Strategy needed for the ‘energy century’

December 17, 2007
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Silicon Valley has become synonymous with solar technologies these days as California moves to corner a market considered, in many respects, integral to our long-term battle against climate change.

Canada, however, is finally stepping up to the plate. We’re beginning to see some serious solar ventures springing up across the country, and the list even includes a couple of initial public offerings (IPO), allowing the average investor to get a piece of these domestic gems.

Earlier this month, Day4 Energy Inc. of Vancouver raised $100 million in an IPO and will likely raise another $15 million by the end of this month. And last week, Montreal-based 5N Plus Inc. filed a final prospectus for an IPO expected to close this Thursday that will raise $62 million.

Day4 says it can make conventional solar photovoltaic panels more efficient using its patented electrode technology, which connects solar cells together and on to a large module in a way where more power can be collected. It plans to manufacture its own line of Day4-branded solar panels.

5N Plus develops and produces high-purity metals used in the production of certain solar cells. The company plans to use the money from its IPO to construct a 40,000-square-foot manufacturing complex in Germany, with the primary goal of producing cadmium telluride used by solar stock-market darling First Solar Inc. of Phoenix, Az.

John MacDonald, chairman and chief executive officer of Day4 – and, it should be pointed out, the co-founder and former CEO of Canadian aerospace leader MacDonald Dettwiler & Associates Ltd. – is convinced solar technology will play a key role in solving the world’s energy problems.

“This will go down in history as the energy century, the century in which humankind changes the way it generates energy to power its economies,” MacDonald said in an interview.

After 30 years of looking at the Earth and watching it change, he said he couldn’t resist getting involved in Day4. “This is a very promising technology and I think I could help bring it to commercial reality.”

In Ottawa, Cyrium Technologies Inc. announced this month it has raised a total of $5.5 million, which will go toward developing its high-efficiency solar PV cells. The company uses nanotechnology to significantly boost how much power it can get from its solar cells.

Closer to home, a company called SonnenEnergy Corp. closed a $12 million public offering in late November. The company builds and operates large solar power parks in Germany with a plan to expand into the North American market. On Dec. 6, it announced that former Newfoundland premier Brian Tobin had joined its board of directors.

And in July, Mississauga-based 6N Silicon Inc. raised $6 million in private equity to develop a low-cost manufacturing process for the production of solar-grade silicon.

These companies add bulk to a list of Canadian solar companies that include Toronto-based Mondial Energy Inc. and EnerWorks Inc. of Dorchester (two solar thermal ventures attracting serious attention in the United States), Arise Technologies Corp. of Waterloo (a solar silicon and cell manufacturer with a plant opening in Germany), and Victoria, B.C.-based Carmanah Technologies Corp. (a leader in solar-powered LED lighting systems).

It’s a solid group, giving Canada’s solar industry some added weight in an increasingly competitive market. But as we’ve seen with Arise and 5N, there’s no guarantee that innovation developed in Canada will result in manufacturing and jobs based in Canada. Both Arise and 5N have their sights set on Germany, a country that goes out of its way to attractive foreign investment.

What Canada needs is a clearly articulated and properly supported industrial strategy that both nurtures Canadian innovation and domestic job creation, offering a transition for a traditional manufacturing sector struggling to survive.