#CTC 42 - Canada tackles transport emissions

Hey there,

New regulations aimed at reducing the emissions intensity of transport fuels came into effect this month. The new system should encourage fuel producers to invest in solutions like carbon capture and low-carbon biofuels, and includes federal funding to support innovation in these areas.

Elsewhere in climate, Deep Sky announce their first carbon capture facility, a new partnership with MaRS aims to bring in new funding for municipal emissions reduction projects, and a new report warns Canada is falling behind on climate innovation.

In funding, we have a major industry investment in biochar to make more sustainable steel, Bill Gates' Breakthrough Energy Ventures backs GeologicAI's low-impact mining exploration, and a large new funding round for CarbonCure’s low-carbon cement.

💰 Funding

🪨 CarbonCure (Dartmouth, NS) raised over $105M in funding led by Blue Earth Capital. CarbonCure’s technology enables concrete producers to use captured CO2 to produce durable, low-carbon concrete. The funding will allow CarbonCure to accelerate its product roadmap and growth plans.

⛏️ GeologicAI (Calgary, AB) closed $26.5M in Series A funding from Breakthrough Energy Ventures. GeologicAI uses advanced machine vision and AI to explore underground more efficiently than traditional core sampling. The funding will enable GeologicAI to develop and scale its technology globally.

Orennia (Calgary, AB) closed $32.9M in Series B funding led by Wellington Management. Orennia’s platform enables energy developers and investors to manage the energy transition, using data and predictive analytics to effectively deploy capital. The funding will be used to expand the team and execute on the product roadmap.

🏢 BrainBox AI (Montreal, QC) secured a final $10M investment as part of its latest $30M raise. The final funding comes from European Insurance Group, while ABB and the Quebec government announced funding contributions in May. The funding will be used to expand the scope and global availability of BrainBox’s predictive and self-adapting AI for building operations.

♻️ CHAR Technologies (Toronto, ON) secured a $6.6M strategic investment from steel & mining giant ArcelorMittal. CHAR converts wood and organic waste into renewable natural gas and biochar. Biochar can replace coal used in steelmaking, reducing emissions.

⚡️ Calogy Solutions (Sherbrooke, QC) received $1.4M from the feds through the Quebec Economic Development agency to develop and commercialize energy storage solutions for the aerospace industry. 

🌱 Cascadia Seaweed (Sidney, BC) received $1.5M in funding from the British Columbia Centre for Innovation and Clean Energy (CICE). The funding will help develop a 100 hectare seaweed farm in partnership with Metlakatla First Nation.

♻️ Anaergia (Burlington, ON) received a $5M USD grant from the state of Michigan to develop a bioenergy project in Kent County. The waste-to-energy facility will reduce the county’s dependency on landfills, reduce emissions, and produce carbon-negative fuels. 

💰 Public Ventures launched a $100M impact fund focused on scaling up Canadian climate tech and life science startups.

📈 Milestones & Growth

Montreal’s Deep Sky will build its first carbon capture facility in Quebec, partnering with California’s Captura.

Calgary’s Oco will provide carbon capture ink for Adidas’ new trail running shoes.

Vancouver’s Loop Energy, a producer of hydrogen fuel cells, will provide the fuel cell system for ARP E-Vehicles’s new hydrogen electric bus platform.

Calgary venture studio Harvest Venture Builders will offer a new vertical focused on AI for energy operations. 

Engineers at UBC were the first to develop carbon fibre from bitumen.

North America’s largest biochar plant will be completed next year, producing up to 30,000 tons, in a partnership led by Bécancour, QC’s Airex Énergie.

Pearson Airport will be home to Ontario’s first public hydrogen refuelling station in a partnership with Carlsun Energy.

🌎 In the news

NATIONAL

New standards for fuel: Canada’s Clean Fuel Regulations came into effect and aim to reduce the carbon intensity of transport fuels by 15% by 2030. This would deliver about 10% Canada’s net-zero goals for 2030. The new rules should encourage the fuel industry to invest in low-carbon fuels, EV charging, and carbon capture, all of which are eligible for credits. The regulations are also complemented by the Clean Fuels Fund, which sets aside $1.5B to support clean fuel production and EV charging infrastructure. As the National Observer reports, the consumer impact is a little murky because its not a direct fee, but a credit system, and depends how much producers will pass along to consumers (except in NB and NS, which opted to hike fees through their provincial energy boards).

