General Market Commentary

The Bank of Canada held its target interest rate at 5% on March 6, 2024. The Bank is continuing its policy of quantitative tightening. In the fourth quarter, global economic growth slowed; in Canada, the economy grew by more than expected but the Bank said the pace remained weak and below potential. As such, the decision was made to hold the rate and continue to normalize the Bank’s balance sheet. There is speculation about a potential April decrease, which would be announced on April 10.

Meanwhile, the federal government continues to support the cleantech and clean energy market in Canada, which is working toward achieving net zero targets and earning a competitive spot in the global clean energy transition space.

Natural Resource Canada’s Clean Fuels Fund is investing $1.5 billion to grow the production of clean fuels in Canada. The Fund supports building new and expanding existing clean fuel production facilities, including hydrogen, renewable diesel, synthetic fuels, renewable natural gas (RNG) and sustainable aviation fuel. The fund also supports feasibility and front-end engineering and design (FEED) studies that will create jobs and enable the sector to grow at the size and pace required to contribute to Canada’s climate goals.

The subject of this month’s Hot Sector News was recently a recipient of Clean Fuels Fund investments.

Hot Sector News

This month we’re putting the spotlight on CHAR Technologies Ltd. (TSXV:YES), which provides a waste to energy solution that aligns with the green energy transition by diverting waste from landfills and generating sustainable clean energy to decarbonize heavy industry.

The Toronto-based company offers first-in-kind high temperature pyrolysis (HTP) technology processes for wood and organic wastes to simultaneously generate renewable energy revenue streams — RNG or green hydrogen and a solid biocarbon — that provide a carbon neutral drop-in replacement for metallurgical steel making coal.

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CHAR Technologies operates across multiple business units with an integrated approach that supports the deliver of versatile and tailored solutions to meet a broad spectrum of needs in the biocarbon and renewable energy space. The four operating business units are: CHAR Tech Solutions, CHAR Tech Biocarbon, CHAR Tech Services, and Altech Environmental Consulting.

Since 2011, the company has steadily established itself as a leader in the field. Last month, CHAR Technologies was named as one of the top performers on the TSX Venture Exchange. The 2024 TSX Venture 50, comprising 10 companies from each of the five industry sectors, celebrates excellence in market capitalization, share price appreciation, and trading volume. CHAR Technologies’ consistent performance and innovation in cleantech have secured its place among the elite in this prestigious ranking.

“Our recognition as one of the top performers on the TSX Venture Exchange for the second consecutive year is a testament to our dedication to excellence and innovation,” said Andrew White, CEO of CHAR Technologies. “This year has seen remarkable acceleration in our project pipeline, coupled with meaningful partnerships. Collaborating with industry leaders in the steel industry has opened doors to incredible opportunities, and we are eager to persist in our transformative journey towards a greener, more sustainable future.”

At the core of CHAR Technologies is its proprietary high-temperature pyrolysis (HTP) technology, where organic materials or wood waste are heated to over 800°C in a completely oxygen free environment, significantly reducing carbon emissions. Credit: CHAR Technologies.

Most recently, CHAR Technologies received funding from Natural Resources Canada (NRCan) through the Clean Fuels Fund. More than $5 million will support FEED studies that will enable CHAR Technologies to replicate their first-of-its-kind woody-biomass-to-renewable-energy facility in Thorold, Ontario in other parts of Canada.

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Supported by an existing investment of $5 million from NRCan, CHAR Technologies is finalizing its construction of its clean fuels production facility at BMI’s Multimodal Hub in Thorold, which will convert woody biomass to renewable energy like RNG and biocarbon. The new NRCan funding will enable CHAR Technologies to replicate this work at four new facilities: in Kirkland Lake, Ontario; Drayton Valley, Alberta; and Saint Félicien and La Sarre, Quebec. This will create a distributed network of low-carbon fuels production facilities across three provinces in Canada.

Image

Minister of Natural Resources Jonathan Wilkinson (sixth from left) and CHAR Technologies CEO Andrew White (to the right of Minister Wilkinson) at the Thorold facility on March 8, 2024. Credit: CHAR Technologies/Paul Schmidt Photography.

Taken together, the Thorold, Ontario, project — which is expected to reach commercial production this year — and the four other clean fuel production facilities, which are expected to come online in the following two years, will maximize the value of underutilized waste wood resources and help decarbonize Canada’s steel and mining industries, and gas utilities.

“CHAR Tech is honoured to be the recipient of Natural Resources Canada Clean Fuels funding. We extend our gratitude to the Government of Canada and Minister Wilkinson for their unwavering commitment to environmental stewardship,” said White. “With the support of the Clean Fuels Fund, we are poised to swiftly actualize our proprietary process, fostering the advancement of localized sustainable energy solutions throughout Canada.”

Today the stock price of YES is $0.48.

Stocks to Watch

Here is a list of Canadian cleantech stocks that we are monitoring for this column. This list of public companies is by no means complete, and we are open to suggestions from our advisors and readers.

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Name Symbol Price in $CDN

(February 15/24)

Price in $CDN
(March 15/24)
% Change  
Algonquin Power & Utilities Corp. AQN $8.11 $8.19 +0.99%
Anaergia Inc. ANRG $0.28 $0.26 -7.14%
Ballard Power Systems Inc. BLDP $4.42 $3.68 -16.74%
*Biorem Inc. BRM $1.51 $1.40 -7.28%
Boralex Inc. BLX $31.03 $28.72 -7.44%
*CHAR Technologies Limited YES $0.42 $0.48 +14.29%
Electrovaya Inc. EFL $5.48 $5.22 -4.74%
Engine No 1 (Transform ETF) NETZ $83.08 $89.14 +7.29%
EverGen Infrastructure Corp. EVGN $2.13 $2.40 +12.68%
Greenlane Renewables Inc. GRN $0.12 $0.12 0%
Li-Cycle Holdings Corp LICY $0.57 $0.99 +73.68%
Loop Energy LPEN $0.18 $0.17 -5.56%
Northland Power Inc. NPI $24.15 $22.41 -7.20%
*Thermal Energy International Inc. TMG $0.28 $0.28 0%
TransAlta Renewables Inc. RNW $12.48 $12.48 0%
UGE International Ltd. UGE $0.84 $0.83 -1.19%
Westport Fuel Systems Inc. WPRT $7.68 $8.24 +7.29%
Zinc8 Energy Solutions Inc. ZAIR $0.34 $0.28 -17.65%

 

*The authors of this column own equity. It is not meant to be an endorsement, but simply a statement of this fact.

James Sbrolla is a veteran of the financial and environmental industries. Connie Vitello is editor of Environment Journal. To pitch an idea for an upcoming Market Watch column, or to suggest a stock, please contact connie@actualmedia.ca.

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