Environmental Technologies Cluster

Transcription

1 Environmental Technologies Cluster October 2004

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3 Environmental Technologies Cluster

4 ISBN (French edition ISBN ) Legal deposit : March 2005 Bibliothèque nationale du Québec National Library of Canada All rights reserved for all countries. The content may not be copied in any way or translated in whole or in part without the permission of the Communauté métropolitaine de Montréal

5 Note to the reader Through its Economic Development Plan, the Communauté métropolitaine de Montréal (CMM), has adopted a competitiveness strategy centred on dynamic and innovative business clusters. In the fall 2003, the CMM launched a cluster identification program for metropolitan Montreal. This marked the first phase of a process leading to the development and launch of an integrated economic development and innovation strategy. For each of the sectors studied, the CMM wishes to join forces with all the territorial bodies and economic stakeholders concerned. It means to concentrate its efforts on its own role of planning and coordination and does not intend to take the place of existing players and decision-makers in the field, whose role it is to agree on a development plan under the supervision of a relay organization representing their sector. This document is divided into two distinct sections: The first section presents a configuration of the Environmental Technologies cluster; The second section groups together the ideas of the main players of that particular cluster and their thoughts on future development. The cluster configuration was based on documentary research confirmed by stakeholders in the cluster itself. Comments were then made by industry officials in the ministries concerned. This first section describes the value chain of the cluster and goes on to identify the organizations or infrastructure contributing to its development. Finally, as economic development transcends administrative or political borders, potential links with other regions of Quebec are indicated, taking into account the niches of excellence developed by certain regions under the ACCORD (Action concertée régionale de développement) program. While the first section of the document is inherently factual, the second is more subjective, since it reflects the perceptions of the main players in each cluster. These thoughts were gathered in the strictest confidence so as to produce a maximum amount of data. They are focused on two main themes, the state of relational assets and growth strategies. Since we know that relationships between stakeholders are the first source of innovation, it is necessary to identify the relational flow between the various components of the cluster. In the same way, in order to set priorities, we need to know which strategies for growth are favoured by the players in the field. This document is thus intended as a catalyst for priority actions aiming to energize the strategic process of the cluster and to give direction to its innovative thrust. The process will be carried out in a spirit of openness and dialogue which will eventually enable the Montreal metropolitan area to assert its distinctive capabilities among the world s most innovative and prosperous cities. Michel Lefèvre Consultant Economic Development Communauté métropolitaine de Montréal Environmental Technologies

6 Environmental Technologies Configuration Perceptions At the Forefront of Technological Innovation Industrial Chain Firm Foundations The User Markets The User Markets Development Factors Research and Development Research Commercialization Training Research Financing Specialized Services Business Support Structuring Organizations Infrastructure Interregional Links Elsewhere in Quebec The Bio-economy Choice An Underlying Trend Strategic Elements Developing the Technological Knowledge Base Avenues for Growth Laying the Groundwork for the Future Appendices University Research Units on CMM Territory Sources Credits Environmental Technologies

7 At the Forefront of Technological Innovation Just 25 years ago, the environment industry was in its early stages of existence; today it has become a huge market. According to the OECD, it is one of the most rapidly growing sectors in the world (+ 9% per year between 1992 and 1997). Canada, Quebec and the Montreal Metropolitan Area are all successful in this market. Around 60% of all businesses representing Quebec s environment industry have their offices on CMM territory. The entire range of goods and services is represented. Thousands of people are employed, and the industry generates economic spinoffs worth billions of dollars. A widely deployed industry The environment industry encompasses business activities relating to the production of environmental goods and services, as well as environment-related construction. On a worldwide scale, these three large categories represent respectively 22%, 49% and 29% of total activities. That is the definition used by Statistics Canada and again by the Ministry of Economic and Regional Development and Research (MDERR) in a discussion paper published in spring 2004 on the environment industry sector in Quebec. More specifically, the report says, the environment industry includes companies which produce goods and services used to measure, prevent, limit, reduce to a minimum or counteract environmental damage such as water, air or soil pollution, as well as the harmful effects of waste, noise and ecosystems. This industry also comprises activities relating to technology, products and services that are less pollutant to the environment and which reduce environmental risks, minimize pollution and save resources. A huge market The environment industry is a vast sector, affecting all aspects of the economy. Its market is consequently very large. By the end of the decade, the world environment market will be worth CDN$1 trillion, according to Environmental Business International (EBI) forecasts. In 2002, this figure was CDN$846 billion. Canada s share in this market was estimated at $23 billion (2.6% of the total) by the EBI. This is very little compared to the United States ($310 billion), Western Europe ($248 billion) and Japan ($145billion), the top trio. The world environment market is divided into several subsectors. Two of these stand out clearly from the others: waste management services (21%), and water technology, equipment and services (40%). The other 40% of the market is divided into around ten subsectors, the largest of which are resource recovery (8%), waste management material (7%), controlling air pollution (6%), consulting engineering (5%), industrial services (5%) and hazardous waste management services (3%). The market is dominated by multisectoral conglomerates and by large, well established firms capable of providing turnkey projects. Quebec firms, mostly SMBs, do not belong to either of these two categories. Environmental Technologies

