Question Period Note: Clean Tech

Clean Tech

• With a background as a strong innovator and producer of clean tech, Canada is well positioned to seize the opportunities clean growth presents both at home and abroad. In fact, clean tech companies currently employ more than 221,000 Canadians in well-paying jobs. The environmental and clean tech sector grew at 25% from 2012 to 2019 outpacing the overall Canadian economy.
• Our government’s investment in R&D, innovation and major projects over the past five years, accompanied by strong domestic climate policy, have resulted in Canadian clean tech products being developed and commercialized. Canada now has 11 companies listed in the top 100 clean-tech companies in the world, 10 of which have been supported by the Canadian government at one point in their development.
• Canadian innovations in clean tech are at the core of our green recovery. That is why we proposed a 50% corporate clean tech tax cut in Budget 2021 for small and medium-sized businesses manufacturing clean tech. Along with other investments announced in the Budget, we are providing $1 billion over five years to help draw in private sector investments in transformative clean technology projects to fuel the growth of innovative Canadian companies, create well-paying jobs, and bring important environmental and climate solutions to the world.

• Creative solutions and innovative technologies are key to helping the world tackle climate change, plastic waste reduction, biodiversity loss, and other environmental challenges we face.

• Canada’s ambitious climate commitments (40-45% below 2005 levels by 2030; net zero by 2050) will require significant innovation and deployment of clean technologies. Significant investments from the public and private sector will be required to meet our ambitious climate goals. Despite a growing global market there are still significant innovation and commercialization gaps that will have to be filled, particularly in climate mitigation technologies required to achieve net zero emissions.

• Clean technology is a key driver of innovation, environmental improvements, economic growth and jobs. Canada has committed significant funding for clean technology and low-carbon transition, and federal policies and programs are helping create the enabling conditions for growth and deployment in this important sector. In 2019 approximately 211,000 Canadians were employed in clean technology, which contributed $28.8 billion to the Canadian economy.

• In a market expected to exceed $2.5 trillion globally by 2022, Canada has consistently been recognized internationally for its leadership, with at least 11 Canadian companies recognized on the Global Cleantech 100 list for the past several years, and with oil and gas and other resource companies making significant investments in emission reduction technologies and processes. Clean tech companies are export driven: The sector exported $13.5 billion of environmental and clean technology products in 2019, accounting for 1.8% of total Canadian exports. Three-quarters of all these exports were destined to the United States. BNEF estimates that in 2020, Canadian clean tech companies attracted $3.7 billion in investments, 1% of global totals.

• To help strengthen Canada’s clean industrial advantage and advance clean tech, Budget 2021 provides $17.6 billion toward a green recovery that creates middle-class jobs, builds a clean economy and protects against climate change. This includes $5 billion over seven years to increase funding to the Net Zero Accelerator. This support builds on the $3 billion over five years announced in the government’s strengthened climate plan. This funding would allow the government to provide support for projects that will help reduce domestic greenhouse gas emissions across the Canadian economy.

• Canada’s ambitious climate targets, strong and predictable decarbonization policies such as carbon pricing, and medium/long-term financial public commitments are creating the investment environment and market to drive the uptake of clean tech.

• The Government is leveraging its purchasing power to support emerging clean technologies across Canada’s economic sectors such as technologies to reduce emissions in federal buildings and to reduce embodied carbon in construction materials as part of the updated greening government strategy.

• Budget 2021 also makes significant investments in clean technology and clean growth with:
o Clean Fuels Fund: $1.5 billion / 5 years to support the production and distribution of low-carbon and zero-emission fuels, including hydrogen and biomass, across Canada and around the world.
o $319 million over seven years to support research, development and demonstrations that would improve the commercial viability of carbon capture, utilization and storage (CCUS) technologies;
o $1.5 billion over five years to establish a Clean Fuels Fund to support the production and distribution of low-carbon and zero-emission fuels including hydrogen and biomass, positioning Canada as a global hydrogen leader and delivering on the Hydrogen Strategy for Canada;
o $9.6 million over three years to create a Critical Battery Minerals Centre of Excellence, in addition to coordinating federal policy and programs on critical minerals and working with provincial, territorial and other partners; and
o $36.8 million over three years for federal research and development to advance critical battery mineral processing and refining expertise.
o $500 million over 5 years ($100M ongoing) to the Industrial Research Assistance Program (IRAP) to expand and support up to 2,500 additional innovative SMEs.
o $450 million over 5 years to the Venture Capital Catalyst Initiative to increase venture capital available to entrepreneurs.
o 50% business income tax reduction on clean tech manufacturers – going into effect January 1, 2022.

• In addition, our government is also investing $750 million in Sustainable Development Technology Canada to support Canadian clean tech entrepreneurs in scaling up and bringing clean tech products and services to market.

• Example of recent investment: On July 5, 2021, the Government of Canada announced that Algoma Steel in Sault Ste. Marie, Ontario, will receive up to $420 million in federal funding in order to support its transition to electric-arc furnaces, and away from the coal-fired steelmaking processes. This electricity-based process is expected to cut greenhouse gas (GHG) emissions by more than 3 million metric tonnes per year by 2030 making a meaningful contribution to achieving Canada’s climate goals. The investment will create 500 well-paying jobs.

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