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Estimates - Agriculture (17 April 2007)

From Economy Committee Hansard - 17 April 2007

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Department of Agriculture

Mr. Hart: — Thank you, Mr. Chair. Minister, I’m looking at the news release of last Thursday where your government launched its green strategy, and I just see one small line about the farm component of this strategy. It deals with the farm energy audit program. Is that all there is as far as the overall green strategy for agriculture, and if that’s all it is, could you expand on that energy audit program?

Hon. Mr. Wartman: — This is mainly a Department of Environment program. We will be working with them to look at the parameters around, you know, what will be applied, what will the impact be on residences, on other farm buildings. But I think it’s important to note that within the broader green strategy — and it’s not articulated in the news release because I was looking at new program — but we’ve also had very, very and continue to have very good response to our environmental farm plan programs.

We’ve seen good uptake, people doing the planning and then engaging in things like putting land to forage crops, to hay, and looking after light soil areas, repairing areas as a part of their environmental farm planning. So within the green strategy, there are a number of things that we could reference, program within agriculture, that would certainly be a part of the strategy, but not articulated in Department of Environment’s release on last Thursday.

Mr. Hart: — So the farm energy audit program, that’s a Department of Environment program. Did your department have some input on this? And if you did — I see your deputy minister’s indicating that perhaps you did have some — perhaps you could explain how that program is going to work.

Mr. Brooks: — So we did have a representative that sat on the green strategy team and was very knowledgeable and able to help us put forward a proposal in this area. The final details haven’t been worked out at this point. But the general concept is, is that there would be services provided to producers to examine the sort of energy parameters around their home residence, all other heated farm buildings and machinery, to get them to understand their energy use and those areas where they may be able to save on energy in a cost-effective way in all aspects of their farming operation.

Mr. Hart: — So specifically, Mr. Brooks, the $400,000 that is indicated, what is that money targeted for?

Mr. Brooks: — That’s for the energy audits of the farms.

Mr. Hart: — The energy audits of the farms. You mentioned farm residences. I would assume that farm residence would qualify for the EnerGuide program the same as, or whatever the new acronym is for it, the same as an urban residence. So I’m guessing then that this funding is for farm buildings. And you mentioned energy audits with equipment use; I wonder could you expand on that a bit more.

Mr. Brooks: — We’re still developing the program, but when the audit takes place, we would assume that when the auditor visits, they would do as much as they could with the one on-site visit which would extend to the residence. We’re still trying to work out the interrelationship between that and EnerGuide for Houses. But yes, as we would also envisage it extending to equipment, and trying to get a good profile on the energy usage of the farm.

Mr. Hart: — Well I guess we’ll just have to wait and see how that program rolls out and so on. I know most producers are very conscious of energy use, particularly at the current prices. You know, when they fill their farm fuel tanks or pay their monthly statement, it makes them very aware that they should be very energy efficient.

Minister, dealing with this area of environment and agriculture, one of the programs that has been put forward or concepts, I guess, that has been put forward by a number of farm groups in our province in the last year is the alternative land use and payment for ecological goods and services. Other provinces, particularly Manitoba as you know, have funded a pilot program that’s funding both from the public and private sectors — as I understand it, a two-year pilot program — to explore that concept. And I understand back in, I believe 2005 it was, now you may . . . where all first minsters of Agriculture signed a memorandum of understanding that they would go down that road and explore this concept.

Yet we’re seeing farm organizations, when they were trying to set up a pilot project here in Saskatchewan, really ran into a brick wall with your government as far as accessing funds and any other type of help to get this pilot project off the ground. I wonder if you would care to comment and explain your government’s position on this issue.

Hon. Mr. Wartman: — Certainly. The pilot project in Manitoba is one that all of the provinces are looking at referencing for information — the analysis of the effectiveness of the program, cost parameters of the program. We are looking at this basically as a pilot program that should inform all of us as we move forward.

At the same time, certainly within the department, various branches are looking at the impact. When we look historically, we have seen programs that have been provided that would enable best practice, but we have supported that best practice with dollars at times. But they are one-time dollars. Some of the elements that are being explored in the ecological goods and services would be annual payments. And when we look at the pilot project in Manitoba we can see, and this is just in one municipality, costs of over, I think it’s over $630 million per year.

