May 14, 1981 ALBERTA HANSARD 733 LEGISLATIVE ASSEMBLY OF ALBERTA Title: Thursday, May 14, 1981 2:30 p.m. [The House met at 2:30 p.m.] PRAYERS [Mr. Speaker in the Chair] head: TABLING RETURNS AND REPORTS MR. KOZIAK: Mr. Speaker, this afternoon it's my pleasure to table the annual report for the year ended December 31, 1980, of the Supervisor of Consumer Cred­ it, pursuant to The Credit and Loan Agreements Act. MR. R. SPEAKER: Mr Speaker, I'd like to file with the Legislature a correction of one of the statements of the Minister of Housing and Public Works. head: INTRODUCTION OF SPECIAL GUESTS MR. WOO: Mr.

Speaker, through one of its member branches, hon. members have a unique opportunity in joining with me today to accord recognition to a very important organization, the Royal Canadian Legion. The Kingsway Legion Branch, No. 175, has an outstanding record of community service. I wish to cite only three of its more recent accomplishments. In 1980, under the leadership of its immediate past president and with the co-operation of the hon. Member for Edmonton Jasper Place in his capacity as Minister of Labour, the first wheel chair lift was installed in the province, and placed in Branch No. 175.

This was done at considerable cost to the branch, in recognition of the International Year of Disabled Persons. In the same year a $29,000 mobile home fully equipped with a dialysis machine was donated to the Edmonton

chapter of the Kidney Foundation. This year, under its current presi­ dent, a donation of a $15,000 human organ transplant mobile unit will be made. Mr. Speaker, the activities of this branch reflect similar major contributions by Legion branches in the Alberta/ Northwest Territories command, and indeed in Canada. I am proud to have the distinction of serving as honorary president of Branch No. 175, following in the footsteps of a former Lieutenant-Governor of this province, the Hon. Ralph Steinhauer, who formerly held that honor. Mr.

Speaker, the Legion branches in this province comprise approximately 78,000 Canadians who are proud to be called Albertans, and who in turn totally support the hon. Member for Lethbridge West and his Bill, The Remembrance Day Act, now before the House. Mr. Speaker, it is now my distinct pleasure to intro­ duce to you, and through you to members of this Assembly three of those proud Albertans: President Fred Smitten, Vice-President Wilbur McMahon, and immedi­ ate Past President Bill Shackleton. I ask these distin­ guished gentlemen to rise and receive the warm welcome of the House. MR. MANDEVILLE: Mr.

Speaker, this afternoon it's my pleasure to introduce to you, and through you to members of the Legislature, 22 grade 9 students from Brooks. They're here viewing the city of Edmonton and to see us in performance. They're accompanied by two of their teachers, Larry Regner and Janet Gibson; three parents, Mary Stengler, June Kurtz, and Ralph Siemens; and their bus driver Vi Erion. I would like them to rise and receive the recognition of the House. MR. COOK: Mr. Speaker, today it's a real pleasure for me to introduce to you, and through you to the members of the Assembly, 70 grade 9 students from St.

Cecilia school in the Edmonton Glengarry riding. They're ac­ companied by three teachers: Mr. Del Fabbro, Mr. Wasy¬ lycia, and Mr. Grelli. The students are now in the part of the grade 9 curricu­ lum studying provincial government affairs. They're here today to view the Assembly in action, watch the govern­ ment show its accountability to the Legislature, which it always is, and to receive the warm welcome of the Assembly. I'd ask them to rise and receive the welcome of the Assembly. MR. PENGELLY: Mr.

Speaker, on behalf of my col­ league from the constituency of Red Deer, it is my pleasure to introduce to you and to members of the Assembly 50 students from Central junior high school in Red Deer. Accompanied by Mr. Phil Jensen, they are seated in the public gallery. I would ask them to rise and receive the welcome of the Assembly. head: ORAL QUESTION PERIOD Interest Rates — Agriculture MR. R. SPEAKER: Mr. Speaker, my question is to the Minister of Agriculture.

With the exorbitant interest rates farmers are facing in Alberta and western Canada, I'd like to know what proposals were made to the federal Minister of Agriculture with regard to lowering interest rates for farmers in western Canada, specifically Alberta. MR. SCHMIDT: Mr. Speaker, on behalf of the province of Alberta we had the opportunity on Tuesday to join with agriculture ministers across Canada in making re­ presentations on behalf of their producers to the federal minister, Mr. Whelan. The meeting was called basically at the request of Mr.

Whelan and dealt with three basic areas: high interest rates as they pertain to the beginning farmer; the responsibility of stabilization, mainly in the hog industry and touching somewhat on the future of the beef industry; and the last topic was the availability of farm funding and interest rates as they pertain to the Farm Credit Corporation and its role, province to province. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the hon. Minister of Agriculture. In a television interview this morning, the federal Minister of Agricul­ ture said that banks are responsible for the high interest rates.

He said he is going to make representation to the banks. Does the Minister of Agriculture in Alberta agree with that kind of philosophy? MR. SCHMIDT: Mr. Speaker, the federal minister, Mr. Whelan, announced at that meeting on Tuesday that

734 ALBERTA HANSARD May 14, 1981 consultation had been held with the chartered banks on behalf of Agriculture Canada, had discussed the interest rates and of course the problems faced by farm produc­ ers, and suggested that perhaps the banks at that time would hold some of the solution of interest rates as they pertained to agriculture. On behalf of all visiting ministers who were called, I think it was pointed out that we can see little or no relief in the approach through the bank system, recognizing that they are lending institutions, as are others.

The only outcome one could have in dealing directly with chartered banks was perhaps a stay of some of the loans that would be called and would carry them for a longer period of time, but could see little or no relief in the interest rate through a chartered bank. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion. In light of the possibility of staying some of the foreclosures by banks, is the Minister of Agriculture planning to make representation to the Alberta chartered banks to assure himself that that policy would be in effect for farmers in Alberta? MR. SCHMIDT: Mr.

Speaker, the opening statement on behalf of Agriculture Canada was that the problem that exists from a survey across Canada indicated that bank­ ruptcies were appearing in the provinces of Ontario and Quebec and were mainly in the area of hog producers. Perhaps that was one of the concerns that generated the meeting we had the opportunity to attend. The basic chartered bank approach has been made on behalf of the federal government.

We have a good working relation­ ship with the banks here in the province, pertaining to the operation we carry through both the Agricultural Devel­ opment Corporation and collectively with those loans carried through the Farm Credit Corporation. MR. NOTLEY: Mr. Speaker, a supplementary question. Did the discussions centre on the federal Farm Credit, and did the Minister of Agriculture for Canada give any indication that there would be substantial additional funding for federal Farm Credit? MR. SCHMIDT: Mr.

Speaker, the federal corporation and its lending powers, the future of high interest rates and how they would affect agriculture, and the Farm Credit Corporation as to what role it would play certainly came into the discussion. At the time the question was that its role would be limited, recognizing that less funds were available to the Farm Credit Corporation this year than in the past and recognizing that high interest rates would place a greater demand on their lending capability this year. MR. NOTLEY: Mr. Speaker, a supplementary question to the minister. MR. SPEAKER: Followed by a supplementary by the hon.

Member for Athabasca. MR. NOTLEY: What representation was made by the other ministers of agriculture to the federal minister to indicate the need for the federal government to increase funding to federal Farm Credit rather than decrease it? MR. SCHMIDT: Mr. Speaker, all those comments made by the hon. member and certainly all those you could think of were made at that meeting, recognizing that if total relief were to come from the Farm Credit Corpora­ tion, the amount of funding necessary for it to have at its disposal would be rather large compared to what its normal operation would be.

I would just like to touch on two points in the opening remarks. First, the Hon. Eugene Whelan stated: "Agricul­ ture is a joint federal provincial responsibility". We agreed to that and asked how provinces could best help in the high interest rate situation, recognizing that there are differences in programs from province to province throughout Canada. I would like to quote one other aspect from the opening remarks: Some provinces have done more than others to try to ease the burden of heavy credit costs.

While I can appreciate the desire of the provinces to help their producers, in the long run I hope we can get away from unequal treatment that makes it more advanta­ geous to farm in one province than another. Recognizing that there are differences, it was indicated that if those inequities exist it is a federal responsibility to handle both credit, in this particular case, and stabiliza­ tion, because it was the other topic of discussion. MR. APPLEBY: Mr. Speaker, a supplementary question to the Minister of Agriculture.

In view of the recent increases in lending rates of the Bank of Canada and subsequent increases by the chartered banks, I wonder if there is any plan by the Agricultural Development Cor­ poration to increase the very favorable lending rates that are available to Alberta's beginning farmers. MR. SCHMIDT: Mr. Speaker, we review the interest rates through the Agricultural Development Corporation twice a year.

For the next period before a review is held, our basic rate is 12 per cent and will remain in force until such time as the review takes place toward the latter part of September, recognizing of course that we are very, very fortunate in having had that opportunity of one year of operation in the beginning farmer program. Within this province it places the opportunity for our beginning farmers to have that shelter. Of course the high interest rates are challenging beginning farmers throughout Canada.

But in this province they can look forward to that shelter as a subsidy in regard to interest rates for the first of their five-year period. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion. My conclusion with regard to interest rates in this meeting of Tuesday is that no progress has been made; high interest rates will continue. The minister indicated that his office and the government have a good working relationship with chartered banks. When are we going to have some action by discussion with those chartered banks to deal with the question of interest rates for farmers in the province of Alberta?

Has the minister scheduled meetings with the chartered banks not only in Alberta but in Toronto and Montreal to discuss this question and bring some solution to the matter? MR. SCHMIDT: Mr. Speaker, the system of interest rates is a federal responsibility. We could have discus­ sions on behalf of producers within our own province on how chartered banks wish to handle the accounts they have. If there's to be any change in interest rates through chartered banks throughout Canada, it will have to come from the federal government, not from the province.

May 14, 1981 ALBERTA HANSARD 735 MR. NOTLEY: Mr. Speaker, a supplementary question. The minister indicated that his federal counterpart was going to take the initiative and discuss with the chartered banks what steps might be taken by those chartered banks. What specifics did the Minister of Agriculture advise his provincial colleagues he would be undertaking in his discussions with the banks? Would it be expansion in the farm improvement loan system? What kind of sheltering, or would there be any sheltering? You're deal­ ing with chartered banks that are not noted for philanth­ ropy.

What kind of initiatives is Mr. Whelan going to take on behalf of Canadian farmers? MR. SCHMIDT: Mr. Speaker, Mr. Whelan didn't indi­ cate to us the approach, the direction, or how far he or his colleagues were going to continue in their discussions with the chartered banks, indicating first of all that they had had some preliminary discussions and felt that per­ haps further discussions on behalf of the federal govern­ ment and chartered banks were necessary to solve some of the problems of high interest rates. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion.

Has the federal minister indicated to the provincial ministers that the federal minister will report back with regard to his discussions with the chartered banks of Canada? When will the provincial minister demand some kind of results from the federal agriculture minister? That's his job, on our behalf. MR. SCHMIDT: Mr. Speaker, the plan of action, both short and long term — of course the short-term responsi­ bility is entirely that of the federal minister and the direc­ tion he wishes to take.

The longer term — and I say "longer term" for the immediate month ahead, recogniz­ ing that all the ministers of agriculture will meet again in July and with their federal counterpart the second day of the meeting.

The end result was that all the ministers of agriculture agreed to monitor the area of farm financing in their own provinces as it affected not only the pro­ grams which they administer themselves but through the Farm Credit Corporation and the chartered banks, to bring to the federal minister an update on the position of individual loans as they exist with regard to areas of difficulty and, in some cases, the foreclosures. MR. NOTLEY: Mr. Speaker, if I may, a supplementary question to the hon. minister.

