Keynote Panel Discussion: Jim Lane, Bettina Hamelin, Madison Carroll, Jamie Stephen, Scaling Up 2023

[Music] okay so I would argue what we just got was four calls to action all with slightly different perspectives all with slightly different angles on it but nonetheless calls to action all the same and enthusiastic passionate one so thank you to each of our panelists for that as I mentioned oh I'm getting lots of questions already so pile them up and I will try and uh read as we go but maybe I'll just start with one of my own questions to start with and Jim I think there's a microphone there I don't know if there's more than one you guys can maybe pass them around a little bit um my question really comes down to if I sort of pick up a theme one of the themes coming across is I'll call it shortages whether it's shortages in feed stock shortages in Talent shortages in capital shortages in desire um was wondering picking one of those or more of those or tying those together if uh you mind talking to us a little bit about where you see the biggest element of those shortages and probably most importantly maybe one idea of how we start to address some of those shortages I know if Jim you want to get us started uh sure can you hear great uh as you saw on my Slide the and I I think actually the torch light presentation the the constraint is Supply it's not a demand problem I don't think it's actually a price problem I don't think it's a capital problem I do think that we are deploying a lot of technologies that do not have uh we're kind of deploying the wrong technology um saf is expensive and saf takes a long time to build the plants because of the type of plants we're building we're building the wrong plants so uh the reason we're building the wrong plants is because we're using the wrong wrong feed stock we're not using targeting the the larger opportunity um it'd be the same thing if you try to get a message by Pony Express to Vancouver take you a long time be very expensive right so um you know we just need to think a little bit differently and we need to double down on unlocking feed stock um the the point about the um uh the timber resource that we just heard is is very very is correct it's it's an artificial constraint because the way we're thinking going to change your thinking so that would be my answer it's it's a supply problem it's a feed stock problem and um you know values change habits or values uh change habits habits change actions actions change the world so if you want to change the world start with values we got the wrong values about how we're protecting the forest I go next please yeah yeah so I would say um you know our space of really cre creating this buding ecosystem of companies that are coming up with these really groundbreaking new technologies that um lead to sustainability um the big gap is um space for them to go laboratory space and scale up opportunity um there's a sh of of bioreactors and for example in the fish space um uh we had um a speaker uh earlier this year and he um impressed on the audience if he was able to use all of the bioreactor cap capacity that's available around the world he could produce 1% of the the fish um demand so so we need really infrastructure and and that infrastructure is elsewhere it's not in Canada that's the one big thing I think the other big thing is is capital you know we get them started with small amounts of money um um but when they then start growing and they're looking for the $2 to5 million investment that we have a huge gap in that in Canada and so they can't grow here they go to the US they go to Europe they go to incubators and uh you know then it's hard to bring them back great um I guess I was it on okay um I guess I just like to build off the comment on the feed Socks and you know it is is safe like I said is less than 1% of jet fuel it's enabling markets that support a wide range of those feed stocks creating competitive markets that can allow a diversity and other feed stocks to flourish through creating the greatest amount of decarbonization for the lowest value and that's how you can you know diversify what that looks like um and it makes more economic sense so saf is expensive um I think that is that is a limit um but we can work through that with with increasing um efficiency in those Market systems super than I'd say that uh the thing that's missing is political and policy bravery I mean it's you I understand it's a difficult message to say yeah we're going to cut down more trees I mean it contradicts uh a lot of what we what we believe but we have to look at the facts and the reality um of what works and what doesn't work um you know do you eventally the prime minister is going to be getting calls from the president being like hey why are you making our city Smokey every year do something and that requires an honest discussion with Canadians about our role as humans in a boreal forest and what we can and can't do that's great thanks just sort of picking up on a a bit of that then I got a couple of questions here that kind of get at the economics of this so um I think each of you probably have a good and one in particular here talks about $20 trillion for the bioeconomy versus $30 trillion of debt how do we grow sustainably and so I think the regardless of the numbers I think for a lot of people the question is where do the economics start to come together how do we and to a certain extent Jamie maybe it's a question of political will and political interest and prioritization um but wouldn't mind each of your thoughts on um the economics and where the economics of this start to come together particularly at a time period where governments around the world are starting to look at um the fiscal realities of coming out of a covid period where significant Investments were made and now looking at the Investments required in other priority areas so I can go on on on the on the forest side to actually do these types of operations and and go in and and thin the forest reduce Wildfire risk you can't only look at what is the microeconomic cost of doing that what is the cost of not doing something what is the impact in air quality and health care what is the impact on tourism what is the impact on you know in BC wine quality all these things what is what is the cost of having to evacuate people constantly um these are major costs and again this is a public asset and the public owner is not taking care of it and so it cannot be seen as a oh well it's you know too expensive to do this these types of operations um you know it it would just be unacceptable if it was private land and you had all these wildfires creating um air pollution for everybody you cannot