And so there’s a significant cost transfer or cash transfer around the program . . . [inaudible interjection] . . . What is it? Six hundred . . . What did I say?

A Member: — Million.

Hon. Mr. Wartman: — No, sorry. Thousand . . . [inaudible interjection] . . . Yes, that would be . . . Yes. Manitoba can cough that up because of their payments under equalization, you know. No, it’s six hundred and thirty-some thousand, is it? Yes. Sorry about that.

I mean, I think that we can learn some good things from this project, but we can also look at what we have done in the past and how effective it’s been in encouraging best practice. Particularly in areas of risk as I’d mentioned earlier — light soil areas where you want to re-establish either native prairie or you want to establish good forage crops, riparian areas — you want to make sure that you’re using best practices there.

And we have over a number of years provided the one-time funding there, and it’s been effective. I think of all of the provinces, the proportion of land that we have been able to convert — light lands, etc., at-risk lands that we’ve been able to convert — is significantly larger than any other. I think it’s about half of what’s happened in the nation has been done, more than half what’s happened in the nation has been done in Saskatchewan.

So I mean there are a number of dimensions to this whole issue of ecological goods and services as well. When we look at support funding within Europe, you can see that they’ve moved to the whole farm payment. Part of that is looking at what farms do provide as considered public goods. And it also changes how those farms and payments would be assessed in terms of the WTO impact. These programs tend to be in a green box area which means they’re fine under the WTO. And so all of this is being assessed.

And when the farm groups here came and wanted to establish a pilot project in Saskatchewan, we simply said, well we’re doing analysis here and we’re — as most of the other provinces are doing — we’re closely observing what’s happening on the Manitoba pilot project. And I think from . . . and correct me if I’m wrong but it seems to me in our discussions at federal-provincial-territorial meetings that this was basically the direction that we were taking, was that we would, we would all look to this pilot project in Manitoba as a model, a reference model, where we would gain understanding.

And so we’re not, we’re not saying it’s not going to happen, but we are saying that we want to make sure that we do, do best analysis. I mean certainly questions are raised about, should you pay somebody for doing best practices. Maybe, because then you have to do the analysis: how much is for the private benefit, how much is for the public good, and all of those assessments are going on. And I just at this point say there’s I think a lot for us to learn here, but we’re not ready to jump in with both feet at this point.

Mr. Hart: — Well, Minister, I don’t think the farm organizations that are taking the lead on this issue are suggesting that we implement a province-wide program that would pay farmers for ecological goods and services. In fact they are saying the opposite. They’re saying before we go down that route, if in fact we do go down that route, we should have a number of pilot projects across this nation.

And it’s their feeling that Saskatchewan is diverse and unique enough that it should have its own pilot project so that we can do an analysis of this concept within the province to learn from it, to see if one, if it has merit and it is workable; that it is something that we could look in the future to develop a province and a nation-wide program, but also on the flip side of the coin to see perhaps if there are inherent flaws in the concept that renders it unworkable. But their arguments are, and I think I have to agree with them, that we need to have these projects here, and we need to . . . so that we can analyze and understand them in a Saskatchewan environment.

And it just seems to me a bit ironic that Saskatchewan, with the largest percentage of farmland in all of the country, wouldn’t want to take a leadership role in this. And so therefore I would certainly urge you to reconsider.

I mean nobody’s saying that we should implement a province-wide or a nation-wide program at this point in time because there are far too many unanswered questions, and we need to have a number of these pilot projects around the country including Saskatchewan so a good analysis can be done on it.

Hon. Mr. Wartman: — I appreciate the points that you are making, Mr. Hart, and they are the points that the farm groups made when they were coming to us as proponents of a potential pilot project. But the reality is that we have two pilot projects in Canada. We have one in PEI [Prince Edward Island], and we have one in Manitoba. And federal and provincial ministers basically agreed that we would not duplicate what’s going on in those projects until they were completed.

We wanted to use those projects as the pilots so that we could learn from them. And basically that’s where we are today. When the conclusions of those pilot projects are reached, we will certainly seek the best information that there is there, and we’ll work with that.

