Session Two:

Short Term Tactics & Legal Obligations

The second Future Proofing Canada session focused on securing the long-term viability of Canada’s cleantech businesses amid shifting trade dynamics. Discussions covered:

• Immediate actions businesses can take to mitigate the impact of tariffs.
• Legal obligations and compliance requirements in the current trade environment.
• Short-term strategies to build a more resilient and competitive Canadian economy.
• Sector-specific challenges and opportunities, fostering knowledge-sharing and problem-solving.

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What Built Environment Innovators Need:

• Clarity on exemptions: Uncertainty remains around final exemption decisions, similar to steel tariffs. Reducing uncertainty is crucial for strategic planning.
• Internal preparedness: Companies must prepare for worst-case scenarios while staying agile as regulations evolve.
• US market insights: Understanding that US business leaders anticipated trade conflicts can help Canadian companies adopt proactive measures to navigate the evolving environment.
• Strategic proactivity: Monitoring emerging trends and adapting accordingly will help maintain a competitive edge and position the sector for long-term success.
• Contingency plans for manufacturing and labour shifts: Relocating manufacturing or labor to the US is seen a last resort, but strategic planning is needed to mitigate risks.
• Stability for suppliers: Addressing the heightened uncertainty among Canadian suppliers is crucial to ensuring stability in the supply chain and supporting strategic planning.

What Energy and Storage Innovators Need:

• Market expansion strategies: Overcoming barriers to market entry and expansion remains a top challenge for companies. Support is needed to overcome these barriers and increase competitiveness.
• Diversified investment sources: The dominance of US capital is prompting some companies to explore European funding opportunities. Access to a broader range of investors is crucial for financial stability.
• Strategic expansion solutions: Establishing US subsidiaries with local manufacturing is being considered as a growth strategy. Guidance on international expansion and local production would strengthen global competitiveness.
• Access to capital: Concerns about limited capital in Canada compared to the US are widespread. Companies need expanded funding opportunities to sustain growth and innovation.

What Energy Fuels and Alternatives Innovators Need:

• Market adoption and confidence: Skepticism around alternative fuels (e.g., hydrogen, ammonia) is slowing adoption. Incentives and education are needed. Education and incentives are needed to build confidence.
• Faster market entry for solutions: Energy transportation is linked to national sovereignty, but alternative fuel solutions are slow to reach the market. Regulatory approvals and commercialization pathways must be streamlined to improve competitiveness.
• End-user education and engagement: End-users need to be better informed about the benefits of alternative fuels. Greater awareness of alternative fuel benefits could drive adoption and position Canada as a key exporter to markets like Europe.

What Carbon Innovators Need:

• Equivalent solutions: Canadian businesses need domestic alternatives for key technologies that currently rely on foreign solutions. Support is required for scenarios where no direct equivalent exists.
• Strategic planning: Many companies are still in the early stages of assessing market dynamics and need guidance.
• Carbon tax clarity: Companies need clear and consistent carbon tax policies, as uncertainty around industrial carbon taxes is impacting business planning.
• US policy stability: Businesses need reliable information on US policies, particularly regarding the 45Q tax credit, to make informed investment decisions.
• Market certainty: Unclear policies are leading to delays in sector momentum. The sector needs a stable policy environment.
• Operational capacity: Startups need resources to manage administrative overhead and compliance requirements when operating in both Canada and the US, including access to tariff specialists.
• Market entry support: Companies need support to enter the US market faster, as delays are seen as strategic disadvantage.
• Strategic resilience: Businesses need strategies to manage setbacks while pursuing long-term growth opportunities.
• Resource coordination: A centralized database of suppliers, market intelligence, and matchmaking support would benefit companies navigating the evolving carbon market.

What Circular Bioeconomy Innovators Need:

• Tariff clarity: Businesses need guidance on how new tariffs will impact operations, particularly for products that may not qualify for exemptions.
• Equipment investment confidence: Companies require assurance that equipment investments will not be negatively impacted by ongoing market uncertainty.
• Shipping and customer retention: Shipping delays and tariff-related challenges risk eroding customer loyalty and repeat business.
• Exploring new markets: Companies are exploring alternative international markets, such as Sri Lanka and Vietnam, to mitigate the impact of cross-border tariffs.
• Resource allocation for tariffs: Companies need guidance on how much resources to invest in managing tariff-related risks amid ongoing uncertainty.

