Energy Innovation Program – Breakthrough Energy Solutions Canada Program Guide

Table of Contents

1. INTRODUCTION.
   1. 1.1 The Energy Innovation Program – Overview
   2. 1.2 Call for Breakthrough Energy Solutions – Overview
   3. 1.3 Document Scope
2. PROGRAM DETAILS
   1. 2.1 Objectives & Scope
   2. 2.2 Who is eligible?
   3. 2.3 Why Apply?
3. FUNDING & CONDITIONS
   1. 3.1 Available Funding & Support
   2. 3.1.1 Other Supporting Partners
   3. 3.2 Contribution Agreement
   4. 3.3 Outcomes Tracking
4. APPLICATION & SELECTION PROCESS
   1. 4.1 Self-Assessment Survey
   2. 4.2 Full Project Proposal Submission
   3. 4.3 Initial Assessment
   4. 4.4 Final Assessment
5. TIMELINES
   1. 5.1 Submission Deadline
   2. 5.2 Process Timeline
6. INFORMATION SHARING PERMISSIONS
   1. 6.1 Breakthrough Energy
   2. 6.1.1 Information Sharing Permission – Breakthrough Energy Ventures
   3. 6.2 The Clean Growth Hub
   4. 6.3 Trusted Partners
   5. 6.4 Business Development Canada (BDC)
   6. 6.4.1 Information Sharing Permission – Business Development Canada
7. APPENDIX A – Technology Readiness Levels
8. APPENDIX B: Focus Area 1: Manufacturing
9. APPENDIX C: Focus Area 2: Electricity
10. APPENDIX D: Focus Area 3: Transportation
11. APPENDIX E: Focus Area 4: Buildings

1.1 The Energy Innovation Program – Overview

The Energy Innovation Program (EIP), with an annual budget of $24M, provides funding to support clean energy innovation with the aim of making clean energy technologies affordable, reliable, and sustainable.

With targeted funding calls and leveraging of strategic partnerships, the EIP aims to reduce emissions, including greenhouse gases (GHGs), through research, development, and demonstration of clean energy technologies, to meet 2050 clean growth targets.

1.2 Call for Breakthrough Energy Solutions Canada – Overview

The up to $30M Breakthrough Energy Solutions Canada investment under the Energy Innovation Program, in partnership with Breakthrough Energy (BE), will be delivered through a targeted funding call that leverages public and private financing and expertise to support the advancement of Canadian clean energy technologies that have the potential to significantly reduce (GHG) emissions.

Through this partnership, successful companies will receive NRCan funding to advance their technologies, gain exposure to investors like Breakthrough Energy Ventures (BEV), and will have the opportunity to be considered for additional private investment.

Incentivizing leading Canadian entrepreneurs to develop clean energy tech with potential for significant GHG reduction globally by targeting difficult‐to‐solve problems in the clean energy space.

Attracting investment into high‐risk and high‐potential clean energy technology development from leading public and private sector investors and to strengthen the relationship and deal‐flow pipeline of Canadian clean energy tech companies to private investors, such as BEV.

1.3 Document Scope

This Applicants’ Guide has been developed to provide details on the Breakthrough Energy Solutions Canada targeted call, under NRCan’s Energy Innovation Program, including the objectives, eligibility, and selection process.

2.1 Objectives & Scope

This program intends to bridge the gap between public and private capital to advance breakthrough technologies that have the potential to significantly reduce global greenhouse gas emissions. This call is targeting “breakthrough” energy technologies that will:

1. decrease the carbon intensity of a GHG emitting product or system; and/or
2. increase the deployment and/or improve the performance of an existing low GHG product or system; and/or
3. introduce a new low GHG product into the market; and/or
4. introduce a systems-level or structural change that enables the above.

Successful recipients will have to demonstrate how, if highly successful and adopted globally, they have the potential to reduce GHG emissions, by 0.5GT/year globally, in the following focus areas:

Manufacturing – alternative cost-effective low carbon methods for production of key manufacturing materials such as steel, hydrogen, cement, ammonia and direct air carbon capture and utilization.

Electricity – ultra low-cost carbon-free generation; dispatchable carbon-free generation; next-generation ultra-flexible grid management, and low-cost transmission for transferring bulk power between independently operated grids.
 