And at the same time, as I indicated earlier, we are doing ongoing analysis and really trying to get a good sense of what impacts might be here. Are there divergences between here and what’s being experienced in Manitoba and PEI? I mean I think to a large extent those divergences and differences can be accurately projected.

And so it’s not like our eyes are closed to it. It’s just the pilot projects are going on. We are learning from them. And I expect that we’ll take the best information that is available and, hopefully I think, see some changes in the kind of programming that we do that will be responsive to what the needs are.

Mr. Hart: — Well I guess producers and producer organizations are . . . they look back in recent history, and they see some of the adverse affects of programs that are developed in other parts of the country and then applied and tried to make . . . made to fit to Saskatchewan conditions.

And I’m thinking of, you know, the AIDA program and CFIP [Canadian farm income program] and so on and to some extent CAIS — which are all sort of a different version of the same concept which really those programs were developed for industries like the hog industry in central Canada and a number of those industries, but really are a difficult fit for our diverse nature of our agriculture in this province. And what their, you know, what the concern of producers is is that we don’t want to see a reoccurrence of that process. And as you mentioned earlier, you know, the Manitoba project is funded to around the $600,000 mark and it’s a two-year program. And the argument is that I’m hearing from the producer groups is in terms of government spending and private spending, it’s not a lot of dollars.

And I certainly have to admit I’m not an expert in the area to know all the nuances of the differences between Manitoba and Saskatchewan but those people who have done a lot of work in this area say there are enough differences that they would feel that it would be tremendously valuable to have our own pilot project.

So what I would urge . . . The Manitoba project this year will be in its last year of operation. Once the analysis is done and if it’s determined that there is a need for additional pilot projects, I would urge you to — in this province — to seriously consider looking at these sorts of things because I believe we’re entered into a era where we have a moulding or a merging of agriculture and the environment.

At one time agriculture was perceived, and I think in many cases wrongly so, as an enemy of the environment or at least not co-operative with the environmental aspects. But I think that the era that we are in now I think it’s a natural fit and we need to have policies in this province and in this country that make that happen. And so therefore as I said I would urge that we in the future look, go down that road.

Hon. Mr. Wartman: — It’s important to note, and Mr. Cushon reminded me that when the groups were coming we were also saying to them that, you know, you don’t want to duplicate any pilot project that is going on. But if you have a significantly or substantially different pilot project that you’d like to engage in, bring it forward and you know we’ll take a look at it. So I mean I think it’s important to note that we certainly have not been closed to the idea, but there’s no point in duplicating a program. And so at this point there’s been nothing of substance different that was brought forward and so we think that using that program there we will gain some real good insights.

And I think you’re also right, and I appreciate the point that you make in terms of the connection in agriculture with care for the environment. I mean I think of some of the ranchers and farmers whose lives have been dedicated to caring for the environment and to being good stewards. I think of some of the new developments that will help, I mean that we’ll see synergies in terms of our production processing that will certainly be much more environmentally responsible that what we’ve seen in the past.

We’ve seen communities work together to try and make sure that as we’re getting developments that we’re caring for the watershed, for example, as the Spirit Creek group has done around hog development. So I think you’re right. There are clearly connections, and I think the public and certainly I think the industry is more and more aware of those connections and are building towards an even better, more responsible industry.

Mr. Hart: — Well, Minister, what I would add to your comments and the comments I made earlier, and I would like to refer to some of your earlier comments where you talked about whether it’s proper or good public policy to be funding best management practices on an ongoing basis and those sorts of comments. I think the argument that is being put forward under the payment for ecological goods and services is that over time, landowners and producers have sustained all the cost of providing these services to society, whether it be wildlife habitat or riparian management and those sorts of things.

I realize that we have the environmental farm plan and the farm stewardship program which pays for some one-time costs, which I think certainly is a good initiative. But producers, if we use wildlife habitat as an example, if they’re maintaining these areas of wildlife habitat on their farms, they’re having to work around them. They’re incurring extra costs on an annual basis. And the proponents of the concept — which I think, you know, rightly so — are saying maybe it’s time that society at least share in some of those costs because society as a whole is benefiting from the things that they are doing. And I think that’s a concept that we need to explore and move down.