What Digital Innovators Need: 

• Market stability: With rising competition from global players outperforming AI venture capitalists, AI and blockchain companies need strategies to navigate the challenges posed by market corrections and overvaluation.
• Open-source technology access: Expanding open-source technology and data availability is critical for AI development.
• Transparency and efficiency: Companies need stronger domestic AI and automation capabilities to remain competitive.
• Tariff impact: Digital innovators need to prepare for the impact of tariffs on hardware sourcing, as well as the potential challenges for end-users. The uncertainty presents both risks and opportunities for digital solution providers.
• Data accessibility: AI advancements are increasingly dependent on access to data, yet limited access remains a significant challenge for researchers and institutions trying to develop and scale solutions.
• Web3 & infrastructure data: Web3 initiatives, such as Decentralized Physical Infrastructure Networks (DePIN), create valuable data from infrastructure, which could be leveraged for a variety of applications, providing new opportunities for innovation.
• Regulatory compliance: With AI's rapid growth, businesses need strategies to navigate the emerging regulations around data management, accessibility, and security, ensuring they comply while optimizing the use of data in their AI models.

What Water and Wastewater Innovators Need:

• Market diversification: Water tech companies need strategies to diversify their markets beyond the US and explore international opportunities as demand for water solutions grows.
• Political implications of US demand: As the US looks increasingly to Canada for water resources, businesses need to anticipate the potential political dimensions of cross-border water supply, and prepare for the impact on the sector.
• Government resources: Water innovators need better access to government resources and support programs. They require clear guidance on where to find resources and how to tap into available innovation-focused support.
• Water pricing incentives: There is a need for water pricing strategies that incentivize the adoption of water technologies. If water pricing reflects the true cost and offers potential savings through conservation, it could drive greater adoption of water-saving technologies.

Session 3:

Domestic Adoption & National Networks

To build a more resilient and dynamic cleantech sector, Canada must prioritize domestic collaboration, supply chain diversification, and market expansion. The third Future Proofing Canada session explored opportunities to foster stronger national networks, drive innovation, and reduce reliance on foreign markets. Discussions covered:

• Strategies for diversifying supply chains and fostering domestic collaboration.
• Opportunities for innovation and growth within the Canadian market.
• Strengthening domestic connections and how it can contribute to a more dynamic Canadian economy.
• Building more resilient domestic supply chains for Canada’s future economy.
• Collaborating with regional experts to leverage local knowledge, resources, and networks for stronger economic resilience:

Shane MacDougall (Innovation PEI)

Jason Guidry (Halifax Partnership)

Nada Rabie  (Envision St. John)

Dorinda So (PointA)

Sebastian Alamillo-Falkenberg (RXN Hub)

Isabella Tarasco  (Emissions Reduction Alberta (ERA))

Gregory Freeman (Invest Vancouver)

Regional Challenges and Opportunities

Attendees were assigned breakout rooms by region to discuss specific challenges, opportunities, and insights unique to their specific cleantech ecosystems.

What we heard from PEI:

• Challenges for Startup Ventures in Canada: A major challenge is finding investors with a long-term outlook.
• Accessing Patient Capital: Companies should seek funding from Canadian family offices that support sustainable, long-term growth.
• Re-Industrializing Canada: Instead of exporting raw materials, businesses should focus on adding value through advanced manufacturing and hard tech development.
• Strategic Development: Establishing industry-specific resources by sector and region will promote independent innovation and economic success.
• Success Story: McCain’s exemplifies a Canadian company that successfully added value to natural resources.
• Steps Toward Growth: Strengthen interprovincial partnerships and identify key industries in each region to promote growth and innovation.

