Central to our policies is understanding that there is no conflict between environment and economy.

A smart economy is one that is resilient. A smart economy is diversified, less vulnerable to global shifts. A smart economy enriches localized value chains, producing more goods and employing more Canadians. According to numerous studies, notably Michael Porter’s work at Harvard, the more ambitious environmental standards and regulations are adopted, the more competitive and productive is your economy.

Most Canadians enjoy one of the highest qualities of life of any people in the world. We are blessed with abundant resources and a skilled and educated workforce.

While thanks to a regulated banking system we endured the 2008 financial melt-down better than many other countries, our economic indicators are flat-lining. Our employment picture is relatively stagnant. Youth unemployment is particularly worrying, as double the national level.
We face a serious crisis of lack of productivity. Productivity is a measure of innovation and investment in research and development. We are falling far behind the United States for the first time since productivity was measured.

Since the 1970s, our economy has shifted from a majority of our exports being manufactured goods to our current majority of exports being unprocessed raw materials. With this shift we have lost Canadian jobs in “value-added” but we have also lost ground in productivity. Raw resource production as a sector invests far less in Research and Development (R and D) and innovation than manufacturing. The Harper Conservatives have increasingly skewed our economy towards the export of fossil fuels. Putting all our eggs in the bitumen basket was never good economic policy. The dropping price for a barrel of oil makes this more transparent, but even if oil prices rebound, the threat to Canada’s productivity remains a real drag on our economic health.

As Paul Krugman, Nobel Prize winning economist has said, “Productivity may not be everything, but in the long run, it is almost everything.”

According to the Conference Board of Canada, Canada has slipped in productivity to 13th out of 16 countries studied. So while we are still ahead of Belgium in productivity, we have fallen behind Switzerland, Sweden, the U.S., Germany, Finland, Japan and more. R and D is not kicking in, despite a broad suite of policy changes aimed at stimulating such investments from the private sector. Corporate tax cuts have not resulted in improvements in productivity. Nor have the so-called “job creators,” the spin used to explain dropping Canada’s tax rate on its largest and most profitable corporations, re-invested its avoided tax windfall into job creation. Mark Carney, former Governor of the Bank of Canada, has derided the corporate sector for allowing huge amounts of cash to build up in their bank accounts. Carney labeled it the “dead money.” It is now over $630 billion – amounting to approximately 35% of our GDP.

Surely, we can adjust the corporate tax rate, now half that of the US. And we can direct funds to innovators and R and D. One winner for investment is Sustainable Development Technology Canada. SDTC has leveraged significant investment in clean tech R and D. This is one of the fastest growing sectors globally. Canada has huge room to grow jobs and wealth in this sector, while also improving our overall productivity.

It is essential that we become far more creative in reducing our unbalanced dependence on trade with U.S., and that we significantly invest in a National Clean Tech/Energy program to remain price competitive and sanction-free. And finally that we conserve natural resources and invest more in long-term education and re-training.

This generation has the potential to capitalize on the single biggest business opportunity in human history – the shift to a post-fossil fuel economy. Whether this is driven by the need to end the recession through economic stimulus, high energy extraction costs or collapsing oil prices, strategic geopolitical threats to foreign oil, the climate crisis or all of them combined, the country that mobilizes resources to develop and commercialize smarter technologies (e.g. alternate fuels, renewable energy, and energy efficiency) will survive and thrive.

Canada should be that country.

Originally published in the Hill Times.

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Yet, surprisingly the discussion of energy policy gets brushed under the carpet. My contention is that the reason the various energy debates are so unproductive is that we are operating in the absence of any over-arching strategy. Canada is the only country in the OECD without an energy policy. Canada is one of the only countries in the world not participating as a member of the International Renewable Energy Agency. Canada is the only country in the OECD without a comprehensive climate plan. Canada is the only country in the world to have ratified Kyoto and withdrawn. Canada is the only industrialized country without a national Transportation plan.

