A trillion-dollar market ripe for Canadian cleantech exporters

THE CLEANTECH OPPORTUNITY

The most recent estimates from Analytica Advisors valued the global cleantech market at more than $1.15 trillion a year. [1] The bulk of that spending is the result of public policy as countries take steps to rein in environmental impacts, improve air, soil and water quality, and meet collective emissions-reduction targets like those set out in the Paris Agreement.

The market — and opportunities for Canadian exporters — may in fact be even greater because cleantech as a sector is notoriously difficult to pin down.

As Rob James, CCC director of business development and sales for clean technologies and renewable energy, puts it: “You can take virtually any industrial sector or process and make it cleaner, which means the applications for cleantech are pretty much endless.”

WHAT FOREIGN GOVERNMENTS ARE BUYING

According to James, environmental solutions that address the needs of governments at all levels are among some of the most in-demand areas of cleantech today. These include:

Smart grids — Innovations like artificial intelligence (AI), machine learning and the Internet of Things (IoT) to help utilities manage, optimize, decentralize and diversify their electricity grids.

Transportation solutions — Electric fleet vehicles, smart traffic control systems, LED street lighting and other clean alternatives that directly or indirectly relate to transportation systems are all being sought by jurisdictions as they seeks to reduce road traffic or follow through on commitments to phase out internal combustion engine vehicles.

Renewable and clean energy solutions – from wind and solar to biogas and waste-to-energy solutions, new ways of meeting growing energy demand are tackling the duel issues of climate change and clean air, within a backdrop of rapidly falling prices.

Air, water and soil quality solutions — Many countries need solutions to improve living conditions. Massive, dense cities like Beijing and New Delhi are on the market for water purification and treatment solutions, water delivery improvements and related technologies.

Many of these areas of cleantech demand are good for Canada because companies here have expertise directly relevant to them. Around the world, Canada is recognized for its capabilities in areas such as energy efficiency, grid services, and water and wastewater solutions.

REGIONAL TRENDS AND HIGHLIGHTS

Separate from currently hot technologies, certain geographic markets represent strong opportunities for Canadian cleantech exporters, including:

China — Environmental pressures and bold commitments by the government have created a huge appetite for clean technology. Bloomberg New Energy Finance’s New Energy Outlook 2017 noted that China spent $86.4 billion on solar energy solutions alone last year, and estimated the country will increase its wind and solar capacity eightfold by 2040.

The Caribbean — Governments throughout the region are in the process of re-building generating capacity and more sustainable, resilient electricity grids in the wake of 2017’s devastating hurricanes. These infrastructure projects are in turn driving demand for battery storage, grid stabilization technologies and related solutions.

Saudi Arabia — The new Crown Prince’s vision of the country’s post-oil economy may spike demand for renewables. Saudi Arabia recently partnered with Japanese multinational holding company SoftBank to build the world’s biggest solar energy project, which will add 200 gigawatts of capacity to Saudi Arabia and is projected to cost $200 billion.[2]

Norway, Great Britain and France All three countries have committed to phasing out fossil fuel-powered vehicles (Norway by 2025 and Britain and France by 2040), meaning they’re on the lookout for alternatives. China has also announced its intention to develop a timeline for non-fossil fuel transportation.

KEYS TO SUCCESS

So how can Canadian cleantech exporters take advantage of these opportunities? Supports like the Government of Canada’s Clean Growth Hub, created to advance cleantech solutions and take them to the global market, can serve as springboard along the commercialization path.

Once a solution is out in the market, the strength of the “Canada brand” will often set it apart from competitors — something the CCC’s government to government approach can help with. Rob James says it’s also important for exporters to be able to define and quantify the benefits a solution will deliver in terms of emissions reductions, cost savings, long-term return on investment and the like.

Michelle Gartland, Global Affairs Canada’s deputy director for clean technology, adds that broad understanding of a foreign market can also increase exporters’ chances of success. Canada’s Trade Commissioner Service can give exporters incisive market intelligence on current opportunities, regulatory and political considerations, cultural differences in doing business, and key competitors are in a particular region — all to help them position their cleantech exports as strongly as possible.

“Having that kind of value-added intelligence is crucial before making a significant investment,” she says.

One thing is clear: cleantech is the way of the future and global cleantech opportunities are only going to intensify in the years to come. Canada has the technical expertise and foundational knowledge, especially in resource sectors, to capitalize on those opportunities.

Are you a cleantech exporter? Increase your chances of success by calling Sector Director Rob James at 613-996-0161, or emailing rjames@ccc.ca.

[1] Analytica Advisors. Canadian Clean Technology Industry Report. 2017.

[2] Bloomberg News. “Saudis, SoftBank Plan World's Largest Solar Project”.  https://www.bloomberg.com/news/articles/2018-03-28/saudi-arabia-softbank-ink-deal-on-200-billion-solar-project


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