Industry Committee on June 5th, 2024

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Cooper called the witness a joke. I think he should retract that comment. It is counter to parliamentary decorum and he knows that.

[The Chair, Liberal, Joël Lightbound]

Thank you.

Mr. Cooper—

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

The minister's answers were a joke. That's what I said.

[The Chair, Liberal, Joël Lightbound]

Mr. Cooper, I'll give the floor to you.

I agree with Mr. Turnbull. I'll let you correct the record.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

What I said was that the minister's answers were a joke, and they were. He gave no answers.

[The Chair, Liberal, Joël Lightbound]

Okay.

I'll just ask MPs to tread carefully. I don't accept that in this committee we insult witnesses. Be very careful going forward—

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

The former minister is insulting taxpayers.

[The Chair, Liberal, Joël Lightbound]

Mr. Cooper, you don't have the floor. I'm the chair here. I would ask you to speak when I give you the floor.

On that note, I'll turn it over to MP Turnbull.

The floor is yours for five minutes.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you.

I know that SDTC, in the past, has played an important role in the innovation ecosystem when it comes to clean tech. I also know that Canada has, or at least I think it has, a clean tech advantage in the sense that as we build a more sustainable economy and work towards scaling up the innovative solutions that we need to fight climate change and have a stronger, more resilient economy, SDTC seemed to play a pretty key role in that ecosystem.

I want to go to Mr. Khan.

Could you comment on what sort of role in that ecosystem SDTC was really playing, up until the point that we suspended funding?

[Dr. Ibraheem Khan]

SDTC evolved over the time that we received support. There was a seed stage fund, I believe, which provided seed stage funding. We were later on in the cycle because our technology was a little bit more progressed from a seed stage technology.

SDTC has been—along with other funding agencies, like ERA and NRC IRAP—bridging that gap between innovation that comes out of a university like ours and commercial application.

That is very important because SDTC's, as well as other government funding agencies', rigorous due diligence on the technical merits of our technology played an important part in us engaging partners abroad. They recognize the rigorous due diligence that is done from a technical standpoint, so we can reduce the hurdles of trying to get funding from partners as well as investors abroad.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you for that.

Ms. Dubé-Côté, would you like to comment on the same question on the role that SDTC played within the innovation ecosystem? With that unique...do we need to preserve that, obviously notwithstanding the issues that committee members are rightfully concerned about in that there were some practices that did not uphold the highest governance standards?

I want to understand the comments that have been made about ensuring that SDTC can continue to function in the future under a better governance framework, and how important that is. Your testimony today—and maybe I'll go to you next, Mr. McArthur—was about the key role SDTC was playing.

[Isabelle Dubé-Côté]

Sure. Different actors in the ecosystem, from various exchanges through various forums, have shared many ways in which SDTC has been helpful. We mentioned the expertise earlier, which is really something that helped with recognition on the company side, as it was just mentioned. Also, on the investor side, additional investors sometimes came in because SDTC was there to help and bring in expertise on the technical front. That's part of the advantages that were mentioned.

As I mentioned earlier, out of the hundred companies worldwide that are the most efficient clean-tech companies, 13 of them are from Canada, and three-quarters were financed by SDTC. There are a lot of companies. We surveyed a lot of companies over the last couple of months, and various reasons came up front in addition to the financing. The additional support and expertise that SDTC brought to those companies made us very competitive internationally.

[Ryan Turnbull, Liberal, Whitby, ON]

That's great. Thank you for that.

Mr. McArthur, do you want to comment on that as well?

[Peter McArthur]

I think my colleagues have done a good job.

I'll just comment that the valley of death that often exists when a company comes out of a lab and then tries to commercialize is one that exists in many technologies. It's not just in clean tech.

The hardware is particularly difficult, as Mr. Khan indicated. There's a large capital expenditure. It takes a long time to sell into regulated industries. You need access to lab equipment and other technical equipment. Therefore, it has been crucial to have that funding there.

Likewise, Emissions Reduction Alberta also has access to many scientists who help vet that technology, like those at SDTC. That gives comfort to investors, venture capital firms and, in fact, customers who are looking at buying and investing in those technologies as part of the consortium process that exists at SDTC.

[Ryan Turnbull, Liberal, Whitby, ON]

I know you've said multiple times already—and I think there are some other members who agree with you—that resuming the flow of funds to help continue to scale up and provide the financial support for companies within the ecosystem we're trying to help build.... I think that is a key role that the Government of Canada has played for 20 years through SDTC.

Your testimony today is helpful in understanding why we need to get things moving again, notwithstanding the gravity of some of the governance issues within the organization that have surfaced through the Auditor General's report. I really do appreciate your testimony.

How developed is Canada's current clean-tech market? Are we globally competitive right now? If SDTC didn't resume funding, do you think that would start to dwindle? What impact would it have?

Mr. Khan, I'll ask you, and then Mr. McArthur.

[Dr. Ibraheem Khan]

Sure. Like Peter has mentioned, we're more advanced than most international competitors out there. We have more than 10 top clean-tech companies in the world that are recognized. Also, we continue to have fantastic innovation that comes out of our own labs at universities, as well as other institutions. That can be very impactful.

I think Canada is wonderfully positioned with talent and innovation to really solve this clean tech problem in an economical way. Any cutting of support will slow that down.

I'll let Peter continue.

[Peter McArthur]

Some 24,500 employees at Canadian companies have received support from SDTC. That's helped them become competitive on the world stage and generated high-paying, future-based jobs all across the country. That has absolutely been beneficial.

However, you certainly have to respect the Auditor General's report and make sure that it's compliant and makes sense. Like you, we're taxpayers, and we want to make sure that this is done effectively and efficiently.

It's helping in a difficult part. Commercializing innovative technologies isn't easy. It's highly risky. It's hard to get risk capital to go there. It's important that we have risk capital going there through effective means.

[The Chair, Liberal, Joël Lightbound]

Thank you very much.

I'm sorry, Mr. Turnbull.

Mr. Garon, you have the floor for two and a half minutes.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Mr.—

[Tony Van Bynen, Liberal, Newmarket—Aurora, ON]

I have a point of order, Mr. Chair.

[The Chair, Liberal, Joël Lightbound]

Yes, go ahead, Mr. Van Bynen.

[Tony Van Bynen, Liberal, Newmarket—Aurora, ON]

Did I hear comments from Mr. Vis that made accusations of corruption of these individuals?

[An hon. member]

No.

[Tony Van Bynen, Liberal, Newmarket—Aurora, ON]

Who are you looking at when you—

[Jean-Denis Garon, Bloc, Mirabel, QC]

No. That's not what he said.