8 Consulting engineering, a technological vector The greater Montreal urban area is recognized for its consulting engineering firms, several of which are true multinationals. About a hundred of these firms offer environment-related services. Many of them have turned to export markets following the end of major construction work and tighter government spending on the environment in the 1990s. Consulting firms in the Montreal area appear to be excellent vectors for environment technology, especially as many of them are owners of technology that they themselves acquired or even helped develop. Essential technological contribution The environment industry is dependent in large part on the use of technologies and moves forward as scientific and technical advances are made. Recent studies suggest that more than 50% of future technologies linked to the environment have not yet been commercialized. This signifies that the market is still open; what is more, it is growing faster than the services market. Two subsectors are growing at a faster than average rate: prevention methods and equipment, and clean energy systems, both representing true technological innovation tanks, to quote the MDERR document. Quebec and Montreal companies in the environment sector have demonstrated their ability to develop high-performance technology, notably in the treatment of water, air, soil, energy and waste material. There is an enormous potential there to export, which is far from realized. In addition, researchers in a number of labs working on developing new technologies have discoveries in store waiting to be put on the market. A structured cluster, focused on environment technology, would make it possible to take full advantage of anticipated growth in the environment industry that is expected world-wide. Environmental Technologies

9 Emerging technology cluster Environmental Technologies Recherche Research Research Valorisation Commercialization de la recherche Training Formation Technology Suppliers au E r Wate ir A r Ai I nfrastructures Public Infrastructur publiques e B Buildin âtiment g Subsidizing Organismes Organizations subventionnaires C Venture apital de Capita risque l S Specialized ervices spécialisés Service s ol S l Soi Waste Matières résiduelles Bio-processes Bioprocédés Entreprises Utilities services public Manufacturers Entreprises manufacturières Incubators, Technological and Incubateurs/Parcs Multi-Tenant Parks, etc. Recycling/Recovery Récupération/Recyclage Prevention Prévention Business Support Encadrement d affaires Structuring Associations Associations et and Organizations organismes structurants Consulting G énie Engineerin conseil g Resources Ressources / Agro-ecology et Agroenvironnement Environmental Technologies

10 Employment 1 by Borough and City Management, Scientific and Technical Consulting Services Montreal Island East End Rivière-des-Prairies/Pointe-aux-Trembles/ Montréal-Est Anjou Montréal-Nord Saint-Léonard Montreal Island Central Core Mercier/Hochelaga-Maisonneuve Ahuntsic/Cartierville Outremont Plateau Mont-Royal Rosemont/Petite-Patrie Ville-Marie Villeray/Saint-Michel/Parc-Extension Sud-Ouest Westmount Côte-des-Neiges/Notre-Dame-de-Grâce Montreal Island West End Mont-Royal Côte-Saint-Luc/Hampstead/Montréal-Ouest Saint-Laurent Montreal Island South West Lachine Montréal-Ouest Verdun Montreal West Island Dollard-des-Ormeaux/Roxboro Dorval/L Île-Dorval Pointe-Claire Kirkland Beaconsfield/Baie-d Urfé L Île-Bizard/Ste-Geneviève/ Ste-Anne-de-Bellevue Pierrefonds/Senneville Montreal Island Laurentians Blainville Boisbriand Bois-des-Filion Deux-Montagnes Lorraine Mirabel Oka Pointe-Calumet Rosemère Sainte-Thérèse Saint-Eustache Saint-Joseph-du-Lac , , , Saint-Colomban (outside the CMM) Saint-Jérôme (outside the CMM) Lanaudière L Assomption Mascouche Repentigny Terrebonne North Shore 1. Individuals 15 years of age or older who have a regular workplace or who work from home. People who have no fixed address are not included. N.B.: Figures were rounded to the closest multiple of 5; they may therefore not add up exactly to the sum of the components. Source: Statistics Canada, Employment by Place of Work, 2001 Census Figures on Waste Management and Remediation Services represent NAICS code 562 Laval Montérégie South Shore Beloeil Boucherville Brossard Candiac Chambly Châteauguay Delson Greenfield Park Hudson La Prairie L Île-Perrot Longueuil Mont-Saint-Hilaire Notre-Dame-de-l Île-Perrot Otterburn Park Pincourt Saint-Basile-le-Grand Saint-Bruno-de-Montarville Sainte-Catherine Sainte-Julie Saint-Hubert Saint-Isidore Saint-Lambert Saint-Lazare Saint-Philippe Varennes Vaudreuil-Dorion Montreal Metropolitan Area Quebec Canada , ,710 18, ,935 Notes: Management, Scientific and Technical Consulting Services represent (NAICS 5416) include environmental consulting services and other scientific and technical consulting services. This code does not reflect the entire environment technology industry because a number of jobs are included in other clusters (plastics, pulp and paper, etc.) Environmental Technologies 10

