Part 1 Developing Sustainable Communities Through Green … · 2014-06-03 · market expected to...

Investing in the Green Economy

Part 1

Developing Sustainable Communities

Through Green Innovation

May 2014


Thesis:

Supporting and harnessing green innovation

is the best way to build vibrant, healthy,

sustainable economies and communities in

the 21st Century


Private & Confidential


CO2 EMISSIONS FROM ENERGY BASE AND 2020 PEAK SCENARIOS, GTONNES

25

27

29

31

33

35

37

2006 2010 2014 2018 2022 2026 2030

Base Scenario 2020 Peak Scenario

Source: New Energy Finance, GE2M


Demographics ResourceScarcity

Environmental Challenges


“Going green is the largest economicopportunity of the 21st Century”

John DoerrKleiner Perkins Caufield & Beyers


Solar Power:

$300B annual

investment by

2030*

* Source: New Energy Finance

HELLO


SALTWORKS

Desalination:

$95B market

worldwide from

2010 – 2015*

* Source: Water Industry News

http://www.saltworkstech.com/

http://www.saltworkstech.com/


Smart Grid

market projected

to exceed

$400B by 2020*

* Source: GTM Research, Global Smart

Grid Technologies and Growth Markets,

2013 - 2020


Smart

communities a

$1.2T global

opportunity by

2020*

* Source: Frost & Sullivan


Biofuels:

$247B market

by 2020*

* source: Pike Research


Biomaterials:

$65B by 2015 *

* Source: Global Biomaterials Market,

www.marketsandmarkets.com

http://www.ecosynthetix.com/index.html

http://www.ecosynthetix.com/index.html


* Source: www.lohas.com

LOHAS

marketplace:

$350B in

North

America

today*


* Source: Precision Farming Market by Technology, Components &

Applications - Global Forecast & Analysis 2013 - 2018

Market for

precision

farming in

2015:

$3.75B*


Greenhouse

horticulture

already $1B

annually in

Canada, with

over 10%

annual growth*

*Statistics Canada and FCC


Global

aquaculture

market

expected to

reach $195B in

2019**

Kuterra Closed Containment Salmon Fish Farm: Namgis First nations

**Source: Transparency Market Research "Aquaculture Market… - Global Industry Analysis, Size, Share, Growth,

Trends and Forecast, 2013 - 2019


Smaller scale because they are more efficient

Greater local ownership

Provide finished products for both local markets and

export – rebuild local supply chains

More diverse, skilled job market

Self-sufficient communities, both economically and in

terms of resources (energy, food)

More resilient to external shocks

Broader tax base and better infrastructure

COMMUNITIES GAIN FROM GREEN INNOVATION


GREEN INNOVATION VIRTUOUS CIRCLE: ECONOMIC

Green innovation

Creates new market

opportunities

Attracts capital &

skills

Shareholder returns

Increased investment

capacity

New seasoned entrepreneurs

New business ideas


GREEN INNOVATION VIRTUOUS CIRCLE: COMMUNITY

Green innovation

New local corporations

Creates local employment

Self sufficient

economies

Stronger local tax

base

Local infrastructure

(education, transportation)

Higher standard of living

Attract knowledge

workers


Part Two

Policy Ideas for Developing Green Innovation

and Sustainable Communities

May 2014


HAROLD INNIS

“… Canada as an exporter of staples to more highly industrialized areas, in terms of fur, lumber, and finally wheat, pulp and paper, and minerals.”


Economically vulnerable: to “cyclonic” shifts from commodity price changes, foreign levies, or even fashion changes

Environmentally vulnerable: to collapse from depletion of resources

WEAKNESSES OF A STAPLES ECONOMY


Declining price on gasoline

Meaningful global climate change treaty

Carbon tariffs (low carbon fuel standards)

New low carbon technology breakthrough

Investor or customer boycotts

IMAGINE IMPACT OF…


Staples Economy: Where wealth is based on exploiting raw natural capital

Green Economy: Where wealth is created from innovation focused on resource efficiency

ECONOMIC TRANSITION


ECONOMIC TRANSITION

Staples

Large scale industrial business model

High capital cost projects

Foreign ownership

Focused on raw natural resources

Export markets

Denude natural environment

Green

Smaller scale distributed business model

Lower capital cost projects

Local ownership

Focused on finished goods

Local and export markets

Sustain natural environment


The right regulatory environment

Sufficient risk capital

Support local markets

The right people/labour market

Create hotbeds for green innovation

TO DEVELOP A LOCAL GREEN ECONOMY


Environmental Regulation Enhances and Encourages Innovation and Competitiveness through a process called the “Innovation Effect”

THE RIGHT REGULATORY ENVIRONMENT

Embrace the Porter Hypothesis


Implement market-based reforms that address the Tragedy of the Commons, such as:

- Environmental fees: eg: GHG emissions

- Environmental tax incentives: eg: reduced royalty payments in Oil Sands; biodiversity in farming

THE RIGHT REGULATORY ENVIRONMENT


SUFFICIENT RISK CAPITAL

0

1,000

2,000

3,000

4,000

5,000

6,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

$1,000 invested in VC Companies Companies funded

VC dollars invested in Canada


Local investment/angel tax credit

Allow Program Related Investments for Foundations

Encourage (mandate) pension funds to invest locally (% of assets)

SUFFICIENT RISK CAPITAL


Renewable Energy Feed in Tariffs – local ownership

Labeling for local food producers – VQA

Support local supply chains

Government procurement

SUPPORT LOCAL MARKETS


ATTRACT KNOWLEDGE WORKERS

“The most valuable assets of a 20th-century company were its production equipment. The most valuable asset of a 21st-century institution, whether business or non-business, will be its knowledge workers and their productivity."

Peter Drucker*

* Source: Management Challenges of the

21st Century


ATTRACT KNOWLEDGE WORKERS

Good educational facilities

Mixed use neighborhoods

Public transportation

Active transportation

Cultural activities

Knowledge based enterprises


CREATE HOTBEDS FOR GREEN INNOVATION

Develop green innovation hubs that:

support new companies/incubation

are connected to local post secondary education

provide services to new companies (legal, tax)

provide access to funding options

allow for knowledge spillovers

leverage off local strengths and existing innovation


Thank you!

Part 1 Developing Sustainable Communities Through Green … · 2014-06-03 · market expected to...

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