Transportation – passenger & freight transportation efficiency solutions, battery technologies, high-speed charging technologies, and other enabling technologies to accelerate electric vehicle adoption; advanced materials; and low emission liquid fuels.
 

Buildings – advanced low carbon building solutions and construction techniques, intelligent buildings, and next generation heating and cooling technologies.

Additional details on each focus area can be found in the Supplemental Guide which can be downloaded upon successful completion of the Self-Assessment Survey.

2.2 Who is eligible?

With the objective of bridging the gap between public and private capital to advance breakthrough technologies that have the potential to significantly reduce greenhouse gas emissions, applicants must meet the following criteria:

• Be a privately-held legal entity validly incorporated or registered in Canada;
• Entrepreneur or Start-up seeking Seed or Series A or Series B funding;
• Own or have licensing rights to the IP related to the technology outlined in the proposal;
• Technology must be at a Technology Readiness Level between 4 and 8, see Appendix A for TRL definitions; and
• Project must be ready to start by April 1, 2020 with tangible performance targets to achieve within the 2-year funding period.

Preference may also be given to companies that demonstrate the following:

• Demonstration of Revenue; or
• Previously secured investment of at least $500,000 in the company; or
• Significant co-funding partner (e.g., Adopter) on the proposed project

2.3 Why Apply?

The following section describes the general terms and conditions. Further restrictions and conditions may apply to a specific program component. Any specific conditions will be documented in the application materials.

3.1 Available Funding & Support

As of August 7, 2019, Breakthrough Energy Solutions Canada is making available a total investment of up to $40 million over 2 years (April 1, 2020 to March 31, 2022) to successful projects.

*Projects that are considered R&D may receive consideration for up to 75% total project cost.

Successful companies will form the Breakthrough Energy Solutions Canada Cohort and will be evaluated on an annual basis during Annual Accelerator Sessions, with an opportunity to obtain an additional investment from private and public investors, such as Breakthrough Energy Ventures (BEV) and Business Development Canada (BDC).

Please note, that the Energy Innovation Program provides non-repayable contributions for eligible R&D and FEED project activities and for eligible demonstration project activities. Please see section 3.5.6 of the General Guide for more information.

Please see section 3.5.6 of the General Guide for more information.

3.1.1 Other Supporting Partners

Breakthrough Energy Solutions Canada is committed to strengthening the relationship between Canadian clean energy tech companies and investors.

As a result, new partners may be invited to join NRCan, BEV and BDC in providing support through their expertise and/or follow-on funding to BESC Cohort companies.

3.2 Contribution Agreement

Successful applicants will have three (3) months after receiving the notice of funding approval to enter into a contribution agreement (“Contribution Agreement”) with NRCan, after which time, funding may be reallocated to other projects. The Contribution Agreement will address the following elements, without limitation: project scope, work plan, milestones, deliverables, performance targets, payment schedule, reporting requirements, and terms of funding.

3.3 Outcomes Tracking

Following a successful Proposal stage, successfully funded projects will be required to report on expected outcomes to ensure that targets and objectives are being met. Since outcomes may only be realized after funding has ended, provisions have been made for ongoing data collection and assessment for a period of five years following the project’s completion date.

The Department of Natural Resources (NRCan) is committed to a consistent, fair, and transparent project selection process in order to identify, select, and approve the allocation of funding to projects that best fit the program’s objectives.

The program may request supplementary information at various points in the review process.

TEXT VERSION:

Breakthrough Energy Solutions Application Process

Phase 1 – Self Assessment Survey

Step 1: Review of Applicants’ Guide
Step 2: Complete Self-Assessment Survey
Step 3: Download required templates

Phase 2 – Project Proposal

Step 1: Prepare Proposal Details

Step 2: Submit Proposal in INTEGRO
Step 3: Initial Assessment
Step 4: Notification of Initial Assessment Results
Step 5: Final Assessment
Step 6: Project Selection

4.1 Self-Assessment Survey

The Self-Assessment Survey has been designed as a first step in the process to screen out projects/recipients that do not meet the programs eligibility criteria.  Applicants are required to complete the program’s Self-Assessment Survey in order to proceed to the full proposal phase. Once completed, you will be provided with instructions on how to access the full proposal package (including templates).