blame it all on climate either so that's that's what I'd say is it's it's a consideration of not just the uh the microeconomics what does it mean for the country as a whole it's fair Jim let me just add in uh some economics because that was really that was a question that's a good start let's let's begin with what we're using for saff right now we're using soybean oil that's 70 cents a pound now it takes 8 pounds of oil to make a gallon so um I'm doing this imperial gallons so I'll you have to convert into liters but the that you're starting at 560 just for the feed stock it's unacceptable to use $5.60 worth of soybean oil make a $3 fuel right it's just not going to work now you can do carbon credits all you want forever but you know we need to get the price down now let's look at the price of uh other biomass resources uh the billion ton study that was done by the US Department of energy projected a billion tons available $60 a ton if you use the different feed stock $60 a ton that's three sets a pound we're using the 70 the 70 Cent feed stock instead of the 3 Cent feed stock that's our problem okay anybody else want to jump in on the economics all right let's keep going because I've got a lot of questions and I'm never going to get to all them so my apologies first to everybody here but uh question for Betina you talked a lot about skills what are the skills that we're missing in agrobiotech the most theill missing primarily is on the on the scaling up on on on the biom manufacturing side of the skill sets um so that's really where it is we have very few biomanufacturing Engineers um in Canada and those are the programs we need to uh we need to really strengthen and I want to I want to just highlight that there is an organization that's called castle that is starting uh to do that on the medical side which is really important but we really don't have uh focused uh training programs on uh biom Manufacturing in the EG and food space we also don't have the programs in universi because that space requires a lot of interdisciplinary interactions you know you have to have the biology the engineering the mathematics the computer science the AI all of these skills need to come together and we don't have these kind of join training grounds in Canada that's great anybody else uh any thoughts on the talent side of uh the equation well you know I I would say in particularly in in forestry uh it's extremely difficult um you know Timber Harvest as I mentioned is down by about a third probably about 40% now you've seen about 150,000 job losses in the forest product sector I mean who wants to come into to that I mean I a lot of rural communities have really been left behind over the past decade I would say um and the forestry communities are are definitely in that that group um so it it is it is challenging there are some emerging you know things like remote remely operated harvesting equipment they've even got drones that can actually um avoid having to build roads and do some thinnings still quite early stage but um you know so I I think some of that comes into it but ultimately um bring getting people into a what has historically been uh a an economically challenging sector over the last 20 years um it is difficult to get people to see that as a as a job priority Fair please make one more comment and um and that is that you know in the agricultural space um the farming Community really has trouble uh keeping um and and recruiting uh folks who want to be farmers and being a farmer has sort of a certain Vision associated with it which is kind of hard labor and it's outdoors and it's running these big farms but farming is becoming so high tech it's really an a an area where uh people can apply so many different skill sets and I visited um a greenhouse last week it's incredible the tech that's involved there so it's it's talking more about the how attractive that is as a working ground it's uh it's robotics it's um and by the way uh we're using CO2 specifically to make our plants grow in green houses so here's another use of uh CO2 that's great thank you uh soim this one starts with you but I suspect others will be interested in commenting too uh question around the revenue streams that you showed for renewable Diesel and being contingent on us and specifically California credits and incentives and what do you see as the opportunity for Canadian policy makers to provide similar incentives in Canada to manage the cost challenge well Canada has a clean fuel standard that it's deploying right now so British Columbia has a low carbon fuel standard all you have to do is replicate what works and we already know what works and those those kinds of Economics that you saw in the chart there are California but the same kind of um prices exist in for carbon credits uh for the low carbon fuel standard in British Columbia that the piece that doesn't exist in Canada and this is an opportunity is a tax credit an investment tax credit that uh is matched to the tenor of the loan so what you need to do is is get a 20-year off take but you need a 20-year tax credit as well because that's what's going to get plants financed uh right now it's the 80% of the time it takes to build a plant is the financing we've got to get that down we need to build a hundred bio refineries a year we're building about you know a handful and the reason is because it's taking too long to finance them so we've got to squeeze that down so we need an investment tax credit uh that is matched to the tenor of the loan 20-year loan needs a 20-year tax credit and a 20-year off take agreement we finally have 20-year off take agreements the very first one was signed last week by Southwest Airlines real visionary uh piece of work there um a lot more of other things happen but if you get those three things you'll get bio refineries built in you know the financing will come together in weeks or months not years anybody else on on the incentive subsidy conversation yeah nice go ahead yeah I think um with the incentive side it's important to be able to stack those so there's incentives for the producers but again it's like taking a cost and splitting it up across the entire uh stakeholder chain and so so um the ability for The Operators who are purchasing that to use that under incentives or their ESG reporting and how does that done and what do those look like um is should be considered when when they're being developed so that way each there's a kind of an incentive or or uh cost share for each piece through through the entire chain of custody not just the producers The Operators and then ultimately how that gets passed on to scope three thanks Jamie goe I I just say some of the some of the