The Short Report – November 9, 2022: Feds and Alberta invest $461M in hydrogen plant; new cybersecurity task force; Canada in top 15 “talent competitive” countries, open science awards, and more
November 9, 2022
The Business Development Bank of Canada (BDC) launched a $400-million clean-technology fund, Climate Tech Fund II, to help scale up the commercialization of low-carbon technologies. The investment increases BDC’s investments in the clean-tech and climate-tech sectors to $1 billion, building on the $600-million Cleantech Practice fund it launched in 2018. The fund partners with global institutional investors and government funding programs to support promising firms, and currently has 50 companies in its portfolio including agrifood, biofuels, solar and geothermal power, hydrogen, carbon capture and electrification. BDC
The Government of Canada announced an investment, through the Strategic Innovation Fund, of $300 million in Air Products Canada's $1.6-billion net-zero hydrogen production facility in Alberta's Industrial Heartland just northeast of Edmonton. The Government of Alberta will contribute $161 million, through the Alberta Petrochemicals Incentive Program, toward the facility, The facility, scheduled to begin production in 2024 as the world's largest net-zero hydrogen plant, will utilize advanced auto-thermal reforming technology to convert natural gas into “blue hydrogen,” capturing and sequestering the carbon dioxide emissions. Air Products, headquartered in Pennsylvania, is projecting output of 165,000 million standard cubic feet per day of hydrogen, half of which Imperial Oil will buy for its planned renewable diesel refinery at its Strathcona refinery near Edmonton. The federal government also has committed to support low-carbon hydrogen development with a hydrogen investment tax credit and through the new $15-billion Canada Growth Fund. ISED, Govt. of Alberta
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The Government of Canada ordered several Chinese firms to divest from Canadian companies working in the critical minerals sector. Innovation, Science and Economic Development Canada said Sinomine (Hong Kong) Rare Metals Resources, Chengze Lithium International and Zangee Mining Investment must divest, respectively, from Vancouver-based Power Metals, Calgary-based Lithium Chile, and Vancouver-based Ultra Lithium. Sinomine made an equity investment of $1.5 million in Power Metals. Chengze, which owns approximately 19.35 per cent of Lithium Chile’s outstanding common shares, said it is reviewing the federal order and its legal options. The order comes after the federal government last week updated its policy under the Investment Canada Act to restrict foreign investment in critical minerals. ISED
The Federal Court of Appeal ruled against Montreal-based aerospace company CAE Inc. in a case involving the federal Scientific Research and Experimental Development (SR&ED) tax credit program. CAE had appealed a decision in September 2021 by Justice Sylvain Ouimet of the Tax Court of Canada, who ruled that $81.6 million provided to CAE through the then-federal Strategic Aerospace and Defense Initiative constituted “government assistance” and not an “ordinary commercial agreement,” so it thereby reduced CAE’s SR&ED tax credits by $81.6 million. The Federal Court of Appeal, in its Oct. 19, 2022 decision by a tribunal of judges, ruled that Ouimet “acted correctly in applying the authoritative principles of case law” in rejecting CAE’s argument that its SR&ED tax credits should not have been reduced. The appeal court’s decision means that government innovation/incentive programs that provide loans and funding for tech companies and other recipients may now be potentially assessed as both reducing SR&ED and creating taxable income for those recipients. Federal Court of Appeal
The Government of Canada invested, through the Sectoral Workforce Solutions Program, more than $39 million in the Canadian Council for Aviation & Aerospace’s Industry-Led Training for the Aviation and Aerospace Sector project. The funding will support the design, development, implementation, and evaluation of a new technical training and certification system for key occupations in aerospace. The project will produce more than 2,000 hours of new digitized training content that will offer employers the tools to provide on-the-job training for workers, from entry level up to full certification — the first of its kind in Canada. Up to 900 new and current aerospace workers in Ontario, Manitoba and British Columbia will benefit, the government said. Employment and Social Development Canada
