NRCan adds ecoEnergy Innovation Initiative to growing suite of energy R&D programs

Complementary to NSERC and SDTC offerings

Natural Resources Canada (NRCan) has received a massive response to the latest addition to its suite of energy R&D programs to reduce energy-related emissions and reduce and eliminate air pollutants from energy production. The ecoEnergy Innovation Initiative (EII) held an initial competition for the federal labs portion of the program last fall and received 1,100 letters of intent (LOI) for $6 billion in projects seeking $2.5 billion in EII support. The demonstration portion of the initiative is still working its way through the approval process.

Awards have been made to 60 internal R&D projects at NRCan, Environment Canada, the National Research Council and others valued at $80 million over five years. Although the money is already flowing, the winners won't be announced until this summer along with the successful demonstration projects. A ‘B' list has been compiled which will be drawn upon if any projects on the on the original list do not proceed.

"The response to the (initial) LOI far surpassed our expectation. There's no shortage of ideas," says Dr Marc D'Iorio, DG of NRCan's Office of Energy R&D. "The LOIs represent $2.5 billion which is 10 times more money than we have. It shows that there's a healthy innovation system"

EII was announced in the 2011 Budget and launched in the fall of last year with $97 million over two years. The remainder of the funding ($184 million) was announced by NRCan minister Joe Oliver in late May, bringing the five-year total to $281 million. More than half of the funding will go toward R&D projects, with the balance directed towards demonstration projects of between $1.5 million and $20 million.

EII covers up to 75% of R&D projects in five key areas (see chart) and 50% of total project costs for demonstration projects. The emphasis is on collaboration across sectors. Applications to date show an average of five partners for each R&D project and eight partners for demonstration projects. There has been a notional allocation of the R&D project funding across the five priority areas (see chart) but D'Iorio stresses that funding will be awarded on merit.

"The project leads are a real mix — industry, university and associations. There's a healthy mix of research teams," says D'Iorio. "We're happy to see the level of collaboration access the innovation system … New areas are emerging such as in the north and off-grid communities. It's quite exciting."

EII succeeds the $230-million ecoENERGY Technology Initiative which focused largely on carbon storage and sequestration (CSS) (R$, April 16/08), and joins NRCan's ongoing Clean Energy Fund and the Program of Energy R&D (PERD) which has been running since the late 1970s.

D'Iorio says the EII is different from other programs in two ways. First, the program is open to the largest range of players of any NRCan energy R&D program and it features an Internet-based matching service that allows partners to find other collaborators with similar interests and objectives.

"It's the first to be open so broadly to the R&D community in Canada," he says. "There's a very strong emphasis on collaboration and partners that span the innovation spectrum."

coordination with nserc and sdtc

NRCan's Office of Energy R&D coordinates activities and dispenses funding across 13 federal departments and agencies but it isn't the only player in the energy R&D space. The Natural Sciences and Engineering Research Council (NSERC) funds a range of research in the natural resources and energy fields. In FY10-11, it spent $147.6 million in these areas, compared to $91.4 million in FY04-05.

At the other end of the R&D spectrum, Sustainable Development Technology Canada (SDTC) is also a significant player. Its SD Tech Fund received a $40-million top-up in the 2011 Budget and has now dispensed $560 million to 228 projects over the past decade. That funding has leveraged another $1.4 billion, primarily from the private sector, with portfolio companies raising $1.7 billion more in follow-on financing. The fund has about $30 million remaining for two competitions this year (R$, April 17/12).

"Our approach complements the SD Tech Fund ... There's no overlap. Their client groups are companies that own intellectual property while our client groups are largely utilities who adopt the technology. We work with companies that use and produce electricity," says D'Iorio. "We've had many discussions with SDTC to make sure our roles are clear. We've also worked with regional development agencies. They held workshops and we presented the EII program. SDTC and NSERC also presented."

EII will be promoted at events in September in Montreal, Toronto, Halifax, Calgary and Vancouver, augmented via a series of webinars.

Across all departments and agencies, the federal government spends about $750 million annually on R&D and demonstrations. Combined with approximately $1.4 billion from industry, energy R&D accounts for $2.2 billion in annual expenditures.

"The numbers have been going up progressively and consistently," says D'Iorio.

The International Energy Agency (IEA) reported in 2009 that Canadian R&D outlays totalled $559 million (including $272 million for nuclear fission and fusion), augmented by $149 million from the provinces for a total of $708 million. That compares to a little more than $200 million in 2004.

The IEA notes that "the general thrust of federal effort has been towards closer integration of science and policy, with a great concentration on applied research and technology development in co-operation with private-sector partners".

He notes that Canada's energy R&D spending has been rising in recent years but recommends further increases, particularly at NRCan's Office of Energy R&D.

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