MARCH 15, VANCOUVER — Today, on the Expo floor of the GLOBE Summit for Sustainable Business, 27 prominent Canadian business, environment, youth, Indigenous and labour leaders will launch a landmark research report on the opportunity and state of clean innovation in Canada. These leaders of the Smart Prosperity Initiative are calling on government to help clean innovators get ideas to market, creating wealth and jobs, by pushing ahead on environmental standards while doing more to buttress business competitiveness. That includes:
- An accelerated capital cost allowance for all clean technologies;
- A tax credit for investment in growing clean technology companies;
- Reduction of regulatory impediments to innovation;
- Moving ahead with carbon pricing and strong environmental standards to drive low carbon innovation and clean growth (for vehicles, fuels, buildings, and industries).
Clean innovation feeds a fast-growing global market for environmental solutions that will be worth $2.5 trillion by 2022, according to the Smart Prosperity report released today. It is a massive economic opportunity, not just for the emerging cleantech sector, but for Canada’s established industries including natural resources, energy, manufacturing and agriculture. For example, it is anticipated that $3.6 trillion dollars will be invested, world-wide, in technologies that boost efficiency in resource-based sectors by 2030.
“Canada has what it takes to capture a big slice of the global clean innovation opportunity, but right now we’re falling short,” says Annette Verschuren, Smart Prosperity leader, CEO, NRStor and Former CEO, Home Depot Canada. “We’re great at generating ideas and developing them into promising technologies. But we’re behind other countries in getting those ideas to market. That means we’re missing out on the jobs, business opportunities and wealth that we could be generating.”
While investors and entrepreneurs are the driving force behind clean innovation, government has a critical role to play in fixing market failures and stimulating demand, explains Stewart Elgie, co-chair of the initiative and professor of law and economics at the University of Ottawa. Half of that equation is setting ambitious environmental policies that spur innovation, and on this front, Canada is on the right track. “Driving clean innovation takes carrots and sticks -- strong environmental rules plus smart incentives to help firms get there,” said Elgie. “Kudos to governments for moving ahead with carbon pricing and world class climate standards. Now we need to match that with strong competitiveness incentives.”
At the same time, Smart Prosperity leaders are urging government to pay more attention to the other side of the clean innovation equation: competitiveness.
“We have got to lower costs and increase the business incentives if we really want clean innovation to take off,” says Lorraine Mitchelmore, Smart Prosperity co-chair and CEO of Enlighten Innovations. “Environmental ambition has to be matched with competitiveness measures because, we know, when business costs go up, the first thing that gets cut is R&D budgets. That’s exactly where we need private investment to flow, so let’s get the barriers out of the way.”
The report lists six key recommendations to accelerate innovation for a stronger, cleaner economy that benefits all Canadians.
We must act now to secure our place among the world’s leaders in clean innovation reads the statement signed by Smart Prosperity leaders in the new report. The world will build a low-pollution economy with or without us. It’s our intention to ensure Canada opts in.
For more information and to schedule interviews with Smart Prosperity spokespeople, please contact:
Media Background FAQ
In light of Canada’s current business context, Smart Prosperity proposes three competitiveness actions government should take now to drive clean innovation
Smart Prosperity’s Clean Innovation report emphasizes that “well-designed policies that reduce barriers to innovation, paired with targeted incentives” are critical to strengthening Canada’s economywide competitiveness and the opportunity for clean innovators to thrive. Today, in launching the report and in light of our current business context, leaders are offering three specific competitiveness recommendations specifically geared to drive clean innovation:
- Accelerated capital cost allowances for all clean technologies, to boost adoption and stimulate market demand for clean tech.
- A tax credit for investments in the growth clean technologies, to help stimulate private investment and to leverage the government’s $2 billion public investment in clean tech (in the 2017 Budget).
- Reducing regulatory barriers to innovation, for example by creating “regulatory sandboxes” with trial periods, developing nimble regulatory regimes for emerging technologies, and creating a “troubleshooter office” in governments to help innovators resolve regulatory impediments when they arise.