From reading his com­ munique, the minister has indicated that the federal gov­ ernment would like to see a consistent approach across the country. I think most of us would agree with that. Bearing that in mind, and the fact that discussions with the various chartered banks for some kind of preferential rates will be, I think most of us would agree, hopeful at best, what reasons did the federal Minister of Agriculture supply to his provincial counterparts for the cutback in federal Farm Credit funding? That's where there should be an expansion of money. Some reasons must have been given.

Is it that the federal minister can't sell it to his other cabinet colleagues? What were the reasons we have a cutback in FCC funding when we should have an expansion? MR. SCHMIDT: Mr.

Speaker, I'm not too sure just how the cutbacks take place in regard to the Farm Credit Corporation, other than to say that the indication on behalf of all the provinces to the federal minister was that if the Farm Credit Corporation were to accept part of its role in the high interest rates that exist today — because it was suggested that was perhaps one of the areas that could relieve some of the situation that exists — funding far in excess of what is there at the present time would be needed. How those funds would enter into the Farm Credit Corporation is of course a federal responsibility. MR. NOTLEY: Mr.

Speaker, a supplementary question to the minister. MR. SPEAKER: Followed by a final supplementary by the hon. Leader of the Opposition. MR. NOTLEY: I appreciate the minister's answer and the representation made. However, notwithstanding the fact that it's federal jurisdiction, it affects every farmer in this country. What reasons did the Minister of Agricul­ ture give to his provincial colleagues for a cutback in an area where — I'm sure every single member of this House, notwithstanding our political differences, could agree — there should be an expansion? MR. SCHMIDT: Mr.

Speaker, no answer was given as to why funds were not available at the present time. Nor were any answers given to some of the input costs that have appeared overnight that producers throughout Canada are faced with in the agricultural industry. We feel they are one of the factors, in some cases, that high interest rates make it difficult from an operating point of view. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the Minister of Agriculture. I think this is what Alberta farmers want to know.

What actions will be taken by the minister in the next month or two with regard to facing this question of interest rates in Alberta? What are the planned actions the minister has on behalf of the government of Alberta? MR. SCHMIDT: Mr. Speaker, to date within our own province we have no indications that — other than high interest rates which plague all aspects of Albertans, and farmers are no different. Some individual changes have been made on practices as they pertain farm to farm.

The Agricultural Development Corporation will continue to take care of those who make application to it, in both the beginning farmer stage and those who qualify under the last resort aspect in the other two areas of commitments that are ongoing. We will have the opportunity to mon­ itor Farm Credit's response and the role it plays within the province, and have always had the opportunity to share with banks any problems that have existed on an individual base throughout the province, to give us some indication that more than the average are finding it diffi­ cult. That program will be ongoing.

Of course if we find any major change in any one of those particular areas — I'm speaking now of the Farm Credit Corporation — or through the chartered banks, we will be able to keep the federal minister updated as to what we find within the province. Other than that, Mr. Speaker, input costs are things we as a province can look at and will continue to. Some of the comments made collectively on behalf of all the agriculture ministers seemed to look towards farmers in the province of Alberta as being a sort of choice few.

When you look at the overall packages that exist throughout Canada, it places Alberta producers in a rather preferred position.

736 ALBERTA HANSARD May 14, 1981 MR. R. SPEAKER: Mr. Speaker, I think keeping the federal minister updated certainly isn't going to solve the problem for our farmers here in Alberta. The Minister of Agriculture should look at that. Livestock Industry Stabilization MR. R. SPEAKER: My second question, Mr. Speaker, to the Minister of Agriculture as well, relates to the comment of the minister and the discussion point in the meeting with regard to Canadian stabilization, supposed­ ly of the hog industry and possibly the beef industry.

At this point I'd like to know from the minister, number one, is there a possibility of a Canadian stabilization program being put place and, number two, does the government of Alberta support that stabilization, not only for hogs but for beef? MR. SCHMIDT: Mr. Speaker, I'd like to confine my remarks to hog stabilization because it was the topic of discussion. I think there was total acceptance by all provinces and they all agreed that if stabilization is to have some stability in Canada, it should be a federal responsibility. That was accepted by all.

As to whether that will be achieved, I would say the chances are rather slim. From a federal point of view stabilization goes much further than many of the producers wish to accept, because they also include supply management in stabiliza­ tion. Of course that is the sticker in its degree of accept­ ance by producers across Canada. The philosophy of stabilization, of some semblance of uniformity, is still acceptable.

I'm very pleased to say that, despite the lack of action from a federal point of view, we have managed to have an ongoing discussion and monitoring of the policies that exist between Manitoba, Saskatchewan, Alberta, and British Columbia, trying to keep some semb­ lance of uniformity in forms of stabilization as it pertains to the hog industry. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the minister.

In light of the fact that Ottawa has not made a decision with regard to stabilization — I think that's the conclusion I gathered — could the minis­ ter indicate what action he or the government will now take with regard to the commitment of the Alberta government to stabilization in the hog industry? MR. SCHMIDT: Mr. Speaker, recognizing that of course we would prefer a uniform, universal, federal program, we have never stopped looking and working toward a program, waiting hopefully for the federal pro­ gram.

We will continue to assess the programs before us, recognizing those that exist in our neighboring provinces and the responsibility we have to those. MR. MANDEVILLE: A supplementary question, Mr. Speaker. Has the minister met with cattle producers re­ cently with regard to their concern with establishing the hog marketing stabilization program? Is the minister going to take another look at the stabilization program announced in the Speech from the Throne for the hog producers of the province? MR. SCHMIDT: Mr.

Speaker, we've had the opportuni­ ty to discuss the proposal with both the pork producers and the cattlemen, and of course some differences of opinion as to the proposal, even amongst some of the producers. We will continue to have representation and have met with the cattle industry. It's my understanding we'll be meeting with them again, early in the new week. MR. MANDEVILLE: A supplementary question, Mr. Speaker. Could the minister indicate when a final deci­ sion will be made as to whether the hog stabilization program will be going in place, and when it will be in place? MR.

SCHMIDT: I can't give a definite answer, Mr. Speaker, but recognizing that the industry is waiting for some type of reply to their request for a system of stabili­ ty as exists in other provinces, we're certainly ongoing and studying the proposals as rapidly as possible. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the Minister of Agriculture. Could the minister indicate the position of the government with regard to the position of the Western Stock Growers, who indicate that they are not in support of stabilization for the cattle or the hog industry.

Does the government support that posi­ tion, or is there a difference in policy position? MR. SCHMIDT: Mr. Speaker, it certainly would be one of the areas that one would enjoy if the market system were such that programs of support were unnecessary, not only in the province of Alberta but in other provinces as well. It becomes rather difficult in looking and assess­ ing the hog industry as it exists in Canada with a produc­ tion of about 12 million hogs a year.

The province of Alberta, which represents about 1.6 million of the 12 million hogs raised in Canada, would be the only prov­ ince that had no form of stabilization or assurance on behalf of the hog industry. Agricultural Development Corporation MR. MANDEVILLE: Mr. Speaker, my question is also to the hon. Minister of Agriculture, as soon as he has his little sip of water. The minister indicated that he had a meeting approximately a week ago with the board of directors of ADC. Was whether the board of directors would be involved in administration or just in setting policy discussed?

At the present time, I understand the board is approving loans. Was this portion discussed in their meeting? MR. SCHMIDT: Mr. Speaker, we had the opportunity to discuss with the board members the programs they've administered over the period of years. We've also had the opportunity to discuss with them individually whether they saw any changes that could come about.

The imple­ mentation would perhaps provide a speed-up in the pro­ cess, and an opportunity to review some of the actual paper itself as to whether the end result of the documen­ tation they have is serving the total need, and if some of it could be shortened or, in some cases, maybe not be part of an application. So we had the opportunity to delve into and do a total review of perhaps all the areas the hon. member has discussed both in the House and with the department over the period of years. MR. MANDEVILLE: A supplementary question, Mr. Speaker.

Would the minister consider the suggestion that the board of directors be involved only in administration and not in the approval of loans — leave that to the administration?

May 14, 1981 ALBERTA HANSARD 737 MR. SCHMIDT: Mr. Speaker, it was part of the discus­ sion. We would have to be back again for the opportunity to bring together all the thoughts we left. Perhaps that is one area that would require some work. I believe that will be ongoing. At a later date we'll have the opportunity to assess some of the suggestions. MR. MANDEVILLE: A further supplementary question, Mr. Speaker. At the present time, the loans are all pretty well approved at the head office. Was there any consider­ ation of approving some of these loans at the regional level, or even at the local level? MR.

SCHMIDT: It was one of the topics of discussion, Mr. Speaker, recognizing that there are also some prob­ lems that would appear in the areas if we went that route. Of course, it would certainly be a departure from the normal operation and would require a fair amount of research to see to what extent, and if, it's feasible. MR. MANDEVILLE: One final supplementary question, Mr. Speaker. I get a lot of reports on the appeal committees not having the power. They'll approve a loan, and then come to the board and they turn them down.

As far as the local appeal committees are concerned, are there any suggested changes in the policy so that when they make a decision, their decision is final, or at least have more input in the loans when they come to the head office? MR. SCHMIDT: Mr. Speaker, the role of the local development committees was discussed to some length, recognizing that the role they play is a must as far as the Ag. Development Corporation is concerned. We in gov­ ernment have made use of the local committees to a great extent.

I can remember that in the disposition of Crown lands, they play a very valuable role in their communities, because they are on site and, in most cases, know the applicants or the parents of the applicants. So the infor­ mation they can provide is certainly of value to us. We are looking at the question of how far we can go in utilizing the knowledge they have. Hopefully, there may be some input at the beginning of the loan application, as well as their original function of handling appeals, which they were designed to handle. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the Minister of Agriculture.

My concern is the sort of non-answers we're getting with regard to these questions about the important area of financing agricul­ ture in the province of Alberta and high interest rates. Since the meeting on Tuesday with the federal Minister of Agriculture, which discussed interest rates, has the minis­ ter reconsidered the government's position with regard to changing guaranteed loans into direct loans from ADC? Has the minister made a decision with regard to that one change in policy that would help a significant number of Alberta beginning farmers right now? MR. SCHMIDT: Mr.

Speaker, we have not changed the basic policy of ADC, and that's what the hon. member is asking. Loans are available through ADC that affect both direct money and guarantees. That program will continue. Hazardous Chemical Spills MR. NOTLEY: Mr. Speaker, I'd like to direct this ques­ tion to the Minister responsible for Workers' Health, Safety and Compensation. It flows from reports that a Grande Prairie woman involved in the 1974 PCB clean­ up has claimed some after-effects from her work on that clean-up.

On Tuesday the minister indicated that he was going to ask his department to evaluate the work they've done in checking the people involved in the 1974 clean­ up. I would ask the minister if he's in a position to advise the Assembly what steps have been taken to test the people involved in the 1974 clean-up. MR. DIACHUK: Mr. Speaker, I would only like to respond that I've asked my officials for a report. As of today, I haven't received it. I'm unable to respond more fully. MR. NOTLEY: Mr. Speaker, a supplementary question to the minister.

In view of the fact that there's at least some potential danger to the health of people involved, and apparently the company has lost its own report, will the minister assure the House that the department of Workers' Health, Safety and Compensation will take the initiative in attempting to find these people involved in the 1974 clean-up so there can be proper medical testing for their own health and safety? MR. DIACHUK: Mr. Speaker, can I suggest that if the company has lost the report, it sounds like the hon. member may have it? I would welcome a copy of that report. MR. NOTLEY: Mr.