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Innovation, Science and Economic Development Canada contributed, through the Strategic Innovation Fund, $15.9 million to support a $77-million project with EXFO to create a 5G centre of excellence in Montreal. EXFO, headquartered in Quebec City, intends to develop one of the world’s first artificial intelligence-based automated network solutions that will autonomously run 5G network testing and quality assurance centres in Canada and around the world. The new centre of excellence will develop and commercialize four new AI-centric technology platforms to supply deployment and operation of the next-generation 5G telecommunications networks. ISED
The Government of Canada announced a $6.4-million grant, through the Canadian Institutes of Health Research, to establish an Inuit Research Network. The funding will support implementation of Inuit Tapiriit Kanatami’s National Inuit Strategy on Research, which aims to enhance Inuit capacity, knowledge and self-determination in research. The investment is in the four Inuit regions and their respective land claims organizations, Inuvialuit Regional Corporation, Nunavut Tunngavik Incorporated, Makivik Corporation and the Nunatsiavut Government, to guide research that strengthens Inuit health and support existing and new research initiatives that address Inuit needs and foster interdisciplinary connections. CIHR
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Health Canada announced an investment of more than $5 million in the Pain BC Society, to expand the Pain Canada Network and to enhance support for nearly eight million Canadians living with chronic pain. Pain BC’s project, “Developing a Pain Canada Network and Expanding Best Practice Education and Training Programs across Canada,” will receive funding of up to $4.5 million over five years. Pain BC also will receive more than $250,000 over 18 months for a project to help improve access to care and services for people in B.C.’s 2SLGBTQIA+ as well as Chinese, Punjabi, and Arabic speaking communities who are living with chronic pain. Health Canada
The Social Sciences and Humanities Research Council of Canada invested more than $2 million over three years to support six Canadian research teams collaborating with international partners. The six joint SSHRC research projects in which Canadian researchers are participating are among the successful projects in the seventh call of the Open Research Area launched in summer 2021. SSHRC
The Government of Canada invested, through the Strategic Innovation Fund (SIF), $49.5 million to support conversion of the traditional oil refinery in Come By Chance, Newfoundland and Labrador, into a facility capable of producing diesel and sustainable aviation fuel from renewable plant oils, including vegetable oil and used cooking oil and tallow utilized in the food industry. The first phase will be able to produce 18,000 barrels per day of renewable diesel and sustainable aviation fuel. The fully repayable contribution from the SIF was made to Braya Renewable Fuels (Newfoundland), owned by Dallas, Texas-based Cresta Fund Management’s Braya Renewable Fuels. ISED, Oil & Gas Journal
Natural Resources Canada invested nearly $1.6 million in the Canadian Renewable Energy Association (CanREA) to establish the CanREA Electricity Transition Hub. CanREA, utilities and system operators will also contribute to this project, bringing the total investment to more than $1.9 million. The Hub will help Canadian utilities and system operators build capacity to increase the deployment of cutting-edge clean power, storage, and grid technologies. The Hub has 13 founding utility and system operator participants, including Alberta Electric System Operator, BC Hydro, City of Medicine Hat, EPCOR, Essex Power Corporation, Fortis Inc., Manitoba Hydro, NB Power, Ontario Power Generation, Qulliq Energy Corporation, SaskPower, Toronto Hydro, and Utilities Kingston. NRCan
The Government of Ontario launched a $15-million Life Sciences Innovation Fund to help life sciences entrepreneurs and innovators bring their ideas and prototypes from the lab to the marketplace. The new, early-stage fund is an important tool in the province’s Life Sciences Strategy, said the government. Eligible companies will receive up to $500,000 to scale their made-in-Ontario health solutions both at home and in global markets. The Life Sciences Innovation Fund will be delivered by the Ontario Centre of Innovation. Govt. of Ontario
RESEARCH, TECH NEWS & COLLABORATIONS