11 Employment 1 by Borough and City Waste Management and Remediation Services Montreal Island East End Rivière-des-Prairies/Pointe-aux-Trembles/ Montréal-Est Anjou Montréal-Nord Saint-Léonard Montreal Island Central Core Mercier/Hochelaga-Maisonneuve Ahuntsic/Cartierville Plateau Mont-Royal Rosemont/Petite-Patrie Ville-Marie Villeray/Saint-Michel/Parc-Extension Sud-Ouest Côte-des-Neiges/Notre-Dame-de-Grâce Laurentians Blainville Boisbriand Mirabel Sainte-Anne-Des-Plaines Sainte-Thérèse Saint-Eustache Lanaudière Mascouche Repentigny Terrebonne North Shore Laval Montreal Island West End Mont-Royal Saint-Laurent Montreal Island South West Lachine Verdun Montreal West Island Dollard-des-Ormeaux/Roxboro Dorval/L Île-Dorval Pointe-Claire Pierrefonds/Senneville Montreal Island ,155 Montérégie South Shore Boucherville Brossard Chambly Châteauguay Delson Hudson Longueuil Mercier Notre-Dame-de-l Île-Perrot Saint-Constant Sainte-Catherine Saint-Hubert Saint-Philippe Montreal Metropolitan Area ,555 Quebec 6,120 Canada 23, Individuals 15 years of age or older who have a regular workplace or who work from home. People who have no fixed address are not included. N.B.: Figures were rounded to the closest multiple of 5; they may therefore not add up exactly to the sum of the components. Source: Statistics Canada, Employment by Place of Work, 2001 Census Figures on Waste Management and Remediation Services represent NAICS code 562. Environmental Technologies 11

12 Configuration Environmental Technologies 12

13 Industrial Chain Environmental Technologies 13

14 Industrial Chain Firm Foundations Montreal s environment industry has a solid base of companies in each of the major market segments (water, air, soil, waste, environmental management). The number of these companies varies depending on the source consulted. According to Statistics Canada, in 2002, there were 1,697 businesses in Quebec whose primary or secondary activity was environment-related. In its outline of the industry, the MDERR puts this number at 740, based on a 1999 survey by the Comité sectoriel de la main-d œuvre en environnement (environment workforce sector committee CSMOE), which only includes companies whose main activity is the environment. The 1999 survey also reveals that 381 of these companies specialize in only one market sector (water, air, soil, waste, environmental management), while 359 of them operate in more than one sector. The waste management sector has the biggest concentration of companies (231), followed by soil (155), water (149), environmental management (144) and air (66). In all, 458 of these firms (62%) are established in the regions of Montreal, Laval, Montérégie, Lanaudière and the Laurentians. By combining various directories from (CRIQ, Écoroute, Enviro-Accès, Réseau Environnement, Stratégis), we can draw up a list of some five hundred firms working in the environment sector on the territory of the CMM. This list includes companies of all sizes: multinationals, major local players, firmly established SMBs and R&D start-ups. Most common, however, are small businesses. Over 60% of companies listed by the CSMOE in 1999 have fewer than 20 employees. This situation does not seem to be a disadvantage on the environmental technologies market, since the companies with 100 employees or less produced 70% of environmental goods during the year Finally, the Quebec environment industry, all categories combined, generated revenue of $3,067 billion in 2002 (Canada: $15.8 billion). With 60% of companies, including the largest, the economic benefits for the Montreal area come close to, and even exceed, $2 billion. A mostly specialized workforce How many jobs does the environment sector create? A survey carried out at the end of the 1990s by the Canadian Council for Human Resources in the Environment Industry (CCHREI) showed that around 97,000 people worked in the environment industry itself. Of these, 45,000 were environment specialists and 52,000 were workers or support staff. The number of specialists working in Quebec was at the time close to 10,000, out of a total estimated workforce of 20,000. The 1999 CSMOE survey shows similar results, since it tallies 19,784 jobs, spread across the different market segments as follows: water (6,298), air (3,464), soil (4,227), waste (12,819) and environmental management (2,414). The same CSMOE survey shows that these jobs are offered in four different areas: technology and environmental solutions providers (45%); contractors in the other sectors (20%); municipalities and institutions (20%); NGOs and NPOs (5%). Environmental Technologies 14