Speaker, I always enjoy a good reply, but in this case we are talking about the health and safety of people.

Will the minister give this House an assurance — and I hope it's a little better assurance than we got from the Minister of Agriculture on interest rates — that we're going to have the department of Workers' Health, Safety and Compensation work closely with P&G to get the names of the people who were involved in the 1974 clean-up so they can be properly tested medically to ensure that there is no danger to their health as a consequence of action they took in the public interest to help clean up a PCB spill? MR. DIACHUK: Mr.

Speaker, I believe the record shows that I indicated that my officials at all times co-operate with the workers in making sure that any spills are safely recovered. However, as of today and this Tuesday I rose and responded that I don't have the information before me, but I would welcome any citizen from that constituency or from any part of Alberta, including any member of the Legislature, who is con­ cerned about his or her health to respond, report, contact either my officials or my office directly.

If they have any concern about the safety or health of any worker in this province, I would welcome that information. To date I haven't received any. MR. NOTLEY: Mr. Speaker, a supplementary question. Surely the minister is not going to wait until people come to him or until he hears about it third hand.

I'm asking the Minister responsible for Workers' Health, Safety and Compensation whether that department, in conjunction with the company, will review the company's employee records of 1974, obtain the names of the people who participated in the clean-up without satisfactory clothing, and then contact them so there can be proper medical

738 ALBERTA HANSARD May 14, 1981 testing of the people who took

part in that clean-up. Very directly, is the minister going to take the initiative? MR. DIACHUK: The representation made by the hon. member will be noted. I can only assure the hon. member that his representation will be looked after, as any other representation made by workers. But sincerely, Mr. Speaker, my office has not received any requests for such an examination or review, from the workers individually, the union, or the hon. member himself. MR. NOTLEY: Mr. Speaker, I put the question to the minister again. Will this government take the initiative?

It's well and fine to wait for responses, but we're talking about potential danger to the health of people who partic­ ipated in a clean-up in 1974, in the public interest. We owe them a debt of gratitude for that. Very directly to the minister, will there be an effort on the part of the department to contact P&G in the next few days at the latest and get the employee list of people who participat­ ed in the clean-up, so they can at least go and have a medical test? MR. DIACHUK: Mr. Speaker, I think the hon. member is just repeating his question.

I've assured him that his representation is noted and will be looked into. MR. NOTLEY: Mr. Speaker, a supplementary question to the hon. Minister of Environment. Is the minister able to advise the Assembly categorically, as a result of the examination by the Department of Environment, that the waste material from the 1974 PCB spill is not in a position where it could potentially drain into the Wapiti River; not only the 1978 spill, but more particularly the 1974 spill? MR. COOKSON: Mr. Speaker, I think the hon. member is getting his spills all mixed up.

The '74 spill involved approximately one gallon of material, which was sus­ pected to be PCB. It was subsequently cleaned up by a contractor who dealt in handling hazardous wastes. The 1978 spill, on which I made some comments earlier and on which a detailed report is in my hands, is public information. I'd be happy to make that available to the member. Import Tariffs MRS. CRIPPS: Thank you, Mr. Speaker. My question is to the Minister of Economic Development. Can the min­ ister indicate to the House if he's had discussions with the federal government regarding its proposed Buy Canadian policy? MR.

PLANCHE: Not precisely, Mr. Speaker, other than the question of oil. MRS. CRIPPS: More directly, I understand the federal government may be thinking in terms of adding a tariff to products brought into this country. Is that a possibility which may affect Alberta companies and Alberta growth? MR. PLANCHE: Mr. Speaker, we've done some serious looking at what's called the Blair report, where they suggested a 3 per cent preferential may be given to the purchase of Canadian goods. That's simply a tariff.

In its industrial development permitting system, this government has consistently requested that maximizing Alberta and Canadian manpower and material is an es­ sential ingredient for getting a permit, provided that the purchaser doesn't have to pay a premium for like goods and services. The reason for that is that, in the long term, to add unnecessary capital costs to ongoing enterprises isn't going to help anybody who builds around them or is employed by them. MRS. CRIPPS: A supplementary, Mr. Speaker. Is that tariff over and above the tariffs already in existence? MR. PLANCHE: Mr.

Speaker, I can't answer that pre­ cisely, but I presume it is. Almost everything Albertans buy outside of agriculturally oriented products is tariffed. So it would follow that a 3 per cent surcharge or prefer­ ential purchasing policy would simply add 3 per cent onto duty paid goods. ORDERS OF THE DAY DR. PAPROSKI: Mr. Speaker, I'd like to rise on a point of privilege, to make a correction in Hansard of May 11, 1981, page 649, when I was speaking on AADAC. At that time I said: "I'd like to congratulate the staff of the Alcoholism and Drug Abuse Commission, primarily Mr. Wilf Totten on his retirement." Mr.

Speaker, of course I meant to say that I'd like to congratulate the staff of AADAC, particularly Mr. Wilf Totten for his excellent job, and furthermore I'd like to wish Mr. Totten best wishes on his retirement. Thank you, Mr. Speaker. MR. OMAN: Mr. Speaker, last Monday when I intro­ duced what should have been Bill Pr. 2, I mistakenly introduced it as Pr. 5, which was a later Bill. I'd like to have that noted in Hansard as well. head: MOTIONS FOR RETURNS MR. HORSMAN: Mr. Speaker, I move that motions for returns 113, 125A, 126, and 127 stand on the Order Paper. MR.

SPEAKER: Is the Assembly sufficiently aware of the numbers? HON. MEMBERS: Agreed. [Motion carried] 129. Mr. R. Speaker moved that an order of the Assembly do issue for a return showing: (1) copies of all correspondence between the Alberta government and Baker Lovick Advertising Ltd. re­ garding the design and promotion of the Alberta Heritage Savings Trust Fund logo, (2) the total amount paid by the government of Alberta to Baker Lovick Advertising Ltd. for their

part in the design and promotion of that logo. MR. McCRAE: Mr. Speaker, I'd like to make a com­ ment regarding subparagraph 1, which asks for copies of all correspondence. I'd simply like to point out to the Assembly that the normal practice in the House is not to table correspondence without the acquiescence or concur­ * *See page 649, right column, first paragraph

May 14, 1981 ALBERTA HANSARD 739 rence of the writer. In this case there is no correspond­ ence; otherwise I would move an amendment to the motion. As it is, with that caution, it would be perfectly acceptable. [Motion carried] 130. Mr. R. Speaker moved that an order of the Assembly do issue for a return showing an accounting of all advertising work done for the provincial government by McVean Advertising Ltd. of Calgary, including a description of the work, the amounts paid for each project, and whether each contract to McVean Advertising was awarded as a result of open, competitive bidding. [Motion carried] head: MOTIONS OTHER THAN GOVERNMENT MOTIONS 207. Moved by Mr. Cook:

Be it resolved that the Assembly urge the government to initiate a study of the present statute law, regulations, and public policies of the government with respect to energy conservation, with the objective of identifying provisions which may have the effect of discouraging conservation, identifying possible areas of change to maximize conser­ vation, and to develop a province-wide policy, both with respect to the activities of the public service and an appropriate role for government, to encourage energy conservation and discourage energy waste in the province. MR. COOK: Mr.

Speaker, it's a real pleasure to be here in the Assembly today. Thursday, May 14, in effect became energy conservation day in the Alberta Legisla­ ture. The Bill later this afternoon will deal with energy conservation as well. I think it's appropriate that we deal with both topics: a general policy statement which re­ views the whole question of the need for energy conserva­ tion as a policy standard, a goal for the province, and then focusing on one aspect of that — what we can do to improve our residential stock for Albertans.

Basically Motion 207 asks that the government of Alberta consider the development of a policy statement that will become a performance test for departments as they plan program­ ming and activities, and also review past actions in statute law. Having accomplished that, I presume the govern­ ment of Alberta would try to make our economy, our society, and our province leaner and more efficient in energy conservation. Mr. Speaker, it might be necessary at the outset to ask ourselves: why is energy conservation necessary? I'll deal with three good reasons: one, we're in a period of interna­ tional uncertainty.

A lot of Canada's supplies are brought from offshore countries which are politically unstable. The House of Saud in Saudi Arabia has had one at­ tempted coup in the last two years, and they supply a significant percentage of Canada's foreign crude requirements. MR. SCHMID: Forty-seven per cent. MR. COOK: The hon. Minister of State for Economic Development — International Trade states 47 per cent. That royal family has some internal problems; no clear line of succession is established. There could well be some very serious problems with crude oil we depend on from Saudi Arabian oil fields.

When we think of international uncertainty, we only have to think of Iran, and that could be a real problem. Secondly, while we're in a period of a temporary glut of oil on the world market, we've traditionally had a shortage over the past few years. It's interesting that a study published two days ago by the International Energy [Agency] points out that we should have an energy glut for about two years, followed by some very serious prob­ lems.

Third, if we have an international problem, Alberta and Canada would have to share our oil and petroleum supplies with our partners in worldwide industrialized democracies. We have that commitment, again establish­ ed by the International Energy Agency by treaty. We would have our consumption and supplies cut. So those are some good reasons. I'd like to make a couple of other quick points. Energy conservation is a desirable goal, because it makes our industrial and physical plant efficient. I think a good Progressive Conservative government would like to see that kind of development.

With an efficient industrial or residential plant, profits are available for use in other areas: more investment, greater income is available for companies to provide more employment, and greater in­ come is available to provide greater social services. That's a desirable goal: an efficient, lean industrial plant. Secondly, Alberta is growing very, very rapidly right now. We're building an industrial plant that will have its energy consumption set for the next 20 or 25 years. It's much easier to try to have a lean industrial plant under construction than to go back and try to retrofit it.

It's much better that we try to develop a climate for economic efficiency now, rather than wait until international situa­ tions catch up with us. That's why I think energy conser­ vation is necessary. It's economically attractive to try to conserve energy for the long run. It's conservative in the best sense of the word; we're protecting a valuable and limited natural resource. Having made those points, I think we should turn our attention to the main elements of a good energy conservation program. What should we look for in an energy conservation program? Generally, Mr.

Speaker, there are about four features: a public information program — and the Alber­ ta government is doing a very good job there; pricing policies that encourage conservation and make consumers face the real world — Canada and Alberta are not doing so well there. We need incentive schemes to encourage conservation, like Bill 214, which we'll be looking at later this afternoon, that would encourage home-owners to refit their homes, assist with grants and loans for con­ sumers to make capital investments, and encourage in­ dustry to make capital investments in its industrial plant.

The fourth point is: establish regulations and standards that set conservation objectives. Quite clearly, an example is the U.S. Environmental Protection Agency, which set fleet standards for mileage. I think it should be noted that when the United States was establishing those standards in the early '70s, the car industry — General Motors, Ford, and Chrysler — said it was impossible to reach those; it was impractical and no technology was available. But the Japanese and the Germans did it.

Had the Americans not enforced by regulation improved mileage standards for their automo­ bile fleets, they would be in an even worse situation trying to compete with the Japanese or Germans today. I think it can be safely said that the regulations and standards the U.S. government set, in effect, helped save the American automobile industry from some very stiff worldwide

740 ALBERTA HANSARD Mav 14, 1981 competition. So we need regulations and standards in cars, buildings, and consumption for industrial processes. Those are the four main elements of a good energy conservation program: public information programs, pr­ icing policies that encourage conservation, incentive schemes to help assist making capital investments to accomplish that goal, and regulations and standards. A lot of Albertans ask me: why should we in Alberta be concerned with energy conservation? We have lots of oil and gas. We have a gas glut; it'll never run out. Well, Mr.

