Thank you very much.
I'm here today to speak to you from an industry perspective. I apologize that I didn't have notes for you in advance, but I just landed from a three-week trip abroad, and I'm a little disoriented from jet lag. Hopefully you'll indulge me over the next five to ten minutes.
The clerk asked that I perhaps give you a bit of background on Ballard Power Systems. Ballard is a fuel cell technology company based in Vancouver, Canada. We've been in this business for approximately 25 years. Our business is essentially the development of intellectual property, the sale of products and services, and the licensing of some of our technologies to our customers and partners.
To give you a sense of our revenue streams and where they come from, in 2013 Canada made up approximately 10% of our revenue. From a trade perspective, then, 90% of everything we do happens outside of this country, so anything that happens with regard to removing trade barriers to increase competitive forces for us is a very positive move and endeavour, given our reliance on trade for our business.
When I look at our business over the course of the last couple of years, and specifically in terms of market focus, we have four areas of business focus.
Number one is telecom backup power. Here we provide fuel cell solution systems that essentially replace diesel generators as backup power systems for telecom base stations around the world. As of today, we have about 10 megawatts of these systems operating in different parts of many of the countries you're looking at in terms of the TPP, which affects us, because in many of them we have customers who are buying our solution today.
The second key area of business for us is what we term “engineering services”. In this area we help companies who are looking to advance their fuel cell developments. Specifically we work with automotive companies, such as Volkswagen, Daimler, and others, who are looking at various things in terms of moving ahead their fuel cell technologies, specifically for introducing them in vehicle applications.
We're also involved in material handling. Here we provide our core technology, particularly in the United States, to one of our customers who then builds fuel cell engines for forklift applications. We have approximately 4,000 of our fuel cell stacks operating in these engines in various distribution centres in the United States today.
Finally, we're also in the business of licensing our technology. Here is where we look at our core business, our core competency. We're trying to advance growth in different markets, and particularly markets such as the ones you're looking at, where we would partner with companies to essentially take on the manufacturing, sales, and distribution of the product where we would retain the core technology here in Canada and essentially license our know-how to these companies.
We have about 355 people working at Ballard, many here in Vancouver. These are engineering positions, with key employees who really are responsible for developing the technology and supporting our customers around the world for the deployment of these. We have R and D operations in Bend, Oregon, and in Hobro, Denmark. We also have a manufacturing facility here in Vancouver as well as in Mexico.
In terms of our focus and our real interest here, approximately 35% of our revenue in 2013 occurred in the countries that you've identified as being part of the TPP, so this is an area that's near and dear to us as it relates to the importance.
Really there are three things that matter to us when we're looking at doing business with companies in these various countries around the world.
First, are the governments, when they're talking about renewables, including fuel cells? Oftentimes we'll get into countries and they'll say, “Are you wind? Are you solar? If you are, you're eligible for a whole bunch of incentives.” But oftentimes fuel cells don't get included on that list. One of the things I'd like to ask, then, as the market leader for fuel cells coming from Canada, is that you consider making sure that fuel cells are on that list of renewable applications.
Second, and just as important for us, is the reduction or elimination of tariffs and duties.
If we're going to compete in these markets, oftentimes there is a 20% to 30% tag to our price, which already, in terms of new technology, is trying to compete with diesel generators and other incumbent types of technologies. So that puts us at a disadvantage in these countries, and the elimination of these duties and tariffs greatly supports our export business. That would be the second area in which I'd encourage your commitment and support.
The third area, which is really key to our business and decision-making with regard to who we do business with and what countries we'll get involved in is the protection of our intellectual property. As is the case for most companies in the technology space, our core business is the development of patents and the development of know-how, and if we can't protect that when we're selling abroad, then we'll have real problems in terms of protecting our ability to continue to compete in these markets.
When I look at the role of trade barriers and I look at the role of trade negotiations from an enterprise perspective, I would say those are the three main issues that we grapple with on a day-to-day basis in our decision-making as to whether or not we're going to do business with companies in specific countries, and they are what drives us to have that growth.
When I look at our growth over the course of the last three years, 80% to 90% of our growth has been coming from either Asia or Latin America or from Africa and India. Really it's in the emerging-market space where we're seeing a tremendous amount of growth, and with the increase in trade barriers being dropped, we see our business as one that will continue to see growth in those markets. Obviously, our interest is to remain in Canada, because we see that we have the core competencies, the core personnel, and the core IP here. Our objective therefore is to leverage that to then export our know-how, our products, and our services to these other countries around the world.
With that, I'll pause and indulge in your questions.