General Market Commentary

The Bank of Canada (BoC) released its second annual climate risk disclosure report, to evaluate and communicate the climate risks the BoC faces as an institution. The report also includes an update on what the bank doing to manage those risks and the steps it is taking to reduce its own greenhouse gas (GHG) emissions.

“Climate change is and will continue to affect all Canadians,” states BoC Governor Tiff Macklem in his executive summary. “We must therefore take it into consideration as we pursue low, stable and predictable inflation and financial stability. Our work on climate change is still unfolding, and we will continue to reduce our own carbon footprint while improving our understanding of the broader economic and financial implications of climate change.”

One of ways Canada is coping with climate change is to support its sizable cleantech market of over 2,400 cleantech firms – including 13 of the top global cleantech ventures. The growing green economy is supported by dedicated government programs and a robust research and development (R&D) environment supported by excellent academic institutions, government support programs and investment tax credits such as the Scientific Research and Experimental Development (SR&ED) incentive.

Banks such as the Royal Bank of Canada (RBC) are demonstrating support for net zero transition. RBC recently announced it would be allocating $1 billion by 2030 to support the development and scaling of innovative climate solutions.

Peter McArthur is a VP and National Cleantech Lead at RBCx. He may be a commercial banker but he’s also a lifetime environmentalist who admits he’s happiest with a paddle in his hand.

McArthur also works with the Canada Cleantech Alliance and the Ontario Clean Technology Industry Association (OCTIA) to help empower entrepreneurs, investors, and companies to scale innovative solutions to the major ecological challenges.

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“RBC’s definition of cleantech is unique,” explains McArthur. “It’s got to be innovative, proprietary, and it’s got to have a meaningful environmental impact. Lastly, there must be a path to revenue and profitability.”

McArthur says RBC and RBC Foundation have committed $100 million by 2025 to the RBC Tech for Nature™ program to support community organizations develop cleantech for agriculture, energy, and nature-based solutions.

Hot Sector News

This month we’re putting the spotlight on Electrovaya Inc. (NASDAQ: ELVA) (TSX: ELVA), a leader in the global energy transformation, focused on contributing to the prevention of climate change by supplying safe and long-lasting lithium-ion batteries.

The company offers an extensive array of intellectual property and designs, as it develops and manufactures proprietary lithium-ion batteries and battery systems for energy storage and heavy-duty electric vehicles based on its Infinity Battery Technology Platform. This technology offers enhanced safety and industry leading battery longevity. The company is also developing next generation solid state battery technology at its Labs division.

Headquartered in Mississauga, Ont., Electrovaya has two main operating sites in Canada and has acquired a 52-acre site with a 135,000 square foot manufacturing facility in New York state for its planned gigafactory.

Electrovaya | Electrovaya

Facilities Location | Electrovaya

Top: Electrovaya’s headquarters is a 65,000 square foot engineering and development centre in Mississauga, Ont. Right: The gigafactory in Jamestown, NY features a 137,000 square foot building that is powered by 100 MWh of renewable energy from Niagara Falls. Credit: Electrovaya.

CEO Dr. Raj DasGupta has been with Electrovaya for over a decade, following in his father’s footsteps. He has been involved with every aspect of the business from cell manufacturing, engineering activities and business development to the operations management and senior executive strategy.

In the early days, the company was focused on car batteries and found itself fighting for a lane in a very competitive market. But DasGupta helped switch gears to focus efforts on the niche battery cell technology for heavy equipment. Major milestones have included the development of a leading forklift battery and cells that now power more than 100 facilities for major customers such as Walmart Inc., Target, The Raymond Corporation and its parent company, Toyota Material Handling, and more.

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In 2003, the Nasdaq team selected Raj DasGupta and the Electrovaya team to ring the closing bell on the company’s inaugural trading day. Credit: Electrovaya.

“We’ve had steady growth,” says DasGupta. “In terms of employee growth, we employed 20 people in 2018 and now we have over 100 people in Ontario right now, about half of whom are in engineering or research and development.”

Revenues are also on the rise, from US$5 million in 2018 to US$44 million last fiscal year and a projected growth of US$65 million for this year. In fact, over the past five years, the share price has climbed 310%.

What are the key priorities for the next few years?

DasGupta says he intends to maintain conservative spending, so the company remains in a profitable mindset. While he prepares the NY facility for the demand they see coming in 2026, he also intends to expand into other sectors that employ heavy equipment, including mining, construction, and defence.

Electrovaya’s Infinity Battery Systems feature unique ceramic composite cell separator materials are proven to provide the safest nickel manganese cobalt (NMC) based Lithium-ion cells on the market. Credit: Electrovaya.

The CEO sees the opportunity to expand not only in North America, but globally. He just returned from a trip to Australia where some of the heavy equipment in operation was consuming a whopping 1,000 litres of diesel per day.

“Our products provide a significant decrease of GHGs and a much higher return on investment. This tech should be the go-to for all things heavy duty,” emphasizes DeGupta. “All of this equipment has to be decarbonized down the road and we have the safe and cost-effective solution for it.”

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Today the stock price of ELVA is $4.21.

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.

Name Symbol Price in $CDN
(April 15/24)
Price in $CDN
(May 15/24)
% Change
Algonquin Power & Utilities Corp. AQN $8.02 $9.10 +13.47%
Anaergia Inc. ANRG $0.30 $0.27 -10.00%
Ballard Power Systems Inc. BLDP $3.93 $4.31 +9.67%
*BIOREM Inc. BRM $1.94 $1.96 +1.03%
Boralex Inc. BLX $26.82 $32.34 +20.58%
*CHAR Technologies Limited YES $0.41 $0.36 -12.20%
Electrovaya Inc. ELVA $4.35 $4.21 -2.99%
Engine No 1 (Transform ETF) NETZ $82.41 $83.71 +1.58%
EverGen Infrastructure Corp. EVGN $2.14 $2.00 -6.54%
Greenlane Renewables Inc. GRN $0.11 $0.10 -9.09%
Li-Cycle Holdings Corp LICY $1.27 $0.76 -40.16%
Loop Energy LPEN $0.16 $0.06 -62.50%
Northland Power Inc. NPI $22.57 $22.75 +0.80%
*Thermal Energy International Inc. TMG $0.30 $0.26 -13.33%
TransAlta Renewables Inc. RNW $12.48 $13.00 4.17%
UGE International Ltd. UGE $0.78 $0.59 -24.36%
Westport Fuel Systems Inc. WPRT $7.90 $8.27 +4.68%
Zinc8 Energy Solutions Inc.

(Abound Energy)

ZAIR $0.33 $0.10 -69.70%

*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, and Connie Vitello is editor of Environment Journal. To pitch an idea or stock for the Market Watch column, contact connie@actualmedia.ca.

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