Speaker, I think there are some very compelling reasons. Basically they're threefold. When we waste energy, there's an opportunity cost; that is, we could have sold that energy across the border and received real value for those millions of feet of natural gas that consumers use but which do not materially affect their standard of living. The natural gas a home-owner uses to keep his or her home at 72 or 73 degrees is wasted if, by insulating the home, the home-owner could cut gas consumption by 50 per cent and still be just as warm and comfortable.

The province and citizens of Alberta could enjoy an increased return on that natural gas, a public resource, if we sold it to our American cousins. So there's an opportunity cost if we consume a natural resource unnecessarily and don't receive fair market value for it. Secondly, we're building an industrial plant and a resi­ dential housing stock whose energy consumption stand­ ards and patterns will be set for the next 20 or 25 years.

If we don't set up a climate today that encourages a lean, efficient industrial plant and residential stock, as a people and as a government we're going to be locked into some very expensive subsidy programs to keep the inefficient industries operating or trying to help Albertans on low incomes meet their utility bills. In the United States, Mr. Speaker, there are some horror stories of elderly people on fixed incomes, generally in older, poorer insulated homes, who, faced with massive utility costs, turn down their thermostats in winter to the point where they endanger their health and even their lives.

In Alberta that probably won't be quite as severe because we have a very generous program, about $2,000 every four years, for senior citizens to invest in their homes. But I'm sure we're going to find some cases of senior citizens endangering their health or their lives over the next few years. It can be directly traced to our construction techniques. If we perpetuate that, knowing full well the costs, the ramifica­ tions of that public policy, we're unnecessarily asking for trouble. And the tragedy is that it's clearly avoidable. The third point is that Albertans are trustees of a natural resource.

Trustees is a word that has had me in some hot water in this Assembly from time to time, Mr. Speaker. But we are trustees of a natural resource; in this case, oil and natural gas. Our failure to act responsibly means that future generations are going to be denied a very valuable resource, and we do them a disservice. We've established that energy conservation is a desir­ able goal. We've looked at why it's necessary for Alberta, and we've looked at the main features of a good energy conservation program. I guess the next point we should look at is what we as Canadians and Albertans are doing.

If those are the standards and goals, over on the other side we should ask ourselves how we are doing, how we perform. Unfortunately, Mr. Speaker, not very well. I have a document from the International Energy Agency, published just a year ago. It shows that Canada has the highest rate of energy consumption per unit of gross domestic product of any industrialized country in the western world. Per $1,000 of gross domestic product, we put something like — I'll just figure this out; this is in metric. MRS. CRIPPS: I can't understand it either. MR. COOK: That's why I thought I would try to convert this very quickly.

We invest about 10 per cent of our gross domestic product in energy. That compares with Sweden, which is around 6 per cent. Sweden has a very similar climate. You would think they would have similar problems. I'm not comparing Canada to Greece; I'm comparing Canada to a country that has similar econom­ ic structures and climate problems. We could take a look at Norway, which I think is on this chart. It is at 5 per cent. Again, Norway has a very similar climate.

We're about 50 per cent more inefficient, if you like, with our industrial and housing stock, if you believe the statistics of the International Energy Agency, which is an affiliate of the Organization for Economic Co-operation and Development, a fairly conservative, very responsible organization. If those figures are to be believed, Mr. Speaker, our country is not performing very well. We have the highest energy consumption record in the indus­ trialized world, and I think that's to our shame.

Canada has the lowest petroleum and energy prices in the indus­ trialized western world, and I think that's directly related. I think the fact that we have the lowest costs means that Canadians put much less emphasis on conserving a resource. Mr. Speaker, the only conclusion one can reach is that if we do have some serious problems in the offing in the very near future, Canada is going to be more affected than any other country because we'll be less efficient, less able to handle a major international problem. I think we've seen that with the oil disruptions in 1967, in 1973, and again in the late '70s.

Oil supplies are inherently unstable, because basically they come from politically unstable countries. Canada imports fully one-third of its energy requirements. If there is an international problem, we're going to have some very serious disruptions. Alber­ ta will be affected as well because, under international treaty obligations, we'll have to divert our supplies to other countries to help them out. We'll have no choice. Mr. Speaker, Alberta does have an outstanding record in energy conservation on the supply side. Our Energy Resources Conservation Board has a record that's un­ paralleled in the world.

I think it should be said that we have some very fine and competent Albertans conserving energy for us on the supply side. They make sure we get the best possible production from our oil and gas re­ serves. But we don't have a very good record on the consumption side. I think that is a source of concern. Let's go back to the motion. The motion basically sets out, as a general policy objective, asking departments to review their policies, their administration, and their stat­ ute law, with the single objective of trying to create an environment that promotes energy conservation.

Let me try to give members of the Assembly this kind of picture. In the year 2000 our population will have roughly dou­ bled. We're a province of around 4 million people. Our energy reserves have fallen off dramatically. The cheap, conventional oil has been virtually exhausted. We're left with much more expensive oil from the tar sands and much more expensive gas because we're bringing it in from remote regions. Mr. Speaker, as a province we're going to be faced with greater costs. And because of energy consumption patterns established in 1980, we're going to be locked into a very inefficient industrial and

May 14, 1981 ALBERTA HANSARD 741 residential heating pattern. As a province we're going to be locked in to some of the worst energy conservation oriented housing and industrial plant in the country. We're going to be facing much, much higher costs, and we'll be much less able to compete. I think every Alber¬ tan, especially members of the Assembly, should be con­ cerned about that prospect. So I think we should be asking the government to review its policies, department by department; asking the government to try to identify a program that will lead us to a more efficient industrial and residential plant.

Fail­ ure to do that will have some very grave consequences for us as a people in 20 years. We're asking the Assembly and the government to have a long-range view. I'm just going to take two minutes, and then I'm going to listen to the contributions of other members. There are some opportunities for some policy changes. I'd like to run quickly through a couple of suggestions. Mr. Speak­ er, in agriculture — and the minister is here. Mr.

Minis­ ter, we should be looking at trying to encourage research and development that would lead to techniques in agri­ culture that would reduce energy consumption on the farm; for example, tillage techniques, the amount of energy that's required to pull a plough — I'm sorry, not a plough; we've done away with ploughs — but seed drills and all the equipment that is necessary to run a modern, efficient farm. We should be trying to go through with our extension services in the agricultural sector to en­ courage young beginning farmers to review their farm practices. Pesticides and fertilizers are petroleum based.

In the Energy and Natural Resources Department, Mr. Speaker, we should be trying to create an energy conser­ vation branch. We have one now; it's the smallest in the country. We devote less money for energy conservation in our budget than P.E.I. . We should be trying to boost that, so that we can try to educate young Albertans and Albertans generally about the need for energy conservation. We could be looking at our royalty structure. Natural gas that comes out of the ground isn't charged a royalty until it's cleaned through a gas processing plant. Only the gas that emerges is charged a royalty.

That leads to ineffi­ ciencies in the gas treating process. I understand that up to 10 per cent of the gas is lost in that. That compares very poorly with gas processing plants in the United States, where they are charged a royalty on gas that leaves the well, not the plant. Less gas is consumed in the process. Mr. Speaker, our Environment Department encourages urban sprawl.

It does that by providing water and sewer all through a metropolitan region, and encourages urban growth not in a high-density pattern but in a sprawling fashion that requires us to service that area with very expensive roads, freeways, and makes it very difficult to service an area like that with LRT. The Minister of Government Services is here, and I think he has a tremendous program. All buildings owned by the Alberta government have been asked to reduce their energy consumption, and I think that's a very good record. The minister should be congratulated.

As well the minister's department computer models new construction, so that they can predict energy consumption patterns and ask an architect to revise his plan if it's evident that there is going to be a problem. That is a good example of leadership in this area, Mr. Speaker. Housing and Public Works could be trying to provide for better insulation standards in public housing. They could be trying to encourage municipalities to increase the density of urban Alberta.

We could be trying to help people with the family home purchase program by asking builders to upgrade their insulation standards, and only those better buildings would qualify for assistance. Now this is an important point. Energy costs in Alberta reflect only about one-third of the true market value. If we as a country and as a province increase our energy costs and also approach world price conditions, consum­ ers who are now paying $400 or $500 to heat a 1,200 square foot bungalow are going to be faced not with a $500 bill but with a $1,500 bill.

That becomes a very significant element of a consumer's monthly bill when they're trying to meet their mortgage payments. I think that Housing and Public Works should take that into consideration. They should be trying to increase the standards for new residential buildings, recognizing that the home-owner is going to be faced with a very much stiffer cost for energy, and that will affect his or her ability to pay the mortgage payments. In this Chamber, Mr. Speaker, we've heard a great deal about interest rates.

Here is a good example to provide some assistance to home-owners, so that they're better able to meet those costs. Those are just a couple of suggestions, a few depart­ ments. That's the kind of way we should be looking at the problem, and our failure to do so will leave us with an inefficient industrial plant, an inefficient residential hous­ ing stock, and it will be with us for years and years to come. It will lock us into a pattern of energy consump­ tion, and we will pay very, very dearly for the policies we're setting today. With that, I'd like to listen to other members.

I'm anxious to hear other members' concerns, or whether they think this is a concern at all. Future generations are going to look upon us and judge us on our wisdom and our policies, and I think we as a government should be trying to seriously consider what we can do to make this province leaner, more able to compete economically in the world by becoming more efficient in our energy use. Thank you. MR. KOWALSKI: Mr. Speaker, I'm pleased today to rise to participate in the debate on Motion 207 brought forward by the Member for Edmonton Glengarry.

At the outset, though, I'm a little surprised that the member wishes to rename May 14, 1981, energy conservation day. It's my understanding that in the past we've had many days dealing with energy conservation. By wanting to designate May 14 with that new name, perhaps the member was setting aside many of the excellent programs already in existence with respect to this question of energy conservation and management in the province of Alberta.

I'm pleased that the member took us to Saudi Arabia for a few minutes, to Iran for several more minutes, then to the United States, and finally back to Alberta, where he said there was need for a climate for positive action on this subject. I'm also pleased that the Member for Edmonton Glengarry raised four specifics in a general way when he talked about this climate for positive action. He referred of course to the question of pricing.

We as Albertans all understand the difficulties we have, in the context of Canada today, caused by an intransigent fed­ eral government in dealing with us in a fair pricing arrangement and accord. As I understand it, a number of studies in other countries of the world clearly indicate that if energy prices do rise to the fair level that they should, in fact it does tend to reduce a lot of waste with

742 ALBERTA HANSARD May 14, 1981 respect to unnecessary travel, travel with one person in a car rather than with two, three, or four people, and the like. Pricing also allows us to look at other sources of energy, perhaps even cleaner sources that we have today. Of course inventiveness only comes if there's a fair return and incentive for those who are involved in the business of inventing. In a second suggestion the member mentioned that we need an incentive scheme for home-owners, so that home- owners could move in the direction of improved energy conservation. That's an interesting one.

Without any doubt, the most important incentive we all have, those of us who own homes and those who do not, is the incentive we meet at the end of the month to try to come up with the dollars necessary to pay our utility and heating bills. Goodness knows, everyone in this Assembly has more electrical heating utensils in his home than he would ever use at one time. I'm sure it's not at all uncommon for any one of us at any time in the evening to find three, four, five, six, seven, eight rooms in our home with the lights on, yet we're all sitting in only one room.

