and I know that we have what it takes to get there. The total budget for the Department of Energy for 2013-14 is $26.13 million and that's a reduction of $3.43 million over the last fiscal year. These budget changes will not affect the level or the quality of supports that we deliver in the Department of Energy.

 

Part of this reduction was already budgeted for as part of our three-year agreement with Efficiency Nova Scotia, and part of the changes are a result of lower take-up in solar projects, apart from HRM's Solar City Program, and the remainder is the result of a reallocation in priorities which allows Efficiency Nova Scotia to focus its support for efficiency programs for low-income Nova Scotians, as well as existing in new homes. To clarify, Mr. Chairman, I am speaking about non-electricity programs funded through the department, not electricity programs that are funded by ratepayers.

 

The Department of Energy recently underwent a restructuring to focus on three main areas. Those three main areas are: sustainable and renewable energy; petroleum resources and business development and corporate services, and amongst those three main areas there are a number of work divisions.

 

Those work divisions include Business and Technology, which promotes investment in the energy-related capabilities of Nova Scotia; Energy Markets, which provides technical and policy advice to the Nova Scotia Government regarding electricity, renewable energy, refined petroleum products and biofuels, liquefied natural gas, and natural gas transmission distribution and use; Resource Assessment, which develops policy, legislation, and regulations for the exploration and development of the province's offshore and onshore petroleum resources; also Energy Fiscal Affairs, which forecasts and monitors the financial results and fiscal implications of petroleum exploration and development, administers audits, and assesses royalties from petroleum projects, and administers the province's royalty regulations and agreements; also Strategic Policy, Planning and Services, which coordinates energy policy strategies and plans - and that includes working closely with the federal government and other jurisdictions, of course, with industry and with key stakeholders to develop an efficient and effective regulatory regime and policies for offshore and onshore energy activities; and, finally, the Communications division, which works to create greater public understanding around energy issues in the province, including the exploration and development of oil and natural gas, electricity, and renewable energy.

 

Mr. Chairman, our restructuring efforts are now complete and we're close to having all the required positions filled. We've seen some reductions in our department through vacancies and have eliminated 1.5 full-time equivalent positions, plus funding this fiscal year. However we have added term FTEs to assist with the upcoming Marine Renewable Energy Strategy and also sustainable transportation initiatives. Given this, the full-time equivalent count in our department has risen by one over the last fiscal year.

 

Mr. Chairman, my department is realizing additional efficiencies by making reductions to various departmental areas including travel, grants, professional services, IT, and telecommunications - and those savings amount to $319,000. We also anticipate a reduction in provincial revenue related to the offshore - and I'd like to highlight that. When this government first came into office, the province at that time, in 2009, generated close to $400 million in offshore revenue, but this amount has reduced substantially in these last few years with only $20 million in revenue estimated for this fiscal year. So this reduction can be attributed to lower natural gas prices and certainly also to production declines.

 

In 2009, the offshore call for bids resulted in no bids, no exploration interest in our offshore at all - but, my, how times have changed. With the great vision of the Department of Energy, the province invested heavily to develop a clear picture of the geology off our shores, which is known certainly as the Play Fairway Analysis, and with the dedicated public servants we used that analysis to market the plan worldwide, the vast potential that is in Nova Scotia's offshore.

 

The Play Fairway Analysis and the marketing efforts have been highly successful, as I mentioned earlier, yielding more than $2 billion in bids for exploration in our offshore just this past year alone. Since the Play Fairway Analysis was completed, and prior to the closing of the 2012 call for bids, the department performed additional geoscience work and marketed it on six of the parcels of land that were awarded in that call.

 

In addition to departmental staff and other institutions in Nova Scotia, for instance Dalhousie, Saint Mary's, the Canada-Nova Scotia Offshore Petroleum Board, and the Geological Survey of Canada, they also have much expertise that has played a crucial role in developing this Play Fairway Analysis. This expertise will continue to be an important and necessary contributor to our offshore knowledge for many years to come.

 

The government support for offshore oil and gas exploration and development remains strong. The province is working together with all the stakeholders to ensure that Nova Scotia companies are made aware of the opportunities that will arise from the renewed interest in our offshore. We are committed to a proactive outreach to local suppliers and businesses so that they are positioned to take advantage of opportunities that will emerge with the Shell and BP seismic program, exploration program, certainly leading to potential development of an offshore project.

 

Our department is pleased that industry associations such as the Maritime Energy Association, or the MEA as it is often known, play an important role in accessing opportunities for the supply and service sector within the oil and gas industry, as well as for those within the renewable energy field; in fact the MEA has been actively involved in hosting supplier development sessions for the Lower Churchill and the Maritime Link, as well as supporting the efforts of Shell and BP in creating better awareness of the scope of upcoming project activities.

 

Mr. Chairman, we anticipate another call for bids soon and we are working to ensure that companies have all the necessary information to be able to consider the rich potential that truly is in our offshore.

 

The department continues its geoscience work and, in addition, the department has granted $224,000 to OERA, the Offshore Energy Research Association, at the end of 2012-13 to help build even further on that Play Fairway Analysis work. This association managed the Play Fairway Analysis research project, and the analysis estimates there is 120 trillion cubic feet of natural gas in our offshore and also eight billion barrels of oil, which represents a huge energy potential and, certainly, great job prospects.

 

The 2013-14 budget includes funding for the province to continue to market the results of this research. There is also an increase in the grant that was provided to the Canada-Nova Scotia Offshore Petroleum Board. This additional money will enhance the board's ability to regulate our offshore oil and gas exploration and to regulate the development and production to ensure healthy and safe practices, as well as additional environmental protection and resource conservation.

 

So as we continue to develop our oil and gas potential of our offshore, these functions become more and more critical, and the increased funding will provide support to cover additional expenses as a result of the increased interest in our offshore. The vast oil and gas potential of Nova Scotia's offshore also represents vast potential certainly for continued good jobs and a growing prosperous economic future for workers and families, communities and businesses right across this great province. In fact, Mr. Chairman, Shell is expected to begin its seismic program this coming summer, and will require support services to complement that, such as ship crews, marine supplies, catering, provisions, certainly helicopter support, transportation and accommodations, and many more services that will likely be sourced within this province, and will certainly add to our economic impact in Nova Scotia.

 

I want to take a minute, Mr. Chairman, to talk about rising power rates - and I know it's probably been front and centre on many peoples' minds here today, the rising cost of energy. When our government came to power in 2009, we heard from many Nova Scotians that they were concerned about the cost of electricity and of home heating fuels - and no one should ever have to choose, really, between heating their home or feeding their family. This government is providing more supports to help Nova Scotians address rising costs; in fact, one of the very first things we did when we came into government was to eliminate the HST from home heating bills. This government, as we also know, provides home heating rebates for low-income Nova Scotians. So those simple measures alone save Nova Scotian families millions of dollars every year.

 

But, we did not stop there. We are attacking the rising cost of energy, actually, on a number of fronts. Government has introduced supports and programs designed to offer assistance and encourage energy efficiency among lower-income Nova Scotians. And in 2012, the Low Income Advisory Committee was created by the URB to identify opportunities to ease the challenges of power consumption, and account management for low-income customers. This committee includes representatives from Nova Scotia Power, from the Affordable Energy Coalition, the Consumer Advocate, of course, the URB themselves, and also the Department of Energy and the Department of Community Services, as well as others. This committee will be recommending to the URB, later this year, clearer, fairer rules for bill payment arrangements, for late charges, and for disconnection procedures.

 

And if I might take a minute, Mr. Chairman, just to talk as an MLA - I know each of us in this House often are approached by constituents who are having challenges with their power bill, and usually disconnection is a real concern or a threat to a family. And so this committee will be working with URB and the other partners, as I mentioned, to try to find some workable solutions, especially for low-income Nova Scotians. Through the Department of Community Services, also, emergency heating assistance is available to help income assistance clients in an emergency state; in fact, through this program, over $900,000 has been spent to keep income assistance clients with heat and lights in their home. This government continues to support the Heating Assistance Rebate Program, or often we refer to it as HARP, in which lower-income Nova Scotia families can participate.

 

But the best way, of course, to help lower energy bills is through energy efficiency programs, and I want to take a minute to talk about Efficiency Nova Scotia. Efficiency Nova Scotia operates programs to help low-income homeowners improve energy efficiency and conservation, which generates permanent and cumulative savings and can lower reliance on assistance programs and grants - two such Efficiency Nova Scotia programs are the low-income homeowner service and also the direct installation of efficient products. Now, the homeowner service program provides energy audits and turnkey retrofits, and since 2010 there have been over 2,750 participants - and the work is done at no cost to the homeowner. The work is completed by qualified contractors, and each homeowner will see energy savings of about $750 on an annual basis and that's not only this year that's next year and for all the years that follow without any additional investment by the homeowner or by government. With those types of savings it's not hard to see why this is a very worthwhile program.

 

The other program I mentioned earlier is the direct install of efficient products and this program provides services like CFL lightening, hot water tank insulation, low-flow shower heads and faucet aerators. Since 2010 there have been more than 21,000 participants, including an estimated 3,000 low income Nova Scotians, to benefit from this program this past fiscal year alone. These efficiency measures can see households realize annual savings of up to $160. The average homeowner will see those energy savings of $160 this year and again next year, and in all the years that follow, without any additional investment by government or by the homeowner themselves.

 

Mr. Chairman, 1,326 lower income households received building upgrades such as wall and attic insulation as well as air sealing. These measures translate into total energy savings of over $767,000 on an annual basis.

 

As these efficiency programs indicate, one of the best ways to lower the cost of power is to identify ways to conserve energy in our homes and in our businesses. Government programs are encouraging more Nova Scotians to conserve energy in their daily lives. Through Efficiency Nova Scotia in 2012 alone, Nova Scotians took efficiency measures that will lower future electricity cost by about $136 million for households and businesses. That means that there was enough electricity saved through these efficiency programs to power about 16,000 homes. In fact, Mr. Chairman, every dollar that's invested in energy efficiency returns more than $2 in energy savings to Nova Scotians. I would say that's an excellent investment on the part of Nova Scotians.

 

Our plan includes directly supporting programs for households, particularly low-income residents as you just heard, and businesses through Efficiency Nova Scotia, including home energy assessments, appliance retirement programs, a low income home owners service, and also business energy rebates. These programs make a real difference in the lives of Nova Scotians and we'll give you an example of that. Take for instance Weldon and Rose Nickerson of New Waterford who have a yearly savings of about $170 on their electricity bill and their monthly oil bill is cut almost in half, thanks to help from Efficiency Nova Scotia. Another example would be Terry and Pam Punch of Halifax who were able to invest in a woodstove, with help from Efficiency Nova Scotia, that resulted in seeing their bill drop from $912 in January and February, before the woodstove was installed, to today about $360 for the same time period, with that woodstove.

 

Mr. Chairman, businesses both large and small are also benefiting from efficiencies programs. As an example, Glen Tutty, who is the owner of the Joy Gift & Jewelry Store in the Mayflower Mall in Sydney, praises Efficiency Nova Scotia for the retrofit of LED lighting in his store that translated into 35 to 40 per cent annual reduction in his power bill, and in addition, of course, he had very bright and cheery store that welcomed the customers to come inside.

 

Another example in Stellarton, Sobeys partnered with Efficiency Nova Scotia on a number of energy efficiency initiatives to help reach its sustainability goals including insulation of variable speed drives on heating ventilation and air conditioning units, LED freezer lights and strip curtains, energy efficient lamps, occupancy sensors, and anti-condensation refrigeration controllers. This retrofit helped Sobeys achieve energy savings of over 4.9 gigawatts, a savings of over half a million dollars in annual electrical costs and the reduction of its environmental footprint by over 3,700 tons of CO2. Savings were so impressive that comparable measures were taken in a number of other Sobeys stores elsewhere in the region.

 

Another example of a business that has benefitted from Efficiency Nova Scotia program, in the Amherst area, PolyCello, an industry leader in flexographic printing and flexible packaging solutions, needed to reduce their electricity costs to stay competitive. With the help of Efficiency Nova Scotia, they installed a more robust and energy efficient chiller solution, which is a key piece of infrastructure for the company's manufacturing line. This new chiller is estimated to save more than $50,000 in energy savings and to reduce maintenance costs by about $5,000 a year. These are worthwhile investments that save these businesses money and certainly reduce their carbon footprint.

