On May 19, 2021, Clean Energy Canada, a think tank based at Simon Fraser University, released its report titled “Turning Talk into Action,” which made recommendations to develop Canada's battery supply chain. The report was released in the wake of President Biden and Prime Minister Trudeau identifying in their “Roadmap for a Renewed U.S.-Canada Partnership” the battery supply chain as an excellent opportunity for collaboration. As well, the Government of Canada's recent budget and strengthened climate plan have reinforced Canada's commitment to supporting domestic battery supply chain development.
The report sets forth a vision to make Canada a global battery supply chain leader by 2030. The report identifies the significant benefits of achieving this goal, including securing competitive advantages, creating jobs, and accelerating intellectual property leadership.
However, the report also injects a healthy dose of realism by identifying real challenges to developing and scaling the domestic battery supply chain. These include Canada's small market size, minimal manufacturing capacity, limited industrial policy, and non-coordinated decision-making. Other challenges include foreign competition, market risk, and limited commercialization funding.
The report recommends key priority actions to meet some of these challenges and establish Canada as a battery supply chain leader.
Break Down Silos and Foster Collaboration Among Stakeholders
The report states that it is imperative that Canada facilitate greater cooperation between stakeholders. It recommends an intergovernmental battery secretariat to assist in breaking down silos across government and facilitate coordination of federal and provincial efforts. The secretariat would bring together ministers and critical department staff from federal and provincial governments to achieve more agile decision-making. Another recommendation is to create an industry-led Canadian battery task force, supported by government to strengthen collaboration between industry and government. A task force composed of key players along the battery supply chain and Canadian financial institutions would provide recommendations to governments by the end of 2021 on how to develop Canada's battery industry. Finally, the report proposes creating a North American Battery Alliance (similar to the EU Battery Alliance) in order to increase Canada's market size and enable Canada and the U.S. to commit to the development of a competitive industrial strategy.
Build Up Canada's Battery Market and Attract Battery-Related Investment
To support Canada's battery supply chain, the report recommends measures to build up Canada's battery market and attract investment. Canada's access to metal and mineral resources is a significant value proposition. The report suggests improving supply chain transparency, developing action plans, establishing an off-grid electrification fund, and accelerating project permit timelines to unlock Canada's sustainable battery metals, minerals, and materials supply. It also underlines that Canada must work to develop midstream supply chains that feed into regional manufacturers. The report recommends that the federal government create a $15 billion federal government battery supply chain fund to invest in strategic projects focused on commercializing battery technology and enable public-private partnerships.
Encourage Innovation and Promote Canada's Domestic Battery Supply Chain
The report emphasizes that in order to compete globally, Canada must encourage innovation and promote the domestic battery supply chain. Canada should promote its competitive advantages, including security, sustainability, stability, and proximity to critical metal and mineral reserves. The federal and provincial governments must articulate Canada's full value proposition to develop a branding and marketing strategy. As well, Canada must maintain its status as a leader in battery technology research and development. The development of a government-funded and industry-led Battery Centre of Excellence, bringing together university researchers, mining companies, battery manufacturers, and automotive Original Equipment Manufacturers (OEMs), could assist the creation of intellectual property, economic value, and technology leadership. The report also recommends creating a Canadian Zero Emission Vehicles (ZEV) Market Development Strategy to bridge policies that accelerate Electric Vehicles (EV) adoption with market opportunities to scale up the domestic EV market.
Next Steps
Clean Energy Canada has joined the chorus of voices urging the development of Canada's battery supply chain to bolster the automotive sector, create new jobs, improve economic value and anchor Canada as a global leader. However, it has also delivered a wake-up call to government: Canada faces significant challenges to attaining this goal and must take immediate steps to foster stakeholder collaboration, grow the domestic market, attract investment, and promote innovation.
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