The question is: why are the lights on in the other four, five, six or seven? Walk into any kitchen and see the appliances there as a necessary convenience for the people who use those app­ liances, but in many cases hardly necessary for the ulti­ mate survival of our species. Nevertheless they're there. I would certainly hope we're not being asked to come up with incentives to reduce the dollar figure attached to the energy costs of running everything from an egg beater to an electric bottle opener to an electric ice maker in your refrigerator.

The third area the member talked about was establish­ ing regulations and standards. Regulations and standards are fine, but I am a Conservative, as is the Member for Edmonton Glengarry. I'm also a Progressive Conserva­ tive, and I would tend to be progressive in that we should be looking at reducing regulations and standards rather than increasing the number of regulations and standards we have in our society today. It seems to me that the best incentive we all have is the incentive of meeting the dollar figure we need for our cost of living at the end of each month.

If that dollar figure is to be subsidized by some other program, it negates the reason for having good management of a personal nature. If you look at the record that already exists in the province of Alberta on this question of energy conservation and management, it seems to me that we have all the regulations and stand­ ards we need at this point. What we need is a better public awareness of what is happening. The member indicated a fourth area: a public informa­ tion program.

It's really with regard to a public informa­ tion program that I want to spent my time this afternoon, to make mention of the very excellent programs this government already has in place, and to refer to a number of departments and the initiatives they've taken in this whole question of energy conservation, which of course is simply no more than good energy management. Good energy management gives three benefits to a socie­ ty.

First, it's a process of reducing unnecessary waste; secondly, it saves us money; and thirdly, it often increases our level of comfort: all of which are extremely important to ensure a good quality of living. A number of govern­ ment departments are very, very actively involved in this whole question of energy management and conservation. In fact more than two dozen have programs of consider­ able benefit under way. All too often, though, these programs are all but ignored by members of the public. Unfortunately, perhaps we have not done as good a job as we might have in providing information to them.

In my view the major organization we have in our province that allows us to conserve energy, is the board which has "conservation" as one of the four words in its title: the Energy Resources Conservation Board. It is extremely well respected in and outside Alberta. Its basic responsibilities are to regulate exploration and produc­ tion, and to set up policies, with the approval of this government, for the orderly development and manage­ ment of our resources in the best interests of the people of Alberta. That also means having a reserve of energy for the citizens of this province several decades into the future.

Ensuring that we have a sustained amount of energy resources available for our future, is in fact a management tool applied to us today. That means we cannot sell an unlimited amount of our resources without ensuring that we do have the back-up resources for the future. I might add that we have a very interesting manage­ ment tool currently in place, and that is the oil reduction tool that has been in place for over two months. Effective June 1, there will be a further reduction. That energy supply will be retained in the ground in Alberta, as much for energy conservation and management purposes as for any other.

Essentially, Mr. Speaker, there are three major ways a government can look at energy conservation. It can lead the way by setting an example in its own operations. Secondly, it can look to the area of assistance in advisory programs, in terms of expert guidance that might be made available to individuals, firms, and businesses. A third area would be sponsoring research into more effi­ cient and perhaps even alternate energy sources. I'd like to talk about all three this afternoon and, first, look at what the government is doing in the form of setting an example in its own operations.

Very, very major savings are being realized on a monthly basis. I'm pleased the Member for Edmonton Glengarry pointed out the excellent work of the Depart­ ment of Government Services. That department was es­ tablished in 1976. One of its prime purposes was to reduce energy consumption for government buildings without adversely affecting their function. There are a number of ways in which that has come about.

Of course they're ongoing, and the managers we have are consistent­ ly and continuously looking for improved methods of arriving at energy conservation and management through such things as improvements in air conditioning units and heating and lighting systems. We can look at such things as shutting off air handling units, where practical, during weekends and weekday off-hours, reducing lighting levels, and improved glass. You can use computers to manage when lights come on and off in a particular building, and when thermostats are adjusted. Air flow can be checked and monitored on that basis.

Now that's an operating cost that's ongoing. What's saved today will be saved next month, next year, and in the years gone by. Very, very importantly, particularly when it's in the operating side, we often have a difficult time arriving at realized savings. Figures from Government Services indicate that in the years 1977 to 1979, a saving of some $3.5 million was realized in the operating side. However, it did cost some money to realize that $3.5 million. It cost about $1.7 million to realize that saving of $3.5 million.

But you did get an economic benefit as a result of the investment, and those kinds of investments have to be continued. As well we have to have excellent training programs for people

May 14, 1981 ALBERTA HANSARD 743 who are involved in maintenance. Today maintenance work in some of our large government buildings is very, very different than it was decades ago when buildings were much smaller and fewer people were using those buildings. With our new technology and because of the excellent technical base we have in this province with architects, engineers, and designers, we are in a great opportunity to design new buildings, away from the old stone masonry types that were ugly to look at, as well as inefficient from an energy point of view.

We now have that, and it's an avenue and an area we have to look at. Another department that has a major role to play is Alberta Housing and Public Works. In the last several years, it has developed a new design manual which out­ lines requirements for such things as new buildings and the type of designs that we have to fit an urban or rural environment. But one underlying objective is tied to the manual, and that is directly related to energy conserva­ tion.

In fact a specific target in the manual is to ensure that we have increasingly better performance levels with respect to energy consumption on a per unit floor basis, on a yearly basis. With computers we now have the benefit of excellence in design in a way we did not have a decade ago, and that certainly is a tool we have to implement. Advanced Education and Manpower has a very major role to play, particularly in the heating costs of universi­ ties and colleges in this province of ours.

Where better can you find the technical expertise and knowledge than from those individuals who are employed at the universi­ ties in a professorial or research role? Particularly, effi­ cient lighting at all academic institutions is extremely important. With the lighting/heat units we have in this province simply from the sun, we now have a great opportunity to build with increased use of glass, more skylights, and the like. I've already talked about individual switches. Now that may sound very, very small in this whole question of energy conservation.

But if you look at a province as large as Alberta and count the number of buildings we have, if in fact we did make better use of our light switches . . . Look at this Assembly today, where perhaps 50 per cent of the members are in their places. Perhaps we only need 50 per cent of the lights on. That of course is an example. I just want to emphasize computer controls again. That has worked at the University of Alberta, where energy savings did accumulate through the years 1975 to 1979. Some $2.7 million was realized just by the effect of that one computer program.

In fact some statistics put for­ ward by Advanced Education and Manpower indicate that energy consumption at our universities and colleges has decreased with a savings factor of some 30-plus per cent in the last several years. Alberta Hospitals and Medical Care has to be involved in a conservation program. We have to have our hospitals designed where energy is extremely important, from the lighting side, the heat side, and the like.

I'm really pleased to know that that department is now taking a leading role across the country of Canada, and is very much involved in an interprovincial task force associated with the federal government called the Federal/Provincial Task Force on Energy Management for Health Care facilities in Canada. Alberta Government Telephones is another agency in this province which has done excellent work in the last several years in attempting to reduce energy consump­ tion. Shortly we will have a new AGT office building in downtown Calgary.

It has solar glaze reflective glass to reduce air-conditioning loads, office zone lighting sys­ tems, above-standard insulation, and thermal storage tanks that will allow recycling of waste heat within the building. All four things go a great way to improve it. As well, AGT is now testing smaller, subcompact trucks, and has a number in operation in the Calgary area. They're converting some of their truck fleet to diesel fuel. They're also getting away from the larger automobiles we're so used to using, and going to compact cars.

Interestingly enough, AGT employees with company vehicles are also requested to observe a 90 kilometre speed limit. In an area of energy management, AGT is conducting solar and wind energy research. Alberta Education has moved in this area of energy management in a very positive way, and in fact has conducted several fairly major studies in this question in recent times. One conducted at Grande Prairie examines the savings that could be obtained through better opera­ tion and maintenance without equipment or structural changes, which is very important.

Some people believe the only way you can effect major savings in heating is by simply rebuilding the whole building. But of course, with imagination, you can effect changes in a number of ways. In fact in one study conducted in Grande Prairie, savings of some 20 per cent were effected by such no-cost measures as lowering the temperatures at night, reducing the hot water temperature, pulling out lights in vacant rooms, and the like. [Mr. Purdy in the Chair] The second study, in Calgary, looked at a range of modifications that could be made within schools.

Interest­ ingly enough it found that major alterations, unless they were done in conjunction with repairs otherwise needed, weren't cost effective. Of course most people who use common sense know that. But sometimes we have to have a study to determine that as well. There is a very interest­ ing school in Edmonton, the Sweetgrass elementary school, where heating costs were reduced some 50 per cent by unique design. One of the unique factors in that design was placing the gymnasium in the centre of the school with classrooms surrounding, including northern window exposures.

Alberta Education has in fact put out a new document, Guidelines for Conserving Energy in Alberta Schools, and they're going to have a further test on it in some 50 schools in the province in next year or so, at a cost of some $1 million in applied research. Alberta Recreation and Parks has been moving in this area as well, in terms of its new recreation facilities in the province of Alberta. Mr. Speaker, I said there were really three areas which the government could move in. I just raised a few high­ lights in one. A second area is by looking at assistance and advice through advisory programs.

That certainly has happened in this province where two major departments, Housing and Public Works, and Alberta Energy and Natural Resources, have co-operated and are promoting what's called an enersave home energy audit. You can get a document from these two departments, fill in a whole series of information, return it to the two departments, and they'll do a computer check on your home and tell you how you can save energy bills by upwards of 30 per cent. It's a very interesting program, but unfortunately not too many Albertans have taken advantage of it. A second area of course is agricultural homes.

Alberta Agriculture has a new farm home planning course, with several options attached, at very, very minimal cost to the

744 ALBERTA HANSARD May 14, 1981 people of rural Alberta. As well, in the area of agricul­ ture, are new technologies such as the type at Brooks, where waste heat from a large manufacturing gas com­ pressor station is being used in a greenhouse experiment. It's proving rather successful. Near Tofield we've got a poultry broiler house with an air-to-air exchanger, to demonstrate how to recycle heat from exhaust air. Near Paradise Valley we have a new form of building construc­ tion. It has a permeable membrane ceiling in a dairy barn, and it's currently being evaluated to look at the way to retain heat.

Interestingly enough, industry and commerce account for half the energy consumed in this province. Of course that area must be looked at by the Department of Economic Development. A great deal of research needs to be done in those areas. Alberta Transportation has a role to play in ensuring that weight limits on our high­ ways allow commercial vehicles to move larger loads in a safe, efficient, and effective manner.

Alberta Municipal Affairs also has a role to play in this, certainly by looking at property assessment legislation to remove, in essence, features which indicate the tax structure is being affected by investments in energy which are of the negative type. I indicated as well, Mr. Speaker, that there was a third area. Of course that was to look at the area of research into more efficient and alternative energy sources.

I think it's rather interesting that this Monday in Ottawa a committee of members of the House of Commons tabled a report on energy into the 21st century, and indicated that the great source of energy in the 21st century will be hydrogen; in fact, indicated and recommended that the federal government commit itself to a $1 billion research program [in] the utilization of hydrogen. Perhaps that is an area we will be looking at. It is extremely clean, efficient, and effective.

But certainly in Alberta with the lead we're taking in the Alberta energy resources research fund, managed by our Department of Energy and Natur­ al Resources, we have to continue to look at the whole question of wind and solar energy. We're a natural base for it. We have a natural environment for it. Mr. Speaker, perhaps one other area of energy man­ agement should be talked about. That's the question of the government policy dealing with decentralization.