 

Efficiency Nova Scotia is already delivering programs at a lower cost than seen under the former Conserve Nova Scotia program as it gains efficiencies for multi-year program commitments and a larger volume of activity overall. The energy efficiency industry is an important employer here in Nova Scotia. I know members will be familiar, in their own area, with companies that supply these programs. Energy efficiency programs generate more than $40 million in business annually for energy consultants, engineers, electricians, contractors, retailers and various suppliers around the province. In fact, in the northern region where I hail from, there are about 40 people employed with Trinity Maintenance in providing these programs throughout northern Nova Scotia.

 

We will continue to support energy efficiency upgrade programs for low income Nova Scotians as well as for owners of existing and new homes. Government is also supporting Efficiency Nova Scotia's efforts to manage energy demand by consumers. By changing how Nova Scotians think about and use energy, showing them how to conserve, we can help ease demand on the power supply. What we're really doing is transforming our energy future because we are also attacking the province's decades of reliance on costly imported coal to generate electricity.

 

In recent years the cost of coal has risen by 75 per cent and that high cost is one of the main drivers behind rising power bills. It is also polluting our environment. In fact, new federal law requires us to significantly reduce greenhouse gas emissions from this sector by the year 2030. These new limits on greenhouse gas emissions will require Nova Scotia to continue to reduce its emissions from coal-fired energy. These requirements force us to significantly change how we generate and use electricity so that we can reduce our greenhouse gases by more than half between 2010 and 2030.

 

This means this province's reliance on coal is truly no longer an option. I'm happy to say our government has taken a number of steps to transform how we generate energy in this province. Because in 2010 we set out on a renewable path, the federal government entered into an equivalency agreement with the province so that the federal greenhouse gas reduction targets for the electricity sector could be met our way. That is through a diverse, local and regional supply of cleaner energy, in fact, already being on a sustainable path will result in $1 billion in savings to the ratepayers over the federal option. That's certainly significant. I would like to add that government also has in place renewable targets that would see 25 per cent of our electricity come from cleaner energy sources by the year 2015 and 40 per cent is our goal by the year 2020.

 

These targets are in place to meet both environmental and energy objectives. They're designed to protect the health and well-being of future generations. This government continues to seek out numerous avenues of renewable, local, clean energy. The actions we are taking will move us away from being reliant on a single energy source and towards using more local, green and sustainable sources from our communities and from our neighbours.

 

Diversifying our energy mix will also stabilize electricity prices over the long term, while reducing greenhouse gas and other harmful emissions. Government is looking at the best ways to develop Nova Scotia's abundant renewable energy resources. One of those ways is through tidal energy. My department has introduced the Marine Renewable Energy Strategy last spring, with a focus on three main components: research, development, and regulations.

 

The strategy will guide tidal development in Nova Scotia, as we move through the research stage through to commercial production. The Marine Renewable Energy Strategy was developed with input from many of Nova Scotia's greatest minds in the oceans sector. It sets out broad policy and economic and legal conditions for renewable energy projects, technologies, and services from our ocean. It also prepares us for commercial development and the establishment of a new industry, particularly around in-stream tidal.

 

Included in the strategy is a plan to harness some of the most powerful tides in the world, in order to produce safe, clean, local renewable energy for Nova Scotia. Certainly, the Bay of Fundy tides are recognized as some of the very best in the world, and have a huge potential here for our marine renewable sector. The Marine Renewable Energy Strategy will help us develop the expertise, the experience, and the infrastructure to ensure that Nova Scotia is a centre of excellence for tidal energy projects.

 

The power of tidal currents has fascinated researchers here for many decades. In fact, Mr. Chairman, Nova Scotia has more research and more technology companies focused on the ocean than in any other area of North America and we continue to build on this. The province has a well-developed and diverse marine industry with strong research capability. In fact, many of the world's leading technology developers already have a presence in Nova Scotia and so tapping into this expertise gives our province a competitive advantage, when developing new technologies to harness the tidal power.

 

Highlights of our work include updating the strategic environmental assessment of the Bay of Fundy to gather information on how commercial development of the industry will impact the region socially, economically, and environmentally. We are also undertaking a collaborative tidal energy resource assessment in the counties of Shelburne, Yarmouth, and Digby counties, involving Dalhousie and Acadia Universities, the Nova Scotia Community College, and Fundy Tidal Inc.

 

The assessment will include all phases of potential development and recommendations on the best places to deploy tidal devices. Certainly, as is well known, Mr. Chairman, in the Cumberland County area, the province has established the FORCE project, the Fundy Ocean Research Centre for Energy. It's a world-class tidal energy testing and research station near Parrsboro, where industry and government and academics are working together to develop technology that can withstand the Bay of Fundy's tides.

 

Our department is also working closely with Marine Renewables Canada, the industry organization that was created to support the development of that sector. Although this organization is national in scope, its focus is where the tidal opportunity lies, and that's right here in Nova Scotia.

 

We'll take a minute, Mr. Chairman, to talk about our solar potential in Nova Scotia. We're certainly also seeing strong progress on initiatives to capture solar energy, particularly with the introduction of the Solar City Program here in HRM, the Halifax Regional Municipality, and the funding provided over the past two years, and this year, is sufficient to fund about 1,000 installs into homes here in HRM through the Solar City Program. Efficiency Nova Scotia, of course, manages those funds for the province. We will continue to support this project and ones like it across Nova Scotia, to take advantage of this clean energy source.

 

Another renewable energy source is biomass. Biomass can be used for electricity production and also for heating. With changes to the pulp and paper industry and the significance of sustainable forestry practices, energy generated from biomass is an important part of our renewable energy plans. Perhaps nowhere else in the province is this more apparent than in Cape Breton where one biomass project is almost complete - that's at Port Hawkesbury - another one is just beginning in their process.

 

The Port Hawkesbury paper mill is home to the 60 megawatt biomass combined heat and power plant. This project will use renewable wood fibres to produce electricity for electricity ratepayers and it will also use the steam that is produced for the Port Hawkesbury paper mill. The plans for the new biomass facility have been announced and the plant is expected to be on-line later this year, most likely by mid-summer.

 

In Sydney, the Harbourside biomass project, operated by Cape Breton Explorations, will generate six megawatts of energy and create 15 new jobs at the plant, plus about 50 additional new jobs in the forestry sector. Cape Breton Explorations has received approval to proceed to have the project reviewed as part of the Community Feed-in Tariff program, the COMFIT Program, as it's known.

 

Another large biomass project that has been operating in Nova Scotia for many years is the Brooklyn biomass plant in Liverpool. This biomass plant certainly plays an important role in western Nova Scotia, providing a market there for sawmill residues. In fact, they're highly integrated. The sale of sawmill residues to the biomass plant provides an important source of additional revenues for sawmills there in the southwest region.

 

While I think you'll agree that this is a valuable use of Nova Scotia's abundant forestry resources, biomass certainly must be harvested in a sustainable manner if it is to be considered a truly renewable energy source. I know that within the Department of Natural Resources, we're involved in this process and we recommended a cap on the amount of primary forest biomass to be harvested for electricity production. This cap has been incorporated into the Renewable Electricity Regulations. It is at a clear understanding on the types and the amount of biomass that can be used for electricity production. Project developers must provide a fuel procurement plan to the Department of Natural Resources. The plan would outline the types of biomass that will be used at the facility and certainly the steps taken to ensure that trees that are harvested go to the highest and best use.

 

I want to take a minute to talk about our very important wind energy here in Nova Scotia. As we know, wind is also a very valuable and clean energy source. Through the Renewable Electricity Administrator process, three commercial-scale wind energy projects were announced this Fall that will create good jobs and result in $200 million in new investments. The projects are located in Lunenburg and Guysborough Counties, and will help stabilize electricity prices in Nova Scotia, and certainly will also benefit our environment.

 

I'd like to take a moment just to clear up some misinformation about the Renewable Electricity Administrator, or the REA process, as it's known, and in particular, Nova Scotia Power's partnership in those projects. The REA process is run independently of both government and of Nova Scotia Power in a fair and transparent manner to ensure the best value for ratepayers. The call for bids by the Renewable Electricity Plan - on Pages 9 and 10 of that 2010 Renewable Electricity Plan - provided the definition of the independent power producers under the Renewable Electricity Regulations.

 

This definition allows for a minority Nova Scotia Power involvement as a public utility. I know that was discussed at some of the stakeholder sessions leading up to the awarding of the bids. It's certainly an option that all applicants had. In fact, I know the Municipality of the District of Guysborough actually sought out the utilities partnership. Also, any time that Nova Scotia Power wishes to make a capital expenditure, it must be approved by the URB.

 

The fact remains that the lowest bidders were successful in that process. In fact, over the lifetime of the project, with Nova Scotia Power's involvement, the savings to ratepayers will be over $50 million. We expect the URB will soon render a decision around Nova Scotia Power's capital spending on those projects.

 

I mentioned the COMFIT program and COMFIT stands for Community Feed-in Tariff and it's a program that plays an important part in our energy transformation. The program encourages communities to submit the project proposals for renewable energy developments that will generate energy in their own backyards. Many of those projects are wind, although we're seeing other proposals in tidal, in solar, and in biomass as well. Every megawatt of energy produced through the COMFIT results in significant economic activity in the local community.

 

I'm pleased to report that the COMFIT has been an overwhelming success to date. More than 100 locally based proposals have been submitted by more than 20 community groups so far including tidal, river hydro, wind, and biomass projects. Truly COMFIT is a made-in-Nova Scotia model and the first of its kind in the world. We're very proud of the program and its initial success.

 

In March of this year we marked the first COMFIT projects to go on-line. I was at that announcement in Stellarton and there were 56 50-kilowatt turbines in total, three of those were in Goldboro in Guysborough County, two in the Tatamagouche area in Colchester, and one by the Town of New Glasgow at their water treatment facility. The energy produced from these wind turbines will be sold to the electricity grid and certainly used in the communities where it was generated.

 

The wind projects will also create jobs in the local communities and improve our environment. These wind projects will provide their communities with a renewable power source at a stable rate for the next 20 years. In total these six new on-line projects will produce more than 600,000 kilowatt hours of energy within the next year and that's enough power for 120 homes. That's the kind of impact that COMFIT projects have on the communities in which they are constructed.

 

Another great example of communities participating in their energy future is the Eskasoni First Nations 4.4 megawatt COMFIT wind project. That project will be on the same site of the six megawatt Millbrook First Nation wind project, which was approved last February. Both communities are working together on the required grid impact study and the federal and provincial environmental assessments as well as the community engagement strategy. Construction is expected to be finished there in 2014.

 

In the Annapolis Valley, Annapolis Valley Waste has received approval for a 50 kilowatt COMFIT wind turbine project to be located in the Kentville Industrial Park. Once completed and in operation this clean, local, and renewable project will also bring with it local benefits such as reducing greenhouse gas emissions and without mentioning really truly stable electricity prices.

 

The province also works with people in Cape Breton to help them enjoy the benefits of clean, green, renewable electricity generated in their own backyards, while encouraging local economic opportunities. I just want to take a moment to mention some of those projects in Cape Breton, these are COMFIT projects: first of all Cape Breton Universitiy's 5.4 megawatt wind project in Sydney, I remember we announced that at CBU on Valentine's Day of last year, so that was a significant event; Fundy Tidal's half a megawatt tidal industry project in the Bras d'Or Channel; Port Hood and District Recreation Centre's 250 kilowatt small wind project in Cheticamp; Celtic Current's 1.9 megawatt project in Point Aconi; Watts Wind Energy 0.8 megawatt project in Lingan; a 3.5 kilowatt research project near Cheticamp; also Wind4All Communities have a 4 megawatt project in Barrachois; Fundy Tidal's 100 kilowatt project in the Barra Strait; the 0.9 megawatt project in Grand Étang and finally, two 50 kilowatt small wind projects also in Cheticamp. As you can see, there have been numerous communities across the province that are truly becoming engaged in their energy future and this will make a difference.