Also they are telling me that it doesn’t necessarily mean that we have to see a significant increase in public dollars. It’s perhaps a realigning and a shifting of that. And I think there’s real value in there. We need to look at getting away from — I think now I can speak with two hats here, producer and elected representative — I think we need to get away from these ad hoc payments that are addressing crisis situations which at the end of the day we know there are many questions asked as to how much we’ve really accomplished, and move towards longer-term policies and programs where there is some real benefit and perhaps minimizes the need for these emergency and ad hoc payments.

Hon. Mr. Wartman: — You’ll be pleased to know that — and I mean this seriously — I think you’ll be pleased to know that we’re also funding research at the U of S [University of Saskatchewan] around the whole area of private and public benefits related to ecological goods and services. I mean, we want to understand this area and how it might be a significant area in the future. And so we’re putting funding in. We’re looking into the research. We’re looking at the pilot project, assessing that. And as you’ll know we’ve also . . . And you indicated that you understood that we do have through the environmental farm plan things in practice right now that we are funding. And so I think there’s a general trend in this direction which is very positive.

Mr. Hart: — Thank you, Minister. The next area I’d like to discuss is connected to the environment in agriculture and that’s that whole area of biofuels. It’s a subject and issue that we’ve been talking about for a while now.

We are seeing some advances and some increases in production here in Saskatchewan, particularly in ethanol. The only biodiesel project or plant that I know of is a small one in Foam Lake. But what seems to be missing to really get this whole industry off the ground, and particularly with producer involvement, is programs that aren’t there that would allow producers to attain an ownership position in the ethanol and biodiesel industries.

The US has been quite successful in this area. But that just didn’t happen. It was by design. It was designed by their federal government and their state governments. There was federal programs in place and there was state programs in place that enabled producers to take an ownership position in these processing plants. That’s what’s lacking here in Saskatchewan and I know the federal government has made some announcements in this area. To date, I don’t know if we have many details. And I would appreciate the minister’s comments on this whole area and some indication of what he is doing to move this issue along, to enable producers to become, to move up that value-added chain.

Hon. Mr. Wartman: — Well I really appreciate the question and I know this is primarily an issue for rural economic and co-operative development, and if the member had been here earlier this afternoon he could’ve asked that minister and I know would’ve got an astounding answer, full of information and insight.

But it is of course an area that is of huge concern to us in agriculture and we’ve seen I think some really tremendous developments in this area to date. Certainly we’re out in front of most of the other provinces. Ontario’s had a long history in ethanol in particular. But here we have through various programs now enabled the development of several new ethanol facilities. We have, I mean, basically a company that has just come in looking at the climate here and said, we’re going to produce ethanol — not sought any kind of support. So we’ve got Terra Grains building out in Belle Plaine.

We’ve heard some very, very strong comments from producers, good strong comments from producers about the base contract funding that’s available for delivering grains there. I think we’re seeing generally a positive upward impact on prices today that analysts will tell us is largely connected to the production of biofuels.

The other area we’ve seen the expansion of the canola crushing facilities in Nipawin, Clavet, and the two announced for Yorkton. Though they’re not directly at this point announcing anything around biofuels, the potential is there for a significant biodiesel production. And in terms of programming from the province that there is work going on, I can say that much that I know that there is work going on in terms of developing programming, but I can’t say anything further about that at this point.

I can say that we also have some really what I think are exciting developments for producers. And I’m not sure whether I’ve talked to the member but I look at some of the work that’s gone on by Peacock Industries, for example, just north of Saskatoon with another potential biodiesel fuel, but it comes from mustard. And what they have done there is they’ve developed a nematicide from mustard and this has proven particularly effective on nematodes but they’re right now engaged in an analysis and testing on the range of application, where it might be used as pesticide — could it be as a bio-pesticide applicable for organic crops?

