By Curt Cherewayko
Ballard Power Systems Inc.’s CCO Michael Goldstein admits that the Burnaby-based company’s fuel cell-power bus fleet in Whistler would have been impossible without the right team of public- and private-sector partners.
Pitching in on the technological aspects of creating the world’s largest fuel cell bus fleet were companies like Winnipeg-based bus maker New Flyer Industries Inc. (TSX:NFI.UN) and San Diego-based electric drive maker ISE Ltd. (TSX: ISE).
BC Transit was the forward-thinking customer that led the project; the provincial and federal governments helped finance it.
The fleet jumpstarted Ballard’s leap into the transit market.
“We were too small a company to enter this market alone,” said Goldstein, during a panel discussion at Vancouver’s first Energy Roundtable conference on December 7.
Development of the Whistler-based demonstration fleet has helped Ballard reduce the price for its fuel cell bus engines from triple that of competitors’ diesel-hybrid engines to below double.
As well, Goldstein said Ballard has sold bus engines in four countries and to four different transit agencies as a result of the exposure it has received from the Whistler fleet, which was launched during the 2010 Olympic Games.
Goldstein didn’t express the same skepticism as panel member Jonathan Rhone, CEO of Vancouver’s Nexterra Systems Corp., but he noted that B.C. hosts fewer successful demonstration projects like the Whistler bus fleet than it should because of the lack of cohesion, focus, private-public partnerships and access to capital in the province.
The result: B.C. is being outpaced by other, more aggressive jurisdictions in cultivating and creating a sustainable clean-tech sector.
“This is a use-it-or-lose-it thing,” said Goldstein. “We’re either going to step up and be the winner or we’re going to have some other secondary role in the [clean-energy market].”
He wants to see more of the same kind of government and private-sector cohesion that resulted in B.C. securing the 2010 Olympics and delivering a successful Games event to the world.
“I’d like to see us create growth in the clean-tech sector with the same vigour and focus we had for the Olympics,” said Goldstein.
Rhone was more candid than other panel members about the progress of B.C.’s clean-tech sector.
“We’re falling behind,” said Rhone.
He cited four necessary conditions for creating a globally competitive sector: innovation, a local market, a low-cost supply chain and supportive government policy.
Rhone said B.C. is a laggard in each of those areas, save innovation.
He added that the province has failed to exploit its local markets and that government policy is patchwork, with a flavour-of-the-month commitment to clean technologies.
Rhone thinks B.C. should acknowledge its disadvantages: it’s a small market with an abundance of cheap energy, which provides little demand for new cleaner energies.
With that in mind, Rhone said B.C.’s private sector and governments should focus on creating more demonstration projects like Ballard’s Whistler-based bus fleet and Nexterra’s biomass gasification system at the University of British Columbia.
Such projects can be how B.C. companies prove and advertise their technologies and, ultimately, tackle export markets, said Rhone, who wants the province to create $1 billion worth of demonstration projects in five years.
He added that being known as a great market for such projects could be B.C.’s competitive advantage.
The City of Vancouver and UBC both have “living lab” strategies, in which they’re trying to make Vancouver a testing ground for local and international technology companies.
“There are great things happening in pockets here, but it’s all fragmented,” said Rhone, who wants B.C. utilities, governments and universities to collaborate more.
“What I think we’re missing is that cohesion [and] intense collaboration. There needs to be one place where an entrepreneur can go and say, ‘I have this great idea, where can I demonstrate it?’”
But the four Energy Roundtable panel members said B.C. is getting it right in some key areas.
Bruce Flexman, president of the BC International Financial Centre, said low taxes in most categories in B.C. provide a key advantage over the U.S. and many other jurisdictions.
“B.C.,” he said, “has moved from being a laggard 10 years ago to being a very competitive tax regime.”
Amol Deshpande, who is a partner in Silicon Valley-based venture cap firm Kleiner Perkins Caulfield & Byers, said B.C. needs to let the rest of the world know about its strengths – lifestyle, an entrepreneurial culture, a deep talent pool and relatively good support from governments.
They’re part of the reason that KPCB set up a 130-employee office and waste composting facility in Richmond for its portfolio company Harvest Power, which is developing organic-waste energy conversion systems.
“A lot of it’s going to involve outreach – you have to market yourselves,” said Deshpande. “Get them here, and they will want to do more work here.”
Burnaby
CEO: John Sheridan
Employees: 340
Market cap: $120.3m
P/E ratio: N/A
EPS: ($0.01)
Sources: Stockwatch, TSX, globe investor