 

I want to emphasize that under the COMFIT program the applicants must show that there is community support for the projects, for them to move forward beyond the first approval stages.

 

I want to turn now to the Maritime Link. A major part of the province's energy plan and a theme of much discussion, both inside this House and outside, is the Maritime Link project, which will connect Nova Scotia to Newfoundland and Labrador's vast hydroelectric supply by overland and subsea cable. We commissioned energy expert John Dalton who evaluated Nova Scotia's energy alternatives for this project based on the lowest long-term costs to meet environmental and federal requirements and the best option to improve reliability, security, and to be more competitive in the market place.

 

The Lower Churchill Maritime Link project is the lowest, long-term option. In fact, it was $400 million less expensive than importing power from Hydro-Québec and $1.5 billion less expensive than generating more power in Nova Scotia. The Maritime Link promises to provide price stability for 35 years and gives Nova Scotia two connections to the North American grid, securing our supply and promoting competition, which is certainly better for all of us.

 

The Link will provide access to hydroelectricity from Muskrat Falls in Newfoundland and Labrador and truly will, for the first time ever, place us in an energy loop instead of being at the end of the energy line. That loop will allow us to access energy from multiple sources at competitive regional rates. With a 35-year contract at a fixed price, the Maritime Link offers Nova Scotians some shelter from the volatile fossil fuel world market. The more we build a cleaner regional energy infrastructure and move away from coal generation, the more stable and secure our energy prices become. The project will have significant payoffs, including reduced greenhouse gas emissions, price stability, energy dollars staying right here in our regional economy and hundreds of new jobs.

 

Dalton's research confirmed that the Maritime Link project is the lowest long-term cost option to not only meet our energy goals but also our environmental targets. Although the project requires an upfront investment, this investment is reasonable in order to reap the rewards of an additional clean energy source. Truly, the project is a once in a lifetime opportunity to help lower our power rates over the long term.

 

Emera has estimated the Maritime Link will have an impact on electricity rates of less than 1 per cent per year for the first five years. In fact, they're estimated at about 0.95 per cent, less than 1 per cent, and then the price will stabilize or decline after that. That estimate from Emera is about $1.50 per month for the average household.

 

The URB will review the cost on all the options and it will determine whether the Maritime Link is the best option for ratepayers. I might add that I have every confidence that they will view this as the best option. However if the URB does not approve the project, I want to make it very clear that not a penny will come from ratepayers. Will this stop the project from moving forward if it's not approved by the URB? That's really a question best left for Emera and Nalcor to answer. I do know however that both companies are very committed to seeing this project move forward.

 

I want to talk about renewable energy projects. The principle of investing up front to lower our energy costs over the longer term also applies to renewable energy projects. It takes significant investment to build wind projects, to install tidal turbines, and to develop other forms of infrastructure to harness renewable resources, but the long term benefits are huge.

 

Once we invest in the infrastructure to harness the renewable resources, the rest is relatively low-cost. You don't have to pay for the water for hydroelectricity; you don't have to pay for the wind; you don't have to pay for the sun. That's why renewable energy projects make so much sense.

 

All of these initiatives I've just mentioned fit into our province's overall energy plan, Nova Scotia's plan is for the lowest, fairest energy rates, to stabilize rates over the long term. Nova Scotia's energy plan is clearly focused on a future that has more diverse energy, is local, reliable, green, tax-free and efficient. Those are the five pillars of Nova Scotia's plan for the lowest, fairest energy rates. It's an Atlantic Canadian solution that ensures a stable energy future at the lowest, fairest cost to Nova Scotians.

 

Nova Scotia's energy plan presents a new approach to how we generate and use energy. It means embracing new, sustainable practices and cleaner sources of energy. It means using more local, reliable energy sources that will reduce our dependence on costly imported coal. Part of that plan also includes evaluating access and pricing volatility for natural gas, to develop an approach that will provide more affordable and stable prices for ratepayers.

 

Developing a provincial plan is only one part of the work. Certainly the most important part is following through with that plan, making sure that Nova Scotians know that, no matter what, this government is doing the right thing for them both now and into the future.

 

Recently I had the privilege, along with my ministerial assistant, the member for Hammonds Plains-Upper Sackville and also my Deputy Minister Murray Coolican, to present the energy plan to people in communities across this province. This was an opportunity to share information on our plan and to showcase the exceptional energy projects that are already underway. We also had the opportunity to share details relating to the Lower Churchill, the Maritime Link project. Actually we stopped in nine communities across Nova Scotia, from Yarmouth, to Port Hawkesbury, to Berwick and we also stopped in Stellarton, Amherst, Bridgewater and a number of other communities.

 

People there told us that it made a big difference to hear about the plan for the Lower Churchill and Maritime Link. They heard it directly from us and then they were able to ask various questions following our presentation. People at each of our tour stops told us that they agree with our direction towards cleaner, more stable sources of electricity. That feedback tells us that we're on the right path.

 

The province's energy plan is well underway and we're seeing evidence of new sustainable energy projects in the regions across Nova Scotia. These areas are benefiting from the results.

 

I know my time is winding down, Mr. Chairman, but I want to take a minute to talk about sustainable transportation. Sustainable transportation is a major focus of our energy plan and stands to transform our communities in a very positive way. The province is putting the final touches on a sustainable transportation strategy that will outline the best ways to introduce sustainable modes of transportation to communities right across our province. That plan will be ready for release soon.

 

We recently introduced a sustainable transportation pilot program called Nova Scotia Moves, which provides grants up to $200,000 to support local initiatives that encourage people to drive less distance, to move more actively and efficiently, to use cleaner energy, not to mention access a wider range of sustainable transportation options. The Nova Scotia Moves program is successfully engaging communities around sustainable transportation issues.

 

In March, just last month, under this pilot program grants were provided to 28 community groups for sustainable transportation projects. For instance, the Halifax Regional Municipality, under their program, will introduce pedestrian and bicycle-friendly bridges and a level railway crossing to make pedestrian and bicycle access to downtown Halifax more accessible.

 

Another project under the Nova Scotia Moves was the Ecology Action Centre will move ahead with the Go Maritimes plan to create an on-line tool with easy access to information around ground travel options in Nova Scotia. A third project I'll mention is the Halifax Cycling Coalition will advance its plans to build a network of bike-friendly businesses and the support links between cycling and public transit.

 

Chester students on the South Shore will have access to a Community Wheels program that will take them home from after-school recreation activities so they can stay active and connected with their friends. Another example, in the Annapolis Valley, the Village of New Minas will develop 3.1 kilometres of a sustainable active transportation trail on the Windsor to Hantsport railbed. This would be part of the Blue Route and will serve both the commuters and those looking for recreation.

 

A new bicycle co-op called the Deanery will be developed on the Eastern Shore that will serve as a central hub for cycling instruction, bike maintenance workshops and other promotional events involving youth and community members. A safe walking path will be developed linking two schools with recreational facilities in West Hants, along with more community education about road safety.

 

These examples highlight the valuable projects that are being supported by the Nova Scotia Moves program. We expect to be in a position very soon to call for more proposals under this program.

 

I want to talk a minute about natural gas in Nova Scotia. Natural gas also plays a role in Nova Scotia's plan for the lowest, fairest energy rates. This government has made solid progress in rolling out natural gas in the province and Heritage Gas has connected more than 20,000 Nova Scotia households and businesses and we continue to work with the company to expand infrastructure and to extend access to more Nova Scotians. In fact, since 2009 the use of natural gas has risen from just 13 per cent of our electricity mix to today, about 21 per cent here in Nova Scotia.

 

Oxford Frozen Foods and the Town of Oxford now use natural gas as their energy choice. The change is helping them save money and contributing to a cleaner environment and I know very recently we announced that natural gas was coming to Pictou County and it will be available to a number of businesses and institutions and, in time, to a number of residents in the area. I know there is certainly some excitement about that in that area.

 

Compressed natural gas will soon be trucked also to large businesses and industry in Nova Scotia. Heritage Gas is currently developing its compressor station in the Aerotech Park and is on schedule to start serving the Shaw Brick plant in Lantz this Spring. The conversion to natural gas will provide significant savings for Shaw.

 

I know my time is just about finished and I want to conclude by saying that I think we're well on our way to transforming our energy sector. We've never lost sight of our main objective to ensure the lowest, fairest energy rates over the long term. We put a plan in motion that will see our reliance on costly imported coal drop significantly, a plan that will diversify our energy mix, a plan that will tap into clean local and regional power, a plan that will help us meet our federal and environmental obligations, a plan that will reduce our environmental footprint, and a plan that will stabilize rates over the long term.

 

The vast oil and gas potential of Nova Scotia's offshore also represents vast potential for good jobs and a growing prosperous economic future for workers, for families, for communities and for businesses across the Province of Nova Scotia. This year's budget reflects those priorities, as the Department of Energy continues to set policies and support programs that will create jobs, provide the lowest, fairest energy rates and improve our environment over the long term.

 

Once again I want to commend the Department of Energy staff on their diligence and determination to get the job done right, leaving no stone unturned, to do the best job possible and to put in place the best framework to transform our energy future for the benefit of all Nova Scotians. I thank you for having the opportunity here for a few moments to tell you about many of the great things that are happening in the Department of Energy and I certainly look forward to hearing from my colleagues across the floor, their comments or their questions on what they feel is important for energy here in the Province of Nova Scotia. I'll take my seat and look forward to the comments from the members on the other side. Thank you.

 

MR. CHAIRMAN: The honourable member for Dartmouth East.

 

MR. ANDREW YOUNGER: I have a lot of area to cover. I think I will start by asking some questions related to your own opening remarks, that seems a reasonable place to start. In your remarks you said if the Utility and Review Board were to turn down the Maritime Link that you couldn't say what will happen and so forth.

 

I'm wondering about that because just a few days ago the Premier was quoted saying quite the opposite, almost exactly the opposite of what the minister just said. In fact, he said, "People, I think, may think that it has to do with the UARB hearing. But that project is going ahead and the only question is how that's going to happen". That was the Premier who said that and I will table that, of course. That is the exact opposite to what you just said in your opening remarks, minister.

 

I guess the question I have related to that is, your remarks are one thing, the Premier's remarks on behalf of the project have raised quite a bit of concern in the industry, especially because that's what we saw happen in Newfoundland and Labrador where in Newfoundland and Labrador the Utility and Review Board determined that it did not have sufficient time or information to make a decision and instead the government chose to legislate the project. Maybe the minister could clarify the difference between his remarks and those of the Premier?

 

MR. PARKER: Certainly, as I mentioned in my remarks, this is a once in a lifetime opportunity for Nova Scotians, for Maritimers. I think the Premier has called this a game changer for Atlantic Canada and truly for all of Canada. It's an opportunity to bring in clean, green renewable energy from Muskrat Falls through the Maritime Link. We'll certainly cut down on our environmental impact with greenhouse gases and it will get us off dirty imported coal and will provide a reliable source of energy for 35 years at a stable rate. There are many good positives about the project.

 

The decision on whether it moves forward or not is really up to the Utility and Review Board, the URB. That's what they've been charged to do and they will look at all the evidence and all the information that's available to them from Emera, the applicant, I guess it's officially called Nova Scotia Power Maritime Link. They'll present evidence, as will various interveners will be there to present evidence and have the chance to cross-examine each other, to test the evidence that's available to them, and determine whether or not it is in the best interests of ratepayers of this province.

 

That's their role, that's their job. Power Advisory LLC, through Mr. John Dalton, will be part of that evidence as presented there and he will have to defend his reputation. He'll have to defend his study and under full cross-examination from any and all that are there, including the members of the board themselves.

 

If the board determines that it is the lowest and fairest rate and meets the parameters as determined by the Maritime Link Act, then it will determine whether the ratepayers will have the option to participate in that opportunity.

 

I will say, as I did in my opening remarks, that not one penny will be charged to the ratepayers unless the URB determines that it is the lowest and fairest rate for Nova Scotians and is better than the options or alternatives that are presented around hydroelectricity from Quebec or through homegrown sources of wind or natural gas here in Nova Scotia, or a combination of those two.

