Canada’s climate action plan wants you

The Canadian government is inviting applications to the new Partnership stream in its Low Carbon Economy Fund Challenge. Aimed at SMEs, smaller municipalities, non-profits and aboriginal communities, this new stream will support organizations that can demonstrate carbon emissions reduction – an odds-on opportunity for the IT industry.

Climate change predictions can make pessimists of the optimists among us. In the most recent UN Intergovernmental Panel on Climate Change (IPCC) report released in the fall of 2018, climate scientists argued that we have only 12 years to take the action needed to limit global temperature increases to 1.5°C above pre-industrial levels, the point at which failure to do so will bring catastrophic environmental breakdown. But into this gloomy prognosis, report authors have also introduced a ray of hope:

Limiting the risks from global warming of 1.5°C in the context of sustainable development and poverty eradication implies system transitions that can be enabled by an increase of adaptation and mitigation investments, policy instruments, the acceleration of technological innovation and behaviour changes.

The systems transitions consistent with adapting to and limiting global warming to 1.5°C include the widespread adoption of new and possibly disruptive technologies and practices and enhanced climate-driven innovation. These imply enhanced technological innovation capabilities, including in industry and finance. Both national innovation policies and international cooperation can contribute to the development, commercialization and widespread adoption of mitigation and adaptation technologies.

Seizing on this hope, countries around the globe have developed policies and programs – both national and international – aimed at systems transition. On the investment front, to fulfill COP commitments to climate action made as part of the Copenhagen Accord in 2009, and reinforced in the Paris Agreement of 2015, donor countries have scaled efforts to mobilize climate finance. According to a recent report by the Organization for Economic Co-operation and Development (OECD), USD $62 billion in climate finance was mobilized in 2014, up from USD $52 billion in 2013, and a roadmap developed by donor countries in 2016 details actions, including the leverage of private sector finance, that would make it possible to reach a collective goal of mobilising US $100 billion per year by 2020. Canada’s contribution of $2.65 billion is a substantial increase over historical levels of climate funding, and it represents a doubling of the largest climate investment Canada has ever made. In addition, Canada has founded, currently runs, and in partnership with other government and private sector stakeholders, funds the Climate and Clean Air Coalition (CCAC) (Canada has pledged $23 million to the Coalition’s Trust Fund), aimed at concrete action to accelerate efforts to reduce short-lived climate pollutants (SLCPs).

At a national level, Canadian action on climate change is mobilized according to the Pan-Canadian Framework on Clean Growth and Climate Change, the federal government’s plan to meet carbon emissions reduction targets, grow the economy, and build resilience to a changing climate. Essential elements of the plan include a pan-national approach to pricing carbon, measures to achieve emissions reductions across all sectors, action to inspire climate change adaption and to build resilience to climate impacts, and efforts to encourage technology development and adoption to drive growth and the competitiveness of Canadian businesses in a global low-carbon economy. To help Canadians achieve these goals, the federal government has devised five key funding initiatives: a Public Transit Infrastructure fund, which provides short-term funding to help cities upgrade existing transit systems or build new ones; the Climate Change Action Fund, which supports projects that raise awareness of climate change issues; the Green Infrastructure Fund, which funds  environmental infrastructure projects; Clean Technology Programs for clean tech initiatives; and the Low Carbon Economy Fund (LCEF).

An important part of the Framework, the LCEF is a $2 billion fund that is designed to leverage investments in projects that will generate clean growth, reduce greenhouse gas emissions and help Canada meet or exceed its Paris Agreement commitments. The Fund, in turn, is divided into two financial instruments:  the Low Carbon Economy Leadership Fund, which provides $1.4 billion for provinces and territories that have adopted the Framework to help them deliver on their own GHG reduction targets; and the Low Carbon Economy Challenge, over $500 million in funding that is available across the country to support innovative projects that can reduce emissions and generate clean growth. The Challenge is further divided into two streams: the Champions stream, valued at $450 million targets projects created by provinces, territories, municipalities, larger businesses, not-for-profit organizations and indigenous communities, and the Partnership stream.

