B.C. is home to 160 cleantech companies, representing 23 per cent of Canada’s total, according to Ottawa’s Analytica Advisors. The province’s green innovation strengths lie in transportation, renewable energy, fuel cells and smart grid technologies, reflecting the influence of utility B.C. Hydro and fuel-cell pioneer Ballard Power.

“B.C. companies have a long history in power management, including power conditioning and battery storage, while the province’s diverse geography and historic forestry industry support a range of alternative generation technologies such as wind, solar, biomass and tidal energy,” according to consultancy KPMG.

Celine Bak, a partner with Analytica, said long-term public investment in green innovations developed and spun out of B.C. universities has also played a major role. Another boost has come from the B.C. government’s Innovative Clean Energy (ICE) Fund, which since 2008 has contributed more than $72 million to 56 clean energy projects. In addition, the introduction of a provincial carbon tax in 2008 created opportunities for firms such as Nexterra, which helps industries reduce their carbon footprint by generating electricity from biomass.

Ontario, with 221 companies (31 per cent of the total), may lead the country in absolute numbers but still lags B.C. when measured per capita. Even so, it has been most successful at attracting venture capital for its green-themed startups.

Instead of a carbon tax, Ontario’s landmark Green Energy Act and feed-in-tariff program – and its ambitious commitment to phase out coal-fired generation by 2014 – have established the province as one of the best places on the continent to develop renewable energy and smart grid innovations focused on energy management, storage and efficiency. A relatively new Water Opportunities Act aims to make Ontario a leader in water conservation and treatment technologies.

Government funds aimed at green innovation development and smart grid technologies, as well as support for community power, have added to the province’s allure. The MaRS Discovery District in Toronto has become one of the nation’s leading incubators for clean technology innovation, while several universities in southern Ontario – including University of Waterloo, University of Ontario Institute of Technology and Queen’s University – are generating both green innovations and entrepreneurs with the right business skills to take clean technologies to market.

“You can’t take a great technology developer and expect them to be a wonderful business developer,” said Vicky Sharpe, chief executive of Sustainable Development Technology Canada, the federal agency that gives grants to cleantech demonstration projects. You need both, she said.

Quebec, with 152 companies (21 per cent), has traditionally been strong in industrial manufacturing, water and waste management technologies. Bak attributes this strength to its having “a regulatory framework that is very smart and very proactive in terms of recycling.” Rather than setting up a dedicated government fund to support development and commercialization, Quebec recently decided to invest in the sector through venture capital firm Cycle Capital Management.

Nova Scotia, with 50 companies, stands out on the East Coast for its strength around green chemistry, biofuels and renewable energy, such as wind and tidal power. In the prairies, Alberta’s 88 companies, operating in a province known for its oil sands resources, are largely focused on soil, water and emissions remediation technologies, such as carbon capture and sequestration.

Said Bak: “Each province or region is taking a slightly different approach.”

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It’s that last function – chilling or freezing food – that also makes supermarkets major contributors to global warming due to their reliance on nasty hydrochlorofluorocarbon (HCFC) or fluorohydrocarbon (HFC) refrigerants.

That could soon change. Over the past three years, Sobeys Québec has pioneered the use of a more environmentally friendly, made-in-Canada solution that relies on carbon dioxide (CO2) as the primary refrigerant rather than HCFCs or HFCs.

The push to replace the harmful refrigerants came from Simon Bérubé, Sobeys’ senior director of engineering, who challenged the company’s suppliers to design an HCFC/HFC-free system for its planned new store rollout. “One of the problems in the supermarket industry is the leak of refrigerant,” which is both expensive to replace and acts as a global warming super gas, Bérubé explained.

A standard-size supermarket refrigeration system uses 1,000 to 2,000 kilograms of synthetic HCFC/HFC refrigerants, and leaks are common with hundreds of joints in the piping that carries the refrigerant to various display counters. It is estimated that 20 to 30 per cent of the gas leaks out of systems annually.

Sobeys said the CO2-based system allows it to reduce the environmental footprint of its supermarkets by at least 50 per cent, compared with that of a conventional store. The first system was installed in the company’s Saint-Félix-de-Valois store in Québec in 2009. At last count, 32 of its supermarkets now use CO2-based refrigeration.

The CO2 solution Sobeys selected is actually an upgraded blast (of cold air) from the past. CO2-based refrigeration was standard a century ago and only displaced with the emergence of synthetic refrigerants. The advantages that Sobeys is reaping from its new CO2 plants make one wonder why industry ever abandoned the technology. “It’s a simpler system, a smaller system, it’s cheaper to operate, and with no HFCs inside the system there is [relatively] no pollution when there is a leak,” said Bérubé.

Sobeys’ CO2 system supplier, Trois-Rivières, Québec.-based Carnot Refrigeration, claims that CO2 is “a natural, safe (non-toxic) and inexpensive refrigerant” with 1/1,500 to 1/4,000 the potency – and therefore the climate impact – of synthetic refrigerants. The companies calculate the impact another way: a leak of 10 kilograms of HFC refrigerant R-507 generates 33,000 kilograms of CO2-equivalent emissions, while the same volume of carbon dioxide refrigerant leak will generate 10 kilograms of CO2 emissions.

