Progress Report 2012

3.  Progress Report on Industry Canada's Contributions to Themes I to III of the Federal Sustainable Development Strategy

Under the Federal Sustainable Development Strategy, Industry Canada is responsible for seven implementation strategies that contribute to Theme I (Addressing Climate Change and Air Quality).  Progress has been achieved on implementing commitments made by the department in the 2010-2013 Federal Sustainable Development Strategy and the Departmental Sustainable Development Strategy.

The following lists seven implementation strategies for which Industry Canada is responsible, as they appear in Annex 1 of the 2010 Federal Strategy:

• Continue to provide science policy advice and policy frameworks, and work with portfolio agencies to fulfill commitments made in Canada's Science & Technology Strategy in support of the environmental science and technologies, natural resources and energy, and information and communications technologies research priorities. (Implementation Strategy 1.1.21)
• Continue to work with industry stakeholders to encourage and promote the adoption and adaptation of new technologies such as information and communications technologies, biotechnology and clean energy technologies. (Implementation Strategy 1.1.22)
• Continue to implement the Strategic Aerospace and Defence Initiative(SADI) in support of strategic, research and development projects that contribute to new A&D technologies, and which may reduce greenhouse gas emissions and produce new energy efficiencies. (Implementation Strategy 1.1.23)
• Continue to promote the development and use of Corporate Social Responsibility (CSR) management tools by industry and the use of CSR standards in the Canadian marketplace in support of environmental sustainability. (Implementation Strategy 1.1.24)
• Continue to collaborate with partners to enhance Canada's competitive advantage in hydrogen and fuel cell technology development and commercialization. (Implementation Strategy 1.1.36 / 2.1.24)
• Asia-Pacific Partnership: Manage Canadian Asia Pacific Partnership funded projects that promote the development, diffusion, and deployment of clean technologies (Implementation Strategy 1.1.50) - With Environment Canada ( EC) and Natural Resource Canada (NRCan)
• Continue to implement the Automotive Innovation Fund (AIF) through to 2013 in support of strategic, large-scale research and development projects leading to innovative, greener, more fuel-efficient vehicles. (Implementation Strategy 2.1.26)

In summary, IC has met all or mostly met commitments in Implementation Strategies: 1.1.21 related to science and technology; 1.1.22 related to aerospace, clean technology and ICT; 1.1.23 related to the SADI; 1.1.24 related to CSR; 1.1.36 related to hydrogen fuel cells; and, 2.1.26 related to the AIF.   Commitments made in Industry Sector 1.1.22 related to bio-technology/bio-products and clean technology/energy have not been met due to termination of work in those industry sub-sectors due to re-orienting of priorities in the department. Also, one implementation strategy has been completed related to the Asia Pacific Partnership (1.1.26), on which IC collaborated with Environment Canada and Natural Resources Canada.

For a detailed description of these implementation strategies, how they contribute to the Federal Sustainable Development Strategy goals and targets, and non-financial performance results, please see below.

Implementation Strategy 1.1.21 

Continue to provide science policy advice and policy frameworks, and work with portfolio agencies to fulfill commitments made in Canada's Science and Technolody Strategy in support of the environmental science and technologies, natural resources and energy, and information and communications technologies research priorities.

Link to FSDS Goals and Targets

• Theme I   Addressing Climate Change and Air Quality
  • Goal 1   Climate Change: Reduce greenhouse gas emission levels to mitigate the severity and unavoidable impacts of climate change
    • Target 1.1   Climate Change Mitigation: Relative to 2005 emissions levels, reduce Canada's total greenhouse gas emissions ( GHG ) 17% by 2020.

Link to Industry Canada's PAA

• Strategic Outcome 2 - Advancements in science and technology, knowledge, and innovation strengthen the Canadian economy
  • Program Activity 2.1 - Government Science and Technology Policy Agenda
    • Program Sub Activity 2.1.1 Science and Technology Strategy

Description of the Implementation Strategy

IC is working closely with both portfolio agencies and Science Based Departments and Agencies, to further implementation of the federal S&T Strategy.