I can't possibly think of anything more inefficient or ineffe­ ctive than to have a government department, which has nothing to do with activities taking place in the centre of Edmonton, located in the centre of Edmonton. You have 150, 180, or 200 civil servants driving into that central core from as far away as 20, 30, or 40 miles each morning, and at night they go back the same way. You've got these 180 or 200 vehicles rapidly driving to the centre of the city.

And you know how it is in the wintertime: it takes you 40 minutes to get to work, you have to stop at lights, the exhaust is coming, your health is being affected — just a total disaster when it comes to energy manage­ ment. Now it's impossible for me to find anything that would negate that we should have that particular envi­ ronment in a rural environment where everybody could walk to work, no more than a block or two or three from where their head office would be.

If you just realize the cost savings that would accrue to the people of Alberta, I think we'd all say that in essence we have reduced unnecessary waste. We have saved money, and we cer­ tainly have increased the level of comfort that the citizens of this province need, desire, and should have. Of course there are many examples on the question of decentralization, Mr. Speaker. I'm really pleased that a new technical school will be constructed in the fine town of Stony Plain. I'm also pleased that in two years upwards of 180 fine Albertans will be able to walk to work in the town of Barrhead.

Each of them will realize a saving in their energy bill each month of upwards of $40, $50, $60, $70, which has to be very, very significant. As well it improves the quality of life and their actual level of comfort. Look at all the departments of government we have in Edmonton right now. It should not go unnoticed to any member that a block away from where we're sitting here today, there's a great big green building called the Department of Agriculture. There ain't no agriculture taking place in the city of Edmonton.

It would seem to me that if we're really concerned about energy conserva­ tion and management, that's certainly one department which could be decentralized throughout all parts of Alberta. We would in fact effect substantial savings in that area. Of course the list can go on and on. Within each department there are components and compart­ ments that don't have to be there. They're not crucial or essential, and certainly the quality of life of the employees can be improved and, with their quality of life, their morale, efficiency, and effectiveness. Mr.

Speaker, one other thing I would like to draw to the members' attention is Motion 213, which is being presented by the Member for Barrhead. I would just draw it to the attention of the members of the Assembly, because it in fact asks the government to consider adop­ tion of a system of regionalized purchasing. Now I want to relate it to energy conservation. If in fact our govern­ ment today wanted to buy 300 trucks, that tender would go out via a central purchasing agency here in Edmonton. But those 300 trucks wouldn't be located here in Edmon­ ton. They would be scattered all around Alberta. So what happens?

You get the 300 trucks, they're delivered to Edmonton, and then they all have to be driven out to various parts of Alberta. But if there's a maintenance problem, they come back to Edmonton to the main maintenance yard. That's totally inefficient when it comes to energy consumption and the like. I just leave that as a thought, because I'm going to be getting back to it again. I do appreciate the Member for Edmonton Glengarry raising this motion today, and I'm particularly pleased that I had an opportunity to make a few modest comments in this regard. Thank you. MR.

ACTING DEPUTY SPEAKER: Before we com­ mence with the hon. Member for Calgary Forest Lawn, may the hon. Member for Lac La Biche-McMurray re­ vert to introduction of visitors? They're just coming into the gallery right now. May the member have permission? HON. MEMBERS: Agreed. head: INTRODUCTION OF SPECIAL GUESTS (reversion) MR. WEISS: Thank you, Mr. Speaker, and my thanks to the House for the permission to do so. It's my privilege to introduce to you, and through you to members of the Assembly, a group of 26 students from Thickwood Heights school in the newest city of the province of Alberta, Fort McMurray.

Of course, this city is located in the constituency of Lac La Biche-McMurray. They're accompanied today by their teachers and assistants: Miss Sandy Dickson, Mr. Nelson Scott. Mr. Randy Kopp. Miss Joyce Mathys, and Miss Leslie Tuck. I would

May 14, 1981 ALBERTA HANSARD 745 appreciate the students and teachers rising and receiving the cordial welcome of the House. Thank you kindly. head: MOTIONS OTHER THAN GOVERNMENT MOTIONS (continued) MR. ZAOZIRNY: Mr. Speaker, I'm absolutely delighted to have the opportunity this afternoon to participate in this important debate on the motion put forward by the hon. Member for Edmonton Glengarry, and to follow the hon.

Member for Barrhead as a speaker in the Assembly, who I thought made, in his usual fashion, some very extensive, comprehensive, and exhaustive remarks on the subject. [interjections] He described them as modest, but I think he was being exceedingly modest in that remark. With respect to the principle entailed, energy conserva­ tion, I don't think there is a single, solitary member of this Assembly who would disagree with it. The merits of the concept are really irrefutable, and there will be no argument about the principle here.

I think it's also fair to say, as has been expanded upon by both previous speak­ ers, that government clearly has a leadership role to play in this area. I might suggest that the extent to which the hon. members for Edmonton Glengarry and Barrhead took some different paths was in respect to the extent to which that is or is not presently taking place: the Member for Glengarry, while acknowledging what has been done, imploring this Assembly to move the government to do even more in this general area, and the Member for Barrhead perhaps feeling that a more significant amount was being done.

I think there's no denying that the government has shown a real interest in lessening the demand side of the energy equation. Also I concur with the remarks of the hon. Member for Barrhead when he talks about the need for us to look in the mirror, if you will, in terms of energy consumption; to look at our own use of our energy, from the way we use the electric lights in our homes, to natural gas, to the gasoline in our cars. I think it's fair to say that energy conservation really requires an individual com­ mitment.

By the same token, and regrettably so, while we all agree with the question of energy conservation in principle, it has some difficulties in full implementation as it interfaces on our daily lives. I'd just like to refer to a couple of the more difficult questions that are at issue when we talk about being as efficient as we possibly can in energy conservation. The first has to do with our highways. For example, there is clear evidence that a reduction of speed limits to 90 kilometres per hour would have the effect of reducing gasoline consumption.

Of course we have to balance that reality against the need for the populace to move from one location to another in this province at a reasonable rate of speed. We could have a good, healthy debate about what constitutes a reasonable rate of speed. We could also discuss the extent to which the public is prepared to see a reduction of speed limits. But that just raises one of the more difficult parts of the full implemen­ tation of a truly efficient and fully conservationist ap­ proach to energy. Another measure that might well increase energy con­ servation would be the imposition of a gasoline tax.

Again, the clear public policy decision entailed in that is obvious to one and all. Another example would be the reduction or removal of the natural gas price protection subsidy. While it's one thing to talk about the energy conservation side of the equation, I think we have to be cognizant of the fact that we live in a northern part of the world where we are faced with extremely cold tempera­ tures through a significant amount of the year.

We simply have to be able to heat our homes, and rural Albertans have to be able to heat their facilities so that the business and industry of this province can prevail and continue. I simply raise those examples to indicate not a lack of support for the principle of energy conservation, but the fact that there are some pretty tough issues inherent in any greater movement in that direction. I would again like to make the point that I think a significant amount is being done. The hon. Member for Barrhead outlined that in detail, and I don't intend to pursue that area of debate any further.

I would like to spend the bulk of my time in this debate talking about a specific example of an attempt to encourage energy con­ servation in the cities of Calgary and Edmonton. That is light rail transit, which intends to, and will, fulfill a number of appropriate goals, one of course being to help reduce some of the congestion we face in our very over­ crowded metropolitan regions of Calgary and Edmonton.

As well, it has the very desirable advantage of encourag­ ing energy conservation by reducing the number of cars on the road, and operating in a far more energy-efficient fashion than the automobile, particularly as we see it, I suppose everywhere, carrying only one individual. That's a discouraging sight to see anywhere in this province, but it is a reality. With respect to that very worth-while energy conserva­ tion project of light rail transit, I think it's clear that if we want to see the maximum energy conservation aspect, we're going to have to have an integrated system in both Calgary and Edmonton.

I think we have really crossed a threshold, if you will, on light rail transit, by making the decision, which was arrived at on a local basis and supported provincially, to construct the initial lines in both Calgary and Edmonton. Surely the decision to build any line at all must have been preceded by a study and a conscious decision as to whether or not an integrated system would be viable. Having moved with that first leg in both cities, to then say we're going to assess the practicability of the concept of LRT based on only partial construction of the integrated system, to me, is of very doubtful merit.

In the city of Calgary, for example, construction costs are estimated to rise some $59 million per year for every year we do not proceed with completion of an integrated system. So in line with this resolution, I suggest that one way we could encourage energy conservation would be to move more rapidly with assistance to the major metropo­ litan centres, which are experiencing real transportation difficulties, with an integrated system of light rail transit.

I simply add to that my view that when we bear in mind that, like it or not, over 65 per cent of Albertans presently reside in the metropolitan centres of Calgary and Edmonton, we have a clear obligation to ensure that Albertans who reside in those centres — who are in fact bearing a substantial burden, if you will, a significant amount of the brunt of the rapid growth of this province — are well cared for.

I also submit that the tax base the municipal governments have to work with appears to be inadequate to meet the real needs that are there, notwith­ standing the very generous debt reduction program this government implemented back in 1979. Having given that example of light rail transit — and I'm delighted to see the Minister of Transportation in the

746 ALBERTA HANSARD May 14, 1981 Assembly this afternoon — I would also like to say a few more words with respect to the implementation of this resolution. I have some concern about the practicability, if you will, of such an undertaking, particularly when we see the number of departments, as outlined by the hon. Member for Barrhead, that are presently engaged in various types of energy conservation studies and pro­ grams.

It seems to me that perhaps in this resolution itself and debate on it in the Assembly, the member may have partly achieved his goal, which is to make some deter­ mination of present initiatives that are being taken. Cer­ tainly the Member for Barrhead indicated in his remarks that a great deal is being done. As much as I support the concept and the principle, I certainly wouldn't want to see us simply creating yet another bureaucracy within government, when in fact that may not serve a useful purpose and not be very energy conservationist of itself.

But I wish to commend the hon. member for having brought the important issue before the Assembly by way of this motion and, very shortly, by way of debate on a Bill. I think it behooves each and every one of us as elected representatives to be extremely familiar with this very important issue. I know we will all be carrying the message back to our constitu­ ents in the days to come. Thank you very much, Mr. Speaker. MR. L. CLARK: Mr. Speaker, it's a pleasure today to speak on Motion 207. I wondered whether I was going to get in or not. I don't have much time left.

I would like to ask why a province with as much energy as we have should be speaking on a Bill on conservation, why we should worry that much about it. We have an abundance of natural gas, in fact a surplus. We have an abundance of coal. We have a surplus of coal, too, that we were trying to export. We also have considerable reserves of oil; not the type we used to have, but in the tar sands we have a reserve that's probably enviable around the world and certainly across Canada.

I call them re­ serves because if we look at the present energy policy set down by the federal government, that's probably the way they're going to remain, as reserves. When you talk about waste, you can't help but mention the biggest waste of all: the energy program of the federal government. They are wasting taxpayers' money by mak­ ing people pay for foreign oil, just because they lack a sensible energy policy. Mr. Speaker, I was going to say a little more about the federal government, but I don't really have the time today.

I just thought that when you have such experts as they are in the field of waste, they should be mentioned. Mr. Speaker, with the extremely high cost of energy in Japan and the European countries, they placed a major emphasis on energy conservation. In fact even the federal government has talked energy conservation programs. But because of the cheapness of energy in Canada, it has never really been brought home to the people. So what have higher energy prices done for Canada? They've cer­ tainly made the people of Alberta more aware of energy and that if you're going to waste it, it's going to cost you.

On the farm we used to get natural gas for 19 cents an MCF. I really wasn't interested whether or not the barn and the shop were insulated. It was so cheap; compared to the rest, it was one of the minor bills that came in. When it got up to $1 an MCF, that certainly changed around. We started to say, look, we can't do this any­ more. That is one of the major things in the high energy price. It's going to lead to conservation that people will do themselves. I think that's the way it should be. The high cost of energy has done other things.