15 Industrial Chain Between twelve and fifteen thousand of these jobs are reported to be situated in the Greater Montreal Area, but this remains to be confirmed. Undeniably, however, the number of jobs increased significantly during the 1990s. According to Statistics Canada, employment in the environment industry grew approximately 50% between 1995 and 1998 five times higher than the growth rate for the economy as a whole. The employment map Not surprisingly, the majority of environment companies are located in Montreal (about 275) and Montérégie (about 130). There are around sixty in Laval and twenty in the Basses-Laurentides area and southern Lanaudière. City centres (Montreal, Longueuil, Laval) and some boroughs (Saint-Laurent, Boucherville) are home to most of the consulting firms, while the manufacturing companies are based in industrial zones and next to major communication routes (Highway 40 and Metropolitan Highway, Highway 20, junction of highways 20 and 15, Highway 15 and Highway 440). This explains in large part why several companies are based in the towns or boroughs of Saint-Laurent, Dorval, Pointe-Claire, Lasalle, Lachine, Mont-Royal, Anjou, Pointe-aux-Trembles, Blainville, Boisbriand, Boucherville, Sainte-Julie and Varennes. On Montreal Island, the borough of Saint-Laurent is by far the borough that attracts the most companies (45) after the former city of Montreal itself (140). Dorval follows, with about twenty companies, while its neighbour Pointe-Claire has about fifteen. Montreal s East End (Anjou, Saint-Léonard, Pointe-aux-Trembles, Montréal-Est) seems to be the gathering point for waste recovery, recycling and conditioning companies, with over a third of businesses in this subsector present on the Island (about twenty companies). There is another concentration of activities of this type in the Lasalle-St-Pierre-St-Henri zone (around ten companies). In fact, recovery of residual and waste materials accounts for a significant part of the environment industry s activities in the metropolitan area, with over 160 companies for all materials combined (organic matter, oils, textiles, plastics, glass, metals, hazardous products, etc.). There are about thirty of these companies that deal only in the transportation and conditioning of waste products. A complete range of technologies There are approximately two hundred equipment and technology providers, including some manufacturers, but also a large contingent of distributors of products manufactured outside Quebec, some of whom export their products, often by integrating them with anti-pollution systems. In early September 2004, Enviro-Accès published a new directory listing over 160 companies in Quebec that use environmental technologies. This list is the most precise portrait to date since it groups companies by sector (water, air/gas, soil and sediment, mud, leachate, animal excrement, Environmental Technologies 15

16 Industrial Chain residual matter, protection of ecosystems) and by field (municipal, industrial, agricultural, renewable energy and climate change, ecological products and processes). Drinking water and wastewater treatment technologies seem to be by far the most commercialized. This is due to the sanitation programs that have allowed municipalities to acquire equipment and plants to reduce and to process their waste. Then come the technologies associated with air quality control and the reduction of greenhouse gas emissions. There seem to be fewer available technologies for soil waste management and decontamination. Quebec businesses are also prominent in the restoration of contaminated sites and in waste recycling. Finally, the presence of aluminium smelters and pulp and paper mills in the province means that several Quebec companies have expertise in processing industrial waste from these two sectors and in recycling paper and boxboard. Statistics Canada figures show that, in 1998, the prime metal manufacturing industry and the pulp and paper industry were the environment industry s main clients. In short, the whole range of environmental goods listed on the table on the following page can be found in the greater metropolitan area. Low exports Around one half of equipment and technology suppliers in the Montreal area market more than one technology. Export levels are not as high as one would wish, even though several firms are successful on international markets. The value of Quebec exports reached $257.5 million in 2002 (Canada: $1.415 billion), accounting for 8.4% of total sales (Canadian average: 9%). Exports are for the most part in goods, generating revenues of $162.4 million, broken down as follows: waste material, $76 million; water $54.4 million; and air, $22.9 million. The U.S. market is the primary destination by far, accounting for 79% of total exports from Quebec (Canada: 80%). The situation is improving. The external market is expanding at almost twice the rate of the internal market. Small and medium-sized businesses are responsible for practically all the growth in exports. Much of the equipment used in Quebec comes from suppliers in the U.S., Europe or Asia. Canada, on the whole, is an importer of environmental products. In 2000, the total value of imports was $2,476 billion. According to Statistics Canada, between 1996 and 2000, Canada imported purchases of 60% of its analysis equipment, 57% of its waste management equipment, 44% of its air pollution control equipment and 36% of the commodities used for water and wastewater treatment. International competition Quebec companies aiming to break into the Canadian or world markets not only face Canadian competition but also competitors based in the United States and in Western Europe, as the table below shows. Environmental Technologies 16

17 The environmental technology offer is concentrated in two regions of the globe: the United States and Western Europe. In both regions, companies can rely on a considerable domestic market to validate their products before exporting them. Both areas also have a favourable trade balance, since exports exceed imports. Two other countries stand out: Japan and the Netherlands. Both have small territories and dense populations. They are forced to find efficient solutions to the numerous environmental problems they face due to these factors, solutions which they then propose to foreign markets. With Japan s strength in manufacturing, the country produces a great deal of environmental equipment, while the Netherlands concentrates on developing agro-environmental technologies, given the extent of its livestock and agricultural industry. Environmental Technologies 17

