Verdantix Forecasts Canadian Sustainable Business Spend To Grow From $2.3bn in 2010 to $3.7bn in 2014
London, March 1, 2011. The Canadian sustainable business market will grow to $3.7bn in 2014 from $2.3bn in 2010, according to a new report from independent analyst firm Verdantix. Based on an analysis of 163 firms with Canadian revenues of at least $750 million, the Verdantix report finds that the Canadian sustainable business market will exceed $2.8bn in 2012, grow to $3.2bn in 2013 and hit $3.7bn in 2014. Based on cross-industry research of over 1,000 Canadian corporate sustainability initiatives, the Verdantix Critical Moments model defines sustainable business spend across 29 sustainability initiatives. Initiatives covered include spending on energy efficiency, carbon management, sustainability strategy, risk management, cleantech innovation, sustainable operations, human capital investments and industrial emission reductions.
“While the Canadian market will expand at a compound annual growth rate of 12% between 2009 and 2014, the pace of growth is held back by uncertainties over federal energy and climate policy,” commented James Beresford, Verdantix Analyst and author of the report. “At the moment, Canadian federal policy does not include binding legislation to restrict emissions. The federal government has postponed major policy decisions until the US position becomes clearer. At a provincial level the policy environment is fragmented. British Columbia, for example, has implemented a form of carbon taxation and signed up to the Western Climate Initiative. By contrast, Alberta is dominated by oil and shale gas industries and has acted as a brake on federal policy development.”
The Verdantix report Canadian Sustainable Business Spending, 2009-14 is based on the proprietary Critical Moments methodology. Key findings include:
- Canadian Sustainable Business Market will experience 12% CAGR from 2009-2014. Sustainability spend will increase by 12% in 2011 compared to 2010. This positive trend will continue with a year-on-year increase of 13% in 2012 accelerating to growth of 14% in 2013. Over the 2009 to 2014 period the compound annual growth rate (CAGR) will be 12% across all 20 industries.
- Spend on smart grid and on-site renewable energy to experience highest growth rate. Compound annual growth rates (CAGRs) for the 29 sustainability initiatives covered by the Verdantix Critical Moments market forecast vary from 5% to 27% over the 2009 to 2014 period. Spend on smart grid development and implementation will grow at a 27% CAGR to reach $142 million in 2014. For on-site renewable energy the CAGR is 25% and energy and carbon data management 19%.
- Emission-intensive industries dominate sustainable business spend. In 2011, nearly 40% of sustainable business spending is generated by the oil and gas, utilities and basic resources industries. From 2009 to 2014, utilities and oil and gas firms will increase spend at a compound growth rate of 15%, and basic resources will increase spend by 12%. By contrast, growth rates for Banks and Insurance firms will reach just 8% over the 2009-2014 period.
“Expectations for Canadian economic growth between 2010 and 2014 are in the 2% to 3% range. So a 12% increase in sustainable business spending makes this an attractive market,” stated David Metcalfe, Director at Verdantix. “Beyond 2013, we expect higher oil prices, a competitive ratchet effect on sustainability investments and cleantech innovation to accelerate sustainability spending.”
The Verdantix Critical Moments model is based on analysis of market drivers including energy and climate change policy at federal and state level, competitive dynamics within industries, innovation diffusion, risk drivers, oil, natural gas and electricity price forecasts, and Canadian and global GDP growth forecasts.
The Verdantix report Canadian Sustainable Business Spending, 2009-14 launched today and is available to Verdantix clients who can download the report at www.verdantix.com.
About Verdantix
Verdantix is the fastest-growing, independent, analyst research firm focused on sustainable business strategies and market opportunities. For more information visit:www.verdantix.com.
Press contact
Elinor Newman-Beckett, +44(0)203 371 6792
press@verdantix.com
Tuesday, 01 March 2011