“We’re a decade behind on the energy transition”

How innovation is being deployed to save the world from the worst effects of global warming — and where it’s still falling short.

On the heels of COP29, which wrapped last week in Baku, Azerbaijan, the future of the planet is anything but certain. The talks ended with a deal to provide U.S.$300 billion per year to developing nations to decarbonize their economies and cope with the effects of climate change. That’s a marked increase from the U.S.$100 billion currently distributed; however, critics raised concerns that the sum is insufficient for the task at hand, calling it “a travesty of justice.”

Action on climate goals is still very much a work in progress. Next spring, countries are being asked to publish updated national plans, outlining how they will reduce greenhouse gas emissions over the next 10 years. Meanwhile, methane, which traps more heat in the atmosphere, is flooding the atmosphere, and climate change is wreaking havoc across the globe.

Although global investment in cleantech industries is expected to hit $2 trillion — twice that of fossil fuels, according to the International Energy Agency — there are questions about the repercussions of the recent U.S. election on the future of climate technology. Cleantech initiatives, such as the Inflation Reduction Act, 2022 legislation that accounts for U.S.$500 billion to boost clean energy and curb greenhouse gases, are likely to be diluted or struck down, and sweeping changes to climate policy could adversely affect supply chains, open up drilling for oil and gas and curtail a variety of environmental protections.

So how worried should we be about humanity’s prospects? We asked three experts for their perspectives on the important gains we’re making in the race against a warming climate, the hazards undermining cleantech’s progress and the reasons to hold on to hope for the future.

What’s going well

Stéphane Germain is the founder and CEO of Montreal-based GHGSat, a global leader in satellite-based methane monitoring. At COP29, the company announced that it has launched its first CO2-monitoring satellite.

“There are two primary greenhouse gases: carbon dioxide and methane. Methane has a much greater impact on the environment in the short term. If we look at a 20-year scale, every tonne of methane mitigated is like mitigating 86 tonnes of carbon dioxide. If we look at a five-year scale, it’s actually over 100 times greater impact than carbon dioxide. If we want to have a shot at keeping global temperatures within 1.5 degrees [above pre-industrial average] to avert the worst effects of climate change, we need to address methane emissions now, and I think more and more people understand that.

“On November 12, there was a U.S.-China methane summit in Baku and they announced that 159 countries are now in the Global Methane Pledge. That’s amazing. The vast majority of the emissions coming from oil and gas and also from waste and coal are covered by the Global Methane Pledge. We need to translate the pledge into action, and that’s a lot of what we saw at COP28 and at COP29, although we still have a lot of work to do.

“The climate negotiation process put in place by the U.N. is absolutely critical. It’s the only mechanism we have globally for all the countries to get together. The part I see is the international community — from NGOs to corporations — that is also involved in addressing those climate goals. The energy and the enthusiasm around that group, and all the ideas and solutions they’re bringing to bear, is an important part of the COP process, even if we’re not directly involved in negotiations.

“There continue to be new and exciting ways to deal with emissions, from pure hardware solutions to digital solutions and AI. I fundamentally believe that innovation has a huge role to play in tackling the climate crisis, and we need to keep it going.

“I’m optimistic that with the increased attention on methane and the understanding that it really is a quick win, levels will plateau soon. Fixing methane now buys us time to fix CO2 later. It’s a complicated picture, but I think pressure is leading toward greater world action.”

Facing the headwinds

Sarah Goodman is president and CEO of the B.C. Centre for Innovation and Clean Energy (CICE), a non-profit that helps fund and scale clean energy technology startups in B.C.

“What keeps me up at night is: We’re a decade behind on the energy transition and that means we need to supercharge both innovation and deployment. The International Energy Agency (IEA) says we need to triple deployment of renewables, double energy efficiency and significantly scale carbon capture by 2030. Those are all big marks to hit.

“In Canada, we’re really good at the innovation side. We are less good at commercialization, so that’s something that we’re very much focused on at CICE. We support the early-stage innovators. There are 13 Canadian companies on the 2024 Global Cleantech 100 list, and seven of them are based in B.C. We need to see more of those companies grow and stay in Canada.

“I would say that global fragmentation and uncertainty are the biggest threats to meeting climate targets. Whether it’s trade issues or supply chain challenges or government zigging and zagging on policy at the global level — all those things create inefficiencies that slow progress.

“If you’re running a business today, you likely have supply chain risks — it doesn’t matter whether you’re in the concert business or building products. Companies need to be building out those net-zero adaptation plans while not forgetting that clean growth is a $4-trillion opportunity by 2030. For corporate leaders, there’s a big opportunity and a risk management piece that go hand-in-hand.

“We saw under Trump’s last presidency that global investment in clean energy and climate tech continued to go up. Is it a headwind? Yes. I think the biggest risk is uncertainty. If you’re growing a Canadian business and you’ve got customers in the States, is that Department of Energy grant or loan still there to expand your business?

“Right now only two per cent of capital flows to women-led ventures. It’s about 6 percent in climate and cleantech. That means 50 percent of the population is not fully deployed to come up with those innovative solutions. This is about economic opportunity, and we’re leaving half the team in the dressing room.

“There’s a lot of risk aversion in Canada’s corporate sector in terms of trying new things. We need to stop thinking of climate as a crisis and think of it as the biggest economic opportunity. Think about what China has done with batteries and critical mineral supply chains. We’re putting in tariffs because while we debated whether climate change was real, they got on with building a giant business that is now very competitive. We need to recognize that the countries building the economy of the future are the ones delivering the solutions the world needs.”

Bright spots on the horizon

Rachel Field is a senior associate at Engine Ventures, a venture capital firm based in Cambridge, Mass., that invests in science and engineering-based solutions to address the climate crisis and other global challenges.

“There’s a tremendous amount of momentum driving solutions that provide a clean transition for industries that have historically been really challenging to decarbonize. Genuine ways of doing clean cement or other commodities are super exciting because we need these things to be produced in ways that are fully electrified.

“There are also a lot of interesting innovations happening at the intersection of biology and climate that could change things relating to food security and nutrition. Those are real challenges, especially as we think about the needs of the global population.

“Typically, it takes eight years to get something new to market because of field trials and seasonality. That can be a roadblock. Some companies are doing amazing genetic modification work and figuring out ways to hack biology — plant innovations, plant augmentation, plant modifications — to create more resilient crops with larger harvests.

“I’m optimistic about the number of people diving into this space. Given Engine Ventures’s close ties with academia and industry, we have the opportunity to work with amazing researchers who become entrepreneurs. And if we have enough talented and smart people giving their all, the diversity of solutions is going to be so strong and robust that we will be able to push forward some amazing things.”

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