In 2008, the Minister of Industry received recommendations from the Science, Technology and Innovation council's (STIC) on sub-priorities of strategic importance to Canada.  Related to sustainable development, under the priority of environmental science and technologies, STIC identified the following sub-priorities: water (health, energy, security); cleaner methods of extracting, processing and using hydrocarbon fuels, including reduced consumption of these fuels.  Industry Portfolio agencies and other departments and agencies will apply these priorities to their research agenda's, as appropriate.

In June 2009, Minister Goodyear released an S&T Strategy Progress Report, noting that implementation was progressing well.  IC continues to work through the ADM Committee on S&T , the whole-of-government co-ordinating body for S&T Strategy implementation, to provide policy advice and frameworks in support of the S&T Strategy.

Relationship with FSDS Target(s)

By identifying four priority areas in the S&T Strategy, this should encourage research in sustainable development related fields, notably in the sub-priority areas of clean energy and reduced fuel consumption.  It is important to note that the S&T programs and activities in support of sustainable development, such as reducing greenhouse gas emissions, are conducted by other federal Science Based Departments and Agencies (e.g. Natural Resources Canada and Environment Canada).

Non-Financial Performance Results

IC is encouraging other departments and agencies to continue to implement the S&T Strategy commitments, particularly in the areas related to sustainable development, which fall under the four S&T Strategy priority areas of environmental science and technologies, natural resources and energy, and information and communications technologies.

Implementation Strategy 1.1.22  

Continue to work with industry stakeholders to encourage and promote the adoption and adaptation of new technologies such information and communications technologies, biotechnology and clean-energy technologies.

Link to FSDS Goals and Targets

• Theme I   Addressing Climate Change and Air Quality
  • Goal 1   Climate Change: Reduce greenhouse gas emission levels to mitigate the severity and unavoidable impacts of climate change
    • Target 1.1   Climate Change Mitigation: Relative to 2005 emissions levels, reduce Canada's total greenhouse gas emissions ( GHG ) 17% by 2020.

Link to Industry Canada's PAA

• Strategic Outcome 2 Advancements in science and technology, knowledge, and innovation strengthen the Canadian economy
  • Program Activity 2.1  Science, Technology and Innovation Capacity
  • Program Activity 2.2 Information and Communications Technologies  Research and Innovation
  • Program Activity 2.3  Industrial Research and Development Financing
    • Program Sub Activity 2.3.2 Aerospace innovation

Description of the Implementation Strategy

Industry Canada is involved in the development of a Canadian Aerospace Environmental Technology Roadmap (CAETRM).  The objective of CAETRM is to identify critical, enabling technologies and infrastructure that the Canadian aerospace industry will need in order to meet environmental and sustainability requirements over the next ten to fifteen years.  The CAETRM was conceived to formulate a Canadian Strategy to identify the technology drivers and trends, and address the need for a coordinated Canadian industry response to changes in the global aerospace landscape.  In addition, the Green Aviation Research and Development Network (GARDN) fosters development of technologies that will reduce aviation's environmental footprint in a broad range of areas from noise and emission to materials and manufacturing processes.  The objective of GARDN is to provide collaborative opportunities for the Original Equipment Manufacturers (OEMs), SMEs, and other key stakeholders in the areas of environmental technologies.  Activities related to GARDN are in support of the competitive excellence of Canadian aerospace products and services, the economic success of the member companies and the development and training of highly qualified personnel in the aerospace environmental field. 

Work with industry through Precarn and CANARIE to support the development and application of intelligent systems, sensors, and advanced networks which optimize energy use and monitor and reduce pollution. 

Specific project  for FY 2010-2011 for Precarn under their T-Gap Program include:

• Smart Compressed Natural Gas (CNG) Refuelling Station
• Wireless Intelligent Building Sensor Network
• Wireless Pipeline Inspection Robot to Detect Leakages
• Infrastructure Operations Optimization for Oil Sands

CANARIE is the sponsor of the Green Star Network, which is built around three components.  Industry Canada's Communications Research Centre (CRC) is a major partner in the CANARIE Greenstar Network, and actively participates in research that benefits carbon emission reduction.

