Canada needs to think bigger to see true growth in its cleantech industry

The worldwide movement to fight climate change is electrifying unprecedented momentum in the global cleantech market. This momentum is characterized by a global race to innovate, develop, verify, and bring solutions to market. Canada has the potential to lead the pack. There’s no question we have the talent; Canada’s clean technology sector continues to punch above its weight internationally, and we’re getting noticed. This week, the Cleantech Group released its annual Global Cleantech 100 list. Thirteen Canadian companies were named. The sector’s premier research organization also ranked Canada fourth in the world as a clean technology innovator—number one among our peers in the G20. We have a strong number of companies ready to compete globally and deliver solid revenues. And they have the potential to be an exporting powerhouse. Yet, our global market share is less than two per cent. Scaling up to global markets remains the biggest challenge. Over the six years Export Development Canada (EDC) has been really focused on the cleantech space, we have consistently heard cleantech developers say it’s a tough business. Our cleantech industry faces many challenges moving past the research and development stage. In many cases, companies are trying to disrupt markets and, at other times, create new ones altogether. EDC’s customers tell us everything costs more and takes longer than anticipated. While there are a number of factors that contribute, financing keeps coming up as the biggest hurdle. Many clean technologies are capital intensive to produce and have long production timelines. This combination of high capital needs and long return periods in some sectors makes financing more challenging than in other industries. The result is that we have an abundance of cleantech companies with great climate solutions, struggling to get into the global market. Now, more than ever, there is coordinated government support to try and ease some of their pain. EDC alone expects to bring more than $6-billion to the table to help support Canadian clean technology between now and 2020. Our Cleantech Team has tailored EDC’s financial products to accept the type of risk we see in cleantech companies, so we can support the unique challenges of early-commercialization companies that are ready to compete globally and grow their export revenue. We are merely one part of a broader cleantech ecosystem. Just last week, the federal government announced the creation of the Clean Growth Hub, supporting cleantech companies by coordinating existing programs, and tracking results. The last federal budget included nearly $1.4-billion in new financing for EDC and the Business Development Bank of Canada to help the most promising companies in Canada’s cleantech sector grow and expand. Add to that $400-million over five years towards a technology fund run by Sustainable Development Technology Canada, and money for Global Affairs Canada to implement an international business development strategy. It’s good, but there’s still more to do. In a study on the Canadian cleantech ecosystem, Cleantech Group suggests the federal government should also consider the role it can play to help companies move from public to private sector funding more effectively. Businesses themselves have to maximize the support that exists, and then create a value proposition that appeals to the market. The 2017 Analytica Advisors industry report said if Canadian companies were to achieve just a two per cent global market share, we could create a $50-billion cleantech industry by 2022. But we should be thinking even bigger. Canada has to shoot for the top spot. We can be the relentless pioneers at the forefront of this global disruption. Our cleantech companies can have their place on the map in forging a global evolution toward a greener future, and reap the economic and environmental awards. The sooner we embrace our Canadian companies to lead the way, the better that future is for all of us. Lynn Côté is the cleantech lead for Export Development Canada, Canada’s export credit agency. The Hill Times Canadian companies that made the 2018 Global Cleantech 100 list Name Funding Sector Year founded Awesense 0$ smart grid 2009 Axine Water Technologies $15.6M water & wastewater 2010 Carboncure Technologies $9.232M advanced materials 2007 Ecobee $44.24M energy efficiency 2007 Enbala Power Networks $45.11M smart grid 2003 Enerkem $234.3M biofuels & biochemicals 2000 FarmersEdge $59.07M agriculture & food 2005 GaN Systems $24M energy efficiency 2008 MineSense Technologies $26.27M conventional fuels 2008 Opus One Solutions $5.81M smart grid 2011 Saltworks Technologies Inc. $3M water & wastewater 2008 Semios Bio $10.06M agriculture & food 2010 Terramera $10M biofuels & biochemicals 2009 Source: Cleantech Group Note: companies are listed in alphabetical order, not ranked

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Canada needs to think bigger to see true growth in its cleantech industry

Canadian companies are best in class, but scaling up to global markets remains the biggest challenge.

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