It has induced Ontario to set out a 15-year target to reduce the use of heating oil by 30 per cent. I think they're a little late doing that. Saskatchewan also has an interest-free program, something like our colleague from Edmonton Glengarry is trying to put out in the Bill that's following in here today. Then Ottawa has a plan for insulating older houses. But it hasn't given much consideration to a guaranteed supply of energy. The Liberal government has never given a high priority to guaranteeing supply.

When western oil and gas were at rock-bottom prices but was still just a few cents higher than they could get it for offshore, they didn't worry about security of supply; they only worried about the price. That hasn't changed. They still don't worry about the supply; they're only worried about price. In fact in July 1979, Don Braid did an

article on energy conservation in the Edmonton Journal, in which he wasn't too complimentary about Alberta and its conser­ vation programs. He said, "Why should Albertans worry?" Their homes "are heated by natural gas . . . only those eastern [so and so's] are stuck with heating oil". That was in the Edmonton Journal, July 18, 1979. Whose fault is it that they're stuck with heating oil instead of natural gas? It certainly isn't Alberta's. Quite a few years ago, Alberta would have been only too glad to extend a pipeline and supply natural gas to eastern Canada.

But again it came back to price, and they weren't willing to put up the few extra cents it would have taken for that guarantee of supply. They certainly are not in­ terested in guarantee of supply or development of the gas and oil industry across Canada. How do you save energy? I believe there are several ways you can save energy. First, I would like to make a few remarks on what we're doing in Canada. In Canada, we have only one type of energy that's transportable. It's the only one developed to a point where it's available to all Canadians. That of course is the oil industry.

Our entire transportation system . . . MR. ACTING DEPUTY SPEAKER: Order please. I draw to the hon. member's attention that the time has now lapsed for this debate. MR. L. CLARK: I beg leave to adjourn debate. head: PUBLIC BILLS AND ORDERS OTHER THAN GOVERNMENT BILLS AND ORDERS (Second Reading) Bill 214 The Home Energy Conservation Act MR. COOK: Mr. Speaker, I'd like to begin debate on Bill 214 by going back to the debate on the resolution, trying to generally relate why energy conservation is important, applying a couple of quick tests to see what our perfor­ mance is, and then look at this Bill.

We noted that the International Energy Agency pointed out that energy conservation is necessary, be­ cause we're bound to have supply disruptions in the very near future. The international energy market is politically unstable. Secondly, we're faced with very high energy costs, and they're rising dramatically. We need to en­ courage high prices to encourage conservation. Then we

May 14, 1981 ALBERTA HANSARD 747 need to assist Albertans trying to cope with that, by providing incentives. As the international agency has shown, it's a very good policy tool that has a great impact. While artificially low now, Canadian energy costs are bound to rise and respond to international conditions beyond our control. The question we as legislators in Alberta have to face is: can we afford to keep energy costs artificially low much longer? The cost of the natural gas price protection plan makes my point more compel­ ling than anything mere words can offer.

Last year we looked at $150 million in total subsidy costs for the natural gas price protection plan. If we continue at the level of roughly one-third subsidy, and energy prices rise by a factor of three and our population expands dramat­ ically, as it is bound to, we could reach the point where to shelter Albertans in the real cost of energy, we would pay out something between $0.5 billion and $1 billion in any given fiscal year. That would be a permanent charge against the provincial Treasury. Clearly I think most Albertans would suggest there are better ways to spend those kinds of dollars.

They could use them to make necessary investments in housing stock to cut consumption. Mr. Speaker, in the 1940s, '50s, and '60s, insulation was not really mandated by the building industry and not really thought of as being a serious charge. The Member for Drumheller pointed out that on his farm the charge for natural gas was one of the minor bills he faced at the end of the month; it wasn't a significant factor in the average family's budgeting. Well, it is today. Natural gas prices have risen dramatically since 1973.

Some studies suggest the real cost to heat an average 1,200 square foot bungalow was about $522 in the fiscal year 1980. That's based on both the subsidy — the natural gas price protec­ tion plan — and the cost to the consumer. The average consumer probably uses about $500 worth of natural gas a year. If we just project that to 1990 on the national energy program schedule, those costs rise to well over $1,600 for the same bungalow.

If Alberta is successful in having energy prices rise beyond the national energy program — and I think all members of the Assembly sincerely hope for that, because as Albertans we're being charged for the subsidization of inefficient industrial and heating plant in the rest of the country, primarily central Canada — then the cost for heating that home in Alberta will not be $1,600 in 1990. It will be something well over that, perhaps $2,000 or $2,500 a year. I've had a number of my constituents call or write to complain that even at $500, the cost for heating a home is too much.

I'm sure members of the Assembly have had people tell them that things are getting a little expensive. The Member for Cardston shakes his head. But some have stopped by my constituency office or called to say they're getting scared, because last year wasn't a cold winter. What happens if we have increased prices for natural gas and a cold snap? In the winter of 1969, we in Edmonton had fully one month when the temperature did not rise above zero. That was a cold year. With higher energy costs, I can only imagine what the heating bills would be for a poorly insulated home for that kind of year. Mr.

Speaker, if we don't want to pay $0.5 billion in energy subsidies, we have to look for some other alterna­ tive to shelter Albertans. I don't think the price shelter is the way to go. That simply protects Albertans from reali­ ty, and we're facing a day of reckoning. Bill 214, The Home Energy Conservation Act, follows the recommen­ dation of the International Energy Agency and the ex­ perience of a number of other jurisdictions in Canada and the United States. It's not a wildly imaginative or crazy idea. It's quite reasonable, very rational. It attempts to reduce consumption of energy in the average home.

We can make some dramatic savings in this regard, but they have costs. Just to give you a couple of quick ideas of what we can accomplish. With the simple addition of a new furnace, which I understand will be available on the market at the close of this year, perhaps early 1982, we can reduce the average Albertan's consumption of natural gas by about half and still give the same heating value. In short, half the gas that enters the average home today is vented up the chimney stack, because it's not efficiently burned.

To its credit, the Alberta government has been funding re­ search to try to improve that, and there's now a furnace prototype that's 90 per cent efficient. That means 90 per cent of the gas that enters the system is burned and generates heat used in the house; 10 per cent is lost. That compares with about 50 to 55 per cent efficiency ratings on most present furnaces. With that one simple step, we could cut energy consumption for heating the average Alberta home by about half. I understand a new furnace would cost about $1,100.

With the addition of weathers- tripping, improved doors, and perhaps storm windows upgraded to sealed units from old wooden ones which are leaky and not tight, a home-owner could make some substantial improvements as well. Insulation in the base­ ment walls is another way to make significant improve­ ments in the heating efficiency of an Alberta home. Bill 214 provides for a package of grants and loans of $2,500, which would assist the home-owner to make those necessary capital investments to permanently reduce energy consumption, not for just one year but in perpe­ tuity.

It's my contention that an investment like that would also save the government of Alberta a significant amount of money in the long run. The natural gas price protection plan would not have as much gas charged against the system. If we can reduce half the heating requirements for natural gas in the average Alberta home — and I think that's a modest proposal — then we can reduce half the charges for heating residential space against the natural gas price protection plan, thereby reducing the charge on the public treasury.

So there are some good financial reasons as well as political ones, political ones being trying to assist Albertans, sheltering them from high energy costs they are about to face. There are good political and economic reasons for the province to embark on this program. Mr. Speaker, it's a program that has been modelled basically on the experience of the Pacific Light and Power Company in Oregon, and it encompasses basically three points. One is that we use utility companies to provide energy audits of the home.

We have someone who has some experience, some knowledge about how to cut heating costs, go into the home and for half an hour or an hour, look over the home and try to identify where you get the biggest bang for the buck. We don't want to install fancy new storm doors when the old ones might be perfectly satisfactory. But we might want to make some changes in the insulation of the attic. We might want to improve the basement insulation. We might want to in­ stall a new furnace. So we identify the areas where we can get the best return.

An energy audit will accomplish that, because we have experienced people looking over the home and trying to identify areas of maximum return.

748 ALBERTA HANSARD May 14, 1981 Where those improvements can be shown to be cost effective — and the Bill does provide that we don't just go in and try to spend $2,500 as a gift to the home-owner; it has to be shown to be energy efficient and cost effective — the auditor would provide a written estimate to the home-owner. The home-owner then has a standard. If a utility company auditor suggests that a furnace is going to cost $1,100, the home-owner has a standard to judge estimates from contractors. If a contractor comes in wild­ ly high, he or she knows something is wrong. That's a valuable point as well.

Having had that estimate and that audit, the home-owner could apply for grants and loans to a maximum of $2,500 to effect those improvements. We think there are something like 500,000 detached houses in the province right now. If we were to phase in the program so that housing constructed during different periods would qualify at different stages of the program, it shouldn't be a problem to provide the auditors and the contracting services to make those changes to upgrade the standards of home energy consumption. We suggest, Mr.

Speaker, that in the average 1,200 square foot bungalow, we're looking at trying to improve basement wall insula­ tion, ceiling insulation, storm windows, and weathers- tripping and caulking, to reduce the heating bill by about $150 a month. We think it's a very reasonable prospect. It's not technically difficult. It's certainly well within the ability of most Albertans to accomplish those modest goals. Mr. Speaker, let me suggest why we should be doing that in Alberta. That's the program. It's very simple. It works in other jurisdictions. Alberta has a responsibility as a government to do this.

Basically we're all conserva­ tives in this Chamber, even the Socreds. They claim they're more conservative than the Progressive Conserva­ tives. We're basically concerned about having an efficient economy, and the Alberta government has interfered with the market place by providing for the natural gas price protection plan. We provide a subsidy. It encourages waste. We've interfered with the market system. My con­ tention is that we should compensate for that by provid­ ing incentives for consumers to reduce their consumption, because we want them to become efficient.

The market system won't discipline them as much as it could, because we have prevented the market system from doing that by reducing the cost. So we should inject a new system of market discipline by trying to provide incentives for the home-owner to reduce his or her consumption. That's the basic principle of the Bill. It's very simple, very conserva­ tive, and cost effective. As well I think we are all critical of the Canadian energy policy which, again, keeps prices artificially low. As I pointed out, Canada has one of the poorest track records of energy consumption of the western industrial­ ized democracies.

As a result, we're more vulnerable to world-wide supply and price disruptions. Looking at the long-term, Mr. Speaker, the housing stock we build today will be with us for 20, 40, 50 years. The energy conservation climate, if you like, that we have in 1981 will determine energy consumption patterns in the year 2000, in the year 2020. Our failure today to create a climate that encourages energy conservation will cost us dearly. It will cost us in this sense. We'll lose revenue. There are opportunity costs. The natural gas we waste, that we burn unnecessarily to heat our homes, could be exported.

We could be generating more revenue for the public treasury. That's an important fact, Mr. Speaker. Secondly, the cost of the natural gas price protection plan is a burden on the provincial treasury and could rise if we don't do something about it, because we're going to be doubling the population in the province of Alberta. If we want a lean and healthy economy, if we want to encourage Albertans to be conservative, then we should be doing something to encourage them to do that. Bill 214 is an incentive program to reinject discipline into the market place that the Alberta and federal governments have taken out.

It's a modest proposal, Mr. Speaker. I'd like to re-emphasize that in the next nine years we're facing energy costs that should triple in real dollar terms. Albertans are basing their heating costs on $17 a barrel oil, and gas roughly equivalent. That price is only about one-third of the world price. Mr. Speaker, it's my contention that we should be adopting programs. This Bill follows logically from the resolution we debated earlier this afternoon. We do want to set up performance standards for other departments. This is one example in Alberta government programming to encourage energy conservation.