• Networking and computational infrastructure at geographically distributed facilities via the CANARIE network;
  • Middleware to provide cloud services to applications and users;
  • A "Carbon Protocol" for the ICT industry, providing a quantified approach to CO2 emission reductions, based on the ISO14064 family of standards.

Relationship with FSDS Target(s)

CAETRM and GARDN are intended to assist the Canadian aviation industry in reducing its environmental footprint and meeting environmental and sustainability requirements (in operation and manufacturing) through environmental technologies, infrastructure development, and collaboration across the industry.

The development and application of intelligent systems and networks will reduce carbon consumption and GHGs. In manufacturing and resource processing, the adoption of an intelligent system which combines a network of energy or pollution sensors with automated infrastructure management software can very precisely adjust energy and resource requirements to optimize output, and avoid wastage, many times a second, if required. This can ensure a reduction in energy requirements, lower carbon emissions, and a lower cost per unit of output. 

For intelligent building systems, heating, ventilation and air conditioning (HVAC) systems can be linked through ICT networks to advanced environmental monitoring sensors to minimize energy consumption and optimize the contribution of passive solar heating over a 24 hour period.

CANARIE 's Green Star network (GSN) has the goal of creating technology, protocols, and standards for reducing the carbon footprint of Information and Communication Technology (ICT). ICT is responsible for 2% of global CO2 emissions, due to high consumption of electricity produced from coal.

Non-Financial Performance Results

Aerospace:

• Participated as an Ex Officio member of the Board of Directors of the Green Aviation Research & Development Network (GARDN), an initiative of the Business-led Networks of Centres of Excellence.
• GARDN has co-funded 17 collaborative projects to a total project cost of over $23 million. During the fiscal 2012-13 GARDN spent $3.25M on research projects, nearly double that during the previous fiscal year. GARDN supports projects that address the need to reduce the impact of aviation on environment in many different areas of technology from noise and emission to alternative fuels.
• GARDN's application for renewal of funding beyond its first term (2009-2013) was not approved by the BL-NCE Secretariat. However, GARDN has recently submitted a Letter of Intent in response to a call for proposals for new BL-NCEs. The new BL-NCE (GARDNII), if successful, will start operating from March 2014 for a period of four years
• Participated in the Canadian Networking Aerospace Project for Europe (CANNAPE) as a Core Group and Steering Committee member to promote R&D collaboration in aerospace between Canadian and European companies and researchers. Two joint workshops, one in Montreal, Quebec, and the other in London, UK were held in which technology areas of common interest as well as support mechanisms for funding collaborative projects were discussed.
• The CAETRM document has been kept up to date as a roadmap that highlights Canadian aerospace industry's technology priorities. CAETRM is one of the key documents that can be used to develop a critical technology list as recommended by the Aerospace Review. The list will help all the stakeholders to determine investment priorities in aerospace research and technology development.
• CAETRM has also been used to identify collaborative opportunities in aerospace research between Canada and the European countries through the CANNAPE initiative.
• Continued to deliver the Bombardier C-Series Program, a repayable contribution program that is helping to maintain strong research and development in Canada's aerospace sector and which could help position the sector for more cutting edge work in the future. The C-Series is targeting 20% fewer CO2 emissions and 50% fewer NOx emissions than current in-production aircraft.

Information and Communications Technology

CANARIE supports the Green Star Network (GSN) which is developing the world's first internet network, where the network nodes will be powered entirely by wind and solar energy and will provide the same reliability to users as the current Internet network. A likely outcome of this project is a broader market for Green IT and a strong Canadian leadership position within it.

Implementation Strategy 1.1.23  

Continue to deliver and manage the Strategic Aerospace and Defence Initiative (SADI) in support of strategic, research and development projects that contribute to new and improved Aerospace & Defence technologies, and which may reduce greenhouse gas emissions and produce new energy efficiencies.

