Thank you, Madam Chair.

The Canadian primary aluminum industry in Quebec and British Columbia produces 3.2 million tonnes of metal, while having one of the lowest carbon footprints in the world.

From the very beginning, we have supported the carbon pricing mechanisms put in place in Canada, the cap-and-trade system in Quebec, better known as SPEDE, and the taxation mechanism in British Columbia. We also recognize the value of the federal system, although we are not subject to it, since all of our activities are covered by the provincial systems I just mentioned.

Indeed, the federal system is the mandatory benchmark used by provinces seeking to set up an equivalent system in their jurisdictions. It is also the only benchmark used by carbon adjustment mechanisms at the border of foreign countries to evaluate products imported from international suppliers, as only national schemes are recognized right now.

Our reduced footprint is a significant competitive advantage in a world that is increasingly and rapidly moving towards decarbonization, whether in America, for example, or Europe.

In the short term, however, we are not seeing this benefit due to the implementation of the European Carbon Border Adjustment Mechanism, better known as CBAM, since it currently recognizes only scope 1 emissions from industrial processes. Since the global aluminum industry uses the same process, all manufacturers have the same footprint. It's only when we look at scope 2 emissions, i.e., emissions from the energy source, that our competitive advantage conferred by our energy source comes into play.

It's also important to remember that, apart from small volumes sold to Europe, more than 90% of our exports are destined for the U.S. market, which is clearly not about to implement such a mechanism.

So we have to face competition from regions of the world where there is no national carbon pricing mechanism, and therefore no additional costs associated with such requirements.

Our sector has been dealing with the realities of this market dynamic and the existing systems in Canada since 2013. Those are two fundamental factors in our competitiveness analysis.

Another advantage of the current mechanism in place is that there is a fundamental incentive to maintain our reductions over time, due to the fact that the provincial mechanisms are pegged to the national one.

In closing, we want to underline the paradox that the Canadian aluminum industry is now facing and that you must absolutely take into account.

We need to maintain carbon pricing for the reasons I just outlined, as our low carbon footprint is linked to the significant challenge we face. Unlike our competitors elsewhere in the world, who are facing the challenge of the energy transition from coal or natural gas to renewables, for example, we are facing an industrial transition of unprecedented magnitude. We need to develop and implement so-called disruptive technologies on an industrial scale. These technologies, which are still at the research and development stage, will change the way aluminum is produced and allow us to get from two tonnes of emissions to zero.

As the Canadian mechanism and related regulations evolve, we must find the sweet spot that allows us to maintain our competitiveness and recognizes our carbon advantage in terms of emissions levels, while keeping us on a realistic reduction path over time and taking into account the time required to deploy and implement new technologies.

Thank you.