Scaling solutions: accelerating the commercialization of made-in-Canada clean technology

The accelerated commercialization and adoption of clean technology is critical to achieving our 2030 emission reduction target and 2050 net-zero goals. Much has been written about the ambition of Canada’s 2030 emission reduction plan, the feasibility of its targets, and the investment required to meet those targets. One critical piece has been missing from the analysis to date: the degree to which made-in-Canada clean technology is domestically deployed as part of our 2030 and 2050 goals. Each of the seven sectors referenced in the plan—oil and gas, transport, buildings, heavy industry, agriculture, electricity, and waste/others—need to find a net-zero path that is consistent with global technological and market dynamics in its industry. And the challenge is further compounded as many interdependent climate technologies will need to gain commercial traction at once. Any discussion of the barriers to the deployment of clean technology rightly includes higher up-front cost, in-use performance, risk-averse customers, and regulatory hurdles. On top of that, each industry faces its own specific barriers to commercialization that may restrain the adoption of a climate solution that displaces the high-carbon status quo. The Canadian experience to date has shown that it takes between 12 to 15 years to commercialize clean technology as even successful pilots and demonstrations face a steep uphill climb to market success. How is commercialization defined? Simply, it is technology performance proven through successful in-use operations and available for immediate production, based on paced orders. The deployment of clean technologies at scale occurs within a highly interdependent and coherent commercial ecosystem. Scale-up is dependent on how well a company understands the complexities of its customer base and/or strategic partner and what it takes to serve them. Parallel path customer and market development that could catalyze adoption is as important as technology and product development. A recent report by Deloitte Canada, Scaling Solutions: Accelerating the Commercialization of Made-in-Canada Clean Technology, contains a readiness framework to assess clean technology innovation in reference to desired commercial objectives. It extends the concept of readiness beyond technical performance and cost to include market viability, supportive policy and regulatory frameworks, and the capacity of the organization itself to commercialize its technology. Technical readiness gauges the technology’s in-use performance and maturity, cost competitiveness in markets unwilling to pay a premium, and the degree to which it delivers quantifiable, verifiable, and material greenhouse gas emission reductions. Market readiness includes the external ecosystem and structures like supply chain and infrastructure needed for the deployment and use of technology. Policy readiness refers to those public and private sector policies that facilitate the creation of niche or commercial markets and a customer’s ability to adopt innovation. And finally, organizational readiness captures the capabilities and capacity of the organization itself including partnership, intellectual property, and talent strategies. Canada’s clean technology exports totaled $9.2-billion in 2021. If Canada intends to rely on its cleantech industry to compete in a decarbonizing world, we must transition our leading companies into an industrial base of players that can be globally competitive and dominant. The U.S. Inflation Reduction Act has accelerated urgency on this side of the border with investments in electric vehicle manufacturing, the proposed hydrogen production tax credits expected in Budget 2023, and the operationalization of a critical minerals strategy. Continued fiscal support for innovation is critical, but investment alone does not address the more difficult challenge to commercialization: the time it takes to develop, pilot, secure industry buy-in, and then deploy market-ready technology. Industry and corporate Canada have a critical role in fostering the elements of the coherent commercial ecosystem that enables the deployment of clean technology at scale. Private sector action taken today to build, invest, pilot, partner, acquire, or simply buy made-in-Canada clean technology strengthens our domestic markets. Our ambition must be greater than scaling a technology or scaling a company. We must scale climate solutions. Karen Hamberg is a partner and national clean technology Leader with Deloitte Canada. She is a member of the Government of Canada’s Industry Strategy Council and Chair Emeritus CALSTART. The Hill Times