I'd like to close with this point. Space heating for residential purposes in Alberta accounts for 20 per cent of the energy we use in this province. As such it's a very significant factor in an overall energy conservation pro­ gram. Earlier, speakers on the motion generally conceded that energy conservation is a desirable concept; we should be doing something about it. Having made that point and having had those speakers make that point, it logically and necessarily follows that we should be doing some­ thing about energy consumption in home heating. Bill 214 sets out to accomplish that.

I'm looking forward to the debate this afternoon. I think that hon. members will respond to the challenge, and I'm looking forward to an energy conservation oriented Alberta in the years to come. MR. LYSONS: Mr. Deputy Deputy Speaker, I'd like to thank the hon. Member for Bonnyville for asking me to stand in his place this afternoon to direct some comments toward Bill 214. The Bill is a motherhood type of Bill. But when you examine it, it's clearly not what I would want us to pass. The hon. member bringing in the Bill clearly knows little of all he's talking about.

If he wants to set an example in energy conservation, that's great. He should start doing that at home, like showering with a friend or . . . MR. COOK: Mr. Speaker, on a point of privilege. I'm not sure that the hon. member is trying to suggest that I take a different approach to my family life. I'm presum­ ing of course that he means that it would be with benefit of clergy. Mr. Speaker, I'd also like to make the point that I have taken steps to reduce my hot water consump­ tion, and I have installed a shower head flow restricter that I . . . MR. DEPUTY SPEAKER: Order please.

The hon. member has already had an opportunity to partake in the debate, and I ask the Member for Vermilion-Viking to continue. MR. LYSONS: As an example of the wasted energy policy of the hon. Member for Edmonton Glengarry, we have spent an hour and a half here this afternoon burning up lights, electricity, and heat — air conditioning in spots — and I don't know what we've gained. But you certainly could do some conserving there. In his Bill this afternoon, and particularly in his resolu­ tion, he took another run at agriculture and agricul­

May 14, 1981 ALBERTA HANSARD 749 turists. When it comes to utilizing nature and nature's bountiful sources of energy, certainly no one uses solar energy more than agriculture. There's just no question that you can grow vegetables under lights and things like that, but farmers use solar energy as a way of life. [Mr. Speaker in the Chair] Furthermore farmers protect their homes far more than urban dwellers, who live in those great big bird houses, by planting shade trees around their houses. They have windbreaks, all sorts of things conserving energy. Also they're not afraid to grow a garden. That conserves energy.

I know that when we're home on the farm in the summertime, a great deal of our food is eaten raw out of the garden. I'm sure that you don't eat much out of the garden raw when you don't even have a garden. We've got so much land that is available for that. You could set some examples. In this Bill we talk about giving people money at a subsidized interest rate. We set up a bureaucracy, inspec­ tors and auditors to go out and check to see if everything is done. I have some numbers here.

If we give this maximum loan of $2,500, with interest rates being what they are, it would amount to a subsidy of about $300 a year. If we're going to give money away, let's give it away. Just say, hey, go fix your house, like we have with the senior citizens' home repair program. Perhaps the hon. Member for Edmonton Glengarry doesn't realize that a lot of us own our homes. We don't want to borrow money. Why would I want to go out and borrow money to get $300 a year subsidy? I just can't see this. There's a great inequity there.

If you don't own your home and let it run down, fine, you can benefit by these programs. But being a Conservative, I really don't think that's the way we should go. Another thing: in the city, when I come to the Legisla­ ture and go home every night, I'm just amazed that I don't see clothes lines. Out in the country, almost every farm still has a clothes line. There are always clothes flapping away in the breeze: certainly the best way I know of drying clothes, particularly in the summertime. They come in nice and fresh, and you don't have to put in all those chemicals and all that other stuff.

If the hon. member is sincerely interested in saving energy in his home — I tried to trick him into answering this question yesterday — he could scrub his clothes on a scrub board or, as one member out in the back said, you could have a shower with your socks on, if you haven't got a friend to shower with. [interjections] I've got bifo­ cals; I can't get adjusted here. He could walk to work too. That would save car energy. I can read that much here. Another point I have written down. I'll try not to be too long, Mr. Deputy Deputy Speaker — oh, it's the Speaker now. Sorry, Mr. Speaker.

All this paper we get here in the Legislature — we get tons of it every session and through the year. If you really wanted to save costs, you could have a little stove in your bedroom, stoke that up every morning just before you get up, and use some of this paper that we go through. I sneaked up on him yesterday. He didn't realize I was going to be talking today. He was mentioning how he was going to get a larger apartment. He wanted a bedroom. He doesn't have a bedroom. He needs a bedroom for his, for his friend. [interjections] Nevertheless, Mr. Speaker, I could have a lot of . . . MR.

COOK: On a point of personal privilege, could I suggest that the hon. gentlemen not only review his bifoc­ al needs, but consider getting either a little closer to me and listening more carefully, or consulting a doctor to see if his hearing is in need of improvement. MR. LYSONS: He's probably right on both counts. Mr. Speaker, I know that Bill 214 has some great merits, but it also has so many obvious weaknesses.

This afternoon I was very interested in stirring up the hon. member just a little bit, and having him realize that surely in Alberta, in the Alberta way we like to do things, the type of program this Bill would produce isn't really the answer. The answer is example. The answer is making things easier for people. Doing away with the subsidy to home heating users and gas users would be difficult for me to explain to my constituents back home. I think that that's a great program.

When we talk about bang for the buck — and it happened that he was talking about doors when he talked about bang for the buck — I had to think of the time in the Legislature that he mentioned that in order to get a certain individual's attention, you should hit him over the head with a two by four. I can think of a little better place to hit someone, and it would be with a little, long, narrow strap, and ask the hon. member to really sit back and take a good look at what he's got in the Bill, perhaps dress it up and bring it back another time when we can debate it thoroughly and properly. Thank you. MRS.

OSTERMAN: Mr. Speaker, I was going to say it's a privilege to take

part in this debate. At this point in time, I'm not sure I would call it debate. But I do want to support the hon. member's Bill and congratulate him for bringing it forward. I hold a view somewhat different from the hon. Member for Vermilion-Viking. I think I'd challenge some of his statements in terms of trying to develop a rural/ urban argument. Because I have to say that in my travels, if you're talking about waste of energy of various kinds, I believe we're all guilty. I wouldn't charge the urban resi­ dents with more guilt than those of us who live in the rural areas.

Even the clothes line situation is one that I think you're all wet on. MRS. CRIPPS: At least you were when you were hung out to dry. MRS. OSTERMAN: That's right, you may have been hanging out drying on yours too long. However, we obviously have somewhat different opinions. To get back to the merits of the Bill, I really only want to make a couple of comments, Mr. Speaker.

As a result of my personal experience about four years ago [in] spending a great deal of time researching ways to make our home more energy efficient, because we were going to be adding an addition, I discovered a lot of very interest­ ing things. I suppose reading the hon. member's Bill led me to remember several things I encountered that I thought were fairly important to mention today. I believe it is the Conservative way help people to help themselves. Especially in a world where we're so short of energy, I think it moves us in all speed to do what we can to conserve energy.

Even though it may seem we have an abundance of it here, it's not fair for us to waste it. One point in the Bill 1 would like to mention is under "qualifying improvement". There's a list of particular

750 ALBERTA HANSARD May 14, 1981 construction or additions that would qualify for assist­ ance as mentioned under this Bill. Number nine is: "heat­ ing systems and air to air heat exchangers". I don't think the hon. member really went into that kind of detail but, for the information of the House, I just want to relate a little personal experience. There are many kinds of firep­ laces on the market now. Four years ago I discovered a fireplace that was being marketed in British Columbia.

It wasn't even being marketed in Alberta, because it ap­ peared that there wasn't the demand for that particular kind of fireplace, possibly because our energy was some­ what cheaper here. That's one thing. The other reason [is] possibly the lack of wood in this province. We don't normally consider wood to be the kind of thing we would burn for energy. In my research I discovered that indeed a tremendous amount of wood was available to burn that ordinarily wouldn't be productively used in any other manner. This particular fireplace we installed has pipes that run through the chimney.

The fresh air from outside comes through those pipes, is heated by the fire and the heat that's going up the chimney, and is blown into your room. Members of the Assembly, we added an addition to our home — I believe it's 24 by 30 feet — and by extra insulation that goes far beyond what is required now in terms of home building, we virtually eliminated the need for any natural gas heating whatsoever. And we do have a natural gas furnace.

We installed complete glass on the south side, which in the wintertime — and I think all of us know we have a great deal of sunshine in Alberta — heated that room, this very large area, during the day and at night the fireplace was used. The extra insulation mentioned here is really important, because the other thing we discovered was that in the summertime you maintain an incredibly cool house with that extra insula­ tion, therefore eliminating the need for air conditioning.

I won't get into the precise merits of all the different improvements the hon. member mentioned, but I believe this Bill has a lot of merit. Philosophically, I believe it's a Conservative Bill. I support it and ask other hon. mem­ bers to support it. MR. PAYNE: Mr. Speaker, I'd like to begin today with a brief explanation of my motivation for participating in debate on this Bill. Initially I agreed to participate and support, more of a desire to assist a hard-working member of the Legislature than out of an intense personal interest in the subject of energy conservation. However, Mr.

Speaker, after considerable reading, discussion, and contemplation, I must admit that I think the Bill of the hon. Member for Edmonton Glengarry has a lot of merit. I think it deserves a couple of things. First, I think it deserves a more rigorous debate in the Legislature. Se­ condly, I think it deserves more consideration of the principles by individual members. My own conversion, if I can use that word, resulted in part from a heightened awareness of the actual savings that can be achieved through residential energy conservation efforts.

In recent days I've asked myself what kind of savings are in fact possible in Alberta or indeed anywhere. In perusing a recent publication of the Harvard busi­ ness school, I was intrigued with a report by the Harvard business school that cited a federal energy administration test house in Washington, D.C. In this test house, through the simple process of adding some standard insu­ lation devices, the group were able to decrease the total annual energy requirement of the house by 25 per cent. The test also established that with additional insulation, they were able to increase the energy savings to 35 per cent.

To cite another statistic that might be more meaningful to the members here today, I'd like to refer to a Standard Oil of California demonstration study in which they in­ vested the magnanimous sum of $981 in a house in Portland and established that through that modest in­ vestment, the fuel consumption was reduced by 50 per cent. For those of you who are amateur or semi- professional investors, that works out to a rate of return on investment of about 25 per cent. Even in the infla­ tionary condition in which we find ourselves in Alberta and Canada, I suggest that that rate of return demands further examination.

Mr. Speaker, for the benefit of the members here today, I have two other dramatic illustrations of the results that can be achieved with the kinds of measures advocated by the Member for Edmonton Glengarry. First, an experiment in the Puget Sound area, conducted by Washington Natural Gas. Their program estimated that the savings in the 56,000 homes insulated as a direct or indirect result of that company's conservation pro­ gram, has freed gas for 16,000 new homes without requir­ ing any additional supplies.

To quote the president of Washington Natural Gas at the conclusion of that ex­ periment or that testing period: What all that meant was that we had been sitting atop a new gas field for years and didn't recognize it. That is to say, the potential savings through energy conservation in the residential sector can be demon­ strated to be equivalent to the discovery of a brand new gas field. One other American experience in Twin Rivers, New Jersey, a community of 3,000 well-construc