Link to FSDS Goals and Targets

• Theme I   Addressing Climate Change and Air Quality
  • Goal 1   Climate Change: Reduce greenhouse gas emission levels to mitigate the severity and unavoidable impacts of climate change
    • Target 1.1   Climate Change Mitigation: Relative to 2005 emissions levels, reduce Canada's total greenhouse gas emissions ( GHG ) 17% by 2020.

Link to Industry Canada's PAA

• Strategic Outcome 2. - Advancements in science and technology, knowledge, and innovation strengthen the Canadian economy
  • Program Activity 2.3 - Industrial Research and Development Financing
    • Program Sub Activity 2.3.3 - SADI

Description of the Implementation Strategy

The SADI has three objectives: to encourage strategic R&D that will result in innovation and excellence in new and improved products, services and processes; to enhance the competitiveness of Canadian aerospace and defence companies; and, to foster collaboration between research institutes, universities, colleges, and the private sector.

Although sustainable development is not an explicit objective of SADI , results from some projects may reduce greenhouse gas emissions and produce new energy efficiencies.

Relationship with FSDS Target(s)

SADI projects have potential sustainable development benefits including the following:  Reduction in GHGs ; reduction in water pollution; reduction in carbon / ecological footprint; lower energy consumption; and reduction of hazardous / toxic materials in manufacturing processes.

Non-Financial Performance Results

SADI's ultimate outcome is to contribute to the achievement of broader technological, economic, environmental and social benefits for Canadians. For example:

• One project has seen the implementation of waste reclamation and recycling programs to reduce industrial waste and minimize the company's ecological footprint.
• Another company is introducing greater efficiencies to its steel technologies to lower power consumption resulting in a much smaller carbon footprint.

Implementation Strategy 1.1.24

Continue to promote the development and use of CSR management tools by industry and the use of CSR performance and reporting standards in the Canadian marketplace in support of environmental sustainability.

Link to FSDS Goals and Targets

• Theme I   Addressing Climate Change and Air Quality
  • Goal 1   Climate Change: Reduce greenhouse gas emission levels to mitigate the severity and unavoidable impacts of climate change
    • Target 1.1   Climate Change Mitigation: Relative to 2005 emissions levels, reduce Canada's total greenhouse gas emissions ( GHG ) 17% by 2020.

Link to Industry Canada's PAA

• Strategic Outcome 3  Canadian businesses and communities are competitive
  • Program Activity 3.1  Small business growth and prosperity
  • Program Activity 3.2 Industrial competitiveness and capacity

Description of the Implementation Strategy

Under this implementation strategy, Industry Canada will:

• Continue to develop information and management tools for business to help them integrate CSR practices into their operations in support of their competitiveness in the global marketplace.
• Continue to post resources on the IC CSR website, such as the existing SME Sustainability Road Map and the Sustainability Tool Kit for Business.
• Undertake strategic outreach activities to enhance effectiveness and reach of these tools.
• Continue to promote CSR performance and reporting standards and practices relevant to Canadian business.
• Commission at least one survey of Canadian companies' CSR disclosure practices over the three year period of the Departmental SD Strategy.

Relationship with FSDS Target(s)

Increased private sector implementation of CSR practices will help reduce GHG emissions by the private sector.  CSR practices that can help reduce GHG emissions include: eco-efficiency, which leads to reduced energy consumption; rationalization of fleets towards more fuel efficient transportation; design for environment/sustainability (DfE, DfS), life cycle analysis (LCA), sustainable/lean manufacturing practices and extended producer responsibility (EPR) help reduce resource inputs into the production of products, thus reducing GHG emissions.

Non-Financial Performance Results

In fiscal year 2012-2013, Industry Canada promoted the development and use of CSR management tools by industry and the use of CSR performance and reporting standards in the Canadian marketplace through:

• the update to the 2006 Corporate Social Responsibility Implementation Guide for Canadian Business;
• awareness-raising of international CSR performance standards endorsed by the government, in particular the OECD Guidelines for Multinational Enterprises through Industry Canada's participation in the National Contact Point chaired by the Department of Foreign Affairs, Trade and Development;
• awareness-raising of international CSR reporting standards endorsed by the government including the Global Reporting Initiative (GRI) through providing support to the first GRI conference held in Canada in fall 2012 in Toronto; and,
• in support of strategic outreach purposes, continued support to the Industry Association Sustainability Council under the Canada-based Network for Business Sustainability.