The Canadian Cancer Society, CQDM, the Cole Foundation, and Oncopole – pôle cancer du FRQS announced grants totalling nearly $8.5 million for four research projects in Quebec, as part of the Pediatric Cancer Research Initiative. The funding over three years will accelerate the development of platforms, tools and treatments to support advancements across all areas of pediatric cancer care, including prevention, diagnosis and treatment. The research includes developing: new immunotherapy treatments for people with acute pediatric leukemia; a new way to use chimeric antigen receptors to treat acute pediatric lymphoblastic leukemia and rhabdomyosarcoma; a new therapeutic target to improve treatment outcomes for children living with leukemia; and new, targeted treatments for acute myeloid leukemia and acute megakaryoblastic leukemia, as well as nanotechnology to detect these cancers and monitor treatment. Canadian Cancer Society
The University of Toronto partnered with South Korean tech company Naver Corp. and its Toronto-based subsidiary Wattpad, on artificial intelligence research aimed at harnessing technology to empower human creativity. Under the five-year partnership, Naver will collaborate with U of T on four Naver-funded research projects spanning areas ranging from human-computer intelligence to natural language processing. Two of the projects will be carried out in partnership with Wattpad, a digital storytelling platform founded by U of T alumni Allen Lau and Ivan Yuen, and acquired by Naver for US$600 million in early 2021. U of T
Technation, a not-for-profit organization based in Mississauga, Ont., created a new Cybersecurity Taskforce that will focus on addressing some of the cyber threats facing Canada. The taskforce includes leaders from tech startups as well as more established firms, including CGI, Cisco, eSentire, Darktrace, Infosys, Microsoft, and SkyHive. The taskforce is chaired by Gary Miller, CGI’s vice-president of Canada cybersecurity, and includes J. Paul Haynes, eSentire president and COO. It will help identify and address challenges in Canada’s cybersecurity sector, from talent readiness and availability, to cyber resilience in small and medium-size businesses and municipalities, as well as emerging areas of tech such as quantum computing, Internet of Things, and 5G networks. Technation
The University of Calgary officially opened its new $4.2-million Energy Transition Centre (ETC) in downtown Calgary. The centre received $2.1 million from Prairies Economic Development Canada in January this year. The ETC, co-sponsored by UCalgary and CIBC through a multi-year agreement, is a collaboration that includes UCalgary, Innovate Calgary, Avatar Innovations, and the energy industry. The partners will deliver programming specific to the investment, acceleration and commercialization of startup companies working on clean energy development and energy transition. This includes an accelerator program, platforms for technology development and access to expert advisors, training to upskill energy workers, and a ventures readiness program. UCalgary
The Calgary Police Service (CPS) announced a new partnership with the University of Calgary and local cybersecurity firm ENFOCOM. The partnership’s resources will include the Canadian Cyber Assessment Training and Experimentation Centre at UCalgary, established in April this year and led by a consortium that includes UCalgary, Calgary-based Raytheon Canada and ENFOCOM. The centre, equipped with a state-of-the-art, highly automated “cyber range,” can emulate complex real-world digital enterprises. The first-of-its-kind partnership aims to create the infrastructure and processes needed to identify and pursue cybercriminals. CPS, UCalgary
Red River College Polytechnic, Northern Alberta Institute of Technology, and Saskatchewan Polytechnic partnered on an applied research project to ensure workers on the Prairies have adequate electric vehicle charging capability. As part of the $225,000-project, funded by Natural Resources Canada’s Zero Emission Vehicle Awareness Initiative, each polytechnic will establish EV charging stations at their respective campuses in Manitoba, Alberta and Saskatchewan. RRC Polytech’s Vehicle Technology & Energy Centre team, NAIT’s Centre for Grid Innovation, and Sask Polytech’s Sustainability-Led Centres of Excellence will leverage collective expertise to research and distribute information to build awareness of charging options and how to adapt current infrastructure for Level 1 workplace EV charging. Sask Polytechnic
Victoria, B.C.-based Audette raised $12.8 million in seed funding to expand use of its technology in decarbonizing buildings, with a plan to launch across 150 North American cities over the next two years, including 40 in Canada. Audette’s platform – now in five locations in western Canada – uses artificial intelligence to capture, monitor and analyze building data to identify emissions-reduction opportunities. The funding round was led by Buoyant Ventures, a U.S.-based venture firm that invests in climate tech. The built environment generates nearly 50 percent of annual global carbon emissions. BetaKit
