International clean energy venture capital firm Chrysalix believes B.C.’s cheap electricity rates are stifling the ability of clean-tech companies in the province to commercialize their technologies.
President and CEO Wal Van Lierop told BIV on Wednesday that low energy prices have allowed large power producers to survive in the province without having to find innovative ways to reduce costs.
According to Lierop and to Sustainable Development Technology Canada’s (SDTC) new Cleantech Growth and Go-To-Market Report, that has largely led to the absence of any domestic market for B.C.’s clean technology companies.
Lierop was part of a panel Thursday morning discussing the findings of SDTC’s report, which addresses ways Canada and individual provinces can create large and profitable clean-tech companies. He used B.C.’s pulp and paper industry as an example.
“Our pulp and paper industry was leading the world in the ’60s and ’70s because of our low energy prices,” he said. “The low energy prices did not stimulate innovation at all in the past 40 years. And as a result of that, we are still doing what we did in the ’70s. Today, if you bring a CEO of a leading pulp and paper company out of Scandinavia to our factories, they are laughing – they have no idea that this old stuff existed.”
His solution: raise energy rates for both consumers and industry and simultaneously create two energy innovation funds – one for consumers and another for industry. Consumers and industry could access the funds to offset the costs of any innovative energy reduction projects they initiate.
“If you are a pulp and paper company hammered with higher energy prices, you can directly turnaround and – for innovation – get a huge subsidy out of that fund.
“This is a price neutral way, on one hand, to increase energy prices. On the other hand, it ensures you reap the benefits of creating a clean energy economy including all the jobs. And you reap the benefits of innovating our existing traditional industries.”
Such innovative energy reduction projects would reduce energy consumption in the province, he said, and reduce the need for government to direct taxpayer dollars to power production projects like BC Hydro’s Site C hydroelectric dam – another way that increased energy rates could be offset.
BIV further examines SDTC’s report in next Tuesday’s print edition.