Energy-related research and development expenditures, 2022
Released: 2024-09-19
Businesses in Canada spent $2.8 billion on in-house energy-related research and development (R&D) in 2022, up 17.2% from 2021. This marked the second consecutive year with significant spending increases, which contrasts with the relatively stable expenditures seen from 2015 to 2020. Of the overall $30.4 billion spent on in-house R&D in 2022, energy-related R&D represented 9.1% of expenditures, up from 8.5% in 2021.
Outsourcing of energy-related R&D spending rose by 6.2% in 2022 to $306 million. As a proportion of overall outsourced R&D expenditures, energy-related R&D outsourcing accounted for 5.3% of the $5.8 billion that businesses spent in 2022.
Energy-related R&D is essential to address Canada's 2030 Emissions Reduction Plan for a cleaner future. The federal government's second climate target aims to reduce greenhouse gas (GHG) emissions by 40% to 45% below 2005 levels by 2030.
In-house research and development expenditures on clean technologies increased in 2022
Businesses play an important role in achieving Canada's emissions targets, which can be seen through their development of technologies related to renewable energy resources, nuclear fission and fusion, electric power, hydrogen and fuel cells, energy efficiency, and other energy-related technologies, such as carbon capture, transport and storage.
In 2022, businesses spent $1.9 billion on in-house R&D to further develop clean technologies. Energy efficiency saw the strongest growth in in-house R&D spending, up by $107 million from 2021 to $594 million in 2022. This was followed by hydrogen and fuel cells, which rose by $56 million to $306 million, and electric power, which rose by $37 million to $373 million. The percentage share of total in-house energy-related R&D for each of these three technology areas has also grown considerably since 2014. For instance, during the period from 2014 to 2022, energy efficiency increased from 5.8% to 21.5%; hydrogen and fuel cells, from 3.6% to 11.1%; and electric power, from 3.7% to 13.5%.
In 2022, energy efficiency R&D was prevalent in several industries such as computer systems design and related services (12.3%); research and development in the physical, engineering and life sciences (12.1%); motor vehicle, motor vehicle body and trailer and motor vehicle parts manufacturing (10.4%); and navigational, measuring, medical and control instruments manufacturing (10.3%). Hydrogen and fuel cells R&D is predominantly concentrated in the electrical equipment, appliance and component manufacturing industry (58.2%), while electric power R&D is concentrated in the electric power generation, transmission and distribution industry (48.5%).
Expenditures on other energy-related technologies rose by $27 million in 2022 to $155 million. Within this category, carbon capture, transport and storage accounted for $52 million, with $48 million of that amount directed towards fossil fuel production and processing. Canada aims to expand the use of this technology to help reduce GHG emissions, particularly in the oil and gas sector.
Nuclear energy expenditures rose by $9 million to $288 million in 2022, while renewable energy spending fell by $4 million to $172 million.
Government funding rises
Government funding to businesses for energy-related R&D purposes rose 13.4% to $211 million in 2022, representing 7.7% of total in-house energy-related R&D.
Energy efficiency received the highest amount of government funding in 2022 at $64 million, down from the $73 million provided in 2021. By contrast, clean energy technologies received increased funding in 2022 related to electric power (up from $15 million in 2021 to $29 million) and hydrogen and fuel cells (up from $5 million in 2021 to $22 million).
Foreign funding increased from $151 million in 2021 to $307 million in 2022, while its proportion of in-house energy-related R&D increased from 6.4% to 11.1% over this period. Hydrogen and fuel cells received 53.4% of all foreign funding in 2022, while energy efficiency received 20.8% and electric power received 18.6%.
In-house research and development spending on fossil fuels rises, while outsourced spending falls
In-house R&D expenditures on fossil fuels increased for the second consecutive year, up by $171 million from 2021 to $869 million (+24.5%) in 2022. Fossil fuel expenditures had been on the decline after reaching a high of $1.5 billion in 2012. Fossil fuel's share of total energy-related in-house R&D also rose in 2022, up by 1.8% from the previous year to 31.5%, the first increase since 2017. Nevertheless, the share of in-house R&D expenditures on fossil fuels in 2022 remains significantly lower than its peak of 73.6% in 2012.
In 2022, the increased spending primarily targeted oil sands technologies, which rose by $113 million from the previous year to $539 million, followed by crude oil and natural gas production and storage, up by $60 million from 2021 to $144 million in 2022.
Outsourcing of R&D spending on fossil fuels decreased from $133 million in 2021 to $104 million (-21.8%) in 2022. As a result, its proportion of the total amount of outsourced energy-related R&D fell from 46.2% to 34.0% over this period.
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Sustainable Development Goals
On January 1, 2016, the world officially began implementing the 2030 Agenda for Sustainable Development—the United Nations' transformative plan of action that addresses urgent global challenges over the next 15 years. The plan is based on 17 specific sustainable development goals.
Data on energy-related research and development expenditures by area of technology are an example of how Statistics Canada supports the reporting on the Global Goals for Sustainable Development. This release will be used in helping to measure the following goals:
Note to readers
Energy-related technologies
Energy-related technologies include fossil fuels, renewable energy resources, nuclear fission and fusion, electric power, hydrogen and fuel cells, energy efficiency, and other energy-related technologies.
Definition of clean technologies
Clean technologies are defined as follows:
• Any good or service designed with the primary purpose of contributing to, remediating, or preventing any type of environmental damage;
• Any good or service that is less polluting or more resource-efficient than equivalent normal products which furnish a similar utility. Their primary use, however, is not one of environmental protection.
Data collection
The Energy Research and Development Expenditures by Area of Technology survey data are collected as part of the Annual Survey of Research and Development in Canadian Industry.
Random Tabular Adjustment
The Annual Survey of Research and Development in Canadian Industry and the associated Energy Research and Development Expenditures by Area of Technology survey, 2018, are the first annual surveys at Statistics Canada to use the Random Tabular Adjustment (RTA) technique, which aims to increase the amount of data made available to users while protecting the confidentiality of respondents.
Statistics Canada typically uses suppression techniques to protect sensitive statistical information. These techniques involve suppressing data points that can directly or indirectly reveal information about a respondent. This can often lead to the suppression of a large number of data points and significantly reduce the amount of available data.
Using RTA, Statistics Canada can identify sensitive estimates and randomly adjust their value rather than suppress them. The size of the adjustment is calculated to protect respondent confidentiality. After adjusting the value, the agency assigns a quality measure (A, B, C, D, or E) to the estimate to indicate the degree of confidence that users can have in its accuracy. Quality measures account for uncertainty related to sampling, nonresponse and RTA, when applied.
For more information on RTA, please refer to the blog article "Random Tabular Adjustment is here!" available as part of the StatCan Blog.
Products
The interactive dashboard, "Characteristics of research and development in Canadian industry" (), is now available. 71-607-X
Contact information
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).
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