New Zealand Climate Tech for the World Report
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July 2021 NEW ZEALAND CLIMATE TECH FOR THE WORLD How can New Zealand’s Climate Tech innovators succeed on the world stage? An analysis of New Zealand’s Climate Tech innovation ecosystem NEW ZEALAND CLIMATE TECH FOR THE WORLD July 2021 Contents Scope and Purpose ........................................................................................ 4 Methodology .................................................................................................. 5 Executive Summary ....................................................................................... 6 Critical Findings ............................................................................................ 10 Recommendations: Improving the Ecosystem.........................................12 Laboratory New Zealand – New Zealand Technologies for Global Climate Challenges .................................................................... 13 Leading the Way in Low-Emissions Agriculture .......................................16 Digitalising Energy Decabonisation ........................................................... 23 Capitalising on Circularity in Energy and Materials .................................26 Productising Low-impact Consumer Goods ......................................................30 References .................................................................................................... 32 NEW ZEALAND CLIMATE TECH FOR THE WORLD July 2021 Appendices Energy & Power ........................... 36 Resources & Environment ....... 126 Comparison Between Small Comparison Between Small Advanced Economies (SAEs) ..................... 38 Advanced Economies (SAEs) ................... 128 Waste Heat Recovery ................................. 40 Wastewater Treatment ........................... 131 Smart Home Energy Analytics .................. 46 B2C Carbon Emissions Tracking ............. 138 Electrochemical Energy Storage ............... 52 Bioplastics ................................................. 143 Geothermal ................................................. 58 Zero Waste Products ............................... 148 Energy Efficiency - Digital Platforms ........ 64 Natural Textiles ........................................ 153 Hydrogen - Transport & Refueling ........... 70 Transport & Logistics ................ 158 Agriculture & Food ...................... 76 Comparison Between Small Comparison Between Small Advanced Economies (SAEs) ................... 160 Advanced Economies (SAEs) ..................... 78 EV Charging & Management ................... 164 Livestock...................................................... 79 Aerospace Propulsion Modules ............. 170 Livestock Monitoring ............................ 80 Maritime Electrification ........................... 175 Livestock Breeding & Genetics ............ 82 Methane Vaccines................................. 84 Feed Alternatives & Additives ................... 88 Materials & Chemicals .............. 179 Protein Replacements ............................... 93 Comparison Between Small Aquaculture ................................................ 99 Advanced Economies (SAEs) ................... 181 Crops ......................................................... 103 Advanced Materials: Specialty Crops.................................... 105 Green Building & Construction .............. 183 Precision Chemical Application ......... 107 Additive Manufacturing for Construction . 189 Agricultural Digitalisation ........................ 111 Industrial Waste to Value ........................ 194 Agricultural Robotics .......................... 113 CCUS - Point Source Capture .................. 199 Agricultural Software ......................... 115 Surface Technologies .............................. 204 Agricultural Drones ............................ 117 CCS for Agriculture .................................. 122 NEW ZEALAND CLIMATE TECH FOR THE WORLD July 2021 Scope and Purpose This research seeks to answer the question, way that secures New Zealand innovators a place in the “How will New Zealand climate tech businesses global supply chain. Likewise, a proficient ecosystem succeed on the global stage?” is defined as one in which innovators can, in theory, access the research, finances, network and connections Climate tech is defined as technology that reduces to demand necessary for global expansion without having or eliminates greenhouse gas emissions (directly to relocate headquarters overseas. or indirectly) or improves use of natural resources. This report summarises opportunities for New Zealand The intended audience for this report is New Zealand’s climate tech companies to compete on the global stage, innovation