Canada’s share of the fastest growing industry in the world has been shrinking over the last decade and a new report says it’s time to step it up or miss out on a trillion-dollar opportunity.
The Ottawa-based Smart Prosperity Institute report says clean technology will be a $2.2-trillion industry worldwide by 2022, with an estimated $3.6 trillion of investment up for grabs globally between now and 2030.
However, Canada’s market share in the global clean-tech industry has fallen 12 per cent in the last decade, and will continue to contract without a solid, long-term commitment to growing the industry, said institute co-chair Stewart Elgie, a professor of law and economics at the University of Ottawa.
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“Clean innovation is the big global economic prize in the next decade that leading nations are pursuing around the world,” Elgie said. “If Canada wants to win that race, we’ve got to raise our game.”
However, the Pan Canadian Framework on Clean Growth and Climate Change lays out a number of policies that will compel more clean tech innovation in Canada, he said, including a price on pollution with a carbon price, to be in place across Canada by the start of next year, as well as a promised national clean fuels strategy, better energy efficiency standards and limits on greenhouse gases like methane.
There also needs to be significant government funding available to help get good Canadian ideas through the development stage and to market. Canada does well at coming up with ideas and making them work, Elgie said, but it’s not so good at commercializing those ideas and scaling up production, often because of a lack of available capital.
The private sector is often still leery about clean technology, because it’s all very new.
“The truth of it is every major commercial technology of the last century has involved significant public investment and public support,” Elgie said. “Every one – even the oilsands, which has had billions of dollars in public investment before it ultimately became commercially viable and the private sector ran with it.”
Last year, Canada jumped three spots to number four on the Global Clean Tech Innovation Index, a measure of where the best clean technology ideas are expected to come from in the next decade. But if Canada can’t provide the financial help to get those good ideas out, it will miss out on huge opportunities, he warned.
Of course, not everybody sees the Liberal government’s policies – particularly the carbon price – as helpful.
Conservative Leader Andrew Scheer, new Ontario counterpart Doug Ford and Jason Kenney, leader of Alberta’s United Conservatives, have all promised to cancel or roll back carbon pricing if elected. They call carbon pricing a tax that will make Canada uncompetitive, particularly up against a U.S. that doesn’t have a similar burden.
Kenney, for one, has called it a “massive tax on everything” and “a massive wealth distribution scheme requiring a massive bureaucracy to administer.”
The report says encouraging clean innovation requires government both pushing and pulling industry along. That means setting standards that encourage the new technologies, such as a promised renewable fuels standard, aimed at encouraging ways to ensure fuel consumers like cars and furnaces produce fewer greenhouse gas emissions.