With better heat-transfer properties than synthetic refrigerants, CO2 systems potentially require less energy to run and, because they operate at higher pressures, take up less space in the store. Sobeys is also reclaiming waste heat from the system to heat water and store areas, further reducing energy costs.

The Canadian-designed and built system not only offers Sobeys a lower-maintenance refrigeration system, but much of that maintenance can be conducted remotely. “Service calls can be achieved by our home office because it is all electronic,” said Marc-André Lesmerises, a co-founder of Carnot Refrigeration. “You don’t need to have someone in place to open the cases and take a screwdriver and modify something.”

These benefits convinced Sobeys, which under a variety of brands already operates 1,300 stores across 10 provinces, to deploy CO2 refrigeration plants in all new stores to be built in Canada. “We are also doing retrofit projects,” said Bérubé, explaining that the smaller size of the systems allows them to be installed inside existing mechanical rooms.

It’s a big exercise in change management, but it also places the company at the forefront of an industry trend. Lesmerises said he’s confident that CO2-based refrigeration systems are the future, pointing out that other supermarket chains are beginning to embrace the approach.

And because the synthetic refrigerants are ozone-depleting gases, switching to CO2 technology also helps companies comply with mandatory phase-outs under the Montreal Protocol.

Click here to view our complete Tech Savvy series.

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Several months ago the Alberta native began writing dozens of companies in his mutual funds to gauge their support for a national carbon tax. Gagne, who for a decade has worked in Calgary’s largest homeless shelter, was spurred to act because of dissatisfaction with the low standards his “ethical” funds had for environmental stewardship. “It is like setting a speed limit of 350 miles per hour and then congratulating yourself that everyone meets that limit.”

From the start, the 46-year-old has been surprised by the level of support in corporate Canada for a carbon tax – or some other structure to price carbon emissions. His initial flurry of eight letters to the largest companies in his ethical fund yielded three replies. Two of the companies were supportive of some sort of carbon pricing mechanism, while another stated it had no opinion on the subject.

One of those early responses came from the Royal Bank of Canada’s director of corporate environmental affairs, who wrote that the country’s largest bank had been following the issue for a decade. “We support a price on carbon,” the bank said. “But we are publicly agnostic with regard to whether the best design is through a cap-and-trade system versus a carbon tax.”

The bank’s response motivated Gagne to push on with his letter-writing campaign. To date, he has snail-mailed and emailed a total of 185 companies, with 44 replies received so far. He estimates that one-third of respondents have given non-committal answers, saying only that they are monitoring the issue. The rest have been, to his surprise, supportive of carbon pricing.

Surprises came from the likes of oil sands company Cenovus Energy, whose head of corporate responsibility wrote back: “We support the need to establish a price on carbon. We believe that GHG regulations, and the cost of carbon at various price levels, can be adequately accounted for as part of business planning.”

The vice-president of policy development with the Canadian Electricity Association signalled that it has switched from earlier opposition to carbon pricing, stating: “I would agree that the lack of a predictable and national price on carbon, whatever the mechanism, complicates our ability to meet GHG reduction targets.”

Finally, oil and gas company Nexen responded, saying: “We have long advocated for a national transparent carbon tax on all emissions with the proceeds to be used for energy efficiency R&D, renewable, research and energy saving infrastructure.”

Gagne was further encouraged after learning of a larger, more formal effort to measure corporate support for carbon pricing done by green-economy think tank Sustainable Prosperity. The Ottawa-based group conducted a two-year study into business preferences for climate change policy instruments among 13 associations and 17 large companies. It found that corporate Canada “overwhelmingly supports a price on carbon” and has, in fact, been supportive since 2006.

“The bottom line is there was a high level of buy-in,” said Alex Wood, senior director of policy and markets with Sustainable Prosperity. “They were basically split over preference for a tax versus a cap-and-trade system.” Wood noted that a carbon tax represents the speediest option for putting a price on carbon. “It’s quick to implement, and simple to implement,” he said. “To the degree that governments usually have existing infrastructure for collecting taxes, it doesn’t create new demands in terms of the public systems around it.”

The enduring argument against a carbon tax – that a commodity-based economy such as Canada’s would have a difficult time implementing such a pricing scheme – took a hit last year when Australia adopted its own national carbon tax. Scheduled to take effect in mid-2012, the Australian measure sets a price of A$23 a tonne for the Top 500 polluters. After 2015, the tax transitions into a cap-and-trade system for emissions permits. Although Australia pumps out only 1.5% of global CO2 emissions, it has the highest emissions per capita because of its reliance on coal-generated electricity.

British Columbia implemented Canada’s (and North America’s) first carbon tax in the summer of 2008 when it began charging $10 per tonne of carbon dioxide-equivalent emissions. On a litre of gasoline, this worked out to an additional cost of 2.41 cents. The tax rate was increased gradually, rising to $25 per tonne of CO2-equivalent emissions on July 2011. It will jump to $30 per tonne in 2012.

“Why should Canada not lead?” asks Gagne, countering suggestions that the country should wait to see what the U.S does. He’s convinced that if Canada created a national carbon tax or cap-and-trade program, the United States would be more inclined to follow. The fact that a major coal producer and exporter like Australia took the leap only lends weight to that argument.

And as Gagne found, many Canadian businesses see it as inevitable and want certainty on the matter.

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