4.2 Full Project Proposal Submission

The Self Assessment Survey and applications must be completed and submitted prior to the deadline of September 11, 2019.

The applicant must provide all mandatory information in order to be considered for funding.

The Full Project Proposal evaluation process is highly competitive and only the highest-quality projects will be considered for funding. Success in this phase depends on the quality of the Full Project Proposal submitted. In this regard, “quality” means the merits of the proposal in terms of both the potential for impacts based on the assessment criteria and how well the proposal addresses these criteria, including completeness and clarity. It is incumbent on each applicant to communicate the proposed project’s merits through the responses provided in the Full Project Proposal.

*The applicant should be aware that the program will only accept applications submitted through Integro starting June 5, 2019. Special accommodations may be made for applicants in remote areas to ensure that the application form is available and accessible only if the program is contacted at least 2 weeks in advance of the submission deadline.

4.3 Initial Assessment

All submissions will go through an initial assessment to inform the selection of up to 60 projects to move on to the final assessment.  Proposals at this stage will be assessed based on their responses to the following questions:

• WHAT is your technology and vision? Describe the technology and the ambitious goals this technology is aiming to achieve and how.
• Project Milestones in the 2 years of funding: Describe what performance milestones your project aims to achieve over the next two years and how?
• HOW will this technology achieve global emission reductions? How could this contribute to the energy system in order to potentially achieve the 0.5Gt GHG global reductions? What is the market and what % of market penetration would be required in order to achieve these reductions?
• WHO are the people that will ensure the success of this technology? Briefly describe the roles, capability and capacity of your organization, project team and any collaborators.
• WHY is this technology breakthrough or innovative? What problem is the technology aiming to solve? What is the value proposition the end users of your technology?

Only the most promising projects will move on to the final assessment phase.

4.4 Final Assessment

To inform final selection, a panel of experts will assess the merits of your project/technology and business model, using the full project proposal package submitted.

Applicants will also be invited to “pitch” their projects to the panel of expert reviewers in November. Further information regarding these presentations, including time and location, will be provided to invited applicants before the scheduled timeframe. Applicants are encouraged to ensure someone is available to present at the allotted time.

In December, the program team expects to select 10-15 applicants to join the Breakthrough Energy Solutions Canada Cohort of companies.

5.1 Submission Deadline

The deadline for submissions of full application package in Integro is Wednesday, September 11, 2019 at 12 PM (noon) EST. Late submissions will not be accepted. Applicants are encouraged to complete their submissions well in advance of the deadline and to SAVE their work often. Furthermore, NRCan will not accept partial or incomplete submissions. All required content must be provided through the online submission portal: https://eservices.nrcan-rncan.gc.ca/web/epp-ppe/login-connexion, and the submission must be finalized by completing all necessary online steps in order for the Proposal to be considered.

5.2 Process Timeline

The following timelines are anticipated for the FPP stage of this Call. Note that NRCan at its sole discretion reserves the right to modify the currently anticipated timelines.

6.1 Breakthrough Energy

Breakthrough Energy was created to help build the markets and policy environment necessary for an energy transition that addresses the real drivers of climate change.

Breakthrough Energy Ventures (BEV) invests in companies that leverage innovative technologies to help address climate change. Backed by many of the world’s top business leaders, BEV has more than $1 billion in committed capital to support bold entrepreneurs building companies that can significantly reduce emissions from agriculture, buildings, electricity, manufacturing, and transportation. The fund was created in 2016 by the Breakthrough Energy Coalition.

6.1.1 Information Sharing Permission – Breakthrough Energy Ventures

If Applicant advances to the semi-finalist stage, NRCan intends to share Applicant’s application packages with representatives of Breakthrough Energy Ventures (“BEV”), who will use this information to participate in the final selection of the Breakthrough Energy Solutions Canada Cohort of companies and to evaluate potential BEV investments in such companies. If Applicant becomes a participant of the Breakthrough Energy Solutions Canada cohort of companies, NRCan intends to share Applicant’s company information with representatives of BEV, who will use this information to participate in the Annual Accelerator Sessions and to evaluate potential BEV investments in such companies.  BEV may also use such information to provide annual reviews and feedback to such companies.  Accordingly, Applicant hereby authorizes NRCan to disclose such information in confidence to BEV and its representatives for such purposes.