18 Industrial Chain Water Air Waste Renewable energies Alternative fuels Analysis Noise Recyclable Materials Environmental Goods Water supply and water conservation material or technology for the supply and delivery of freshwater, water purification material, water treatment equipment parts (pumps, pipes and valves). Wastewater management and sewage water processing chemical product recovery systems, ventilation systems, biological recovery systems, gravity sedimentation systems, fuel separation systems, wastewater recycling material, chemical products for wastewater treatment, water pollution control material, canvases, screens, clarifiers, filters and filtering material. Air pollution control (indoor or outdoor) catalytic converters, chemical product recovery systems, dust collectors, separators, dust extractors, purifiers, deodorizing material. Management of hazardous and non-hazardous waste material for storing and treating hazardous waste, waste collection material, waste disposal material, waste handling and separation material, recycling and incineration material. Sanitation/treatment of soil, surface water, sea water and ground water absorbents,bioremediation equipment, soil vapour extraction equipment, cleaning equipment in case of spillage, containment systems, chemical and biorestoration products. Eco-energetic material energy management and recovery equipment. Solar energy systems and materials solar facilities, photovoltaic systems,solar thermodynamic generators, solar heating systems for water and buildings. Biomass energy systems and equipment landfill gas recovery systems, other systems and materials that use organic matter (forest and agricultural residue) to produce electricity, chemical products or transportation fuel. Other renewable energy systems and materials wave energy, tidal power and ocean thermal energy conversion systems, geothermal energy. Alternative fuel systems clean fuel systems (reformulated and oxygenated), combustible cell technology, advanced hydrogen and battery systems. Clean technologies, eco-efficient technologies and relatedcomponent integrated processes technologies, material recovery technologies. Assessment, analysis and monitoring of the environment measuring and monitoring material, sampling systems, methods control material, data acquisition systems, other instruments/machines, environment information systems and/or analysis software such as laboratory, remote sensing and MIS management software. Noise and vibration control machinery and equipment noise reducers and silencers, soundproofing material, anti-vibration devices and anti-noise structures alongside highways. Recyclable material metals (ferrous and non-ferrous, including cars), paper, card and other recyclable materials (plastic, glass, textiles, liquids and sewage sludge). Source: Statistics Canada, Environment Industry Survey, business sector, Canada, 2000 pp. 4 and 5 Environmental Technologies 18

19 Industrial Chain Major Countries Environment Industry Offer Country Expertise Offer Exports Import Apparent (income) Market United States Treatment of hazardous waste US$213.5 bil US$21.5 bil* US$18.4 bil* US$210.4 bil (2001) Environmental biotechnology Germany Thermal treatment of urban waste US$83.3 bil US$16.7 bil US$14.7 bil US$81.3 bil (2000) Treatment of drinking water Air treatment France Water treatment US$22.9 bil* US$6.7 bil* US$4.9 bil US$21.1 bil (2001) Canada Relatively undifferentiated CAN$14.3 bil CAN$1.2 bil CAN$3.5 bil CAN$16.6 bil (1998) Sources: Environmental Technologies Industries of US Department of Commerce, 2001, Statistics Canada, Environment Industry Survey, Business Sector, 2000, Environmental Business International, *Forecasts Environmental Technologies 19

20 User Markets Environmental Technologies 20

21 User Markets User Markets Quebec s environment industry has developed thanks to the support of the domestic market which, in 2000, provided 72% of its revenue. Due to their relatively small size 94% employ fewer than one hundred employees Quebec companies are not always equipped to conquer foreign markets directly. They therefore act as subcontractors for large international conglomerates or firms with turnkey contracts. Public administration bodies, mainly the municipalities, are major players in the environment market, making over 30% of purchases. The industry is the main outlet, however, accounting for 65% of procurement. A growth industry The environment industry is considered a growth sector which contributes to improving the efficiency and productivity of other industries. In 2000, Canadian companies spent close to $2.2 billion on environmental protection investment projects. Of this amount, $943.6 million was spent on methods to reduce or prevent pollution in the production cycle and $881.3 million was dedicated to the treatment of the pollution and waste left over at the end of the cycle. In all, they invested $400 million more than in In that year, Quebec businesses showed an investment shortfall. According to a Statistics Canada study on company use of pollution prevention methods, Quebec ranked below the Canadian average in five categories out of six: design and reformulation of a product, substitution or modification of a production process, energy conservation, substitution of materials or solvents and prevention of leaks and spills. The only sector in which Quebec came level with the Canadian average was recirculation, recovery, reuse or recycling. Judging by the companies declared intentions in response to the survey, this shortfall has most likely not been compensated for, except perhaps in the field of conservation. Intense activity on several fronts Technology, equipment and services relating to water represent 40% of the world environment market. This is also the biggest market in Quebec. Activities involve the routing and treatment of drinking water, the disposal and treatment of wastewater, the renewal of deteriorating water and sewage systems, and the control and treatment of liquid discharges from industrial and agricultural sources. Specialization depends on volume and client status (individual, industry, institution, municipality). Demand for mechanical equipment is particularly high. Waste is the second largest sector, globally (21% of the world market) and in Quebec. This generic term covers several types of waste: industrial waste, hazardous domestic products, solid waste, sludge resulting from the treatment of wastewater and from industrial effluents, and manure from livestock farming. Environmental Technologies 21