 

If the board determines that it is the lowest and fairest cost, then it will be determined what that should be in the rate base for consumers in this province. I do know also that Emera and Nalcor have indicated - or I think Nalcor have sanctioned the project in Newfoundland and Labrador and they wish to move forward with the project and they'll look at the markets.

 

It is an opportunity for us if the URB determines that it is the best option for Nova Scotians, that it will be incorporated into the rate and it will be available to homes and businesses and industries in this province - but if they determine that it is not, then not one penny will come from ratepayers in this province. On the other hand, if the companies are determined that they are going to move forward with the project, we hope that it will be feasible for the ratepayers in Nova Scotia.

 

MR. YOUNGER: Mr. Chairman, I'd appreciate it if the minister would actually try to just answer the question. We all listened patiently and quietly to his opening remarks and I'm sure that he appreciated that we listened attentively, but in all those seven minutes or thereabouts that he just spent speaking, he actually didn't answer the question, so I'm going to ask him again.

 

The Premier said the complete opposite to what the minister said in his opening statement, and all I want to know is I want to know the difference - did the minister misspeak or did the Premier misspeak? They are only a few days apart. It's really a straightforward question, Mr. Chairman, I really just want to understand which position is correct because they are actually the opposite position. The Premier said that the project is going ahead regardless of the URB and the minister has said that it is going ahead if the URB approves it - I just want to know which is correct; I think that's pretty straightforward.

 

MR. PARKER: Mr. Chairman, well I believe that both positions are correct. The project is going to go ahead; it has been sanctioned by Nalcor and Emera. They said they're going to build a project and it's going to be coming into Nova Scotia. It would be coming through Nova Scotia to other market possibilities in New Brunswick or Prince Edward Island, or Maine or elsewhere in New England.

 

So they've sanctioned, yes, it's going to go ahead. Is it going to be used by ratepayers in Nova Scotia? Well that's the job of the URB. Absolutely it's coming through the province, into the province and through the province. The role of the URB is to determine whether it's in the best interests of the ratepayers of this province. That's exactly the job of the URB, to determine whether that is fair and just for ratepayers in this province.

 

I explained in my previous answer the job and the role and how they determine that - but not one penny will be charged to ratepayers if it's not determined to be in the best interests of the ratepayers of the province.

 

On the other hand, the project is going ahead and will be coming into Nova Scotia and through Nova Scotia as well.

 

MR. YOUNGER: Mr. Chairman, last week - I think it was last week or the week before, actually the very last week and the week before, the minister repeatedly stated in this House that the Utility and Review Board had not asked for additional time to look at the Maritime Link - and that's fine, we accepted his answer - but of course then, on April 12^th, the minister wrote a letter to the board, signed by the minister, which I will table in a moment, where he actually acknowledges that the board's initial advice to the province was that the board be permitted to take whatever time it reasonably required to process the application and that, in fact, the six months was a minimum, but that's not what they wanted.

 

That letter, Mr. Chairman, is actually signed by the minister and dated just last week, after he was questioned about this in the House and said not quite the same thing. That's fine, the minister is entitled to not wish to choose to extend the Link time frame but I'm just wondering if the minister can clarify why it was that he insisted the board didn't want additional time when, in fact, he wrote the board last week and actually acknowledged that their initial request and their primary request was exactly what the Consumer Advocate is now asking for, the Small Business Advocate and what we suggested was to just let them decide how much time they need. Don't make it political at all, just let them decide. I'll table that. I'd like some clarity on why that is.

 

I'll just clarify what I'm getting at, Mr. Chairman. The minister has stood up a number of times today and previously and said that the board are the best ones to make a decision if this is the fairest and the cheapest and all that, and if he honestly believes that, then why isn't he allowing them to do the process in the way that they actually recommended?

 

MR. PARKER: Mr. Chairman, certainly it's important that we get this right and that the board be given adequate time to make that right decision. We passed the Maritime Link Act here in this House, as the honourable member would remember, about a year ago, I think it was last May, the Maritime Link Act was passed unanimously here by the Legislature, by all members supporting it.

 

Then the regulations were put out for public comment last July and August and we had a few interveners who came forward, although I didn't hear from anybody from this Legislature at that time, but the board had a number of people who looked at the regulations and had some various comments and ideas on how to move forward.

 

Then we also did consult with the board on this Act, on the regulations, on the time frame, and I have the letter that the honourable member is referring to, with me as well. I want to read part of it at least:

 

"I am writing to confirm the Government's intent to maintain the current language of the Act and Regulations. As you are aware, the Act was passed with all party support and the Regulations were subject of consultation and input from the following stakeholders:

 

Consumer and Small Business Advocates -- John Merrick and Nelson Blackburn

Emera

Michael Bradfield

Andrew Bruce

Gretchen Fitzgerald, Sierra Club Atlantic

Bruno Marcocchio, Sierra Club

David Vardy

Earl Young.

 

Also, as required in the Act, consultation took place with the Board. The final regulations reflect input from the Board, particularly with respect to scope of the review. I would also note that the need to require a timely decision reflected project timelines and requirements by Governments of Canada, Newfoundland and Labrador and Nova Scotia.

 

The Board's initial advice to the Province was that the Board be permitted to take whatever time it reasonably required to process the application. The Board noted that six months was the minimum time required assuming a reasonably complete application.

 

After all of its consultations, the Province of Nova Scotia determined that a requirement for a decision 180 days after receipt of an application was a balanced approach to ensuring a thorough review and a timely decision."

We felt that six months was an adequate time period and the board was consulted as well as all those other groups and individuals that I mentioned. Again, the Act was passed here with unanimous support in this House, as well as every opportunity during the regulation time for comment by all those who were interested. Again, we feel it is adequate time to make an informed decision.

 

MR. YOUNGER: Mr. Chairman, once again the minister hasn't bothered to even try to answer the question, and it's a shame - if he wants to make a mockery of this process, that's fine, but I'm sure Nova Scotians will hold him to account for that.

 

The fact is that he's right, the Act which the minister stood for weeks in this House and said was actually not needed, yet we insisted was needed - the minister stood in this House and insisted day after day after day, and the Premier stood in this House day after day after day and said that Act was not needed, and he was wrong, the members of the House voted unanimously in favour of, he's right.

 

The timeline for the review is not in there, and he is wrong when he says that we did not comment because, as a matter of fact, during the regulations we made a public statement and said that we were satisfied if the minister followed the advice of the board. The advice of the board, by the minister's own admission in his April 12^th letter, was that the board be given whatever time they deemed necessary - not what time he deemed necessary. So, in fact, the minister didn't follow our advice on the regulations, despite his inaccurate statements that we did not comment, because we did, we made a public statement saying that we would not make it political as long as he followed what the board recommended. He didn't do that.

 

He's right, I acknowledge that they consulted the Consumer Advocate, that they consulted the Sierra Club, those same people who are now saying, having seen the volume of information, more time is required.

 

Now the problem with this is and the answer that the minister is unwilling to give is very simple; it's the answer to a very simple question. Many of those people who told the minister just months ago that they thought, okay, you're going to go with six months, we can probably live with that, have now seen the documentation and data and said it's not possible. The Consumer Advocate has said that, the Small Business Advocate, and the only reason he can give is in his letter, which is the Government of Canada says we need to do it. Well is this project for the Government of Canada or for the people of Nova Scotia?

 

He's saying that the Utility and Review Board, if they're able to do a complete review, will show it's the lowest and fairest cost. If that's true, then why is he unwilling to let the board have whatever time it deems necessary to do that? I think the minister would do well to remember what has happened in Newfoundland and Labrador where the board reached the end of an artificially imposed time frame, was unable to review all that information and, in the end, decided to make no decision, which forced the Legislature to legislate the project because the Utility and Review Board came to the end and said sorry, we don't have enough time.

 

This morning - it must have been this morning - it might have been Friday afternoon, but I think it was this morning, the minister is probably aware the board put out a letter with the new time frame for the hearing dates. One of them is on a Saturday - that's fine, it doesn't make much difference to me, but they put it on Saturday because they said basically we can't extend this anywhere so we're going to have to start moving into Saturdays, and maybe we'll go to Sundays if we don't get through all the questioning.

 

Well that's all fine but at some point that's got to point to the minister that there are people trying to work within his time frame and they're having trouble doing it. The minister - we can take a recess for two minutes - he can go to the computer and see that the board's Web site has been down most of the day and that the interveners have not been able to access the Maritime Link documents to even review them. There's an apology from the board on there, or there was this morning, talking about that.

 

These are things that the board, in a normal hearing, would deal with. So the question is really quite simple. This isn't about the fact that everybody voted for the Maritime Link Act, an Act which the minister stood up in this House repeatedly and said wasn't needed. He's right, everybody did - the time frame wasn't in it.

 

It's not about whether he spoke to the Utility and Review Board at the time. We know he did, in fact he said in his letter that they asked for more time and that six months was the minimum. His own letter acknowledges that they said that was the minimum, but really they should be allowed to set their own time frame.

 

So the question is really a simple one. At the time the board said that they should be allowed to set the time frame, and they would do that when they see the information, and that would allow them in a circumstance like now to extend it by a week or two weeks or whatever is necessary. So fine, that didn't happen.

 

I accept that the minister - I don't think that the minister at the time was doing this with bad intentions at all, I think he thought that yes, six months, that's reasonable. But he knows it isn't now. All the interveners, the people that this government created legislation to create, like the Small Business Advocate, are saying it's not enough time. So it's a really simple question as to why the minister is unwilling to grant an extension to address that issue. I haven't even heard Emera say that they are opposed to it. The only person that I've heard oppose doing an extension, publicly anyway, is the minister.

 

So it's a very simple question. Knowing now how much information is presented and knowing now the response of the interveners - and even if he wants to ignore interveners like us or groups that the Premier's Office has called lobby groups, even if he wanted to ignore all of those ones - the Small Business Advocate, the Consumer Advocate, the industrials, all of them have said no, there needs to be more time. So the question is, why will the minister not now grant even a short extension to ensure that what he is saying - I mean if he's saying it's the cheapest and fairest rate, great, but the interveners are saying they're not going to have enough time to assess whether that's true or not?

 

I guess the question is, why wouldn't the minister want to ensure that everybody in that room, at least the people like the Small Business Advocate, the Consumer Advocate and the Avon Group feel comfortable that yes, that is the case before this project goes ahead?

 

MR. PARKER: Mr. Chairman, certainly the Maritime Link is a very important project for Nova Scotians. It's going to allow us to have stable, fair, electricity prices for 35 years and it will put us in an energy loop, as you know, and many other benefits, including the many good jobs that will be created to build the project.

 

It really connects us to the rest of North America. Right now we're on a single strand through New Brunswick. It's tenuous at times but this will put us in a complete loop. Energy can be coming to the province from either direction.

 

The process here was fairly straightforward. An Act was passed by this Legislature unanimously, as I mentioned previously. It was an opportunity for everyone to participate in the regulatory review period, which those who wanted to did. Then we consulted with the URB on the time frame and consulted with a number of others, as I mentioned, the Consumer and Small Business Advocate, Emera, the Sierra Club and so on, all those other names I mentioned.

 

Really we're talking about the time to do the job here in an adequate fashion. We've said that consultation was held and everybody was agreeable that time was workable. Now with the material that's coming forward, the URB, as the honourable member just mentioned, is rejigging some of the time frames and is working within the parameters that have been put forward. If it means hearings on other days or additional days, that's an option. Certainly they have to rejig the time frame to make it work.

 

One of the main objections has been - I've heard mention of documents or material or information that has been available and interveners are saying they don't have the time to look at it, but in reality, a lot of those documents that were put forward were on the Web site. They were publicly released. They were fully available for reading. I think of the Atlantic Energy Gateway information, those were released primarily last summer. I remember being in the Energy Ministers conference in Charlottetown and a lot of that information became publicly available after that. So those are materials on markets and on financial scenarios and on maybe a common system operator. There are different things in that Atlantic Energy Gateway information. Those have been available for several months.

 

Also I think it was last July, the 31^st if I remember correctly, the agreements were signed between Nalcor and Emera and the Province of Newfoundland and Labrador and the Province of Nova Scotia. That was eight, nine months ago that those documents were released. They were signed that day and they became publicly available, so that's part of the material that's here for the interveners to look at.

