The potential of worker ownership to finance Just Transition – and other inspiring Canadian examples

briarpatch special issueSaskatchewan’s Briarpatch magazine has published a Special Issue on Just Transition. It is a treasure trove of inspiring on-the-ground perspectives and information from Canadians working for an economic  Just Transition. 

All the articles are worth reading, but here are some highlights:

How will we pay for a Just Transition”   expresses doubt that we can rely on the usual government policies to finance meaningful transition – for example, it reviews the One Million Climate Jobs campaign of the Green Economy Network and the inadequate response by the Trudeau government.  Instead, the article provides examples of more innovative models of worker ownership and cooperation which support redistribution of wealth and financial capital. First,  The Working World, which launched in 2015 in Buenos Aires to finance employee ownership of non-extractive businesses, and now administers a “financial commons” Peer Network .  The Working World has inspired other projects, such as the Just Transition Loan Fund and Incubator and the Reinvest in Our Power projects , being launched by the U.S. Climate Justice Alliance . The article discusses the role of philanthropy, specifically the U.S. Chorus Foundation, which states that it “works for a just transition to a regenerative economy in the United States.” In Canada, a much smaller similar philanthropic initiative is the Resource Movement,  a project of Tides Canada, which gathers “ young people with wealth and class privilege working towards the equitable distribution of wealth, land and power.” 

Other articles:

New York marks Superstorm Sandy 5-year Anniversary in a big way: Climate Jobs Summit, Clean Energy Jobs Report, and expansion of New York’s Green Bank

Hurricane Sandy Oct 29 2012

Hurricane Sandy Oct 29 2012 – photo from the U.S. National Oceanic and Atmospheric Administration

The Climate Jobs Now! Summit was  held on October 27, in partnership with the Office of New York Governor Cuomo, Climate Jobs NY , and the Workers Institute, ILR Cornell University.  The event was built around the theme, Reversing Inequality and Combatting Climate Change: A New Era for States and Regions, with participants and speakers from New York labour unions, government, and climate advocates. The Closing Panel, “Fulfilling the Promise of a Just Transition for All New Yorkers through Clean Energy and Community Resilience” included John Cartwright, President of the Toronto & York Region Labour Council.   Video of some presentations is available .

Also on October 27, the New York State Energy Research and Development Authority (NYSERDA) released the 2017 Clean Energy Industry Report , which found that clean energy jobs employed 146,000 New Yorkers at the end of 2016, distributed as follows:  110,000 jobs in energy efficiency; 22,000 renewable electric power generation; 8,400 alternative transportation;  2,900 renewable fuels, and 1,400 in grid modernization and storage.  Employment growth in clean energy surpassed the economy as a whole, at  3.4% from December 2015 to December 2016, with projected growth to double again to 7% by the end of 2017.    The report also states that the demand exceeds the supply of clean energy workers, with employers reporting  the most difficult positions to fill are  engineers, installers or technicians, and sales representatives.   (In June, Governor Cuomo announced funding for  Workforce Development & Training Programs at campuses of the State University of New York).  

Finally on October 27, a press release  from the Governor’s office announced that the New York Green Bank is seeking to raise at least an additional $1 billion in private-sector funds to expand the availability of financing for clean energy projects. According to the press release, the Green Bank has had  strong interest “from third-party entities like pension funds and insurance companies seeking to use it as an investment vehicle for sustainable infrastructure projects”.  The additional capital  can be invested in projects across the U.S., and the Green Bank is prepared work with other states and NGO’s to establish their own Green Banks.

B.C. Cleantech start-up companies show dramatic growth and a confident future

BC cleantech coverIn mid-March, the B.C. Cleantech CEO Alliance released British Columbia Cleantech: Status Report 2016 , the result of a survey conducted by consultants KPMG in Fall 2016.   The new Status Report  shows “dramatic growth” since the previous report in 2011, supporting the Alliance branding of B.C. cleantech as “the next pillar of the Canadian economy”.

Between 2011 and 2016,  “the number of Cleantech companies is up 35% to 273, the number of BC-based employees is up 20% to 8,560, average wages have increased by 24% to $84,000 and the amount of equity raised is also up 25% to $6 billion.” The sector employs highly trained workers, such as engineers, designers, and sales and marketing professionals, resulting in that high average salary. 91% of companies are located in the Greater Vancouver area.

The survey respondents were only those early-stage companies whose primary purpose is developing new technologies – respondents were distributed as follows:  20%  energy generation; 16%   transportation; 12 % Building efficiency; 12% Resource recovery and waste management; 11% industrial efficiency; 11% water and waste water; 7% transmission and storage; 4% sustainable agriculture,  and a miscellaneous 7% remainder. Given the early stage of these companies, the key focus in the survey was on the sources of finance and the business climate for entrepreneurs. Results show that there is a heavy reliance on federal and provincial government incentive programs – for example, 75% of respondent companies had applied to the Scientific research and experimental development (SR&ED) program and over half had applied to the federal Industrial Research Assistance Program (IRAP).

Ontario is the First Canadian Province to Issue Green Bonds

In early October, Ontario’s sale of green bonds attracted orders of almost $2.4 billion from investors around the world.

The funds will be used to finance clean transportation; energy efficiency and conservation; clean energy and technology; forestry, agriculture and land management; and climate adaption and resilience. Toronto’s Eglinton Crosstown LRT will be the first project to receive funding. Read the news release from the Government of Ontario at: http://news.ontario.ca/mof/en/2014/10/strong-demand-for-ontarios-first-green-bond.html. See also “Ontario goes green with the latest bond sale” from the Pacific Institute for Climate Solutions at: http://pics.uvic.ca/news/news-scan/pics-climate-news-scan-september-25-2014#solutions.

For an financial explanation of green bonds, see the TD Economics report Green Bonds: Victory Bonds for the Environment (November 2013), at: http://www.td.com/document/PDF/economics/special/GreenBonds_Canada.pdf. According to a September report released by UNEP, World Bank and others, green bonds are on the rise worldwide and are “integral” to financing the global low-carbon transition. Read Financial Institutions Taking Action on Climate Change at: http://investorsonclimatechange.org/wp-content/uploads/2014/09/FinancialInstitutionsTakingActionOnClimateChange_Final.pdf.

Bloomberg estimates that the global green bond market will reach US$40 billion by the end of the year, three times more than 2013.