These are not small gaps. And their absence contributes to the nastiness of the debate. The debate tends to fall to regionalism. As a federal party leader, I find the province versus province aspect of the discussion the least productive and most damaging to our national interest. Energy decisions cannot be presented as binary choices in which for British Columbia to “win,” Alberta must “lose.”

What we need is to think like a country. We need to assess what set of policy tools best advance the multiple interests of all parts of the economy and all parts of the country. We need an energy strategy for Canada.
The idea that we need a national energy strategy was floated by former Premier of Alberta, Alison Redford. It was then immediately shot down by the prime minister.

That idea must be revisited. We need a national approach to our energy future. Our starting point should be to agree to some key national goals. I would suggest they would include:

1. Energy security – currently half of the oil consumed in Canada is imported from Saudi Arabia, Kazakhstan, Nigeria, Norway and Venezuela. Meanwhile, the “plan” seems to be to boost production of the most greenhouse intensive fossil fuel, bitumen and ship it to China for refining. Unlike the U.S., Canada has no strategic petroleum reserve. There is no plan for domestic energy security.
2. Energy pricing – We need to stop subsidizing fossil fuels and start pricing carbon.
3. An effective greenhouse gas (GHG) reduction plan for the needed transition to a low-carbon economy.
4. Full employment goals – we create more Canadian jobs by processing bitumen in Canada than by mixing it with toxic diluents and then shipping that dangerous product through pipelines to tankers heading overseas to other nations’ refineries and jobs there.
5. The promotion of innovation and competitiveness in Canada – Canada is falling behind the US in productivity and innovation. Part of the reason is shifting from relatively more value-added exports to raw resource exports (60% of all our exports were value-added in the late 1990s, falling to 40% recently, according to Statistics Canada.) Value-added not only creates more jobs, it attracts innovation, R and D and improves Canada’s productivity.
6. Social justice; ending energy poverty – “energy poverty” concerns must be part of any national energy strategy.
7. Any energy strategy needs to be premised on respect for First Nations right and title, as the recent Supreme Court of Canada language in the Tsilhqot’in decision makes clear is not optional; it’s mandatory;
8. Energy strategies for a resourceful and resilient Canada.

Taken separately, we could be fighting over these individual elements without resolution. Taken together in a grown-up conversation, they all fit together.

If we met around the same table and worked to achieve a consensus that respected the interests of all parts of Canada, demonstrated a responsible approach to the growing climate crisis and worked to create the kind of energy super-power we could be, one working to decrease dependence on fossil fuels, I am confident a realistic energy plan could emerge.

The first step is to start thinking like a country.

Originally published in the Hill Times.

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The clean-tech sector is one identified globally as having enormous potential.  By 2020, it is estimated that the sector will be worth $3 trillion to the world economy.

Certainly, investments in the U.S. have been outpacing Canada. U.S. President Barack Obama’s new tone of resolve in addressing the climate crisis suggests that their previous level of support will be ramping up.  President Obama highlighted the potential of clean-tech to stimulate the economy and create jobs in his inauguration address:

We cannot cede to other nations the technology that will power new jobs and new industries; we must claim its promise.

At the moment, Canada has only one percent of the sector’s current $1 trillion global value.  Still, that relatively small piece of the pie is responsible for 52,600 Canadian jobs in 700 clean-tech companies.  The sector was worth over $10 billion last year, and that was a jump of 18% over the previous year.

In Parliament, I work with a new all-party clean-tech caucus, chaired by Conservative MP Jay Aspin.  We have engaged MPs across party lines in the exciting potential for innovation in clean-tech.  The sector is making gains in improving the energy efficiency of the mining sector, reducing waste water in the oil sands, cutting deeply into the price differential between renewable and coal to the point that some new wind and solar out-performs coal in terms of price.