What We Heard from Nova Scotia:

• Expansion strategies: SMEs must diversify their growth strategies to stay competitive amid trade disruptions.
• Proactive market approach: Businesses should focus on responding strategically rather than reacting to external challenges.
• Cross-provincial collaboration: Stronger ties between economic development agencies will help businesses find the right partners and scale within Canada.
• Interprovincial trade reform: While progress is slow, the recent surge in national sentiment for Canadian goods and services emphasizes the need for policy changes to strengthen trade across Canada.

What We Heard from New Brunswick:

• Proximity to US Border: St. John’s proximity to the US creates both opportunities and risks for local businesses.
• Domestic Opportunities: Companies should prioritize domestic expansion to reduce reliance on international markets.
• Building Local Partnerships: Building local supplier networks and fostering partnerships is key to sharing resources and strengthening the local economy.
• Focus on Domestic Procurement: Emphasizing procurement within Canada can help businesses build resilience and strengthen domestic supply chains.
• Leveraging Support Organizations: With an increasing focus on supporting Canadian ventures, many organizations, including local Chambers of Commerce, are actively offering assistance. Businesses need to better leverage government and economic development support.
• Adapting Technologies for Domestic Markets: Shifting focus or adapting technologies to serve Canadian markets can reduce reliance on the US and help businesses thrive.
• Exploring International Markets: Look for international partners and markets to expand beyond the US and diversify your revenue streams.

What We Heard from Ontario:

• Interprovincial Collaboration: Strengthening interprovincial collaboration is a key priority for economic development groups.
• Procurement Support: More resources are needed to help Canadian businesses navigate procurement processes.
• Auto Industry Concerns: Supply chain disruptions and US trade policies are raising challenges for the automotive sector.
• Tariff Impact on Deals: Tariffs are impacting deal flow, delaying agreements in domestic supply chains. Many companies anticipate slower investment and deal-making over the next 12 months.
• Increased Scrutiny on Science: Scientific research and innovation are facing heightened examination.
• International Support Delays: Accessing global funding and partnerships often takes longer than anticipated.
• Startup Challenges: Tariffs and funding scrutiny are making it harder for Canadian startups to secure deals, intellectual property, and top talent.

What We Heard from Alberta/Prairies:

• Funding Challenges Across Provinces: Companies in prairie provinces lack province-specific support.
• Difficulty in Finding Site Hosts: Identifying suitable site hosts for cleantech projects across Canada remains a significant challenge.
• Challenges in Finding Technology Champions: Finding technology champions remains a challenge—more proactive advocates are needed. Foresight’s Cleantech Adoption Platform is an example of a platform used to highlight vetted Canadian cleantech solutions and accelerate cleantech adoption.
• Ontario Companies Seeking Alberta Expansion: Ontario-based companies seeking to expand into Alberta have found limited “local” resources, as some support organizations seem focused on retaining companies within their own province.
• Value of Webinars for Connection Building: Webinars and virtual events continue to be a valuable tool for fostering inter-provincial/international business relationships.

What We Heard from British Columbia:

• Rapid Market Shifts: Constant changes make it difficult to assess the full impact of trade developments in real time.
• Interprovincial Trade Opportunities: Addressing domestic trade barriers is just as important as navigating Canada-US relations.
• Tariff Impact on Cleantech: Some companies may find competitive advantages despite tariffs, especially those offering cost-saving innovations.
• Scaling in a Larger Market: The US remains an attractive opportunity, but businesses must consider how to incorporate tariffs into pricing strategies.
• Government Engagement: There is growing political interest in developing a BC/Canadian strategy—who in government is leading efforts to expand market access and capital?
• Scaling Challenges: Many Canadian companies expand through acquisition or by relocating to the US, highlighting the need for stronger domestic growth support.

Key Takeaways:

Throughout the discussions across provinces, several common themes emerged, highlighting critical areas for action. 

• Strengthening Canada’s domestic economy reduces reliance on volatile foreign markets.
• Interprovincial collaboration is essential for scaling Canadian industries.
• Government and industry must align efforts to support investment, market expansion, and diversification.
• Businesses must adapt to funding gaps, policy shifts, and supply chain challenges with innovative strategies.

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