eResearch | In Foresight’s CleanTech webinar, industry professionals in the renewable energy sector spoke on the topic of “Scaling CleanTech”. Key discussions covered current scaling challenges and strategies, specifically focused on capital funding.
Industry professionals speaking on the webinar included:
Carol-Ann Brown, VP of Innovation & CleanTech at The Delphi Group- Mark Summers, Executive Director at Emissions Reduction Alberta
- Brady Fletcher, Head of TMX Venture Exchange
- Jean-Pierre Colin, EVP & Director at Dynacert (TSXV: DYA)
- Stephen Kukucha, Partner at PacBridge Partners
Carol-Ann Brown explained how CleanTech projects are capital intensive, as companies require large amounts of investment to fund R&D and to reach stated environmental benefits. As a result, clean technology projects currently have a 31% higher risk premium for interest rates when raising debt compared to other small and medium enterprises, due to higher inherent risks.
Stephen Kukucha spoke on the various methods companies currently have to acquire funding, including non-dilutive sources such as government grants, which provide substantial credibility, and dilutive sources such as equity raises.
Brady Fletcher stated that in the past five months, he has witnessed C$800 million enter the renewable energy sector, as more industries incorporate Environmental, Social, and Governance (“ESG”) standards and practices. In the past five years, the S&P/TSX Renewable Energy and Clean Technology Index increased by 60%, the highest growth rate amongst all Canadian subsectors.
Mark Summers mentioned that in an effort to increase accessibility to funding, the renewable energy sector is collaborating through various partnerships. Recently, Emissions Reduction Alberta partnered with the Business Development Bank of Canada (“BDC”) to work towards getting grants and ultimately creating a consistent funding environment for renewable energy projects.
To increase investments in the industry, Jean-Pierre Colin spoke on how Flow Through Shares could be a large catalyst in making Canada a financing hub for the renewable energy sector. Flow Through Shares were introduced to Canadian investors by the capital-intensive mining industry. Flow Through Shares provide government incentives in which expenditures can be flowed through to investors who benefit in income tax reductions.
10 Canadian Companies Focused on Climate Change
This month, Navdeep Bains, Canada’s Minister of Innovation, Science and Industry announced C$42 million in investments across 10 Canadian businesses focused on innovative solutions for climate change. The funding was received from Sustainable Development Technology Canada (“SDTC”).
10 Canadian Companies who received investments:
- C$10 million – Aspire Food Group, a developer of the first fully automated cricket farm.
- C$5 million – Sollum Technologies Inc., a developer of smart lighting solutions.
- C$5 million – Anomera Inc., a manufacturer of carboxylated cellulose nanocrystals.
- C$4.6 million – Click Materials Corp., a developer of electrochromic window solutions.
- C$4.25 million – Effenco Development Inc., a developer of a platforms for commercial truck connectivity.
- C$3 million – Quebe Technologies Inc., a developer of IoT and AI for reduction of CO2.
- C$3 million – Salient Energy, a battery manufacturer.
- C$2.75 million – EcoPackers Inc., a developer of bioplastics.
- C$2.1 million – CryoLogistics, a developer of insulated containers using liquid CO2.
- C$2.1 million – Pantonium, a developer of digital infrastructure for public transportation.
Further information on the 10 vested companies can be found here: https://www.canada.ca/en/innovation-science-economic-development/news/2020/06/list-of-CleanTech-projects-receiving-support-from-sustainable-development-technology-canada.html
Clean Tech Industry
This year, Jeff Bezos, CEO of Amazon.com, Inc. (NASDAQ: AMZN), announced a US$10 billion fund called the Bezos Earth Fund, to support “any effort that offers a real possibility to help preserve and protect the natural world”, as he sees a need for a quick change in the global environment.
Companies are being proactive and leading client change initiatives. Last year the Institute of Energy Economics and Financial Analysis reported over 100 global financial institutions divested from thermal coal. This group included 40% of the top 40 global banks and 20 of the top global insurance companies.
According to Bloomberg New Energy Finance, global investments in the renewable energy sector is expected to reach US$300 billion this year, compared with US$282 billion last year, due to corporations improving ESG practices while governments implement various new ESG-focused mandates.
//