Implementation Strategy 1.1.36 / 2.1.24  

Continue to collaborate with partners to enhance Canada's competitive advantage in hydrogen and fuel cell technology development and commercialization.

Link to FSDS Goals and Targets

• Theme I   Addressing Climate Change and Air Quality
  • Goal 1   Climate Change: Reduce greenhouse gas emission levels to mitigate the severity and unavoidable impacts of climate change
    • Target 1.1   Climate Change Mitigation: Relative to 2005 emissions levels, reduce Canada's total greenhouse gas emissions ( GHG ) 17% by 2020.
  • Goal 2   Air Pollution: Minimize the threats to air quality so that the air Canadians breathe is clean and supports healthy ecosystems
    • Target 2.1   Air Pollutants: Reduce air pollutants in order to maintain or improve air quality across the country and achieve the emission targets which are currently under development in consultations with provinces and stakeholders.

Link to Industry Canada's PAA

• Strategic Outcome 2  Advancements in science and technology, knowledge, and innovation strengthen the Canadian economy 
  • Program Activity 2.1   Science, Technology and Innovation Capacity

Description of the Implementation Strategy

Work on the clean energy technologies sector focuses on fostering development of energy sub-sectors where IC has an influence and where Canada has an emerging competitive advantage, such as supplier industries for fuel cells, wind, solar, and ocean energy.  To this end, Industry Canada provides expert analysis, advice, and facilitation to raise awareness of Canadian technology and service capabilities in emerging energy sectors; promotes global supply chain opportunities; and produces reasoned policy recommendations.

Recent activities related to this implementation strategy include the creation of supply chain studies and sector profiles for wind and fuel cell industries, participation in the International Partnership for Hydrogen and Fuel Cells in the Economy (IPHE), and co-chairing of the federal Hydrogen and Fuel Cell Interdepartmental Committee.  IC also plans to collaborate on the development of a marine energy technology roadmap.  IC will continue to examine the current business environment for Canadian firms, ensuring that business issues are understood in policy making and leveraging available resources across the federal government to strengthen Canada's strategic advantages

Relationship with FSDS Target(s)

Enhancing the development and commercialization of clean energy technologies can accelerate the deployment of lower-emitting energy generation.  Deployment of energy generation technologies such as wind and energy carriers such as hydrogen fuel cells will help to reduce emissions of greenhouse gases. Commercialization of hydrogen fuel cells could have utility in moving toward this goal, as they are a versatile technology with a variety of applications.

Non-Financial Performance Results

In fiscal year 2012-13, Industry Canada:

• Completed a detailed sector profile on Canada's hydrogen fuel cell (HFC) industry;
• Conducted business case analyses to assess opportunities for hydrogen fuel cells in off - grid type applications;
• Undertook Canadian hydrogen fuel cell supplier development initiatives in partnership with industry and other government departments;
• Supported Canadian HFC companies, academic institutions and foreign multinational firms conducting fuel cell research, development, demonstrations and manufacturing in Canada;
• Chaired a federal committee of government representatives to help coordinate activities and improve analysis and advice concerning fuel cell commercialization; and,
• Represented Canada at International Partnership for Hydrogen & Fuel Cells in the Economy (IPHE).

Implementation Strategy 1.1.50

Asia-Pacific Partnership: Manage Canadian Asia Pacific Partnership-funded projects that promote the development, diffusion and deployment of clean technologies (completed).

Link to FSDS Goals and Targets

• Theme I Addressing Climate Change and Air Quality
  • Goal 1 Climate Change: Reduce greenhouse gas emission levels to mitigate the severity and unavoidable impacts of climate change
    • Target 1.1 Climate Change Mitigation: Relative to 2005 emissions levels, reduce Canada's total greenhouse gas emissions ( GHG ) 17% by 2020.

Link to Industry Canada's PAA

• Strategic Outcome N.A.
  • Program Activity N.A.
    • Program Sub Activity N.A.

