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The BC Cleantech Sector
Department of Foreign Affairs and International Trade Canada March 2013
• SDTC is a policy delivery instrument of the Government of Canada to
deliver environmental and economic benefits to Canadians.
• As a delivery agent, we foster the development and demonstration of
technological solutions that address:
• Forge innovative partnerships and build a sustainable development
technology infrastructure.
• Ensure timely diffusion - increase number and rate of uptake of
technologies into the marketplace across Canada, providing national
benefits.
• Clean Air
• Climate Change
• Clean Water
• Clean Land
SDTC Mission and Mandate
SDTC’s Mission: “The Foundation will act as the primary catalyst in building a
sustainable development technology infrastructure in Canada”.
Why is the BC Cleantech cluster so
robust? • Lower mainland / Vancouver: a small city in stunning physical environment; has great
Universities and Colleges; a Pacific port - all which helps drive collaboration and
connectedness to take action on global climate change
• Legacy of venture growth tech companies and cleantech venture capital
Corporate Tech Successes Venture Capital + Angel Networks
- MDA Yaletown Ventures, Chrysalix Energy
- Ballard Pangaea Ventures, BDC VC, Growthworks
- Creo Renewal, active Angel networks
• Several other growing tech clusters: wireless, life sciences, digital media, software
• BC carbon policy landscape:
• Standards (Regulation) :GHG Reductions Act, Vehicle Emissions Standards,
Landfill Gas Act
• Investments (Programs): Livesmart; Innovative Clean Energy Fund; Pacific
Institute for Climate Solutions
• Carbon Pricing: Carbon Tax Act, Western Climate Initiative (Cap and Trade),
Pacific Carbon Trust
2006
2011
2020
SDTC and its partners are equipped to double Canada’s share of the rapidly growing global cleantech market
Cleantech Presents a Significant Export Opportunity for Canada
2006 2011 2020
Global Market Size $100 billion $1 trillion $3 trillion
Canadian Revenues not available $10.6 billion $62 billion
Share of Global Market not available 1% 2%
Direct Canadian
Employment not available 52,600 jobs 126,000 jobs
Source: Analytica Advisors
4
By 2020, the clean
technology sector will be
the third largest global
industrial
sector
Canada’s Clean Technology Industry
OVER 700 COMPANIES IN ALL REGIONS
Source: Analytica Advisors
TEN SECTORS AND 60 SUBSECTORS
BC’s Clean Technology Industry
Canadian Clean Technology Exports
• 80% of Canadian Cleantech companies export
Compared with 9% of all Canadian SMES
• 55% of these companies are exporting to non-U.S. markets
• 53% of revenues are from export sales
30% of revenues were from U.S. exports
23% of revenues were from non-U.S. exports
Source: The 2011 Canadian Clean Technology Industry Report, Analytica Advisors
Source: Industry Canada, Canadian Small Business Exporters, June 2011
To build a successful Cleantech business, going global is an essential component for all companies, large or small.
Canadian SME’s are leading the way.
7
• China: solar and wind
manufacturing: what’s
next?
• Natural gas glut
reshaping the clean
energy landscape
• “Hot” sectors: energy
efficiency, energy
storage, new
materials, ag-tech,
resource efficiency,
cleaner fossil
fuels/”dirty” or “energy”
tech
• VC investment down
considerably in 2012
• VC moving to “capital
efficient” deals, later
stage rounds
• Exits (IPO + M&A
market) evaporating
• Corporate VC
(Strategics) capital filling
the gap
Clean Technology Trends
SDTC has reviewed over 2,300 initial applications en route to funding over 240 technology projects since 2002
9
• $590 million SD Tech Fund™ launched on April 4, 2002.
• Aimed at development and demonstration of emerging clean technologies.
• $592 million allocated to 245 projects.
• $500 million NextGen Biofuels Fund™ launched on September 12, 2007.
• Aimed at establishment of large demonstration-scale facilities for next-generation renewable fuels and co-products.
• Three funding decisions have been made, two applications are in due diligence and six Indications of Interest are expected to be converted into applications for funding in the near term.