policy that we have um they're supposed to be technology neutral but they are written in such a way that it takes you down a certain pathway of production and compliance is only permitted through certain Pathways um so for instance clean fuel regulations uh carbon dioxide removals are not per at a separate facility are not permitted under that there is a there's a removal occurring um why can they not be used uh clean electricity regulations uh one of the big problems with that again you're trying to regulated on a plant-by-plant basis um not recognizing how how the electricity grid actually operates um and again not permitting carbon dioxide removals uh we need a little bit more imagination in some of this policym and you know instead of having a bunch of opaque costing in terms of you know what compliance costs and you know 400 500 $600 a ton for compliance I mean there are limits to what we're going to be able to accomplish if that is the implied cost of doing it and and yes you can get your five or 10% blend rate but you're not going to get elimination of those emissions so because eventually that implied cost will become too much on a on a on a per liter basis so we always have to be thinking about what is the cost of actually accomplishing what we want to accomplish which is to reduce the emissions great so a more specific question here from Madison somebody was particularly curious about traceability saf and uh how you can ensure traceability of saf in the blend yeah absolutely that's that's a little bit more my bread and butter um so that that is exactly what kosa is working on um how how you trace that we've written our initial set of guidelines that are out in May and we're piloting in in a public feedback period for them but we've developed a unique ID um that starts with the with the producer and changes through the chain of custody so that way you can it's used the same across all Registries across all fuels um it allows you to easily see what's in that fuel what the decarbonization value is and continue to split up into smaller batches so that's what we've uh used with um our product transfer document that allows easily demonstrating what claims are were made um at what point and then ultimately when that fuel is retired that's great trying to Rapid Fire my way through a few of these more specific ones I think this one's down for you cuz it's on Beck Beck sounding very promising can you elaborate on the downside of Beck what's the roadblock uh so the challenge right now is monetization right um and I think this also goes to you know um fuel charge exemptions everything like that ultimately the more transparent things are uh you know that can actually ends up being the lower cost but we're going in on a way of opaque policies um so that consumers in the general public the the voters you know I.E voters don't know what the actual cost is everybody says yes of course I want clean fuels well duh I mean but who wants to pay a tax so that's a that's a Communications thing on in terms of the monetization um basically there's three ways uh there's the voluntary Market that currently is in its infancy uh we've got Norway is going down a pathway of a reverse carbon tax so basically you take funds from the carbon tax and pay for removals uh that would work you know a federal level and then um the other is what Sweden is doing is essentially reverse auctions for carbon dioxide removals so taking funds again from their carbon tax but having a competitive process um for purchase of those removals and they've allocated about 4.5 billion um for Beck specific carbon diox removables so that is currently the challenge uh ipcc everybody says we need need removals but there has to be a monetization pathway that also provides that you know as Jeff pointed out that security that policy um in terms of yes 15 20 years from now the price of carbon will be this because ultimately we're taking hot air and putting it underground so that only has value if policy says it has value right all right so we're down to our last minute here so I'm going to ask you a quick fire one here um which is for those who are here this morning what's the one thing that they should take away this morning that they should be doing within their business within their Community within their organization coming out of this morning to make sure that we uh are actually taking this and turning this into action so maybe we'll go in reverse order to where we started and we'll start with Jamie down at the end uh I just say in terms of um affordability and finding uh unique or the the pathways that have actually been proven I can talk about bioheat but what's actually been proven and not just L listening to what the rhetoric is of what you should do than Madison yeah so I think um it Minds me very specific in terms of Staff but in terms of Staff uh understanding the the broad environment um mean looking at it from a neutral stance on feed stock diversification production process how can we really get the greatest amount of decarbonization for the lowest value and what support systems need to be in place to do that um and supporting those that are looking to take friction out of the process instead of add friction for their own monetary benefit great patina uh there's few things we do more often than eat um our agricultural um systems are not sustainable um so help us rally behind 7.5 billion dollar new economy 86,000 jobs for Canadians and what that requires is investment um bio create is a great tool come and talk to us about bio create I will say that we had a 100 companies come to us in the first round um and we were able to fund 12 companies so funding is really really critical and um Partnerships as well as I said so come and talk to us how we can build that industry that's great last word DJ I think it's all been said but I haven't said it so my turn um but all I all I would add is um that you ought to recognize that in yourselves that you've got to work harder at this and you've got to stop putting your hand out you need a hand up but you know the long-term carbon price should not be your goal your goal should be get the get the technology price down and get the um get the the car get the the right feed stocks in use if you work on that everyone else will do their part and the capital is already there the reason the capital isn't here in this room is because you have worked harder on that so you've got to work harder we all have to work harder so that would be my my challenge for you right well for a conference that is called the Futures now I think we couldn't have got a better panel to start us off so we get a quick Round of Applause for our panel members [Music] he