Sustainable Solutions
09/05/2006
by -- Vicky Sharpe
Accelerating innovation and commercialization of remediation technologies. With as many as 100,000 brownfield sites across Canada, there is enormous potential for commercial development of new soil and groundwater remediation technologies in this country.
Canada's famously difficult soil and groundwater conditions, further complicated by a harsh and variable climate, give rise to challenges similar to those found at contaminated sites the world over. These sites range from desert-like conditions to permafrost, to urban areas and remote settings.
The widely variable conditions require a multitude of remediation approaches, some of which are proven and commercially available. But much work remains to be done to develop additional technologies capable of remediating many of Canada's most contaminated sites.
This presents a unique commercial opportunity for all the key players in the remediation innovation chain, from academic researchers to brownfield practitioners, developers and municipalities. The future market leaders will require a strong focus on innovation, partnerships and active engagement of regulatory bodies.
The potential rewards are attractive: economic and environmental benefits for Canada and a platform for lucrative export opportunities. Tax breaks and other progressive government policies make this a great time to go after those rewards.
New remediation technologies hold the potential for contaminated sites that have not been satisfactorily cleaned using conventional approaches, to realize their full market value. Given the recent positive market reception to innovative green developments, new technologies hold the promise of greatly enhancing the breadth of urban lands available for redevelopment.
But to develop new remediation solutions and take them to market, technology developers and entrepreneurs must first overcome some tough obstacles.
Development and demonstration funding is critical
Regulatory and liability barriers are frequently cited as the major hurdles preventing or slowing the commercialization of remediation technologies. Another, arguably bigger barrier has been the lack of funding for post-research, or later-stage technology development and demonstration. This is further complicated by the difficulty of gaining clearance to test new technologies outside the laboratory, at contaminated sites.
Substantial funding for research of remediation technologies has long been available through a variety of provincial and federal government programs. This has fostered the development of promising, early stage technologies, primarily by research and academic institutions. But success in the next stage - commercialization - has proven more elusive. As a result, few of these early stage technologies, caught in the so-called "valley of death" between research and commercialization, have fulfilled the promise of environmental and economic benefits for Canada.
The perceived risks, the lack of a clear path to the market and the capital intensive nature of full scale demonstrations have kept the financial community from actively supporting remediation projects using unproven technologies.
At the other end of the spectrum, technologies that are proven and commercially available are enjoying relative success today. This is due to a growing emphasis on brownfield redevelopment, spurred on by government policies such as property tax breaks and loan guarantees, plus the lure of escalating property values. Yet some of these technologies are limited in scope, and the risks of applying them to new situations are similar to those facing new and unproven innovations.
Fortunately, new sources of funding - from both government and private equity investment funds -- have become available in recent years to address the gap faced by new technologies.
For example, Sustainable Development Technology Canada (SDTC), a federal government foundation, was established in 2002 to support clean technology projects through the critical stages of development and demonstration. Originally focused on clean air and climate change-related technologies, SDTC last year received an additional $200-million from the federal government primarily to support clean soil and clean water technologies.
"By improving Canadian technologies that address brownfields issues, SDTC is generating economic value and building our potential for technology exports," said Angus Ross, Chair, Canadian Brownfields Network.
On average, SDTC funds one-third of each technology project's eligible costs, free of equity or repayment obligations. Since April 2002, the foundation has completed eight funding rounds, committed $217-million to 97 clean technology projects, and leveraged $560-million from other project partners, for a total project value of $777-million.
Following SDTC's initial call last year for applications for soil and water projects, the Foundation recently approved its first funding in this area, with $4-million allocated to five initiatives.
"SDTC is helping to increase Canada's capacity to transform unused land into valuable real estate suitable for development," said Rick Whittaker, Vice President, Investments, SDTC. "As these technologies are deployed, they can open new urban brownfields to redevelopment, thereby reducing unsustainable urban sprawl."
Technology demonstration sites needed
In addition to the funding gap, another major barrier to technology development and demonstration is access to contaminated lands for the testing of new clean-up methods.
Real estate developers and property owners have been reluctant to try unproven technologies. This is understandable given that the methods may not have regulatory approval, the cost and remediation timeframe may be unknown, and there is a risk of liability or poor market perception.
Facing these risks, many brownfield practitioners, real estate developers and property owners will continue to rely on existing, proven technologies, even if they do not provide the best solution.
Potential demonstration sites could include existing, government-owned contaminated lands, or industrial lands with contamination issues that are not adequately addressed by existing remediation approaches. Progressive property developers can play a critical role by choosing new technologies, with help from government funding that reduces the financial risk.
The Province of Ontario has taken a leadership role by identifying dedicated demonstration sites within its provincial contaminated sites inventory to test new remediation technologies. This summer, the Province brought together the key players in the remediation value chain, including major funding organizations, and began the process of matching promising new technologies with suitable contaminated sites.
The Montreal Centre of Excellence in Brownfield Rehabilitation is taking a similar approach by working with the City of Montreal to facilitate the demonstration of new technologies at contaminated lands in the city's Technoparc area.
Overcoming regulatory, liability and market barriers
The availability of funding and demonstration sites are key enablers to overcoming the regulatory, liability and market risks associated with new clean-up technologies. Demonstration projects provide an opportunity for regulators to monitor the application and effectiveness of new technologies, potentially opening the door to commercial use. Demonstrations also help overcome liability concerns by establishing a performance standard for a given site condition.
When regulatory and liability issues are resolved, new technologies gain the credibility for marketing to brownfield consultants and developers, thereby opening opportunities for commercial success.
The Road Ahead
While "dig and dump" is still a common method of site clean-up, this solution is not sustainable and is becoming less economically attractive over time. Reduced landfill capacity, increased tipping fees and tougher regulations will drive a need for innovative alternatives.
New approaches are required to deal with both organic and inorganic contaminants in a range of different soil and climatic conditions.
In addition to developing new technologies to address common contamination issues, Canadian technology developers can play a pivotal role in addressing uniquely Canadian problems. These include contamination in remote places such as Arctic DEW line sites, which are complicated by permafrost, and oil sands tailing ponds in Alberta.
As daunting as some of the barriers may seem to the technology developer, Canadian innovations have successfully been taken to market, domestically and abroad. The path to success has been made easier through funding from SDTC and other sources, the designation of contaminated sites for demonstration projects, municipal tax incentives and renewed interest from all levels of government in advancing the brownfield agenda.
With these measures in place, the barriers to success have been lowered significantly in Canada. It is a great time to be in the business of brownfield innovation, and to capitalize on the enormous opportunities ahead.
Vicky Sharpe is president and CEO of SDTC. For further information, e-mail vj.sharpe@sdtc.ca.
SDTC launched its next call for funding applications (Statements of Interest) on August 23, 2006. Applications must be received by October 4, 2006. SDTC is interested in receiving submissions related to clean soil and clean water technologies, with a particular focus on solutions that protect public health, improve land use and soil quality through prevention, treatment or containment of soil contamination. The Foundation is also looking for solutions related to clean air and climate change, especially those that integrate multiple benefits.
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