Technology Fund Manager
Cleantech Innovation Chain
Stages of Technology Development
Fundamental
Research
Applied
Research
Technology
Development & Demonstration
(Pilot to Full Scale)
Product
Commercialization
& Market
Development
Market
Entry
&
Market
Volume
Risk Profile
Technology
Financial
Technology
Market
Financial
Technology
Market
Financial
Market
Financial
Market
Financial
Operational Operational Operational
10
11
SDTC funding address the pre-commercial funding gaps in the Innovation Chain
Fundamental
Research
Technology Development and
Demonstration(Pilot to Full Scale)
Product
Commercialization & Market
Development
Market Entry
& Market Volume
Pre-IPO
Gap
Funding Intensity
Pre-
Commercial
Gap
Angel
Governments
Industry Industry
Applied
Research
Project Finance
Public Markets
High CAPEX
Gap
Early VC
Banks
Pension Funds
SD Tech Fund ($590M) NGBF ($500M)
The sources of funding in the Innovation Chain are predominantly available for research and commercialization
Funding Model Ensures Market and Commercial Relevancy
12
SDTC buys down risk associated with bringing new technologies to market enticing the private sector to co-invest
SDTC Funding $’s = 1/3 of Project Costs
Project Consortium $’s = 2/3 of Project Costs
SME Applicant
(Technology)
Key Services Supplier
Other (Government)
Value Added Channel Sales
Customer (Demonstration
Host)
Key Hardware Supplier
$
SDTC de-risking solutions for global supply chains
Fundamental
Research
Technology Development
and Demonstration (Pilot to Full Scale)
SD Tech Fund
Applied
Research
Market
Entry &
Market
Volume
Product
Commercialization
& Market
Development
Commercial Market Rollout –
Connecting Portfolio solutions
with MNEs
De - risking
13
SDTC’s value proposition is to provide a steady supply of field proven or plant proven technology for commercial sale or licensing to large
multi-national enterprises (MNEs)
SD Tech Portfolio – Segmentation by Market Sector
SDTC supported projects contribute technology solutions to major economic sectors in Canada, reducing costs while
increasing productivity and competitiveness
14
as of December2012
$50M (8%)
$34M (6%)
$29M (5%)
$99M (17%)
$142M (24%)
$115M (19%)
$123M (21%)
$0 $20 $40 $60 $80 $100 $120 $140 $160
Waste Management
Forestry, Wood Products and Pulp & Paper Products
Agriculture
Transportation
Energy Utilization
Power Generation
Energy Exploration and Production
$M
SDTC’s current investment into 245 projects is $592M.
as of December 2012
Alberta
Saskatchewan
Manitoba
Ontario
$548M $413M
$20M
$665M
$358M
$8M
$5M
$59M
$1M
British Columbia
New Brunswick
Nova Scotia
Prince Edward
Island
Newfoundland
$62M
Québec
Energy Exploration and Production
Power Generation
Energy Utilization
Transportation
Agriculture
Forestry
Waste Management
Shading indicates Leveraged Funding
SDTC & Leveraged Funding by Sector and Province
SD Tech Fund Investment Portfolio –
Country-Wide
Leveraged Funding is high, particularly at this stage of technology risk
• $1.5 Billion leveraged from consortia members
Industry contribution is strong
• $1.3 Billion leveraged from industry, including corporations and venture capital investors
Small and Medium Sized Enterprises
• SMEs drive innovation in Canada and represent more than one-quarter of the economy. Over 90% of SDTC's portfolio is SME led.
245 Projects
Total Eligible Project Costs
$2.1 B
SDTC Contribution
$592 M (28%)
Leveraged Funding
$1.5 B (72%)
Industry Leveraged Funding
$1.3 B (82%)
Other Funding*
$275 M (18%)
Numbers as of December 2012
* Includes funds from federal departments, provincial governments and academia
Private industry in Canada is supporting cleantech, providing 82% of all leveraged funding into SDTC projects
Demonstrated results in leveraging private
sector capital
17
BC Portfolio – 58 Projects in 7 Key Sectors
Sector
Total BC Portfolio $157M $548M
Lead Consortia Partner SDTC
Investment $
Total Project Value $
Energy Exploration and Production
Sacré-Davey Innovations $5,727,711 $17,681,710
Power Diagnostic Technologies Ltd. $1,164,407 $3,489,382
InvenTyS Thermal Technologies Inc. $1,598,001 $3,914,947
Diacarbon Energy Inc $1,050,000 $3,508,000
Energy Utilization
Carmanah Technologies Inc. $466,167 $2,035,062
IBC Technologies Inc $183,150 $877,150
University of British Columbia $2,408,702 $7,299,098
EcoSmart Foundation Inc. $1,866,630 $3,828,862
Nutriloc Ingredients Corporation $847,319 $2,404,493
Power Measurement Ltd. $2,960,871 $9,104,666
Fuseforward International Inc. $400,000 $1,523,921
SunCentral Inc. $2,345,208 $7,035,838
dpoint Technologies Inc $1,531,394 $3,582,961
SunSelect Produce (Delta) Inc. $1,672,425 $5,609,006
Pulse Energy Inc $2,556,801 $8,552,915
S2G Biochemicals Inc. $2,387,070 $7,211,699
SWITCH Materials Inc. $2,363,621 $7,369,216
CoolEdge Lighting Ltd. $4,181,955 $11,231,677
