Canada Climbs the Cleantech Rankings

When it comes to clean technology investment, notoriously cold Canada may seem like an unlikely hot spot. However, the latest trends in financing indicate that his star is rising.

So far this year, nearly $1 billion (USD) in seed funding from growth-stage financing has gone to Canadian startups in sustainability-focused industries tracked in the Crunchbase dataset. Standout sectors include carbon capture, geothermal and utility-scale solar.

With two months left, 2023 is on track to surpass last year’s record totals. To get an idea of ​​investment trends, here’s a look at Canadian sustainability-focused startup investments over the last six calendar years.

Canada’s largest clean technology investments

The pace of growth in Canadian cleantech financing is particularly notable given that global venture financing has declined sharply since its peak in 2021. Moreover, some rounds are clearly large.

Last week, Calgary-based Eavor, a developer of clean geothermal energy access technology, launched its largest round of the year, closing a $186 million Series B led by chemical company OMV.

Another big round went to Dartmouth, Nova Scotia-based CarbonCure Technologies, which received $80 million in July for carbon removal technologies that inject recycled CO into fresh concrete to reduce its carbon footprint.

Toronto-based OYA Renewables is also scaling up its operations. The company, which develops utility-scale distributed solar projects, raised $71 million from Monarch Private Capital in March in what it described as a tax equity investment, along with $145 million in debt financing.

Action in the early stages

We have also seen a lot of activity in the earlier stages, which bodes well for future growth.

According to Crunchbase data, more than half of Canada’s cleantech investments this year went to seed-stage companies via Series B. While not all recipients were newer companies, many of the larger rounds went to startups founded in the last four years.

Among them is Cyclic Materials, a developer of processes for recovering rare earth elements from products that are difficult to recycle. The Kingston, Ontario-based company raised $27 million in an April Series A. Others include Calgary-based Orennia, a provider of analytics services for clean energy and decarbonization investments, which raised $25 million in a July Series B, and Novisto, a software provider on for sustainable development, which closed with the amount of $20 million in May’s Series B round.

It’s not a coincidence

Even though Canadians make up just 0.5% of the world’s population, they punch above their weight class when it comes to clean energy. Per Cleantech Group, Canada ranked fifth among countries for clean technology investment in 2021–Q3 2023, behind the much more populous United States, China, the United Kingdom and Germany.

Canada’s relative strength does not appear to be a coincidence. In terms of land mass, Canada is the largest country on Earth not controlled by Vladimir Putin. Building and maintaining infrastructure across this vast territory, while maintaining one of the world’s highest living standards, speaks volumes about the talents and hard work of those who call this place home.

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Illustration: Li-Anne Dias