22 User Markets Depending on their nature, different residues require different actions and technologies in order to recycle, reclaim or transform them (especially into energy sources), or bury them safely. The companies in this subsector are specialized either according to the nature of the residue or to the method or type of intervention used: collection, sorting, recycling, disposal, reclamation, composting, energy production. The characterization and rehabilitation of land contaminated by, among others, heavy metals and hydrocarbons, and the restoration of mining sites, have sustained the soils market, which remains nevertheless a small market of some 50 million dollars, shared by the companies that operate and market exclusive technologies and those that carry out the characterization and rehabilitation. Another limited market is the air market, occupied to a greater extent by foreign firms. In this market, companies work on controlling stale indoor air, greenhouse gas emissions, odours from industrial or agricultural effluents, suspended particles, dust and the whole range of organic and inorganic contaminants. As with other dynamic economic sectors of activity, there is a clear trend toward value-added products and services, which accentuates the structural character of technological innovation in this field. Change of paradigm A significant shift of paradigm is underway. We are approaching the environment issue from an increasingly preventive and economic angle rather than in terms of the treatment and remediation of industrial by-products. We are attempting to reduce and even eliminate pollution risks at source, and we are adopting methods to achieve this without impacting the environment, with zero waste, by reusing waste products in the production chain. The effects of this new paradigm are starting to be felt. New vocabulary is emerging. We are learning notions of eco-efficiency, industrial ecology, energy efficiency and clean energy, and we are seeing a gradual shift in the market towards clean technologies and upstream technologies. In the same way, an increasing number of industrial plants and agricultural facilities are adopting bioprocesses, reusing the by-products of their activities and recovering residues. The building industry is taking the same path; it is using materials that are ecological due to their manufacturing methods and characteristics, intelligent control and management systems, and energy efficiency guarantees. Environmental Technologies 22

23 Development Factors Environmental Technologies 23

24 Development Factors Research and Development R&D is the mainstay for preserving acquired knowledge and exploring new avenues so as to improve the position of Canada s environmental technologies industry on domestic and foreign markets. Unfortunately, according to the MDERR report, the environment sector, especially waste materials, is not currently one of the sectors generating the most R&D, even though it is an innovative industry. The 2000 Statistics Canada survey leans in the same direction. It reveals that only 329 Canadian companies have led environmental R&D activities. Investments aimed at improving production eco-efficiency were not taken into account in the report; however, there is nothing to indicate that these investments are sufficient to regild the industry s blazon. A more recent survey led by Statistics Canada reveals that the adoption of a sustainable development policy and the ratification of the Kyoto protocol have stimulated industrial research into the reduction of greenhouse gases. Nevertheless, the majority of environment-related R&D continues to be financed by public funds. Both federal and provincial governments wish to see this research lead to the marketing of new environmental technologies as quickly as possible.lead to eventual market approval with the least possible risk. Some impressive firepower in research With its four universities, two engineering schools and its specialist research centres, the Montreal metropolitan area enjoys a rich diversity of research. No fewer than 42 research units are present on its territory. The Université du Québec à Montréal, through its Environmental Sciences Institute, and McGill University, which has a Faculty of Agricultural and Environmental Sciences, are outstanding hubs of university research. Basic research has a long tradition and is strongly represented here. Applied research is concentrated in the engineering schools and faculties. Regrettably, however, industrial bioprocesses do not seem to constitute a priority axis for research. McGill s interest in green chemistry and Concordia s in green building are to be congratulated, as is the work of the environmental biotechnology researchers at the INRS-Institut Armand-Frappier research centre. In its program, the Fonds québécois de recherche sur la nature et les technologies (Quebec government nature and technology research fund FQRNT) backs these initiatives by financing study groups for green building (Concordia University) and green chemistry solutions (researchers at McGill, UQAM, Université de Montréal, Polytechnique, INRS-IAF and Collège de Maisonneuve/CEPROCQ (Quebec chemical process studies centre) are members of the Sherbrooke-based network). The FQRNT is creating two other such strategic groups, one for the study of bio-innovation in composting (network based at McGill) and the other for the life-cycle management of products and services (École Polytechnique). Environmental Technologies 24

25 Development Factors The results of a contest held by the Canada Foundation for Innovation (CFI), announced last March 8, are also likely to expand the pool of environmental technologies available. Of the 38 projects financed in Quebec, six of them are environment-related (investment: $14,410,689). Three of these projects originate in Montreal institutions, which will benefit from more than half the funds ($8,153,154). The École Polytechnique will receive close to $5 million for setting up a research, development and validation centre for water treatment technology and processes. The École de technologie supérieure will for its part create an applied research centre for the development of products respecting the environment, thanks to a grant of $2.7 million. Finally, Collège de Maisonneuve will obtain approximately $450,000 to carry out work for biomass utilization through the development of technologies for the green extraction and separation of bioactive molecules. The CFI has also contributed considerably to updating laboratories and equipment available to researchers, including those in the environment sector. Since 1997, the Foundation has invested over $640 million ($642,483,338) in 871 projects. The metropolitan region is also home to various research institutes outside of the university network. The most well known is probably the Biotechnology Research Institute (BRI) of the National Research Council Canada. More than 80 researchers work on finding efficient and costeffective solutions to environmental issues and on developing industrial bioprocesses and green technologies to prevent and control pollution. For nearly 20 years now, Environment Canada s St. Lawrence Centre (SLC) monitors the state of health of the St. Lawrence River. It is the only federal centre entirely dedicated to river ecosystems. The SLC promotes the development of technologies to reduce the pollution of the St. Lawrence. It is responsible for several initiatives, including the creation of the centre for soil remediation for the advancement of science and collaboration in order to solve shoreline contamination problems in the Montreal area. The Montreal Centre of Excellence in Brownfields Rehabilitation (MCEBR) attempts to reclaim contaminated sites in Montreal for commercial use. It promotes and supports research, development and pilot projects dealing with methods and technologies for soil decontamination and site rehabilitation. The regional repercussions of climate change are the subject of special attention by the Ouranos consortium, a permanent, independent and interdisciplinary group of some 175 researchers and experts. Its powerful computers can perform detailed climate modeling, which makes it possible to develop appropriate strategies of adaptation. At the CANMET Energy Technology Centre (Natural Resources Canada) in Varennes, researchers work on the integration of renewable energies and the ways in which to improve energy efficiency and reduce greenhouse gases. Finally, in Pointe-Claire, it is worth noting the presence of Paprican, the Pulp and Paper Research Institute of Canada, and of the Forest Engineering Research Institute of Canada. The Quebec Ministry of the Environment has three laboratories, two in Quebec City and one in Laval. Environmental Technologies 25