A recent report by the Pembina Institute, (Competing in Clean energy: How Canada can capitalize on the global transition to clean energy, January 22, 2013), based on a forensic review of the sector and extensive interviews, concluded that Canada could expand our clean-tech sector to $60 billion by 2020. That realistic assessment needs to be underscored.  We have the potential for six-fold growth over the next seven years.

Vancouver Island Technology Park has been an incubator for new clean-tech firms.  There are companies working in bio-fuels, wind energy and tidal power.  As well, outside of the Vancouver Island Technology Park, the Saanich Peninsula has a number of firms working in the clean-tech sector. Everything from Triton Logging, accessing sustainable hardwood from tropical hydro-electric sites, to Aeolis Wind, and a number of environmental consulting companies, including over 300 people working at Stantec. Our area benefits from jobs in clean-tech.

To reach its full potential, we need provincial and federal policies to align.  It is excellent to know we can produce power from tidal action, but it would certainly help the start-up companies if they could access a “feed-in” tariff and sell into the grid.  The federal government needs to continue its support of Sustainable Development Technology Canada (SDTC).  Founded in 2001, SDTC has successfully completed 19 rounds of funding approvals.  Over $500 million has been allocated to 228 projects.   That level of investment has resulted in a highly successful track record in leveraging funds from other project partners.  The ratio is 2.4:1, with $1.4 billion leveraged from $560 million.

Amazingly, of a 14 person national board two of the board members are prominent local residents. The Chair of the Board is Juergen Puetter of Aeolis Wind. And former Saanich-Gulf Islands Member of Parliament, Gary Lunn, was recently appointed to the SDTC board. I sincerely hope they will succeed in gaining replenishment of funding for clean-tech in this spring’s budget.  It has tremendous potential for the planet, for Canada and for Saanich-Gulf Islands.

Elizabeth May is the Leader of the Green Party of Canada and Member of Parliament for Saanich-Gulf Islands.
Originally printed in the Victoria News.

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It has been a persistent problem in Canada’s economic performance that innovation, as reflected in investments in research and development, is lagging.

The fact that our competitiveness is tied to innovation, and R&D, is not disputed. Neither is the fact that Canadian business investment in R&D has been dropping. It has been in decline whether measured in total dollars or as a percentage of GDP. Last March, Finance Minister Jim Flaherty attempted to restructure funds for R&D to stimulate business investment. “Canada is not keeping up with other advanced economies on this crucial front,” Mr. Flaherty told The Globe and Mail.

The policy response in the March 2012 budget was met with widespread skepticism. The Scientific Research and Experimental Development (SR&ED) tax credit program was overhauled to provide less support for such investments, and relatively more money available for direct grants to companies selected as the lucky winners by government. And that is a strategy with an empirically lousy record. Reducing the SR&ED program by over $500-million, less than half of that was to be re-invested in grants.

In the same Globe and Mail story on these changes, Jayson Myers, chief executive of the Canadian Manufacturers and Exporters, noted “The government will be hard-pressed to show how outcomes will be improved in business R&D if they’re spending less money,” (Barrie McKenna, “Tories target lagging innovation with funding overhaul,” The Globe and Mail, March 29, 2012)

If looking for where government policy has been achieving solid results in innovation, a prime example has been the clean-tech investments made through Sustainable Development Technology Canada. In 19 rounds of funding approvals since SDTC’s creation in 2001, 228 projects have been allocated $560-million in funds. That level of investment has resulted in a highly-successful track record in leveraging funds from other project partners. The ratio is 2.4:1, with $1.4-billion leveraged from $560-million.

The clean-tech sector is one identified globally as having enormous potential. By 2020, it is estimated that the sector will be worth $3-trillion to the world economy.

Certainly, investments in the U.S. have been outpacing Canada. U.S. President Barack Obama’s new tone of resolve in addressing the climate crisis suggests that their previous level of support will be ramping up. Obama highlighted the potential of clean-tech to stimulate the economy and create jobs in his inauguration address: “We cannot cede to other nations the technology that will power new jobs and new industries; we must claim its promise.”