Snowflake, an American cloud-based data storage and analytics company, opened its Canadian headquarters in Toronto, which also serves as one of the company’s five global engineering hubs. Snowflake announced in June its plans to establish a physical presence in Canada. The Toronto location will lead a number of efforts over the next few years, starting with its native application framework: an integrated platform for building, monetizing and deploying data-intensive applications in the data cloud. BetaKit
Google Canada officially opened its Google Viger Space, a sustainability-focused office in a retrofitted historical building in downtown Montreal. Google also is committing $2.75 million to deepen support for Quebec’s technology system, which includes: $1.5 million for the Mila Quebec Artificial Intelligence Institute; expanding Google Career Certificate courses offered online; and providing Google.org grants to Digital Movement for the Quebec Digital Literacy Project, and to NPower Canada to deliver Google Career Certificate courses. Google.org grants will also go to local organizations Startup Montreal, Pathways to Education, E2 Adventures, UpstartED, AI4Good Lab, and Resilience Montréal. These organizations work on digital skilling, fostering startup communities, STEM education, job training, wellness for the most vulnerable, and more. Google Canada
WestJet announced a three-month commitment to operating all flights from San Francisco International Airport to Calgary International Airport with sustainable aviation fuel (SAF) produced by Finnish multinational Neste. WestJet said the SAF Destination program, a first of its kind in Canada, underpins the company’s commitment to sustainability and decarbonization. WestJet purchased Neste MY Sustainable Aviation Fuel to fly 40 flights over three months from San Francisco to Calgary, which will reduce 186 tons of greenhouse gas emissions on these routes. WestJet
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VC & PRIVATE INVESTMENT
NOVONIX Limited, a battery materials and technology company, announced that its anode materials division in Tennessee was selected to receive US$150 million in grant funding from the U.S. Department of Energy, to expand domestic production of high-performance, synthetic graphite anode materials. NOVONIX will use the funds to build a 30,000-tonnes-annually U.S. manufacturing facility. Headquartered in Australia, NOVONIX’s Halifax-based battery technology solutions division was spun out of Jeff Dahn’s lab at Dalhousie University. NOVONIX
Toronto-based TouchBistro announced completion of $150 million in growth financing from U.S.-based private equity firm Francisco Partners. TouchBistro will use the funds to accelerate the company’s growth initiatives, including expanding product offerings, core services and strategic acquisitions. TouchBistro’s restaurant management software system runs every aspect of a restaurant, including point-of-sale and customer engagement solutions, on a single platform. TouchBistro
Edmonton-based Earth observation startup firm Wyvern announced it raised a seed round of US$7 million of funding, led by Uncork Capital. This brings Wyvern’s financing to date to approximately $15 million, including $3 million from Sustainable Development Technology Canada. Wyvern CEO Chris Robson said the funding will go toward the launch and operation of the company’s first three hyperspectral satellites, scheduled for launch in the first half of 2023. Additional investors in this round included MaC Venture Capital and Y Combinator. SpaceQ
Calgary-based Durum Capital Inc. boosted its holdings of carbon credits in Alberta’s carbon market, to more than 400,000 from 22,000 via two limited partnerships. The purchased credits, to be delivered by the second quarter of next year, may put Durum among the 15 largest holders in the market, said company vice-president Spencer Gordon. The deal is funded with a $15-million private sale by Wellington-Altus Private Wealth Inc. and $6 million from other investors The value of carbon credits is expected to increase as Canada’s carbon price rises from $50 per tonne this year to $170 per tonne by 2030. Blomberg
REPORTS & POLICY