ecosystem of innovators, customers, investors, and for the surrounding innovation ecosystem to support government agencies, corporates, universities and others and foster climate tech innovation. Becoming competitive responsible for supporting and sustaining climate tech on the global stage requires innovators to successfully innovation. This report summarises findings during a transfer research into commercialised products, raise detailed analysis process, examining global climate tech requisite funds to scale and expand beyond the immediate trends, New Zealand innovators’ positioning in relation New Zealand market, and most importantly, connect to those trends, and the innovation ecosystem’s ability to to owners of demand (direct customers, technology support innovators navigating those trends. Further detail development partners, joint venture partners) in a on the analysis is provided in the appendices of this report. HOW WILL NEW ZEALAND CLIMATE TECH BUSINESSES SUCCEED ON THE GLOBAL STAGE? 4 CONTENTS NEW ZEALAND CLIMATE TECH FOR THE WORLD July 2021 Methodology This report analyses five climate tech sectors (Agriculture & Food, Energy & Power, Resources & Environment, Materials & Chemicals, Transport & Logistics) to identify technology areas in which New Zealand innovators can innovate ahead of trends and potentially compete globally. The analysis combines macroeconomic markers of market attractiveness (market size, growth rate, level of competition, policy drivers), a comparison of New Zealand innovators against comparable innovators globally, and a comparison of the New Zealand innovation ecosystem supporting relevant innovators. Findings generated from this research serve to help the New Zealand climate tech innovation ecosystem to: ■ Benchmark existing strengths and weaknesses relevant to global climate tech trends. ■ Draw comparisons with other small, advanced economies (SAEs) that have successfully pushed climate tech innovations into global markets. ■ Identify critical gaps holding New Zealand’s innovators back from innovating on a global scale. ■ Re-evaluate changes in approach, both strategic and tactical, to create the conditions necessary for New Zealand climate tech to thrive globally. 5 CONTENTS NEW ZEALAND CLIMATE TECH FOR THE WORLD July 2021 Executive Summary New Zealand has come to be known as a global thought received 55 times less funding than the leading country, leader on climate change issues, perhaps most visibly in Sweden, 22 times less than those in Israel, 18 times less than the form of its ambitious commitment to net zero by 2050 those in Denmark, and 12 times less than those in Ireland. and its impressive results in already being 85% of the Some of this gap is explained by the variance in industry focus way to a fully renewable electrical grid. New Zealand has found in each SAE. For example, globally transportation and launched world-leading innovators in climate tech areas in energy innovators receive far more funding on average versus recent decades as well, including LanzaTech and AllBirds. agriculture or resources innovators. However, even countries in which agriculture or resources hold a similar economic However, when compared to other small advanced economies importance (e.g. Israel, Finland, Sweden), all outpaced New (SAEs), New Zealand’s climate tech innovators struggle to raise Zealand’s amount of financing by wide margins in those sectors. the same amounts of funds that innovators in comparable economies are able to, well below the SAE average in terms of aggregate financing to climate tech, number of companies DEFINING SMALL ADVANCED ECONOMIES (SAES) getting funded, and average investment amounts. As observed in Figure 1 below, among SAEs, New Zealand saw both the “Small” economies are defined here as having a lowest amount of investment in climate tech and the fewest population of less than 20 million. “Advanced” economies climate tech innovators receiving funding. New Zealand climate are identified according to International Monetary Fund tech innovators raised 95% (19 times) less funding than climate criteria of per capita income, export diversification, and tech innovators in the average SAE, and 84% (6 times) less than integration into global financial system. The SAEs analysed those in Finland, which ranks one spot above New Zealand in in this report all have GDPs per capita of over US $30,000. climate tech fundraising. New Zealand’s climate tech innovators Figure 1: Number of Companies Raising Capital 2011-2021 KEY: 25 350 ■ ■ 306 300 ■ 20 ■ NUMBER OF COMPANIES RAISING CAPITAL NUMBER OF COMPANIES 250 ■ 234 ■ 223 ■ 15 199 200 $ BILLIONS 156 150 10 136 117 109 100 93 87 5 54 50 10 46 S 179 0 DENMARK FINLAND IRELAND ISRAEL NETHERLANDS NEW ZEALAND NORWAY SINGAPORE SWEDEN SWITZERLAND SAE AVERAGE 0