26 Development Factors Research Commercialization The Réseau environnement network, whose head office is in Montreal, has around 2,000 members in Quebec. These members include industry representatives, as well as researchers, consultants, representatives of teaching establishments, municipalities, ministries and government bodies. Its mission is to encourage the exchange of technical and commercial information to ensure the development of environment science and technology. Every year, the Network organizes an environmental technologies trade show. It will host the pan-american environmental technology trade show, Americana, which returns to Montreal in April Although its offices are in Sherbrooke, Enviro-Accès, one of Environment Canada s three Canadian Environmental Technology Advancement Centres (CETACS), serves metropolitan area businesses. This specialized centre offers them strategic and networking support, as well as publishing statistics on the technologies available. Enviro-Accès also helps companies gain accreditation with the federal Environmental Technology Verification Program and gives them access to financing through the Caisse de dépôt et placement du Québec. Based in Quebec City, the Centre québécois de valorisation des biotechnologies (CQVB Quebec biotechnology development centre) reaches companies in all areas via the Bio-Innovation Network, which is composed of researchers, industry stakeholders and representatives of the financial, institutional and training sectors. The CQVB promotes technology transfer via its liaison bulletin, monitoring activities, sectoral publications and the numerous technical meetings that it organizes. Over the past two years, themes raised have included biocomposites, bioenergy, industrial bioprocessing, marine molecules and aquaculture, in the context of sustainable development. The Centre de recherche industrielle du Québec (CRIQ industrial research centre of Quebec) also serves the whole of Quebec, with its Environment division located in Quebec City. The CRIQ develops biological processes (air, water, composting) and its infrastructure enables it to validate these processes. It set up the ÉCO-RADAR network, a competitive watchdog focusing on technologies and markets. There is also the Canadian Technology Network, grouping together 800 organizations across Canada, which provide SMBs with the resources they need to further technological development. In Montreal, the Centre d expertise sur les matières résiduelles (Centre for waste expertise CEMR) is primarily concerned with showcasing environmental technology projects. Another important player, just inside the CMM in Sorel-Tracy, is the Centre de transfert technologique en écologie industrielle (Industrial ecology technology transfer centre CTTEI), whose aim is to promote and participate in environmental protection through the development of new technologies and technology transfer. The CTTEI shares equipment with the Centre de recherche en environnement UQAM/Sorel-Tracy (UQAM/Sorel-Tracy environment research centre CREUST), which carries out research focusing on business needs. It is recognized in particular for its expertise in the characterization, management, processing and remediation of industrial waste, as well as the appraisal, adaptation and development of environmental technologies for the metallurgy sector. Environmental Technologies 26

27 Development Factors Training Half of all environment industry recruits are university or college graduates, who are paid much higher salaries than the average industry wage. It is also a constantly growing industry, and students wishing to work in this sector will find all the necessary training in the Montreal area; in fact, Montreal offers the most opportunities of all the regions of Quebec. College level Cégep de Saint-Laurent has made water its specialization. Students can register for a college diploma in either Water Purification or Water Purification Techniques and Industrial Safety, or a certificate in Drinking Water or Wastewater Treatment. A certificate is also offered in Site Characterization, Decontamination and Restoration Techniques. Two other CEGEPs offer environment training courses: Cégep Lionel-Groulx in Sainte- Thérèse offers a degree in Horticultural Production and an Environment Technology Agrienvironment course, and Cégep de Rosemont offers a certificate in Environmental Performance of Organizations. University level At the undergraduate level, Concordia and McGill are the only universities that offer specific courses in Environmental Studies. The Faculty of Geography, Planning and Environment at Concordia offers a Bachelor s in Environmental Science. At McGill, three faculties were combined to create the School of Environnement. Students can choose between a Bachelor of Arts and a Bachelor of Science in Environment. Several majors are available: Economics of Agricultural and Natural Resources, Resource Conservation, Soil Science. Students can also choose minors in Environmental Engineering and Ecological Agriculture. Chemical and Civil Engineering students at the École Polytechnique and Engineering faculties at McGill and Concordia can also choose an Environment option. As well, Concordia runs a Building Engineering degree program which is increasingly integrating notions on sustainable building. Concordia and Université de Montréal both offer a Bachelor s science degree specializing in Environmental Geography, and UQAM runs certificate courses in Environment Science and Water Science and Techniques. At graduate level, the range of opportunities is wider. It is possible to obtain a Master of Science with optional courses in Environmental Engineering (McGill), Environment (McGill), Renewable Resources (McGill), Environmental and Occupational Health (UdeM), Environmental Sciences (UQAM), and Building Engineering (Concordia). The Master s in Chemical or Civil Engineering and the graduate degree in these two disciplines can be combined with an option in Environment (McGill, Polytechnique et Concordia). UQAM proposes an international specialized graduate diploma (D.E.S.S.) in Exploration and Management of Non-renewable Resources, and Concordia, a certificate in Environmental Engineering. Finally, it is possible to add an environmental touch to a Master s degree or a D.E.S.S. in Urban Planning (UdM). At the PhD level, the possibilities are reduced to four programs: a PhD in Chemical Engineering with options in Environment and Biotechnology Engineering (Poly, McGill); a PhD in Chemical Engineering with options in Environment and Transport (Poly, McGill and Concordia); a PhD in Environmental Science (UQAM); a PhD in Building Engineering (Concordia). Environmental Technologies 27

