Donald Trump’s decision earlier this month to pull out of the Paris Agreement on reducing greenhouse gas emissions could open more doors for B.C.’s clean-technology businesses.
That’s the conclusion of several industry observers, who note the overwhelming global trend by other major markets, including Europe and China, is to develop more renewable energy. The retreat of the U.S. federal government on leading the charge, officials say, could open more space for B.C. players to fill.
“We have 300 companies here in the clean-tech sector, and they generate $1.8 billion in revenue every year,” said Ian Bruce, director of science and policy at the David Suzuki Foundation. “It has been one of our largest job producers in the last 10 years. Back in 2008, setting on the path of innovation really paid off for B.C. … and now the opportunity is there to use this trend to create more jobs, which are much needed.”
Bruce identified a few fields where B.C. should capitalize on attempts by markets like China and India to become more energy-efficient. Those areas including software that modulates energy consumption in buildings, other construction technology that creates energy-efficient spaces, and biomass energy production.
Bill Tam, president and CEO of the BC Tech Association, said the effect of cooling interest in renewable energy in the United States as a result of Trump’s announcement should not be underestimated. Tam noted the proximity of a market as large as the United States has given many B.C. green-tech startups a “test bed” for further globalization, and the loss of such a market will hurt in some instances.
But the bigger picture is that B.C. can supply renewable-energy needs in places like Asia in light of the ebb of U.S. interest, he said, adding that the Trump announcement is another boon for B.C. companies looking to attract talent.
“The bigger narrative is that Canada has an opportunity before us, and the environment here reflects the openness that we need for companies to do what they need to do to improve the lives of people everywhere. We have a welcoming immigration file. We are inclusive and representative. For Canada, that’s our opportunity.”
Frank Yu, principal consultant for Asia-Pacific power and renewables at Singapore-based consultancy group Wood Mackenzie, said the biggest market for alternative energy in light of the U.S. pullout of Paris may be in China, where Beijing has signalled its continued desire to pursue clean tech.
Yu noted that, with China already home to one of the world’s largest renewable-energy manufacturing industries, it may persuade companies to move other facilities from the United States to Asia to simplify logistics.
“Many U.S. companies who are climatically accountable would likely relocate their renewable technology R&D centres to Asia,” Yu said in a statement. “By leveraging the strong manufacturing value chain in China and other Asian countries, cost of renewables could fall even faster and penetrate more rapidly to displace dirty fossil fuel such as coal in key Asian markets.”
Yu added that Europe has already aggressively engaged with China on solar power and other sustainable-energy initiatives, and the overall public-image impact of Trump’s high-profile comments on the United States may itself be enough to drive a number of green capital funds to Asia.
Tam agrees with Yu’s assessment: “This represents an opportunity for China to lead, which is unprecedented. And B.C. stands at quite a bit of an advantage point, given the way we have already built existing trade links with markets like China.”
Bruce noted, however, that China isn’t the only market generated by Trump’s announcement. He noted India, where the government is taking dramatic steps to improve access to power in rural areas, as another market where B.C. technology can thrive.
In addition, Bruce said, many U.S. states and municipalities – many of them Republican – have already denounced Trump’s decision. Many business leaders have also expressed their disagreement, including Elon Musk, CEO of Tesla and SpaceX, who quit Trump’s business advisory councils after the Paris Agreement announcement.
“Even the market recognizes the fact that this is a poor decision,” Bruce said. “What we see with the Trump announcement is that it has emboldened many states and municipalities to pursue clean-energy technology more aggressively on their own. … Large economies around the world are moving toward clean energy for different reasons, but they are all increasingly looking at clean energy.” •