Canada is under-performing here as well, with only one percent of the sector’s current $1-trillion global value. Still, that relatively small piece of the pie is responsible for 52,600 Canadian jobs in 700 clean-tech companies. The sector was worth over $10-billion last year, and that was a jump of 18 per cent over the previous year.

The creation last year of the new Parliamentary all-party clean-tech caucus, chaired by Conservative MP Jay Aspin, has engaged MPs across party lines in the exciting potential for innovation in clean-tech. The sector is making gains in improving the energy efficiency of the mining sector, reducing waste water in the oil sands, cutting deeply into the price differential between renewable and coal to the point that some new wind and solar out-performs coal in terms of price.

A recent report by the Pembina Institute, (Competing in Clean Energy: How Canada Can Capitalize on the Global Transition to Clean Energy, Jan. 22, 2013), based on a forensic review of the sector and extensive interviews, concluded that Canada could expand our clean-tech sector to $60-billion by 2020. That realistic assessment needs to be underscored. We have the potential for six-fold growth over the next seven years.

One of Pembina’s key recommendations to build the sector, creating jobs and export opportunities for Canada, was to ensure replenishment of funds to SDTC in this spring’s budget. Pembina recommended $100-million per year for the next five years. Whether that figure is the right one, or is too low, is a matter for discussion. But it is clear that anyone watching this sector in particular, and the innovation challenge, in general, would conclude it would be a dreadful tragedy to allow the SDTC to vanish for lack of replenishment in this spring’s budget.

Canada’s economy needs greater innovation. And our commitment to reduce greenhouse gases needs a burgeoning clean-tech sector. These goals, environment and economy, are mutually supportive. Getting pricing signals right, setting out a clear energy and climate policy, will all help ensure that Canada does not get left behind in the rapid global pursuit of clean-technology and green alternatives.

Elizabeth May is the Member of Parliament for Saanich-Gulf Islands and Leader of the Green Party.
Originally printed in the Hill Times.

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On 6 November, the committee heard testimony from the following witnesses: Nobina Robinson, Chief Executive Officer, and Ken Doyle, Director of Policy, from Polytechnics Canada;  Emechete Onuoha, Vice-President, Citizenship & Government Affairs, and Patricia Hawkins, Business Manager, Research Agreements & Innovation Services, from Xerox Canada;  Tom Brzustowski, retired Professor, Telfer School of Management, Ottawa University; and Robert J. Currie, Associate Professor, Schulich School of Law, Law & Technology Institute, Dalhousie University. Nobina Robinson voiced concern over the lack of a coherent, collaborative and responsive innovation within the market ecosystem. She argued that clear definition of the roles of universities and colleges is needed along with reallocation of funds by the government to industrial applied research to increase market competitiveness. To solve the imbalance between discovery research and commercialization support, Ken Doyle suggested investing in programs which solves industry identified problems (e.g the innovation program administered by NSERC) and introducing a national form of voucher program for late stage commercialization support. Mr Onuoha further commented on how strategic investment and applied research in commercialization are critical for the success of innovation. Information communication technology companies like Xerox drive nearly 35% of all private sectors research and development spending annually in Canada and thus can extend the impact of established value added R&D investment. Mr. Brzustowski emphasized the importance of having a strong first patent for market exclusivity; this is a useful protection tool especially where patent disputes and litigations are involved. Robert J. Currie elaborated on how the unofficial use of official marks have been used by public authorities for revenues at the expanse of tax payers; he suggested reforming the trademark act (section 9, subsection 1, paragraph N, subparagraph 3) to limit the authority scope of official marks.

The meeting this week was short as one of the committee members, Mme LeBlanc, moved that a study of the criteria, including national security, defining the “net benefit to Canada” that apply to the review of foreign acquisitions of natural resources by foreign state-owned enterprises be undertaken by the committee. The committee then proceeded to sit in-camera to deal with the motion. To see if the motion passed, see the Minutes.

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