I mean there’s just really some tremendous developments there but the plus side of that is, I mean a second plus side of that is that you’ve got a high-end product in the nematicide and on the other side you’ve got another high-end product is the oil which is similar in quality to canola oil but has a higher cetane level. And so we’ll see some — I think if this proves out and may well do so in the very near future — we’ll again see another shift in cropping. There’ll be significant demand for mustard production across the province as well.

So I think some very strong developments that will benefit producers but in terms of some of the kinds of supports that we’ve seen in the United States for producer involvement, most of those directly funded by the federal government in the US, those I can only say that we’re at this point we’re working on. At this point I can also say that it certainly hasn’t seemed to be an impediment in terms of development of biofuels production yet.

And, you know, take a look at one other announcement that was put forward by the federal government. They were talking about $180 million towards what is roughly a $500 million project for groundbreaking technology in cellulose production of ethanol that could well go into the Birch Hills area. And again, significant benefit to producers. I’ve heard estimates in the 30 to $50 million a year range benefit to the region if in fact that goes forward. So a number of areas of production.

I can see Alberta’s trying to play catch-up right now. They’ve announced a very large development funded by, largely funded by US-sourced dollars. But I mean I just think that there’s so much on the horizon in this area. And I can tell you that we’ve done a lot of work. We’ve been out in front on much of the development. And we’re certainly going to try and make sure and we have I think in — and again I think the member’s aware of this — but in all of our discussions with the federal government and the other provinces, we’ve certainly been encouraging development in a way that will provide best return, best opportunity for our farmers.

Mr. Hart: — Well, Minister, you mentioned a number of exciting things that are happening out there and there are . . . I mean the Terra Grains plant here at Belle Plaine as you mentioned, the Yorkton crush plants. But the fact is that there’s very little of producer ownership in any of those projects. And this is what the concern is out in the country where there are a number of community groups that are trying to get something happening in their area, whether it be an ethanol plant; there’s, I think, one or two groups that are looking towards developing biodiesel plants.

But the biggest stumbling block that they have is raising the investment capital. And we’ve seen this in the past in value-added in rural Saskatchewan and particularly with agriculture. The profitability of primary production doesn’t allow that many producers to come up with those significant dollars to buy a share into the value-added plants. And in the US they realized that, and they put programs in place. And you’re right. The majority of the funding and the initiatives came at the federal level and we need to have that here in Canada.

But the state governments also did play in a fairly significant role — in the top-up exactly, but it completed the package that made it happen. And both levels of government in the US decided that it should happen. I mean they have their reasons, and we don’t have some of those same reasons.

But if we’re looking at seizing an opportunity to build some stability at the primary production level, the opportunity was there. It may still be there. But this industry is moving very quickly. It’s maturing. You mentioned this megaprojects that are being announced in Alberta. The industry will get built. The ethanol and the biofuel industries will get built. The question is: will the producer — primary producers — be part of that or will they merely have another driveway that they can take their, drive their trucks up to deliver the canolas and the feed wheats if that’s for using in grain-based ethanol?

And currently the prices have improved. They’re back to sort of the bottom end of the range that we used to have, but we don’t know how long that will stay that way. We have tremendous production capability in this province and in western Canada. And the producers will produce.

And unfortunately in the primary production area what’s good for your individual farm is not necessarily good for the industry. In other words, when prices are strong you maximize production and everybody does that and we find ourselves in overproduction, which results in low prices. So then when prices are low, well you see increased production because you need to generate those additional dollars so you need to produce more tonnes, bushels, units of production, to generate the dollars to cover the fixed costs.

So it’s a vicious cycle and we need to break that cycle. And the biofuels industry offered at least a partial solution to that. And it is my fear that we are letting this opportunity slip away.

And as I said earlier, we need to see action at the federal level. We have some announcements but we haven’t really got any details on that. And there are community groups made up of community members, including producers, who are really frustrated at this time and are about ready to throw up their hands and say, well if we’re not going to get a bit of a hand up with this, we just can’t accomplish it.

And I would strongly urge you and your government to do as much as you can but also urge the federal government and work with the federal government to get something happening in this area, and happening very quickly.