Description of the Implementation Strategy

Industry Canada participated in the work of the Asia-Pacific Partnership Task Forces and facilitated the involvement of the private sector. In this context, consultations with key domestic industrial sectors were held.

The Asia-Pacific Partnership initiative will not continue after 2010-2011.

Relationship with FSDS Target(s)

N/A - initiative will not continue after 2010-2011.

Non-Financial Performance Results

Implementation Strategy 2.1.26  

Continue to implement the Automotive Innovation Fund (AIF) through to 2013 in support of strategic, large-scale research and development projects leading to innovative, greener, more fuel-efficient vehicles.

Link to FSDS Goals and Targets

• Theme I   Addressing Climate Change and Air Quality
  • Goal 2   Air Pollution: Minimize the threats to air quality so that the air Canadians breathe is clean and supports healthy ecosystems
    • Target 2.1   Air Pollutants: Reduce air pollutants in order to maintain or improve air quality across the country and achieve the emission targets which are currently under development in consultations with provinces and stakeholders.

Link to Industry Canada's PAA

• Strategic Outcome 2  Advancements in science and technology, knowledge, and innovation strengthen the Canadian economy
  • Program Activity 2.3 Canada's Research and Innovation Capacity
    • Program Subactivity 2.3.1  Automotive Innovation

Description of the Implementation Strategy

Budget 2008 announced that the government would provide $250 million over five years to support strategic, large-scale R&D projects in the automotive sector, in developing innovative, greener and more fuel-efficient vehicles.

Under the AIF , Industry Canada considers funding proposals that provide for private sector investment in Canada of more than $75 million over five years for vehicle or powertrain assembly operations associated with significant automotive innovation and R&D initiatives.  The objectives of the AIF are as follows:

• build automotive research and development capacity in Canada and secure knowledge-based jobs;
• enhance the government's science and technology ( S&T ) and environmental agendas;
• support the development and/or implementation of innovative, fuel efficient technologies or processes;
• promote long-term economic benefit to Canada including significant job creation/retention; and
• leverage private sector investments to foster Canadian competitiveness.

Each eligible project considered for funding is subjected to a comprehensive due diligence process that may involve external experts that will examine the feasibility of the proposed eligible project.  All proposals are assessed in the context of their relevance to the objectives of the AIF and must provide environmental, technological, and economic benefits to Canada.

Reporting requirements are outlined in the AIF 's Results-based Management and Accountability Framework and Risk Based Audit Framework ( RMAF - RBAF ).  The RMAF and RBAF provide a strategy for monitoring and evaluating project performance, and a risk-based approach to monitor and manage risks associated with the project.

Relationship with FSDS Target(s)

Eligible activities supported under the AIF are those typically associated with major automotive innovation and R&D initiatives to develop and build greener, more fuel-efficient vehicles, including:

• new product development (e.g., advanced emissions technologies, energy-efficient engines and transmissions, advanced materials, including engineered plastics, and lightweight components and materials);
• leading-edge engineering and design, and prototype development;
• advanced product testing that ensures cleaner, more efficient automotive performance, and reduced greenhouse gases;
• development of new production methods and process technologies, including advanced flexible manufacturing techniques;
• new or expanded facilities to produce leading-edge and more energy efficient vehicles and powertrains;
• substantive investments in new flexible manufacturing processes; and
• introduction of other new transformative production technologies to substantially increase productivity and efficiency (e.g., robotics and advanced IT systems).

Non-Financial Performance Results

In fiscal year 2012-13, the AIF was renewed (January 4, 2013) with an additional $250 million in funding over the next five years (2013-14 to 2017-18). AIF projects include R&D components (e.g. establishing facilities to undertake innovative research; focussed R&D on specific automotive components). Recent projects supported include: Project Lexus which increases the production volume of the Lexus RX350 and start production of the RX450h hybrid in Cambridge, Ontario. AIF projects are subject to comprehensive due diligence prior to the approval of contribution agreements. The AIF is governed by a Performance Measurement Strategy and projects are managed using a risk-based approach.