During the application process, applicants will be asked to sign and submit a signed declaration acknowledging that BEV and its representatives, investors and affiliates (collectively, the “BEV Entities”)  evaluate and invest in numerous companies, some of which may be deemed competitive with Applicant’s current or anticipated business, and Applicant agrees that, to the fullest extent permitted under applicable law, Applicant hereby waives, and the BEV Entities shall not be liable to Applicant for, any claim arising out of or based upon the NRCan funding program, this application or agreement, or any investment by any BEV Entities in any entity competitive with Applicant.

6.2 The Clean Growth Hub

The Clean Growth Hub is a whole-of-government focal point for clean technology focused on supporting companies and projects, coordinating programs and tracking results. Within the Full Project Proposal (FPP) form, applicants will be asked whether they provide permission for NRCan to share their application with the Clean Growth Hub. This will enable the program to provide to projects that may not necessarily go on to get funding under the program, the opportunity for maximum exposure and guidance across other federal funding programs or providers.

The Clean Growth Hub is an interdepartmental organization with member departments and agencies including: Innovation, Science and Economic Development Canada; Natural Resources Canada; Environment and Climate Change Canada; Transport Canada; Fisheries and Oceans Canada; Agriculture and Agri-Food Canada; Global Affairs Canada; the Treasury Board Secretariat of Canada; the National Research Council; Business Development Bank of Canada; Export Development Canada; Sustainable Development Technology Canada; and Canadian Commercial Corporation. Should you consent, the information you provide may be shared across federal departments/ agencies, including but not limited to the departments and agencies represented in the Clean Growth Hub, with a view to assisting you in determining the federal programs/supports best-suited to your needs. Pursuant to Paragraph 20(1) of the Access to Information Act, the Clean Growth Hub will not publicly disclose any information without permission.

6.3 Trusted Partners

In order to facilitate co-funding with provincial/territorial and industry funders, NRCan is working in partnership with other funding organizations across Canada. By giving NRCan the authority to share your proposal with our Trusted Partners, you allow NRCan to explore possible co-funding opportunities. Please note that NRCan will only share these applications with partners where NRCan has a non-disclosure agreement in place and for the purposes of exploring the possibility of co-funding with such trusted partners.

Established Trusted Partnerships include:

• InnovateBC
• Emissions Reductions Alberta (ERA)
• Alberta Innovates
• Innovation Saskatchewan (IS)
• Natural Gas Innovation Fund (NGIF-CGA)
• Ontario Centre of Excellence
• Offshore Energy Research Association (NS)

* Please consult website for most up to date information on Section 9. Trusted Partners.

6.4 Business Development Canada (BDC)

BDC is the only bank devoted exclusively to entrepreneurs. It provides access to financing, both online and in-person, as well as advisory services to help Canadian businesses grow and succeed. Its investment arm, BDC Capital, offers a wide range of risk capital solutions.

As Canada’s development bank, part of our mission is filling market gaps and assist companies with a higher risk profile, but also with huge transformational potential, such as cleantech companies. Given that Cleantech firms require more than just capital to succeed, BDC’s Cleantech Practice also offers customized Advisory Services to its portfolio companies through BDC’s existing highly seasoned Executive Advisors.

6.4.1 Business Development Canada (BDC)

If Applicant advances to the semi-finalist stage, NRCan intends to share Applicant’s application packages with representatives of Business Development Canada (“BDC”), who will use this information to participate in the final selection of the Breakthrough Energy Solutions Canada Cohort of companies and to evaluate potential BDC investments in such companies. If Applicant becomes a participant of the Breakthrough Energy Solutions cohort of companies, NRCan intends to share Applicant’s company information with representatives of BDC, who will use this information to participate in the Annual Accelerator Sessions and to evaluate potential BDC investments in such companies. BDC may also use such information to provide annual reviews and feedback to such companies. Accordingly, Applicant hereby authorizes NRCan to disclose such information in confidence to BDC and its representatives for such purposes.