 

I think of the Dalton Report, I think it was January that John Dalton made his report

public, and that's part of the information that interveners are looking at. They're going to test that information, they're going to - during the public session they'll have the opportunity to quiz Mr. Dalton and ask him about his assumptions on his proprietary computer model that he has put forward.

 

A lot of that material has been available for months and months, so it's not like it's a surprise or new information. True, some of it is new and every week the interveners have a chance to put their questions in and ask for information. If for some reason they're not able to get it, they're able to do it the next week, repeat their questions, get new information or a new spin on what they're looking for.

 

Of course that process is ongoing between now and May 27^th, when the public hearings will be held, and I believe there's adequate time, considering the volume of information that's already publicly available that they can refer to, and with the rejigging of days or hours to have more time on it, it provides, I believe, every opportunity for those interveners to work within the time frame that has been allotted.

 

MR. YOUNGER: Mr. Chairman, I think the minister should probably take some time and go through the evidence that has been filed, because while he is absolutely right that some of the things like term sheets that have been filed, much of the significant information as it relates to this hearing has actually been filed within the past few weeks, some of it. In fact the board has issued notices to Emera saying that they weren't properly addressing some of the questions and we've actually lost a month - not us, the Consumer Advocate and Small Business Advocate and some of those actually already lost a month in a six-month process.

 

The minister should check his facts before he states things like that. I know that some of the interveners will be extremely insulted reading his comments tomorrow morning when they look at what has been said. The fact is that basically what the minister is saying is that the Consumer Advocate is lying and that the Small Business Advocate is lying when he says that. That's basically fundamentally what the minister is suggesting here when he says that well, when the Small Business Advocate stands there and says well listen, this information has just arrived and we don't have it and he says well, it has been around for a year - I'm sorry, but that's exactly what the minister is suggesting of these people.

 

I don't think that's fair. They've come to him and they've come to the Premier and they've said listen, there is a problem here in that so much new information has been filed in that time. So I think to suggest that those people are making that up, I don't know how he can do that. He has seen the letters - I mean I assume that was the reason for the letter that he has written back.

 

MR. MAT WHYNOTT: A point of order, Mr. Chairman. I'd just ask the member - I believe he used the word "lying" twice. I'm just asking the member to retract that please. Thank you.

 

MR. CHAIRMAN: The member for Dartmouth East was not referring to an honourable member of this House but to someone outside the House as he was making his remarks.

 

MR. YOUNGER: Thank you, Mr. Chairman, and thank you for that ruling.

 

Continuing on in that, you know the minister has said that it's the fairest and the cheapest price and maybe it is, maybe it's not, but the minister hasn't been able to tell us a price and, in fact, interestingly in the minister's opening remarks he stated that the Utility and Review Board would make a decision on the price. That's true, to some extent, except in Emera's own filing it says they'll actually make a decision on that in 2017, so that has nothing to do with the current filing - so it's actually impossible for the minister to know whether it would be the cheapest and fairest price because it won't even be filed for another four years.

 

In fact the estimate that Emera is not using anymore, incidentally, Mr. Minister, about the $1.50, included the price minus the cost of taking Lingan off-line, minus the cost of all kinds of other things which actually relate to bringing other renewables on-line.

 

One of the things, actually, is that if you take that number - and the number isn't wrong in and of itself - but if you use that number there, it means that the other renewables that come on-line in the province have to be considered at a much higher price.

 

You know we can debate that all day and that's fine; that will get debated at the Utility and Review Board. The question I have for the minister though, since he speaks a lot about the Dalton Report is, what is the price that Dalton put on Hydro-Québec power in his report, on a per kilowatt hour basis?

 

MR. PARKER: Mr. Chairman, certainly John Dalton of Power Advisory LLC is a recognized energy expert here in eastern North America. He has done a lot of work for this province since about the year 2000, under previous governments, and under this government. He has done work for the State of Vermont and other states, I believe, the State of Rhode Island and elsewhere on the Eastern Seaboard. He has done work for the Province of New Brunswick and he is really an expert on energy prices, electricity prices throughout eastern North America.

 

He has to defend his reputation on his report. He has done reports on several other utilities in the Maritimes and throughout parts of Canada and the U.S. I guess he has a rather unique proprietary modelling system that uses various computer modelling that determines what the price is for this year, for next year - actually he went from 2017 to 2052, that's a 35-year period. He's able to look at a lot of factors in that - what is the price of natural gas? What's the price of money? What's the price of labour? What's the price of various capital projects? He is able to, hour by hour, determine what he thinks the price of power will be.

 

In his model he looked at, will there be less power coming from Newfoundland and Labrador or will there be more power available through that Maritime Link? What will be the price of natural gas in those years? It's a very complex computer modelling system - hang on folks. But anyway, Mr. Dalton recommended that it would be $400 million cheaper to go with the Maritime Link than the Quebec hydroelectricity model. Again, that's based on his years of experience, his knowledge and wisdom that he has gathered over all that time and determining a lot of factors to put into that to make the determination that it's $402 million, actually, cheaper than the Hydro-Québec model and it's also about $1.5 billion cheaper than using a combination of homegrown sources like wind and natural gas, in combination.

 

As we know, the wind doesn't blow all the time so you've got to supplement it with natural gas and that's why that model was put together, to use a combination of the two.

 

The price is based on his knowledge, his expertise, his years of experience and he determined that it is $402 million cheaper than Hydro-Québec and $1.5 million cheaper than Nova Scotia's own sources.

 

In Emera's estimation they've said that it's probably about less than a 1 per cent increase in the cost of electricity over the first five years, in fact about 0.95 per cent in each of those years and then it would decline after that because once the upfront capital is constructed and in place and amortized, it's going to become cheaper over time. That works out, in their estimation, to about $1.50 a month, on the average consumer's power bill.

 

It's a complex model to come up with a simple answer and again the URB will determine whether it's right or not for the ratepayers of this province.

 

MR. YOUNGER: Mr. Chairman, the minister should watch because his ministerial assistant seems very concerned that he can't hold his own. You might want to have a talk with your ministerial assistant about that because he seems very, very concerned about your ability to answer the questions and he's trying to answer for you back there. (Interruption)

 

Mr. Chairman, I think that might be out of order - you can decide on that.

 

You know, minister, it's interesting because he'll talk about it being $402 million cheaper but he can't tell us what the kilowatt hours are, what that estimate is based on, which is interesting because it can actually be calculated, and that will be done and Dalton will have to answer that before the board - what estimate his computer model has used.

 

It's no different than the fact that it may very well be that doing it with wind with a natural gas backup is more expensive, that may very well be the case, but one might ask why Dalton didn't look at it as some of the other backup opportunities, other than natural gas, such as some of the ones that this minister's government is actually involved in, such as storage with compressed air, which doesn't rely on the cost of natural gas. Dalton didn't consider that cost which is actually, if you factor that out and do the math as some people have already done for this hearing, is actually significantly cheaper than natural gas as a backup, regardless of the price because there is no fuel cost, as the minister pointed out.

 

Minister, of course I'm asking these questions because these are the issues that you raised in your opening statement; these are the claims that you made in your opening statement - I haven't even gotten beyond your opening statement yet.

 

This really comes down to a real simple question, which I'll ask again because we know what Rhode Island is paying, we know what Vermont is paying, and I'm not suggesting that you'd get the same price here and, frankly, we don't even know if it would be cheaper, but if the minister is going to stand up and say that it is cheaper, then he has to know what the price is and he has to know what the basis of Dalton's calculation is. If he doesn't know, then he can't stand up and make the claim that it will be cheaper, because he doesn't know.

 

He's the one who is making the claim, which means he has to know what that price is that is being used in the assumption; otherwise the statement would be we believe it will be cheaper, or we think that this will be the best option and will be reviewed by the board - but that's not what he said. In his opening statement he, very definitively, said that this will be cheaper and it will be cheaper by $402 million. If I'm out by a few million, maybe I'm wrong, but I think he said it again there - $402 million, Mr. Chairman.

 

If he is going to make a definitive statement like that, then he must know what the price is. So the question is, what is the - he's right, I know they put it into computer models, I do understand that, but the computer models have a price. All we're asking here, and it's not like this is going to be some secret for years to come because Dalton is going to have to answer this in the IRs coming up, so it's not like this is a top secret piece of information - and I can't believe the minister would commission a report and not be given the information of the assumptions that were used in Dalton's estimates for natural gas, for Hydro-Québec and so forth.

 

So fine, the minister doesn't know them off the top of his head, I accept that. I mean, it's not something you walk around with, knowing what each number is going to be, but will the minister at least commit - or by the time we start tomorrow - to tabling the assumptions for the prices for natural gas and for, I think he called it "imported power" but I think pretty well everybody has assumed that would be Hydro-Québec that Dalton has used in his report. If he hasn't given them to the minister then I'm not sure that I would have paid for the report until I had what the assumptions were based on, because those generally form part of the report, what the assumptions are.

 

If the minister can't tell us what they are, without going on and just saying that it's $402 million which is fine, I have no doubt that the minister believes that, but I hope he only believes that if he knows what the assumptions are and knows what it is based on.

 

Will the minister, if he can't answer it now - which may very well be the case - will he commit to tabling what those assumptions are by tomorrow?

 

MR. PARKER: Mr. Chairman, I'm pleased to answer the honourable member's question once again. The Dalton report is a detailed, proprietary model that he has worked on and perfected over many, many years of his industry experience and, of course, he will be presenting at the URB, he will be presenting his evidence, he will be justifying the model that he works from and all his assumptions will be for him to defend, based on what he has come up with. The full evidence will be available at the URB. Interveners such as yourself, or others who are there, will have every opportunity to quiz him and ask him about the evidence. Again, he's a recognized energy expert. He has had a lot of experience in eastern North America in both Canada and the United States. He has defended his information on past utility board hearings throughout the continent and I know his evidence will be available there for your Party and for other interveners to fully ask him that information.

 

Based on the fact that he is a knowledgeable energy expert, we take him at his word that he knows what he is talking about, based on his past experience. All that information will be forthcoming. It will be coming out at the URB.

 

You mentioned, honourable member, the Province of Quebec or Hydro-Québec is in the business of selling hydroelectricity as well and certainly Emera, from time to time, buys some energy from that utility, but of course the real challenge is we don't have the proper infrastructure in place to bring it into this province. There's a weak link at the Nova Scotia-New Brunswick border and there's not the proper infrastructure through New Brunswick and through Quebec to bring it here and to provide any meaningful amount of electricity without a huge investment to make that happen.

 

Of course once the Maritime Link is in place, we will have infrastructure across Nova Scotia and across New Brunswick and it will provide many more opportunities for us to bring in hydroelectricity from Quebec or power from New Brunswick or perhaps from New England, also from Newfoundland and Labrador. Electrical currents can go both ways in the system and provide many, many more options so that we'll have the opportunity to buy at market rates, whatever that might be negotiated at the time.

 

Certainly even the hydroelectricity from Newfoundland and Labrador will be available at market rates. Sure, we're getting 20 per cent of the electricity for 20 per cent of the investment as part of the deal with Nalcor and Emera, but it opens up so many more opportunities to get market rates like Vermont and like Rhode Island are enjoying at this time.

 

Part of the challenge for us, of course, is that we are a cold province, in many respects, like Quebec. We need electricity in the cold winter months of the year, in January and February and March, the same as Quebec does. Quebec is selling market rate electricity into New England, often in the hot months of the year when there's a real demand for air conditioning. They sell year-round but they have more opportunity for more volume in the warmer months. In many ways, because we're similar to Quebec in our colder temperature regime, we need the power at the same time they do. In the summer months they have more excess capacity and they can sell that at the going rate into other markets.

 

I would suggest, honourable member, coming back to your original question about the Dalton report, is have a good look at the report and certainly when the opportunity comes at the URB to fully quiz Mr. Dalton, ask him about his proprietary model and his assumptions and get a full disclosure of all the information that's available from him.