28 Development Factors Although these training programs are impressive, there are shortcomings. The courses offered still do not give enough latitude to high-tech disciplines such as green chemistry, industrial bioprocessing engineering, product and services life cycles or sustainable construction. Research Financing If Quebec is to improve its import-export record in environmental technology, it must give full backing to R&D activities. Given the considerable infrastructure available and the quality of the research teams already in place, this is a realistic goal, as long as the funding is readily available. Government support for innovation The large federal funding organizations, the Canadian Institutes of Health Research (CIHR) and the Natural Sciences and Engineering Research Concil (NSERC) make room for environmental research. The latter launched a new research program in 2003 to study energy and technology related to the reduction of greenhouse gases. The Environment Ministry also finances research projects. In the Université du Québec network alone, for instance, more than thirty projects are currently funded by Environment Canada. To back innovation and sustainable development, the federal government has launched several new programs during the past few years, among them the Canada Foundation for Innovation (CFI), the Canada Foundation for Sustainable Development Technology, the Canadian Foundation for Climate and Atmospheric Sciences (CFCAS) and the BIOCAP Canada Foundation. BIOCAP concentrates its efforts on forestry, agriculture, greenhouse gas emissions and towards developing organic-based products. Two Montreal forestry projects, presented by McGill University and UQAM, were selected in There is a tendency, however, to group researchers together and to require partnerships with companies in order to make faster progress and ensure that research meets the needs of industry and leads to the commercialization of technologies. This is the case at Technology Partnerships Canada (TPC), a $300million fund which considers environmental technologies a priority sector. The approach is the same at the Canada Foundation for Innovation, whose funds have a leverage effect since its contribution to a project cannot exceed one third of the costs. During the first three competitions, close to $40 million were allotted to 27 projects. Twenty-four other projects are currently being evaluated and a fifth competition has just been launched. The government of Quebec finances several subsidizing organizations, including the Fonds québécois de recherche sur la nature et les technologies (Quebec nature and technology research fund FQRNT), the most active in the environment sector. This fund s budget is currently being reviewed. If any cuts were made, their impact would be exacerbated due to the leverage effect of the subsidies. Valorisation Recherche Québec (VRQ) has, for its part, all but expended the $220 million received since No additional funds have been announced in the short term, which has the effect of Environmental Technologies 28

29 Development Factors slowing down the progression of certain projects and delaying the arrival of new technologies on the market. Quebec ministries are also facing budget cuts, which is forcing them to withdraw their backing for certain research projects and to abandon programs and organizations. The Quebec Ministry of the Environment supports research for environmental technology through two programs: the Programme d aide à la recherche et au développement en environnement (Environmental research and development assistance program PARDE) and the environment component of the Fonds de priorités gouvernementales en science et en technologie (Government priority fund for science and technology - FPGST-E). While the first still accepts requests, the second can no longer do so since it has already attributed the $6 million at its disposal for environmental projects. The Ministry of Agriculture, Fisheries and Food of Quebec (MAPAQ) offers an investment assistance program in agro-ecology, in addition to being a financial partner of the Institut de recherche et de développement en agroenvironnement (Research and development institute for agri-environment IRDA), whose head office is in Saint-Hyacinthe. The following table summarizes the government s business aid programs. Leading business assistance programs* Action Program Sponsor Investment Programme d aide à la concrétisation de projets d investissement (PACPI) MDER Innovation Programme d appui stratégique à l investissement (PASI) Industrial Research Assistance Program (IRAP) Precommercialization Assistance (PA) component Programme d aide à la recherche et au développement en environnement (PARDE) Tax holiday for foreign researchers specializing in pure or applied science leading to R&D activities within a Quebec company. Investissement Québec NRCC (federal government) MENV Revenu Québec Commercialization Programme de soutien aux vitrines technologiques (Technology showcase support program PSVT) IDEA-SME Program, Environment component MDER Environment Canada Canada Economic Development Export IMPACT-PME program MDER NEBS (New Exporters to Border States program) PEMD (Programme for Export Market Development) * Information available in December 2002 Source: La filière industrielle de l environnement au Québec, MDERR, June 2003 DFAIT (federal) RÉSEAU Environmental Technologies 29