Canada must develop a clear, comprehensive federal strategy to ensure it meets its emissions and sustainability goals, and does not get left behind as the clean technology market accelerates, according to one of the world’s leading insurance industry associations.
“An unprecedented transformation across all sectors of society is needed to achieve ambitious net-zero targets over the next few decades,” writes Dr. Maryam Golnaraghi, director of climate change at The Geneva Association, in a recent op-ed for the Globe and Mail.
That means Ottawa needs a “more collaborative and coordinated approach to achieving [its] sustainability goals and low-carbon transition targets,” Golnaraghi writes, including better coordination between government bodies to execute a federal strategy.
The Canadian economy is largely dependent on high-emitting sectors such as mining, agriculture, and oil and gas extraction—and each of these sectors is seeing a wave of climate pledges and strategies that have yet to be aligned with evolving government policies aimed at ensuring Canada meets its target of net-zero emissions by 2050.
The need for clear, coherent policy is particularly urgent on climate tech innovation sector, Golnaraghi writes. Citing a recent report by the Canadian Institute for Climate Choices, she says the country must urgently “expand the scope of climate tech innovation currently taking place, and quickly deploy viable disruptive technologies in its key sectors.” The cost, she warns, is potentially hundreds of thousands of jobs—as well as billions in export revenues—lost.
Financing is not the issue. Citing analysts at Climate Tech VC, Golnaraghi writes that “in the second quarter of this year, innovative cleantech firms raised US$16-billion in 250 venture deals, with the average size of same-stage deals nearly double what it was a year earlier.” However, Ottawa must still ensure policy, appropriate data, and high-level corporate engagement are in place to guide financing.
A combination of favourable financial policies, such as tax incentives, and “enabling regulations” will help Canadian cleantech research and innovation flourish, while fostering market demand both in the public and private sectors.
Golnaraghi calls for the creation of a “sustainable finance framework, co-led by Finance Canada and Environment and Climate Change Canada [and] working with the financial sector”, to help mobilize mainstream investor interest in climate tech.
“New climate tech comes with myriad risks that need to be assessed, priced, and managed for sectoral adoption, large-scale implementation and mobilizing private capital,” she says. Ottawa will want to build and lead strong partnerships with tech, engineering, insurance, and banking communities to “innovate and address those risks.” [Ottawa may also want to help minimize those risks by ruling out the riskiest “unicorns” of all, like small modular nuclear reactors, “blue” hydrogen, and carbon capture systems intended for fossil fuel operations—Ed.]
In February, the Geneva Association released a climate risk assessment report that looked into the need for climate disclosure within and across both the private and public sectors.