Hon. Mr. Wartman: — I appreciate the direction and the sense of support for primary producers that you’re indicating there. I do want to mirror to some extent and raise some questions for you and ask you some questions as well, because as I indicated earlier, we have as a province — Minister Serby and myself in particular — have been really, at the federal and federal-provincial tables, advocating for a program that would parallel the American program, that would put the base, the same federal base as the US government had in, and allow us to do top-up appropriate to our area.

One of the points that was raised by Minister Strahl at the last biofuels meeting that Minister Serby had called, which I ended up attending, very clearly he said, well we can’t afford to do what they’re doing in the United States because it’s building a false economy. And he said, do you think — and I put this question out for you as well to think about and to try and answer because it’s one that’s posed for us — do you think you can justify putting funding into a project that provides an 80 per cent return on investment?

And you look at some of these projects that have been built in the US. They’ve been completely paid off within, you know, we’re talking hundreds of millions of dollar projects that are completely paid off within two years and then providing more returns to those who built them. And so the question was, is there any way that we could justify taking public dollars to build a false economy and have that kind of return coming to those who are engaged in the industry?

What we’re trying to assess and why I say I can’t give you a lot of detail first of all because we’re not clear on the detail of the base funding from the federal government but trying to figure out what we can structure and justify as public expenditure at a time when . . . I mean you know, let’s take a look at one of the areas. Let’s take a look at the area of biodiesel, an area that has, I think, significant promise as I’ve talked about.

But you also have to be aware that you’ve got a petroleum industry that has very strong roots and significant dollars to be able to develop and do research and put together a program that will work primarily for the petroleum industry.

And so when you look at what they’re doing and you see this process of hydrocracking — which I don’t know whether the member’s heard of. Okay, hydrocracking basically is a refining process where you can use oils, fats of a variety of different kinds and produce a renewable distillate fuel. And certainly in . . . Renewable Fuels Association has kind of gone along and said, yes this would make good sense.

Well if you’ve got a much more cost efficient process and a process that is really much more — the petroleum companies who are lending, selling, marketing fuel across the country — that they’re much more interested in than in opting into biodiesel operations, it raises some real questions about whether or not you can put public funding into and how much public funding you might put into that process.

But if you’ve got people who really believe in the projects and the process — and there’s lots of good reasons to do that — then we do have currently in place some support funding for development of business plans. We’ve got funding in place as a province for development of ANGens [agricultural new generation co-operative], new gen co-ops, and ways of providing some support. But that whole question . . . And so I’d ask the member to consider, what kind of grants and loans might be made available? At what level? And when you consider what the challenges broadly are in the industry, you really have to ask, like as the federal minister pressed us, can we justify using public dollars to build a false economy?

And so when we’re looking . . . And I can tell you clearly that we’re wrestling with all of these issues. We see the positives in this industry. But we also see that there are groups of producers, some of them who have other forms of income and some of those very, very significant, but there are groups of producers who are going together and who are building plants. And again I would reference Terra Grains. There is a group there that has said, we’re going to build it; we’re going to make this happen. And they’re doing it. And there are producers who are invested there.

And so as we’re moving forward, as we’re trying to make sure that we’re being the best stewards of public dollars and that we’re also providing in, as you indicated, that need for trying to do some kind of offsets to that ebb and flow of agriculture income, we’re trying very thoughtfully — aware of what the risks are — to put together a program that will be meaningful and that will provide a good opportunity for primary producers and communities that want to get together and build but that will not be so high risk that it could be threatened in very short order by another renewable fuel development.

You know, you want people to get their return. We could provide support and they could invest significant amounts of capital, but if some of the perceived risks are there and real, they could lose the capital too. So we’re, as I say, we’re trying to evaluate, as we get more information on the federal program, how that will work. We’re trying to make sure that as we’re going forward we’re well aware of what the risks and challenges and the new research and development is. And we’re trying to make sure . . . And I mean as I say, we’ve been advocating from the very beginning to try and make sure that producers have the opportunity and supports, justifiable supports, to move forward. So loans, loans guarantees, grants — all of those need to be considered. But the parameters also need, one needs to be very, very thoughtful about how those are developed.

Mr. Hart: — Well, Minister, you asked some questions about the affordability of US-style programs in this area and whether it can be justified as far as wise expenditures of public dollars and all those sorts of questions. And those are valid questions.