 

MR. YOUNGER: There's so much there. The minister doesn't know it. I already said in the remarks that that will be in the IRs of us and many other people to Dalton but I think if the minister is going to make the claim that he did in his opening statement, he should know the answer himself and it's pretty clear that he doesn't by his remarks, otherwise he would have told us.

 

He might want to check to see what the weather is like in Vermont before he starts to suggest they get most of their power in the summer months.

 

There are so many things that he talked about. He talked about the lack of transmission infrastructure to get things out of wherever else, New Brunswick, P.E.I. if they did something, or Quebec. In case he hadn't noticed, there actually isn't a connection to Newfoundland and Labrador yet either, so that's a similar issue, one that they're proposing spending $1.52 billion, and once you add the interest and everything else, I mean there are all kinds of estimates. I'm not sure whose to believe but everybody agrees, Emera included, that total cost actually to ratepayers is more than that. He talks about it being 20 per cent and 80 per cent and that's not true either, because it's actually 20 per cent for 35 years and then it's 100 per cent to Newfoundland and Labrador after that.

 

So if you look over the life cycle of it we pay 20 per cent of the capital costs, then we pay some operating costs, and then we actually are - actual total out of the life cycle project of that is actually well down in the single digits over the life cycle cost of it.

 

He talks about taking Dalton's word for it, and I have no doubt that Mr. Dalton has done this work before and so forth, and he talks about taking his word. Well, Nova Scotians took the NDP's word they wouldn't raise the HST, they took the NDP's word that they wouldn't add a tax to electricity bills, and those didn't pan out either. So it's not about taking somebody's word, it's about the fact that this is a very expensive project which may or may not be good - and it's not even about being on an end of a line, it's about whether this is the right deal, whether this is the best deal for Nova Scotians, and at the moment because there are questions that the minister simply won't answer, at the end of the day you've got to look at that and say well why won't the minister - maybe it's not even why won't, it's why can't the minister answer those questions because those strike me as being the exact questions that can be answered.

 

They can answer them in Newfoundland and Labrador for their residents, they can tell them what it's going to be on a per kilowatt hour basis, they can tell them exactly how many jobs are going to be in Newfoundland and Labrador, they can tell them all those things. For two years, a year and a half - I'm not sure exactly how long we've been talking about this, but we haven't be able to get a straight answer on any of that. That's the problem, Mr. Chairman, not being able to get an answer.

 

I'm probably going to come back to this project tomorrow, given that there is only about 15 minutes maybe. There are a couple of other things that I wanted to get to tonight before we get on to that. The minister talks a lot about coal and I want to ask him about Trenton, in his own backyard. Last year the Trenton plant unfortunately, due to human error, suffered an incident with one of the generators, I think it might have been Unit 5, but I'm not sure if it really matters which unit it was. That unit had to be completely refurbished. At the time it was - last year - refurbished as a coal unit rather than refurbishing it as a natural gas unit, which was an option, and that's pretty well accepted that there were basically the two options.

 

Now the minister has stood up repeatedly, many times and talked about getting off coal, getting off coal, getting off coal. He knows in his own backyard there are residents who are very concerned about coal ash in that area and questions whether the "baghouse" works at that particular plant. The minister will know it is a different technology than somewhere like Point Aconi, which is much better at capturing some of the particulates, the mercury, and things like that. Trenton is an older-style technology and yet Nova Scotia Power went ahead and refurbished that plant as a coal unit, thereby extending the life cycle. I think by that time the Equivalency Agreement would have either been signed or the minister would have been negotiating it, I don't remember exactly where the overlap of dates are but I know it was being talked about.

 

The effect of having done that meant that the lifespan of that coal unit is now extended fairly significantly. Then we look at an announcement the other week where the gas line is being extended to the Northern Pulp Mill, which is good. They're hoping to attach the Michelin plant. They tried to get a lateral into the Trenton plant and the line that they are building will not be sufficient in order to ever supply that Trenton plant. They will have a big enough right-of-way to build another pipe, but the pipe itself will not be big enough, and the reason it will not be big enough is because last year Nova Scotia Power refurbished that unit instead of converting it to natural gas - refurbished that unit as a coal unit. I'm wondering that, being in the minister's own backyard, and being so insistent that Nova Scotia has to get off coal, why he would have allowed that to happen?

 

MR. PARKER: Mr. Chairman, I'm always pleased to talk about Pictou County, it's near and dear to my heart. It's a great spot, I invite you to come and visit at any time, honourable member, and I will give you a tour around at any time, just let me know when you're coming. We'll see if we can keep that date in mind.

 

I have talked about coal in the past. It's a costly fuel. It has gone up by 75 per cent in price on average, over the last seven years, and it's certainly been driving the cost of electricity higher and higher. At one time, of course, we had coal in abundance in both Pictou and Cumberland, and certainly in Cape Breton areas, and I guess also in Inverness. But of course, there is very little now that is mined. There are no underground mines. We're hoping that the Donkin project will be forthcoming, but at this point, there are no underground coal mines.

 

There are a couple of surface coal mines, one in Cape Breton, and one in the Stellarton area in Pictou County. All our coal now comes from Colombia, or Venezuela, or the southern United States. It's costly, expensive, and it's a pollutant. While we know that coal is still a part of our energy mix for many years to come, we're working hard to get onto renewables, and even cleaner fossil fuels like natural gas. The honourable member mentions the natural gas that is coming into Pictou County. The announcement was held a couple of weeks back. It allows a cleaner energy source to replace some of the coal and other sources that are out there.

 

I know the first anchor tenant will be Northern Pulp, but it's also going to be available to other industries in Pictou County including Sobeys, quite possibly Michelin, as the honourable member mentioned, certainly the Aberdeen Hospital, the community college, and a number of other smaller businesses, and probably in time, residences in the area. It's great, it's a good news announcement and it'll help us clean up our environment. It will estimate to save about 40 per cent on fuel costs and it's just a way to work towards cleaner energy sources and a cleaner environment.

Now, you mentioned the Trenton plant, No. 5, they had some conversion there in the last year or two, and a few years before that they put on a baghouse to help clean up some of the pollutants. Unfortunately, from time to time, there are problems and I'm certainly familiar with the issues in the neighbourhood from meeting with some of the coalition members and their concern over the environment issues when the fly ash becomes a problem.

 

Emera, of course, is under regulations under the Department of Environment, and I would encourage the member, when the estimates for that department become available, that you talk to the minister for that department to get some of the answers. The Equivalency Agreement was mentioned by the honourable member, and that was negotiated between the Province of Nova Scotia and the Government of Canada, and it is still going to allow us to meet the greenhouse gas targets and the coal regulations within the time frame, but in a slightly different way that will actually save ratepayers of this province about a billion dollars in electrical costs.

 

That's a huge amount of savings, that otherwise, if we had stuck strictly with the federal plan, would have ended up costing Nova Scotia ratepayers an additional billion dollars. We're still going to meet the target but we're just going to do it our way.

 

We recognize there are some challenges in the environmental aspects but with our Equivalency Agreement we're working hard to meet those targets and save money for Nova Scotians at the same time.

 

MR. YOUNGER: I sometimes worry that we're not on the same page; this time I think we're not in the same book. I hope that's not the answer he plans on giving in Trenton on May 11^th because he might get run out of town. The thing is it's a real straightforward question. The minister stands up frequently and talks about how coal is bad in Nova Scotia and yet the first opportunity he has where - that unit was down we were taken for a tour of that unit, that unit was completely rebuilt.

 

If I recall correctly what happened, seawater got into the system. I'm pretty sure it was No. 5 but it doesn't make much difference which of the units it was, the same amount of work that went into replacing that as a coal unit would have rebuilt that as a natural gas unit. You would have then had a coal unit and a natural gas unit in Trenton and so be it. That's the way these things will get converted if they ever are.

 

At the same time, actually the same day, that morning, I had been to Northern Pulp where they had been talking about this project which was announced the other day, which has benefits as well. One of the holdups was the fact that they couldn't get Nova Scotia Power to do this and nobody felt like the government was pushing this. The minister knows; he raised it on the floor of this House when he was in Opposition, about the coal ash and the problems, the baghouse and so forth. You would think that both to balance the energy costs - natural gas has fewer emissions, especially in a plant of that kind. The minister has basically said that so I don't think that's really in dispute. I just have to question why the minister would not have played an active role in trying to encourage Nova Scotia Power to ensure that's changed over.

 

The interesting thing is that they did it without going to the board. They did it and then decided they would go to the board afterwards and seek forgiveness. I'm not sure that they've actually gone yet, although they will, if they haven't already, they will and they'll go for the capital expenses on that. But those capital expenses could have gone - it would have allowed Northern Pulp to get gas faster. It would have reduced the costs for them to get gas. It would have taken gas to the forge. It might have actually got gas into Stellarton faster. You think about I.M. Matheson or places like that that really will never have a gas line unless it's there for some other large tenant because they just wouldn't use enough gas. The hospital the minister mentioned, all those are correct, even smaller loads like the Big 8 plant, I know it's further away but you'd be coming in off the line.

 

The question becomes why would the minister not have ensured that plant was changed over, or when that was rebuilt that it was rebuilt as a gas plant, since it was being rebuilt anyway, and that was only last summer when the minister was standing in this House telling us about the evils of coal? Under his watch, he allowed that plant to be rebuilt as a coal plant.

 

MR. PARKER: I think all Nova Scotians are concerned about the cost of power, the cost of electricity in this province. Coal has been a driving factor in that for a long time. Past governments have relied on coal for far too long. That's why this government has taken a number of actions, a number of plans to transform our energy sector to get away from coal. Natural gas is an important part of that, but so is the use of tidal energy which we have been developing in this province, so is wind energy, so is the use of sustainable biomass and not even just from forestry uses, but from grasslands or farm waste.

 

There are just so many options that we're blessed with here in Nova Scotia that can get us off of expensive coal. While natural gas is not renewable per se, it's actually a much cleaner fossil fuel than others, as the honourable member would know.

 

We had discussions with Nova Scotia Power; we've been working with them. They have to make the decisions that are in the best interests of the ratepayers and if they decide that the business case is not there, not a good investment, then it's not good for the ratepayers. They're looking at the best interests of the ratepayers and which direction to go has to be determined through the Utility and Review Board.

 

I know our time is running out and I'm sure, honourable member, we'll have our chance another day to continue our discussion, and I look forward to that.

 

MR. CHAIRMAN: The time for the Liberal caucus rotation has elapsed.

 

The honourable member for Inverness.

 

MR. ALLAN MACMASTER: Thank you, minister, and members of the department for giving us a chance to ask some questions this evening.

 

My first question is, I notice the total expense in the estimate and forecast for 2012-13 just finished, is identical. I have a feeling there's probably a good reason for that. Maybe the department wanted to ensure that it could spend every dollar that was budgeted and that might have something to do with money that it's forwarding to - I'll give you a page number, Page 8.2. If we look at total departmental expenses for the year just past, the actual amount matches the forecasted amount exactly. It's very efficient to be able to come out with the exact number but I'm presuming there's a reason for that. It's probably because whatever money was left over in the budget - maybe you directed it towards more grants for energy efficiency or something. Minister I'll let you comment.

 

MR. PARKER: I welcome the honourable member to the discussion here tonight. I was expecting somebody else, but that's fine, you're always welcome and glad to have you participate in the debate.

 

You're observant in noting that the dollar figure was exactly the same for both the estimate and the forecast. There are a couple of reasons for that. As you can imagine there are some issues that come in over budget that are higher than anticipated. Some issues are less expensive. It's like your household budget. You spend more, unexpectedly, on car repairs but maybe your power bill is less than you had anticipated. It's up and down and that's true in the department as well.

 

For example, we spent less money on sustainable transportation funding in 2012-13 but as we move forward there will be stronger emphasis on sustainable transportation. Some of the grants were less than anticipated and there were some slight changes in the number of salaries, the number of vacancies. There has been a slower take-up in some of the items that were budgeted for but on the other hand, there are always some things that cost a little bit more.

 

Some additional grants were moved around to other areas and there was additional spending. There were some extra expenses on litigation and there were just some extra expenses that were unaccounted or unexpected. Overall, I guess we were able to balance our budget to the penny just by good management and efficient operations within the Department of Energy.