Clean Innovation Report Recommendations
In addition to the three competitiveness actions listed above, Smart Prosperity is emphasizing the six key clean innovation recommendations outlined in its report:
1. Unleash private investment in clean innovation. By co-investing in promising clean technologies, governments can de-risk and catalyze the large amounts of private investment needed to grow these inventions into market successes. Public support should target priority areas where Canada has comparative advantages — with particular focus on hard-to-finance stages and technologies.
2. Set world-class environmental standards. Adopting stringent environmental policies — particularly pollution pricing and other flexible tools — will spur demand for clean innovation, position Canadian businesses as environmental performance leaders, and send the long-term signals needed to drive private initiative and investment. Well-designed policies that reduce barriers to innovation, paired with targeted incentives, can strengthen Canada’s economywide competitiveness.
3. Open export markets. Prioritizing clean innovation in Canada’s trade missions and programs, while also supporting ambitious international climate and environmental agreements, will help boost global demand for made-in-Canada clean technology solutions.
4. Lead by example through green procurement and infrastructure. By leveraging their own purchasing power as Canada’s biggest buyer, governments can grow the market for clean innovation, build the infrastructure to prepare us for a low-carbon economy, and provide a testbed and showcase for Canadian clean technologies.
5. Strengthen Canada’s clean innovation ecosystem. Nurturing clusters and incubators, generating better data (to inform investments and policies), and investing in skills, capacity building, and developing young entrepreneurs can help grow a stronger, more connected innovation system for a 21st century clean economy.
6. Create a Clean Innovation Strategy. Bringing key players together to map out Canada’s comparative advantages and priorities in the global clean innovation race will ensure that everyone is pulling in the same direction in making investment, infrastructure, research, and resource allocation decisions.
To view the full report (available March 15), visit: www.smartprosperity.ca
Clean Innovation: Key Facts and Stats
- The global market for clean innovation is estimated to be worth $2.5 trillion by 2022
- The market for smart homes and buildings is estimated to grow 30% by 2020
- Global investment in technologies and innovations to boost resource efficiency in the resource-based sectors is estimated to be $3.6 trillion
- Between 2005 and 2014, more than 35 countries around the world have demonstrated it is possible to decouple pollution from growth, with falling GHG emissions and increasing GDP.
- After Europe brought in carbon pricing in 2005, the number of new patents for low carbon technologies more than doubled in four years.
- Canada’s share of the global clean technology market has fallen by 12 per cent since 2008
- Business expenditure on R&D (BERD) has been dropping steadily in Canada for 15 years, and lags well behind the rest of the OECD.
- Canada’s share of global cleantech publications is 3.4 per cent but our share of global industrial patents is only 1.1 per cent.
Smart Prosperity Leaders
Executive Director, Student Energy
Global Managing Director, McKinsey & Company
Executive Chairman, Alterra Power Corp; Chairman, Pan American Silver Corp
Vice President, Legal & External Affairs and General Counsel, Unilever Canada
President & Canada Country Chair, Shell Canada
CEO, Venture Communications
Co-chair, Smart Prosperity; Professor of law and economics, University of Ottawa
Richard P. Eno
President & CEO, BioAmber
Special Advisor, Royal Bank of Canada; Former National Chief, Assembly of First Nations
Executive Chairman, Bullfrog Power
President & CEO, Nature Conservancy of Canada
Chief Conservation Officer, WWF-Canada
Co-chair, Smart Prosperity; CEO, Enlighten Innovations
Canadian National Director, United Steelworkers
Founding Executive Director, Centre for Indigenous Resources
Board President, Pembina Institute
President & CEO, Aluminium Association of Canada; Co-founder and Director, SWITCH
Founding President & CEO, Sustainable Development Technology Canada
Marcia M. Smith
Senior Vice President, Sustainability and External Affairs, Teck Resources
Executive Director, Clean Energy Canada
Executive Director, Broadbent Institute
Senior Vice-President, Office of the CEO, RBC
Managing Partner, Government and Public Sector Advisory Services British Columbia, Ernst & Young LLP
President & CEO, International Institute for Sustainable Development
Co-chair, Smart Prosperity; CEO, NRStor; Former CEO, Home Depot Canada
President & CEO, The Co-operators