Canada is ranked #15 (dropping from an average #12 in 2015-2018 rankings) in a list of the 133 most “talent competitive” countries in the world, according to this year’s Global Talent Competitive Index published by INSEAD, the Human Capital Leadership Initiative, and Portulans Institute. The report assessed countries’ and cities’ performance in enabling, attracting, growing and retaining talent. Canada is one of the top 10 performers for growing talent (#10), does well in attracting talent (#12), has a good ability to enable talent (#14), and is ranked #19 at retaining talent. However, the country’s “Talent Impact” (#21) would benefit from greater entrepreneurship and more vocational and technical skills, according to the report. The top three countries were Switzerland, Singapore and Denmark. Four Canadian cities made the list of the 175 most talent competitive cities, including Vancouver (#16) Toronto (#22), Montreal (#28) and Ottawa (#42). The top three cities were San Francisco, Boston and Zurich. The report’s authors said “the great divergence between richer and poorer economies continues to be a feature of global talent competition, and current signs indicate that it is more likely to grow than to diminish in the coming years.” INSEAD
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The Government of Alberta made about $160 million in revenue since 2016 due to the Renewable Electricity Program (REP) introduced by the previous NDP government – and later cancelled by the UCP government, according to a study by the University of Calgary’s School of Public Policy. Rather than directly subsidizing renewable projects, the REP asked renewable energy developers to bid in competitive auctions for “contracts-for-differences,” with the least-cost projects winning the day. Under a contract-for-difference, the government tops up any gap between the auction price and the market price, guaranteeing the developer a fixed price for its generation. However, when market prices are above the auction price, the cash flows the other way, with the developer paying the government. Along with the value of carbon offsets surrendered by developers as a condition of the contracts, “A combination of falling renewable energy costs, the design of the procurement, and high power prices has led to considerable cashflow to the government,” says the study. More than $4.3 billion worth of renewable projects have been announced in Alberta since 2019, according to provincial data. UCalgary School of Public Policy
More than 680 large-scale hydrogen projects (314 in Europe) have been announced globally, amounting to $240 billion in direct investments, according to industry reports co-authored by McKinsey Sustainability and the Hydrogen Council. However, a significant investment gap remains for hydrogen to fully contribute to decarbonization, say the reports. Achieving a pathway to net zero will require additional direct investments of $460 billion by 2030 – closing the gap between the $240 billion of announced projects and $700 billion in required investments. With sufficient investment, clean hydrogen could help abate seven gigatonnes of CO2 emissions annually, about 20 per cent of human-driven emissions, according to the reports. McKinsey
Atlantic Canada is ranked #10 among the world’s top 35 “blue economy” (based on ocean-based resources) startup ecosystems, according to The Global Startup Ecosystem Report, Blue Economy Edition, by San Francisco-based Startup Genome. Vancouver is ranked #14; Calgary in the group ranked #26 to #30; and the Toronto-Waterloo ecosystem in the #31 to #35 group. Canada’s blue economy is highlighted in the report, which notes the contribution by Canada’s Ocean Supercluster. Since the global innovation supercluster announced the Ocean Startup Project just over two years ago, more than 100 new ocean companies have been founded. Singapore is the No. 1 ranked blue economy startup ecosystem globally, based on Startup Genome’s criteria of performance, funding and experience. Startup Genome
In advance of the United Nations COP 27 climate summit this month, a new briefing note by the Institute for Sustainable Finance (ISF) at Queen’s University sets out the challenges to unlocking private-sector financing for adaptation and resilience initiatives that will protect Canadian communities from future climate-related weather events such as fires and floods. The note’s key takeaways are:
- While financing climate change mitigation (reducing greenhouse gas emissions) has been a major focus in Canada, adaptation and resilience (helping communities withstand climate-related events that are already happening) is much less developed.
This is the case despite annual losses in the billions from climate damage. The cost of rebuilding after the late 2021 floods in British Columbia alone is estimated at $9 billion.
- Adaptation financing accounts for only seven percent of global climate finance. While the private sector has the capital required, the benefits of investing in a resilient infrastructure are highly diffuse, challenging to quantify, and difficult to monetize as cash flows, deterring investment.
This reality is particularly pointed among municipalities, which control approximately 60 percent of the country’s infrastructure but collect just eight per cent of its tax dollars.