 

MR. MACMASTER: My next question is around royalties. Last year there was about $23 million; this year they're projected to be about $20 million - that's found on Page 2.2. I know that through past investment in research that was then handed to industry, we've seen BP and we've also seen Shell, each planning to spend about a billion dollars. I know it's hard to really predict, but has there been any indication from industry what kind of offshore activity they hope to be able to generate now that they've planned to spend that kind of money? What could it look like for royalties going forward, say, in the next five years?

 

MR. PARKER: Certainly royalties have dramatically changed here in Nova Scotia, even since this government came to power. In fact, I think in the last year of Premier Hamm's Government there were close to $500 million in royalties from our offshore. It has dropped today to, I think it was $27 million this past year and it is projected to be only about $20 million next year. That's a huge difference in the amount of dollars that are available to a government to provide programs, whether it's for roads or schools or health care or whatever.

 

We've worked hard in this government to get back to balance and those dollars had to be found somewhere, but it was to make up for the royalties that were lost coming into the province. It's about a $480 million difference, but through good management we've been able to do it and hopefully will be able to continue to stay on track. As the Premier said, we've turned the corner and it's onward and upward from here. It has certainly not been thanks to any help from the royalty structure in the offshore.

 

However, things are happening out there, as you referenced in your question. The Deep Panuke project will soon be coming on stream. In the next quarter or two it will be producing natural gas and it will provide some royalty revenues. I think it's estimated to be in the range of $2 million to $3 million in the first year and then it will ramp up from there as they get fully into production.

 

Our Sable Offshore Energy Project has been going since 1999 and that's where the major royalty revenues are coming from. That's winding down. It's still ongoing and it will still be producing revenue, but it has been 13 years producing and the guesstimate is somewhere within the next five years it may well be winding down. Of course, they had some challenges there this year on some of their production fields and they're working hard to correct those now and it should be soon that they'll have that under control and back in full production, on a dwindling basis as they go forward.

 

Our real optimism, our real hope, is from the Play Fairway Analysis and the research and work that was done on that geoscience work, and it's already paying off. As you know, we have over $2 billion worth of exploration commitments from both BP and from Shell. Actually, Shell will be doing seismic work this summer and that will in turn create some economic opportunities for Nova Scotians, and supply ships and lodging and the seismic companies themselves and a whole lot of other employment opportunities for Nova Scotia companies - and not far behind is BP. With the Play Fairway Analysis showing that we have something like eight billion barrels of oil out there and over 120 trillion cubic feet of natural gas, there's just all kinds of potential in our offshore that in the future, as the seismic work gets done and the exploration work is complete, the next step is commercial production. That's when the royalties start to flow, as well as jobs and income for Nova Scotians who work in that industry.

 

We're very optimistic that our future in the offshore is bright and there's going to be another call for bids, most likely later this month, that will probably attract even more interest. As we move forward there will be all kinds of potential for Nova Scotia in our offshore.

 

MR. MACMASTER: It would be nice to see the royalties go back up to $400 million or $500 million a year in the budget. Hopefully, that will be the case. They'll actually be able to extract some of those eight billion barrels of oil and 120 trillion units of natural gas. It does certainly make a difference for helping to balance the budget. I know when Premier Hamm balanced it in 2002-03, he only had $12.5 million in royalty revenue that year but that's good to know. I'm not sure in dollar terms what we might be able to predict, in terms of dollars per year, but I respect that it's hard to put a number on that. I'm not going to press you on that because it's hard for us to know that.

 

The next question I have is around - I know the department uses various prices for units of input for electricity generation by Nova Scotia Power. If we look at energy across the province, I've seen prices for coal somewhere around 3.75 cents per kilowatt hour to 4.5 cents per kilowatt hour right now. If you could give a rundown of some of the forms of energy and their cost per kilowatt hour, I can think of that for coal, I can think of wind energy - I've heard of it being as much as 14.5 cents per kilowatt hour but I've also heard 9.8 cents. I've heard for community feed-in tariff, it is more like 50 cents per kilowatt hour for wind.

 

If we look at natural gas, it's somewhere probably around, I know we've had volatility in the province, it may be 6 cents per kilowatt hour for natural gas, provided there are no spikes because of problems with supply. We have coal, natural gas, wind, tidal I know is very expensive. I think we believe Muskrat Falls is somewhere between 16 cents and 20 cents per kilowatt hour. Wreck Cove is pretty cheap, I think, but if you could provide a rundown of the per kilowatt hour costs of the various types of energy inputs that are used to generate electricity in the province today. Thank you.

 

MR. PARKER: Madam Chairman, welcome to the chair. Producing electricity is certainly a very complex business and the cost of producing the fuel is part of the production costs that goes in to determine the rate homeowners or businesses pay.

 

Besides the cost of the fuel, whether it is coal or natural gas or whatever, there are labour costs for linemen or executives or whomever within Nova Scotia Power: the cost of capital; the cost of borrowing money; the cost of the infrastructure, replacing wires or poles or whatever it might; the cost of maintenance; there are a lot of costs that go into determining what the rate will be and one determinant that Nova Scotia Power went to the Utility and Review Board and asked for was the FAM rate, the Fuel Adjustment Mechanism, that can be adjusted if the price of fuel that they are paying goes up or down. The FAM rate is set every year by the URB, based on the evidence that is presented to them from the utility on the cost of their coal or natural gas or whatever.

 

I do know that through the COMFIT program, local energy produced in local communities for the benefit of the local people, there are different rates that have been set by the URB: for small wind, I think it's around 49 cents per kilowatt hour; for large wind I believe it's around 13 cents per kilowatt hour; for tidal energy it's somewhere around 65 cents per kilowatt hour. That program is under review at this time and we're looking at how well the program has worked. We believe it has been quite successful, but one issue that has not been included in the COMFIT rate is solar energy. We're looking at that right now and seeing if it is feasible. Previously it was far too expensive to consider, but some of those costs have come down and it may well be feasible to look at again. At least we're studying them and seeing if it's possible.

 

The rate that was set by the Renewable Electricity Administrator when he called for bids for large wind projects such as were awarded in the South Canoe and the Guysborough County projects. Those rates were very competitive and they came in somewhere around 75 cents per kilowatt hour, with Nova Scotia Power as a minority partner. The competitive bidding process really helped bring down the price of what they can produce electricity for, so that's another price you might want to keep in mind.

 

It's constantly changing and really the cost of the fuel source - I don't have those on the tip of my fingers, but I can probably make those available to you on the coal or the natural gas, those unit prices. I'll pledge to get those for you in the next day or two.

 

MR. MACMASTER: I want to thank the minister for providing those numbers. They are similar to those that I have considered myself. I've talked to different people, from people in the energy industry to - even for COMFIT, I could read the press releases that are being put out that show the rates that communities are benefiting from by getting the amounts that they're getting for the energy on the revenue side for them.

 

I guess the point that I want to make, and I know there are costs of capital and labour, all that can be fed into the per kilowatt cost. If you look at the price of coal, you can factor in the cost of the plant over time through amortization; that can become a component of the cost per kilowatt hour.

 

I guess my next question, and the reason I'm asking this is, does the department recognize that requiring Nova Scotia Power to use inputs that are more expensive than others actually drives up the cost of power that Nova Scotia Power produces for Nova Scotians? In other words, if the government is telling Nova Scotia Power you can only burn X amount of coal per year, and we know that roughly 58 per cent of the power generated is from coal, the remainder has to come from the other more expensive inputs. Does the department recognize that by requiring Nova Scotia Power to use those other types of energy inputs, it's actually driving up the cost of power for everybody?

 

MR. PARKER: Certainly we're doing everything we can in this province to try to drive down or try to stabilize - the price of electricity and coal, certainly, have been a big factor in the price of energy produced in this province over the last number of years, and we're working to get off of coal. Of course, the federal government has mandated that we do just that. They have required us to close out power plants and we have our Equivalency Agreement that will reach those same targets, but in a slightly different way, or doing it our way, will help save ratepayers somewhere in the range of a billion dollars over the next number of years.

 

We're getting off coal; we're using more natural gas. As I talked about a few minutes ago, natural gas is now coming to Pictou County and it's going to be available to our industries, to our businesses, and eventually, in time, to homeowners and institutions. That's one way we are saving energy, less expensive than coal. They estimate it will be 35 to 40 per cent cheaper than coal. That's a significant saving and makes the economy more competitive. Perhaps when a business is looking to relocate to an area, if they see there's natural gas available in an area, and there's a 30 to 40 per cent energy savings, it's a very big determinant to come to a community that would offer that.

 

We're also, through our Renewable Electricity Plan, getting off of coal and working towards wind energy, tidal energy, sustainable biomass, and some natural gas. This year we're down to about, well, certainly less than 60 per cent of our energy is produced from coal and we estimate by 2030, more than half of our energy will come from renewable sources that I just mentioned.

 

If you read our Renewable Electricity Plan that came out in 2010, it mentions that the cost of renewables from 2010 up to 2015 would be in the range of 1 to 2 per cent of our energy costs, and it has actually proven to be closer to 1 per cent. It is quite doable, and through the COMFIT program we are encouraging communities and Nova Scotians to be involved with us in getting away from expensive, polluting coal and getting onto these renewable sources.

 

Truly, we're blessed in Nova Scotia with our own sources of energy right in our own backyard. We have some of the best wind regimes in all of North America. The honourable member mentions we still have some coal available that we're trying to develop as well. We have tidal power, probably the best tidal energy anywhere in the world, in the Bay of Fundy, and we have sustainable biomass from farm waste and use of forest waste and other sources. We are blessed that way with good renewable sources.

 

Also the federal government has mandated that we have to get off of coal; we have to get away from it. We'll never get there in the next year or two, but over time, we'll eventually get away from fossil fuels, and get onto more and more renewables. It's about a mix. We are blessed in that we have good opportunities here for a whole variety of sources that will help stabilize our energy source. And of course, the Maritime Link is going to be available to help stabilize our rates for 35 years and will be a source of energy that will not only bring stable rates, but will also put us in the energy loop. It's going to bring in electricity not only from Newfoundland and Labrador, but because of the upgraded transmission system, we'll have the opportunity to buy energy from New Brunswick or from Quebec, or elsewhere, and it really provides more stable and more reliable sources. So we have many green sources, as well as a mix of some fossil fuels as well.

 

MR. MACMASTER: Thank you, Madam Chairman. I want to talk about emissions because we know when we think about coal, it does produce the most emissions. I know the minister has said that we have to move away from coal because of federal government regulations but I do know the Equivalency Agreement actually backed off on some of that requirement to move away from coal. I know that is saving money. I can think of the Point Tupper power generating plant, which is right next door to the area I represent. There are 60 people working there, the remaining life of the asset was valued at $45 million. I know with the changes made by the federal government in relaxing the restrictions on coal in this province, it is allowing us to continue using that asset and not strand that $45 million as an expense that we'll never get any benefit from.

 

I want to talk about emissions. The reason I brought up the last question was just to highlight that coal is the cheapest. I know we keep hearing that it is expensive and it has gone up in price by 70 per cent. I would actually challenge that number, and I will at some point before the sitting is finished, but coal is the cheapest. We also have to think about emissions. I'm thinking about how, the more we move away from coal, we are really driving the price of power up for people.

 

Let's look at emissions. I want to make the point that if Nova Scotians are sacrificing money in their monthly budgets to go to pay higher power rates, they are getting something for it on the emission side. We all know that countries all over the world emit emissions and if we look at China - this is something that was brought to my attention from someone who lives in my constituency. In the U.S. Energy Information Administration, an atlas of pollution, the world and carbon dioxide emissions reported that CO₂ emissions for China increased 13.3 per cent from the year before. It was 7,711 megatons of CO₂ emissions.

 

Nova Scotia reported less than 10 megatons of emissions from Nova Scotia Power. Based on that data, if Nova Scotia Power completely stopped electricity generation tomorrow, China's growth in emissions alone for the year would erase the savings that we would achieve in Nova Scotia in just four days. My point is, the real emitters in the world are large countries like China and our efforts here to reduce emissions, while admirable, they are really having negligible effect. They're not really having any real meaningful impact.