Power Measurement Ltd. $1,702,882 $5,108,646
NuWave Research Inc. $2,030,000 $5,610,000
18
Sector Lead Consortia Partner SDTC Investment $ Total Project Value $
Power Generation
West Lorne Bio-Oil Co-Generation Limited Partnership $5,000,000 $12,215,947
NxtPhase T&D Corporation $887,598 $3,614,695
Xantrex Technology Inc. $1,213,614 $3,677,618
Clean Current Power Systems Incorporated $1,582,000 $4,795,500
Angstrom Power Incorporated $169,752 $1,263,271
Tantalus Systems Corp. $2,981,310 $11,079,087
MSR Innovations Inc. $680,839 $1,512,976
General Fusion Inc. $13,897,455 $63,548,185
Exro Technologies Inc. $881,235 $4,001,042
Quadrogen Power Systems, Inc. $2,910,145 $7,441,221
Etalim Inc. $2,935,340 $9,651,600
Ballard Power Systems Inc. $7,304,367 $22,141,838
PAVAC Industries Inc. $3,549,865 $10,526,620
Shipstone Corporation $2,513,498 $5,294,474
Agriculture
Middle Bay Sustainable Aquaculture Institute $5,768,999 $17,129,821
Namgis First Nation $2,650,000 $10,589,812
semiosBIO Technologies Inc $2,750,000 $8,118,304
BC Portfolio – 58 Projects in 7 Key Sectors
19
Sector Lead Consortia Partner SDTC Investment $ Total Project Value $
Transportation
Westport Innovations Inc. $1,000,000 $3,115,376
PlugPower Canada Inc. $2,000,000 $9,026,000
RailPower Technologies Corp. $584,079 $1,634,600
M.A. Turbo/Engine Ltd. $152,844 $332,604
Advanced Lithium Power Inc $1,400,000 $5,534,876
NxtGen Emission Controls Inc. $2,265,194 $9,509,955
HTEC Hydrogen Technology & Energy Corp. $4,014,212 $11,150,588
Automotive Fuel Cell Cooperation Corp. $11,558,274 $51,997,205
Ballard Power Systems Inc. $6,905,887 $32,391,589
Corvus Energy Ltd. $1,238,984 $3,754,497
Westport Power Inc. $2,302,834 $18,753,644
Whale Shark Environmental Technologies Ltd. $646,000 $1,756,909
Forestry, Wood Products and Pulp & Paper Products
Lignol Innovations Ltd. $6,240,816 $20,325,922
Nexterra Energy Corp. $1,159,518 $3,513,692
Nexterra Energy Corp. $5,518,777 $17,563,845
Alterna Energy Inc. $1,254,317 $8,891,092
Lignol Innovations Ltd. $6,870,561 $20,632,316
Waste Management
Paradigm Environmental Technologies Inc. $250,000 $1,208,804
Ostara Nutrient Recovery Technologies Inc. $375,760 $1,777,628
Saltworks Technologies Inc. $2,612,638 $8,064,022
Minesense Technologies Ltd. $1,475,000 $3,954,848
BC Portfolio – 58 Projects in 7 Key Sectors
Getting Technologies to Market
20
VC/PE,
Public, Debt,
Asset-
backed, etc.
Access to Capital
& Technology Markets
Customers,
Partners,
Aggregators
TECH
ADOPTION FOLLOW-ON
FINANCING
SDTC and its
Portfolio Companies
Accelerating the access to key market players for SDTC’s predominantly
SME portfolio companies by leveraging
SDTC’s relationships, market access and brand
Investment Returns &
Strategic Benefits
The Markets
Investment Commercial
SDTC key G-T- M Partners: Export Development Corporation (EDC) and DFAIT
21
52 companies into which SDTC has invested $168M have raised $2.3B in follow-on financing from the private sector in the past seven years.
*Based on publicly disclosed financings to SDTC-funded companies as of December 31, 2012.
Helping High-Growth Firms Access Risk
Capital
Cleantech Commercialization Strategic Partner
Works with SDTC in a variety of ways, including the ones
identified below, to accelerate the market entry of clean
technology from development through full commercialization.
SD Tech Fund
Virtual Incubator
Works with SDTC at the
technology incubation level,
evaluating next generation
clean technologies for
demonstration or investment.
Technology
Demonstration
Partner
Works with SDTC at the
technology demonstration stage
by acting as a demonstration
host or a co-investor for an
SDTC supported technology.
Follow-on
Financing
Partner
Works with SDTC at the
expansion stage of an SDTC
supported technology
company by investing in the
company.
Partners: Broad group of
investors, investment banks,
angels etc.
Supporting Partner:
Technology
Adoption
Partner
Works with SDTC at the stage of
early market entry of SDTC
supported technologies by
incorporating the technology into the
company’s own business or
providing it as a product or
component of their offerings to end-
use customers.
Partnering with Global Leaders
Sustainable Development Technology Canada
Montreal Office:
Place Ville Marie
1, Place Ville Marie, Suite 2001
Montréal, Québec H3B 2C4
(514) 448.4885
Toronto Office:
First Canadian Place
100 King Street W., Suite 3700
Toronto, Ontario M5X 1C9
(416) 644.8726
Vancouver Office:
World Trade Centre
999 Canada Place Suite 404
Vancouver, BC V6C 3E2
(604) 844.2857
Head Office:
World Exchange Plaza
45 O’Connor Street, Suite 1850
Ottawa, Ontario K1P 1A4
(613) 234.6313
For More Information
Paul Austin, Regional Director, Partnerships [email protected] Office: + 1 604 844 2857 Mobile: + 1 604 761 0849