OTTAWA—Two arm’s length federal bodies are joining forces to help Canada claim its share of the rapidly expanding global clean technology market.
Export Development Canada (EDC) and Sustainable Development Technology Canada (SDTC) announced the two sides have come together to further develop Canada’s international capabilities in the cleantech sector.
According to Analytica Advisors’ annual report of the cleantech industry in Canada, there were more than 700 cleantech companies operating across the country in 2011.
Globally, market demand for the technology is expected to grow from $1-trillion in 2010 to $3-trillion by 2020.
“Cleantech companies need to scale up and go global, which provides a natural fit for EDC and SDTC to work together to help put Canadian companies at the forefront of the industry,” EDC president and CEO Stephen Poloz said in a statement. “At the core, this partnership is about giving Canadian cleantech companies every advantage and opportunity to grow into global leaders.”
EDC and SDTC say they have complementary approaches that make bringing a technology to market more streamlined and efficient.
EDC’s programs can help to incite commercial financing similar to the way SDTC’s process de-risks technology development and levers incremental private-sector investment, the organizations said.
Aside from the financial instruments they deploy, the involvement of EDC and SDTC can often reassure downstream investors and customers.
“While SDTC has helped companies in our portfolio attract over $3-billion in private capital through our vast network of industry and early stage equity investors, more needs to be done to unlock commercial bank finance for this sector,” SDTC president and CEO Vicky Sharpe said. “This collaboration will help Canada … with the potential to drive huge job growth in this field—from more than 44,000 to 125,000 positions by 2020.”
Under the terms of the agreement, EDC says it plans to use its range of products, including bonding, guarantees, financing and political risk insurance, in projects or transactions involving later-stage STDC companies.
SDTC will share its assessment of technology risks and the capacity of portfolio companies to perform in international markets with EDC.
EDC will also look for opportunities within its network of foreign buyers and top global corporations, and leverage its many partnerships with multilateral organizations (other export credit agencies, development banks, etc.) whose activities and programs present opportunities for the technology solutions developed by SDTC portfolio companies.
“EDC can play a unique role in the development of the Canadian cleantech sector,” Poloz said. “We are looking to catalyze capital for companies that have passed the demonstration stage of development.
“Many of SDTC’s portfolio companies are great matches for our approach, and we look forward to working with SDTC and other commercial financial institutions to give this initiative real momentum.”
Since its inception in 2001, SDTC has received more than $1-billion in funding from the Canadian government.
The foundation says it has completed 19 funding rounds and allocated a total of $560-million to 228 clean technology projects.