Falling behind: A report from BCG finds some major shortcomings in Canada’s climate tech ecosystem as the U.S. Inflation Reduction Act pulls innovation south. The report found that only 17% of climate tech investor dollars stay in Canada while the majority is invested in the U.S. The slow response from the federal government was called out as a particular issue in the report, a sentiment echoed by many in the climate tech ecosystem - the feds have announced various tax credits but they still aren’t implemented.

Better together: MaRS Discovery District partnered with the Federation of Canadian Municipalities and the federal government to launch the Climate Action Accelerator to Net Zero (CAANZero), a program to help municipalities identify, invest and implement projects that drive down emissions. The program is unique in that it will aggregate individual municipal climate projects into investment-ready portfolios that appeal to external capital sources.

Other federal moves:

• Canada will contribute $450M to the Green Climate Fund, a global climate change fund associated with the Paris Agreement.

• PM Trudeau and Alberta Premier Danielle Smith met during the Calgary Stampede to discuss federal net-zero goals and a working group to address Alberta’s concerns over timelines. 

• New federal policy is expected later in July to phase out “inefficient” fossil fuel subsidies, though how these are defined is unknown.

• Dairy Farmers of Canada received $7.5M to advance sustainability in the dairy industry.

• Nine Indigenous-led solar and battery storage projects received funding from the feds totalling $160M.

• Interest in the federal On-Farm Climate Action Fund has exceeded expectations, with more applicants than funding, as farmers seek out climate-friendly practices.

An investigation from The Narwhal found that oil companies in the Pathways Alliance hyped up their emissions reduction efforts while lobbying the federal government to weaken and delay an emissions cap on the sector.

Adoption of Tesla’s NACS charging standard continues, with Electrify Canada, Polestar and Volvo announcing support for the standard.

CEOs from several Canadian pension plans called on their portfolio companies to adopt the International Sustainability Standards Board disclosure framework, a potential new global standard for ESG reporting.

A new report from the Institute for Sustainable Finance at Queens University found that emissions disclosures by Canadian companies varies greatly, but are improving in quality and frequency with more regulatory certainty. 

PROVINCIAL

The Stellantis battery factory saga has come to an end after the Ontario and federal governments reached a deal with the automaker. The new agreement includes up to $15B in production-based tax breaks, and marks a new “auto pact” between the two governments. The deal is a direct response to the incentives offered in the US through the Inflation Reduction Act (IRA) and those offered by the federal government for Volkswagen’s new battery plant. The Logic has more on why this is the tip of Canada’s EV iceberg. 

Elsewhere in Ontario’s EV sector, Hyundai shared that it’s considering Canada for its next EV manufacturing plant, and Mitsui High-tec announced it will expand its EV motor cores plant in Ontario with an investment of $100M and a $3.1M contribution from the province. 

The Ontario government announced that it plans to build a new nuclear generating station, the first new large-scale plant in the province in over 30 years. The province is pursuing large- and small-scale nuclear in an effort to meet rising energy demand from EV adoption and industrial needs.

Nova Scotia Power achieved a 10% emissions reduction from EV charging through a smart charging pilot that encouraged charging during peak wind generation periods.

Newfoundland and Labrador launched a $100M Green Transition Fund to help organizations across the province reduce their emissions. The funding comes from the West White Rose offshore oil expansion project.

Saskatchewan’ clean energy sector saw several investments from the federal government, including $7M for clean energy projects, $9.5M to support the biotechnology industry, and $50M to support the 200MW Bekevar Wind Power Project led by Cowessess First Nation. 

Quebec kicked off a review of its carbon cap-and-trade system with California through a series of public consultations and workshops.

Mining giant Rio Tinto is dipping it's toes into lithium for the first time through agreements with two Quebec-based mining exploration firms.

The first Indigenous-owned wind project in the North is going up in the Yukon with enough generation capacity to power 650 homes.

📣 What’s going on

💡 EarthTech 2050: This accelerator from Foresight Canada is looking for climate tech companies that can reduce or remove “at least half a gigatonne of CO2e by 2050”. Apply by July 30th.

💡 Advancing Agrifood Through Artificial Intelligence: Protein Industries Canada is seeking applications for food-focused AI projects to help grow Canada’s plant-based protein industry. 

📅 Carbon Capture Canada: The conference & exhibition will showcase Canada’s carbon capture and underground storage industry. Featuring speakers from The Global CSS Institute, Emissions Reduction Alberta, Svante carbon removal, and more. Sept 12-14th in Edmonton.

📌 Jobs

Visit the Climate Tech Canada job board to see open roles at companies like Arca, SWTCH, Novisto and many more!

That’s all for this week. Thanks for reading and if you’re enjoying the newsletter, share it with a friend!

Justin