And you know, I mean, I certainly don’t have the answers to those and neither do the producers. But what they are saying is that they need to know in a timely fashion as to what is out there, if in fact there is anything that will be coming, you know, down the pike to help attain that ownership position, whatever that may be.

We’ve seen in the past with farm programs that here in Canada we’ve never been able to match the American programs. In fact it’s been argued that we don’t need to match them. I mean that’s a whole other debate and that sort of thing. And we could, you know . . .

Hon. Mr. Wartman: — Let me tell you, if I can, because I hear where you’re going on this. And I think that one of things that it’s important to note is that remember what we did in terms of our preliminary ethanol development. We carved out a portion for the smaller operations because those generally tend to be the integrated facilities where farmers have had opportunity to buy in.

But in what we’re proposing and pushing with the federal government in terms of overall programming, one of the things that we are saying is that: carve out a section. You’re putting in a mandate; carve out a section as we did here as a deliberate economic choice. Carve out a portion and say 25 per cent of the mandate allocated should specifically be for plants owned by primary producers. And you know, I think that farmers and community groups who own these plants should have an opportunity. And so if we can get them to agree they’re going to put a mandate in place, can they carve out a portion? Because the potential — call it a threat — but the potential for the petroleum companies to do a renewable distillate that could take up, I mean particularly given some of the questions in terms of efficiency costs, could take up probably the whole mandate. And so carve out a portion.

Mr. Hart: — Well I mean if this is where we need to go then that’s perhaps what we should be doing. That is for people such as for governments that have the resources of research and access to all the information to determine those in consultation with producer organizations and so on. But I guess the point that I would like to make is that — and this is what community groups and producer organizations are saying — we’ve been dealing with this issue for quite some time and we need a decision. Whatever the decision is, we need to have it.

Now I mean I guess they would like . . . The producer groups would say, well we just won’t let, you know, let governments make all the decisions. We want to have a voice and this is what we think should be done. But the bottom line is it’s time for a decision so that everyone knows what the rules of the game are and then we could get on with doing what we need to do, whether it’s a community group building an ethanol plant or biodiesel plant or looking at the rules of the game and saying, no, this isn’t for us; we better back away from it.

But there’s so much uncertainty out there and there’s a number of these projects that are in limbo because we. . . Take the Shaunavon project that’s been on the books for five years.

Hon. Mr. Wartman: — Sorry. If I might say, I’ve been really liberal in allowing — and I don’t like to say that loosely — but I’ve been really liberal in allowing the Minister Responsible for Regional Economic and Co-operative Development to speak here and expecting at any moment that the Chair would rein him in and call on the Minister of Agriculture to speak again. And so I think we need to make sure there’s a division.

And I think that if you would ask me in terms of Agriculture what we’re doing, there are a whole number of things that we’re doing to try and make this happen as well in terms of some of the research that we’re doing in terms of co-product. We’ve developed a new feed centre up at the University of Saskatchewan. Largely that is going to be focusing on the by-products and how do we get the most highly nutritious feeds available.

I mean there are a whole lot of areas where the Department of Agriculture has been taking steps so the producers will get a maximum benefit out of these. We’re working with feedlot developments as well that I think are very important as we move forward. So I would, knowing that the chairman is about to rein that other guy in, I would ask that you try and focus on the Agriculture side of it, please.

Mr. Hart: — Well I certainly appreciate the chairman’s indulgence in allowing these line of questions and, you know . . . And just state that I realize that in government you need to, perhaps you may or may not need to make these divisions. But the biofuels industry, from a producer’s viewpoint, is part of agriculture. Or at least it can be a large part, a significant part of agriculture. But I certainly appreciate the dual role that you were playing here tonight in answering these questions.

And just finally I would like to re-emphasize that it is time for decisions in these areas, both at the provincial level and at the federal level. Absolutely. The federal government needs to take a leadership role in this as the US federal government did, but also the provinces certainly have a role to play. And in Saskatchewan your government has a role to play and we need to get moving on this. We need to have answers. Whatever those answers are, we need to have those answers.


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