- Investing in adaptation and resilience today will likely prove to be more cost effective and less disruptive to the economy and society as a whole than the alternative down the road. ISF
More than 330 businesses from 52 countries, including Canada, are urging governments to compel them to disclose how their operations impact biodiversity. The businesses, with combined revenues of more than $1.5 trillion, signed the “COP 15 Business Statement for Mandatory Assessment and Disclosure” in advance of the United Nations Biodiversity Conference COP15, to be held Dec. 7 to 19 in Montreal. Historically, the release of biodiversity data has been voluntary, but the businesses argue that mandatory reporting would give them the information they need to take appropriate action and also create fairer competition for business. Canadian signatories include Montreal-based SNC-Lavalin Group Inc. and Toronto-based Lafarge Canada Inc. Other signatories include: Aviva Investors, BNP Paribas, Danone, FirstRand, GSK, H&M Group, Holcim, IKEA, Mahindra Group, McCain Foods, Natura &Co, Nestlé, Rabobank, Roche, Sintesa Group, Sainsbury’s, Salesforce, Sony Group Corporation, Tata Steel, Unilever and Yara. Business for Nature
Dr. Elizabeth Cannon, PhD, president emerita and professor emerita of geomatics engineering at the University of Calgary, was appointed as chair of the federal government’s independent expert panel that will review the full applications to the Strategic Science Fund (SSF). Cannon has served on the federal natural resources minister’s National Advisory Board on Earth Sciences and as a board director of the Canada Foundation for Innovation. She also served as chair of Universities Canada and co-chair of the Business + Higher Education Roundtable. The SSF, announced in August 2021, is a new approach to supporting third-party science and research organizations through a transparent, competitive, peer-reviewed funding process. ISED
Dr. Jennifer Hamilton, PhD, joined Vancouver-based Variational AI as a company advisor. Variational A is a molecule discovery and design startup firm, and developer of novel generative AI-based drug discovery platform for novel kinase inhibitors used in therapeutics. Hamilton has worked with biotechnology companies, big pharma, and venture capital funds. Most recently, she spent 15 years at Johnson & Johnson Innovation, as country lead responsible for search and evaluation and transactions in Canada. Variational AI
Several open science initiatives were awarded The Neuro – Irv and Helga Cooper Open Science Prizes, administered by the Tanenbaum Open Science Institute at McGill University. The prizes recognize projects, services, tools and platforms that unlock the power of open science in neuroscience to advance research, innovation and collaboration for the benefit of health and society. This year’s winners are:
- Nick Halper, Megan Peters, Kathryn Bonnen, Patrick Mineault, and Anne Urai, who won the $80,000 International Prize for their Neuromatch It is a U.S.-based online community of computational neuroscientists whose mission is to foster inclusive global interactions for learning, mentorship, networking and professional development.
- Justine Hansen, PhD candidate at The Neuro (Montreal Neurological Institute-Hospital, McGill University), received the International Trainee Prize of $10,000 for her “receptor atlas” on how 19 neuroreceptors and transporters relate to brain structure and function, and for her “neuromaps” project, which brings together more than 40 existing brain maps in one place to help scientists find correlations between patterns across different brain regions, spatial scales, modalities and brain functions.
- Agah Karakuzu, PhD candidate at École Polytechnique in Montreal, won the $5,000 Canadian Trainee Prize for developing four open science applications in brain imaging.
The prizes will be awarded in person at the Open Science in Action Symposium on November 30. The Neuro
Peter Dinsdale and Gail Powley were appointed board directors at the Canada Foundation for Innovation, and Erasmus Okine and David M.C. Walker were appointed members. Dinsdale is an Indigenous leader and is currently CEO of YMCA Canada. Powley has supported entrepreneurial advanced tech companies and is currently president of Technology Alberta. Okine was appointed provost and vice-president (academic) of the University of Lethbridge for three years, beginning April 2020. Walker is professor in the emergency medicine department at the School of Medicine at Queen’s University, where he is cross-appointed to the School of Policy Studies. CFI
Marc Morin, a prominent serial entrepreneur in the Waterloo region tech community, is stepping down as CEO of Waterloo-based Auvik Networks. Doug Murray, a Silicon Valley veteran, is taking over. Morin said in a blog post that he’s about to turn 60 and the timing is right for new leadership at the network-management company he co-founded 11 years ago. He will remain on Auvik’s board of directors. Communitech