Technology Readiness Level (TRL) is a measure used to assess the maturity of evolving technologies (devices, materials, components, software, work processes, etc.) during its development and in some cases during early operations. When a new technology is first invented or conceptualized, it is not suitable for immediate application. Instead, new technologies are usually subjected to experimentation, refinement, and increasingly realistic testing. Once the technology is sufficiently proven, it can be incorporated into a system/subsystem^{Footnote 1}.

The lowest level, TRL 1, indicates that information already learned from basic scientific research is taking its first step from an idea to a practical application of a lesson learned. For example, after learning that hydrogen and oxygen can be combined to generate electricity, some would suggest an idea for building a machine to do just that.

A technology that has achieved TRL 9 is one that has been incorporated fully into a larger system. It has been proven to work smoothly and is considered operational. An example of an operational TRL 9 technology is the fuel cells which combine hydrogen and oxygen to generate electricity for NASA's space shuttle^{Footnote 2}.

Technology Readiness Level Descriptions:

0. R&D not specifically intended for technology development (but could be in support of technology adoption). Examples are knowledge generation to support codes, regulations and standards needed to support domestic adoption and to support Canada’s position in opposing non-tariff export barriers. Also includes Basic Research conducted prior to Applied Research.
1. Early-stage scientific research begins the translation to applied R&D - lowest level of technology readiness. Basic scientific research begins to be translated into preparatory applied research and development. Examples include paper studies of a technology’s basic properties, algorithms and mathematical formulations.
2. Technology development begins - once basic principles are observed, development of practical and specific applications can be initiated. Applications are speculative and there may be no proof or detailed analysis to support the assumptions. Examples are limited to analytic studies, including concept development.
3. Active R&D is initiated - active research and development is initiated to establish proof of concept, including analytical and laboratory studies to physically validate analytical predictions of separate elements of the technology, i.e., individual components that are not yet integrated into the technology.
4. Basic technological components are integrated to establish that the pieces will work together, i.e. initial operational characterization of technology. Standalone component prototypes implemented and tested.
5. System / subsystem prototypes are improved significantly - the basic technological components / prototypes are integrated within a reasonably realistic supporting environment so that the technology concept can be tested in a simulated environment. Examples include bench-scale laboratory integration of components and observation of operating characteristics.
6. Model/prototype is tested in relevant environment - representative model or prototype system, which is well beyond that of TRL 5, is tested in a relevant test environment. Represents a major step up in a technology’s demonstrated readiness. Examples include testing a prototype at the pilot scale, integrated with existing systems, if applicable, in a laboratory environment or in a simulated operational environment. Engineering feasibility demonstrated.
7. Prototype near or at planned operational system - represents a major step up from TRL 6, requiring demonstration of an actual system prototype in the intended operational environment. Examples include field testing or field trials over a period sufficient to provide meaningful data on the performance of the technology.
8. Technology is proven to work in a “real world” operating environment - actual technology completed and qualified through test and demonstration. This includes projects currently at the demonstration project stage.
9. System proven though successful demonstration. Actual application of technology is in its final form – commercialization-ready technology proven through successful operations.

Objective

Canada’s industrial sector, which employs roughly 3 in 10 workers, accounts for approximately a third of Canada’s total energy use and GHG emissions. Developing low energy pathways and scaling up emerging technologies to make the production of manufactured materials such as steel, hydrogen, ammonia, and cement commercially viable will boost competitiveness and help Canada meet its GHG reduction objectives. 

According to the IPCC, direct industrial CO2 emissions contribute 10 GtCO2, or 29% of global emissions.

Target

We are looking at cost effective low emission pathways for:

• production of steel;
• hydrogen generation;
• production of ammonia; and
• production of cement.
• We are looking for technologies that will transform the current linear economy to a circular carbon economy and move manufacturing industries and the energy sector towards low-carbon production that reduces CO2 emissions sustainably.

• Advanced technologies to manage, recover and re-use waste heat such as re-use of waste heat in high temperature processes.

• Fuel switching - low-carbon fuel or feedstock substitution or development of innovative processes that reduce or eliminate traditional fuels to achieve energy and emission reduction in industrial processes, including electricity, biomass and natural gas.