 

We all have to do something and I agree with the member for Guysborough-Sheet Harbour, but the point I want to make is that it's important to try to do something, and we are doing something, but I think by moving too quickly towards renewables, we're not really making a difference on the emission side, as I've just illustrated. We're raising power rates for people because we are moving away from coal and we do know that it creates emissions and it is the dirtiest of emitters - coal - but we have to look at things in relative terms. The reason I'm raising the question is because, if we don't consider the economy with our efforts to reduce emissions, I don't think we're doing ourselves any favours.

 

I would like to point out that if we really wanted to do something, because I do believe we all want to reduce emissions throughout the world, we would focus our resources on trying to generate more efficient renewable energy in the province. Maybe that would be by investing in companies that are working on renewable energy options to make them better and cheaper so that they're not only good for us, but that we can go to a country like China and say, here, why don't you do what we've done? It hasn't hurt our economy and you're going to do yourself, your own country and the world a whole lot of good by moving towards a renewable energy that is cost-effective and that makes economic sense as well.

 

I look to Page 8.3 in the estimates, it's not at a number but I just look at the mandate for Sustainable and Renewable Energy, should the mandate change, based on the point I've just made, to include energy affordability as one of the strategic directions of that division so we can recognize that, yes, let's get away from coal but let's do so at a pace that we can afford? Why don't we try to encourage greater efficiency in renewable energy instead of adding the capacity now and driving up power rates when there could be a future point in time when renewable energy might work better? We'll be stuck with all the old renewable energy technology that's not efficient. I'll let you comment, minister.

 

MR. PARKER: I thank the honourable member for his strong interest in protecting our environment and as always, as legislators, we have to try to find that balance between protecting the environment and also protecting the economy. I believe sincerely that's what we're doing within the Department of Energy.

 

If you've had a chance to read our mandate, it mentions that very balance between the social, the economic, and the environmental responsibilities that we have as a department and I think we've been working hard on that balance on the environmental side. Certainly, we've worked with the federal government to come up with the Equivalency Agreement. They initially said no, you have to close down your coal plants, regardless of the cost to the taxpayer, regardless of the captured costs left behind in that infrastructure.

 

It was a hard fight, we had to really negotiate very hard with them to come up with that Equivalency Agreement, an agreement that will save Nova Scotia ratepayers about $1 billion over the lifetime of the agreement but still meet the goals, still meet the environmental targets.

 

In 2010 it's estimated that our output was about 10 megatons of greenhouse gases and under the Equivalency Agreement that's down about 7.5 megatons by 2020; by 2030, to meet the target the federal government has mandated, it's around 4.5 megatons. As you know, our Premier was given an award for that initiative to reduce our greenhouse gases when he attended the conference in Copenhagen, Denmark, in 2009. We were the first jurisdiction in North America to set some hard targets for greenhouse gas emission reductions and so we are being commended for that. We're working very hard on the environmental side to ensure that we reach those targets and protect our environment from further harm.

 

We're also cognizant of the fact that we don't want to see more coal-fired generating plants built in this province and the best way to prevent more infrastructure investment in those big expensive plants is to use the power we receive wisely. We've been working very hard through Efficiency Nova Scotia to encourage Nova Scotians to insulate their homes, to wrap their hot water tanks, to wrap pipes, to install better doors and windows, just to have a more energy-efficient home, and not only homes but small and large businesses and industry.

 

We have a strong commitment to energy efficiency in this province, both on the non-electric side and on the electric side as well. Those programs are paying off. It's estimated that we have, from the 2009 levels, if we didn't have those energy efficiency programs we would need about 4.1 per cent more electricity than what was produced in 2009. In time it's estimated, by continuing to use those efficiency programs, over a 20-year period the amount of savings would be equivalent to the building of a brand new power generation unit. It is about $1 billion to build a new power generation plant in this province and the savings will be equivalent to building a new plant.

 

Last year I read it in my speech - or somewhere - that the cost of energy for 16,000 homes is what we saved in Nova Scotia. There are other ways to tackle the problem and certainly becoming more efficient in the energy we do use - in other words we use less - that's going to save us in not having to build new power generation plants. I commend you for your initiative in that balance too, between the environment and the economy. As the Department of Energy and as a government we're working hard to try to reach that goal of that balance.

 

MR. MACMASTER: I know that natural gas emits 50 per cent less than coal and it's also quite cheap right now. I know we've had fluctuations. (Interruption) Actually it is quite cheap. I looked at it the other day it was $4.20. I remember only about three years ago it was over $13. I don't think the minister wants us to bring up fracking tonight but I think that's why the price of natural gas has dropped so much because there is a glut on the market.

 

One of our challenges is to get access to it and I think that's why we've seen the spike in prices, which we've seen earlier this year. In my mind that's not something that we can't remedy. I know that hospitals in this province - I was sitting here last week in Public Accounts Committee - I know that even the government hospitals recognize the need to get off of Nova Scotia Power-generated electric and have natural gas trucked right into their hospital.

 

I know, minister, even in your own constituency, Northern Pulp is moving to natural gas; why? Obviously they are doing it for economics, it's cheaper and they have access now to a pipeline that is bringing gas to them. I also know of a company in the province that produces wind energy but they sell it to the grid. They don't want to use it because they have access to cheaper natural gas as well. I guess I think about Nova Scotians; it's pretty hard to refute the evidence that natural gas is cheaper and that's why even the government, through their hospitals, is moving towards it.

 

What is the department doing to help stabilize the cheap natural gas that is available throughout North America right now? I'm thinking about activity that might result in a pipeline coming eastward to bring natural gas closer to Nova Scotia so we can benefit from: one, the fact that it emits 50 per cent less than coal, and two, that it is a lot cheaper than the renewable sources that are being brought online.

 

MR. PARKER: Natural gas is a cleaner burning fuel than oil or coal. Certainly it is something that has provided some options for Nova Scotia Power and for businesses and residents in this province. It is still a fossil fuel. It is still a dwelling resource out there. It could be around for decades, maybe centuries to come, but at some point it will be gone.

 

The problem here in Nova Scotia, of course, is that for too long we relied on just one fossil fuel to heat our homes or to provide electricity, and for years that was oil. Through the mid-part of the century oil was king and it was cheap and it was the fossil fuel of choice and then along came the oil crisis in the early 1970s and oil suddenly went up out of sight. Then the government of the day turned to coal. Coal was the next major source of energy and that was fine for a time because we had a lot of coal mines and a lot of coal here. It was relatively cheap and easy to access in Nova Scotia. Of course we no longer have mines that are producing, other than the surface mines. That may change in time with an underground coal mine in Cape Breton, but at the present time it's not producing.

 

Natural gas is another fossil fuel and it too fluctuates according to world market conditions and local conditions. I guess we can't hitch our wagon all to one fossil fuel source. We've learned our lesson in the past and while it can be part of our mix, and certainly is at this present time, this past winter just shows how volatile it can be. It was relatively cheap all along. We had a good source from the Sable Offshore Energy Project, but then supply became tight because of some challenges there in the Sable Offshore Energy Project. Our Deep Panuke gas wasn't quite ready to come on-line and they had some infrastructure challenges in the New England area as well. So all of a sudden, gas in Nova Scotia became quite expensive. In fact, it tripled in price in the month of December.

 

I know Dalhousie University is connected to natural gas and their additional increase was something like $400,000 for the month of December alone. It went down a bit in January and it stabilized a bit since then, but it shows the volatility of natural gas, it can go up and down so quickly. While it's a good, cleaner source compared to oil or coal, it's still not the perfect source as far as the impact on the environment, but it's a necessary part of our mix. Nova Scotia Power has used it when it's relatively cheap. They have the option in some of their power plants to switch over to oil when the price is not so attractive, if oil is cheaper.

 

We've undertaken a couple of initiatives to look at natural gas and to make it more available. One is, as you know, we're allowing containerized natural gas on trucks. You may have noticed a picture in The ChronicleHerald recently. It showed a very large truck with a lot of wheels because it carries a lot of weight. I think it had something like 11 different large tubes that would be supplied to an industry like Michelin or Minas Basin Pulp & Power, somewhere like that that needs a large source all at once. That's one thing that we've allowed in addition to our franchise area that Heritage Gas has. Heritage Gas has about 20,000 customers in residential and businesses around the province.

 

The other thing we've undertaken is a natural gas study in the Department of Energy here recently. We've had a consultant look at the whole landscape of natural gas - looking at supply, both from Nova Scotia offshore or onshore; looking at supply from New England through a pipeline. Is it possible to reverse that pipeline or add to it to get more capacity? We're looking at all the infrastructure that we have and the potential to bring it in, supply and demand, and what we can produce or what we can bring in from elsewhere.

 

We do know it's a valuable source of energy in this province and we just need to know all the facts and information that is available to us. We're going to await that report; it should be available very shortly. It will help tell us how we move forward.

 

The other thing, the federal government also is looking at LNG and what's available for gas in that regard as well. There are a number of initiatives that are occurring around natural gas and we recognize it as a valuable part of our diverse energy portfolio. It can't be the be-all and end-all, but it can be part of our energy mix in this province.

 

MR. MACMASTER: I recognize that natural gas did triple in price, as you say. The thing I think about is - for natural gas to triple in price, then it's only getting up to being as expensive as some of the wind energy that's purchased by Nova Scotia Power, which concerns me, because if people are running away from natural because there are problems with supply of it and that's driving up the price, they would probably run away from wind if they could choose but of course they can't because it's procured through Nova Scotia Power. I'm not going to say, Madam Chairman, that all wind is bad, but if it costs three times the price of say natural gas when natural gas isn't spiking in price because of the supply issue, it raises the question, why would we want to have so much capacity of it? But I'll move along from that.

 

Is there is something that the minister could offer with respect to any discussion about finding other ways to secure? I know they are looking at trucking natural gas around the province but I don't know if there is any talk, and I don't imagine it would be revealed here, if there is any discussion on bringing a pipeline. I know there was talk about Trans Canada Pipeline bringing a pipeline across the country, bringing it eastward. They were looking at maybe oil but also natural gas is possible.

 

I know there is a price differential between Brent Crude, which is based on the price of oil coming out of the North Sea and other places around the world coming into New York, the New York exchange. I know that West Texas Intermediate is much cheaper and I think it's because they don't have as many routes to get their product out onto the market and as a result they are stuck selling to people at a lower price.

 

I know we only have a couple of minutes left but is there anything you could provide us with on an update on that, on better access to oil and natural gas? It could bring down the price of gasoline if they're dealing with cheaper oil to begin with, when they start to refine it. Also, if there is natural gas coming here, it would get rid of the issue of us having price spikes when there are production downturns in, say, Sable offshore natural gas, which we're depending on right now.

 

MR. PARKER: I guess, in the first part of your question, you mentioned natural gas, and I'll get to that first. I think it points out the value and the importance of diversity. Natural gas can be part of the mix but there are times when it certainly - like this past winter it was much more expensive than wind. You referenced wind energy as being more expensive but that's not always the case. Wind energy sometimes is cheaper. The Pubnico Point Wind Farm was built, I believe, in 2003 and that power is stable. It comes in around 6.9 cents per kilowatt hour and that stays the same for 20 years. The REA proposal recently, the South Canoe Wind Project in Guysborough County is also I think about 7.5 cents per kilowatt hour. That wind is considerably cheaper than the natural gas. Diversity is so important. You can sometimes rely on one, sometimes you rely on another but it's good to have a variety of sources to make it happen.

 

I know I'm running out of time here but the proposal for the east-west pipeline is an interesting proposal and I think we can be supportive of it. It will help the Maritime Region so if it is of benefit to New Brunswick, it's going to help Nova Scotia and Prince Edward Island. That's a private sector initiative but I think as a province we're quite supportive.

 

MADAM CHAIRMAN: Order, please. The time allotted for today's consideration of Supply has elapsed.

 

The honourable Government House Leader.

 

HON. FRANK CORBETT: Madam Chairman, I move the committee do now rise, report progress and beg leave to sit again.

 

MADAM CHAIRMAN: The motion is carried.

 

[The committee adjourned at 9:29 p.m.]