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Market News

 July 30, 2006
Sales of GHG reduction technologies rising

 Ottawa, Canada (GLOBE-Net) -- Sales of technologies and services designed to conserve energy or to produce solar or wind energy have increased by 16% in the past two years, according to a Statistics Canada survey released last week.

The Environment Industry Survey included any technology or service that cuts greenhouse gas emissions, including energy conservation, renewable energy systems, or the capture and conversion of gases from landfills and agricultural sources. Canadian businesses earned $737.7 million from such sales in 2004, an increase of 16.6% over 2002.

Technologies to conserve energy or to improve energy efficiency accounted for $318 million (43%) of the total, and also showed the strongest growth, increasing 32 % over the past two years. Solar and wind energy production accounted for $140 million and also showed strong growth up almost 20% since 2002. The renewable energy segment includes small-scale hydro systems. Revenues from that group totaled $169 million.

Sales of fuel cells and alternative fuel technologies amounted to $95.2 million, actually declining 19.1%, says the report. The provision of services to reduce greenhouse gas emissions contributed $104.1 million in revenues. Product installation, maintenance and consulting in the area of energy efficiency and renewable energy represented most of these revenues.

Construction of renewable energy facilities added $17.2 million. Ontario, Quebec, British Columbia and Alberta were the largest markets for emissions reducing technology, with $235 million, $169.7 million, $126.4 million, and $104 million in sales, respectively.

Statistics Canada describes survey as a 'census with a cross-sectional design'. Surveys were mailed directly to firms in the environment industry, and response was mandatory. A small percentage (5%) of firms carried out research and development activities to develop emissions reduction goods and services, with 87% of those firms carrying out those activities in house. Around one-quarter of the firms contracted research and development activities out to other firms, while 27% carried out joint research with another firm.

The single larges source of research and development funding was the Canadian government, which provided 51% of firms with some funding. Parent, subsidiary or affiliated firms provided 33% of firms with some funding.

A lack of financing was cited as the number one obstacle to developing and marketing goods or services for greenhouse gas emissions reductions, with almost half of the firms identifying that as an issue. Government policies and regulations, a lack of market demand, and high cost were other major challenges.