To date, Challenge fund administrators have identified one Champion. On January 10, 2019 the Minister of Environment and Climate Change, Catherine McKenna, announced that Enwave Energy Corporation was the first recipient of funding from the Low Carbon Economy Challenge’s Champions stream. To help the company expand its deep lake water cooling system, which draws water from Lake Ontario to cool several hospitals, government and other high-rise structures in downtown Toronto, the government is investing $10 million. In Toronto, the carbon footprint of buildings is high – they contribute approximately 40% of the total emissions. Enwave technology, the government believes, can address this energy intensity: the project is expected to reduce the amount of energy needed to air-condition buildings by up to 80 percent, a significant reduction that will be impactful as temperatures continue to rise due to climate change, and in cities due to the heat island effect. By leveraging investments made by Enwave, the government is working with Canadian businesses to support ingenuity and grow Canada’s clean economy. According to the government, this kind of innovation is not only good for the environment, but good also for people and the economy. Commenting on the project, Minister McKenna noted:

Canadians across the country are coming up with innovative methods to increase energy efficiency and reduce emissions, saving people money and creating good jobs along the way. By investing in these projects, from coast to coast to coast, the Government is making sure we are positioned to succeed in the $26 trillion global market for clean solutions and to create good middle-class jobs today and for the future.

Interactive Climate action map
Interactive Climate action map

For the government, energy efficiency improvements are a critical piece in the climate mitigation puzzle that offer triple bottom line benefits – to people, the planet and the economy. Clean Energy Canada argues, for example, that “energy-efficiency measures in Canada’s climate plan will help improve Canada’s economy and environment between now and 2030 by creating 118,000 new jobs, boosting GDP by $356 billion, and saving Canadian households an average of $114 a year. The economic benefits of energy efficiency are enormous for Canadians. Every $1 spent on energy efficiency generates approximately $7 of GDP.” In its support for climate change projects overall, the Canadian government has identified clean energy and energy efficiency as important priorities. In the Climate action map, which identifies government-funded projects, energy efficiency occupies a relatively important place, alongside projects to support public transit improvements, clean technology innovation, transition to clean fuel alternatives, and climate adaptation.

But the government is looking to do more. And in December 2018, it introduced a second, “Partnership” stream in the Low Carbon Economy Challenge. Targeted at smaller applicants, including SMEs, and smaller municipalities, indigenous groups and other organizations, the new stream is valued at $50 million. According to government, projects will be selected for funding based primarily on their ability to reduce greenhouse gas emissions, and also on the project’s potential contribution to clean growth, energy savings and job creation, overall risk and feasibility, and cost-effectiveness.

This new trench of funding should prove especially attractive to the increasing number of IT companies who are engaged in the development of new products and solutions designed to address energy resource challenges – and who could benefit from new sources of funding for research/commercialization/distribution, as well as to consumers of information technology. Green IT innovation – new server efficiency, better data centre facilities management, new cooling techniques, power innovations, new teleconference and communications solutions, for example – are designed to improve the carbon impact of ICT, which is just under 2 percent of global GHG emissions or the equivalent of the airline industry, as well as the footprint of businesses and organizations that operate it. In addition,  The SMARTer2030 report, published by the Global e-Sustainability Initiative in 2018, has calculated a meaningful CO2 abatement potential (202 million tons) for Canada through the use of ICT in several sectors, including smart logistics, smart manufacturing, connected private transport, smart agriculture, smart buildings, and smart grid. And even more importantly, as the IoT Coalition Canada has explained in a recent report, ICT Roadmaps to Enhanced Sustainability, IT and its communications variant, IoT, have enabled new ability to monitor, manage, control systems, while reporting metrics in real time to support continuous improvement – and to report on progress towards sustainability targets,  matters of importance, such as energy efficiency and carbon emissions reduction. Technologists are invited to align their vision of climate action with government assessment criteria in the Low Carbon Economy Challenge application here.

Key dates for the LCEF Partnership stream are as follow:

December 20, 2018: Launch of Partnerships stream
March 8, 2019: Deadline for Partnerships Applications
Spring 2019: Final funding decisions for the Partnerships stream