• Pathways to improve the separation of valuable metals and advance separation technologies.

• Chemical sector to advance chemistry and low-intensity separation technologies.
• Metal processing and refining of metals using electro-metallurgy or hydrometallurgy to replace pyro-metallurgy processes.

• We are looking for low-cost direct air CO2 capture and utilization technologies.

Objective

To seek out new forms of low-cost, dispatchable, carbon free energy. 

To enable GHG reductions through increased stability of networks that are operated using high penetrations of variable renewables (such as wind and solar), transmission of bulk-power and interconnections between independently operated grids.

To facilitate increased penetration of variable renewables while maintaining power quality, affordability, and sustainability.

Target

Cost-effective low emission methods for:

• Installing and maintaining bulk-power transmission lines, cables, and systems
• Innovative methods for installing and operating systems to reduce “right of way” demands and associated land and legal costs
• Material innovations to improve and reduce associated costs of conductors, insulation, and related equipment including structures such as raceways and towers
• Dispatchable carbon-free generation
• Forms of generation or integrated systems that are able to be ramped and dispatched as needed.
• Long duration (to seasonal) energy storage to allow variable renewable energy (VRE) capacity firming, including
• site-independent, scalable, pumped-hydro and other gravity-based solutions
• advanced thermal and compressed air energy storage
• power-to-gas pathways and conversion cycles
• Enabling and incentivizing greater demand-side flexibility
• Aggregation of smaller loads (e.g., residential and smaller C&I customers)
• Pricing signals and economic incentives
• Analytics and advanced methods for command and control
• Leveraging edge and decentralized models of networks (both digital & power systems)
• Ubiquitous sensors providing increased visibility and situational awareness
• Grid automation and prescriptive control (data science and computing)

Objective

In 2015, the transportation sector was the second largest source of GHG emissions, accounting for 24% of total national emissions, with 96% from passenger and freight vehicles.

To advance technologies that have the potential to either penetrate or initiate step-wise change by removing barriers (e.g. technical, cost, and social) to adoption of cleaner energy transportation solutions globally.

Target

• Breakthrough technologies that will enable the cost reduction and/or adoption of electric vehicles for passenger or freight mobility:
• Advanced battery technology for on-road vehicles that enable greater energy densities, higher charge and discharge rates, and lower costs
• High voltage power electronics >1000V for on-road vehicles
• Advanced light weight metal (aluminum, steel, magnesium), carbon fiber polymers, and glass, including enabling manufacturing technologies (e.g. joining); high performance traction motor materials (e.g. electrical steels and aluminum conductors)
• Advanced solutions for passenger cabin efficiency, heat recovery and battery thermal management systems, with onboard thermal energy storage
• High-speed charging technologies for charging infrastructure
• Transportation system efficiency solutions, including the integration of technologies that will enable more efficient urban planning and design resulting in smarter use of transport networks (e.g. autonomous vehicles, intelligent transportation systems integrating different modes of transport and traffic management)
• Low-Carbon liquid fuels from sources including but not limited to biomass
• Sustainable liquid fuels that demonstrate clear low lifecycle carbon intensity from the originating raw material source to the products of combustion;
• Low-cost pathways for renewable hydrogen or carbon to synthetic fuels that serve as a drop-in replacement for petroleum-derived fuels

Objective

Buildings account for 17% of total GHG emissions in Canada, and 28% of global energy related CO2 emissions. Breakthroughs are essential to reducing building energy use and GHG emissions. Emerging technologies in building design, construction, and operation offer opportunities for more affordable lower carbon solutions.

Target

• Efficient next generation heating, cooling, and water heating technologies (e.g. seeking greater than 100% coefficient of performance, low/no Global Warming Potential refrigerants);
• De-risking transformative solutions for new building construction and enabling deep energy retrofits (e.g. innovative envelope technologies, emerging construction practices, cost effective deep energy retrofit solutions);
• Promoting technology-enabled design and operation of efficient homes and buildings (e.g. artificial intelligence, prefabrication, optimization software); and
• Developing next-generation building energy management systems (e.g. application of machine learning, Internet of Things, sensors and controls).