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The CleanTech Issue
Letter from the Editor | 4
The CSE's 20th Anniversary Milestones | 6
Here are our top 10 highlights from the past 20 years
A Special 20th Anniversary Interview With Richard Carleton | 8
Hear our CEO’s thoughts on what has contributed to the CSE’s success and the lasting impact the Exchange hopes to make
On a Positive Note
| 10
CSE listed issuers and financiers share their experiences in working with the Exchange
Celebrating 20 Years | 13
Enjoy these moments captured at our anniversary celebrations in Toronto and Vancouver
Hybrid Power Solutions | 16
Product quality and local manufacturing are just two of the key advantages this battery maker enjoys
SHARC International Systems | 20
Clean energy from an unlikely source catches on across North America
Replenish Nutrients | 24
Growing demand for natural fertilizers sets the stage for major capacity expansion
Beyond Oil | 28
Israeli FoodTech company helps alleviate health concerns related to commercial frying
BluSky Carbon | 32
Carbon removal that powers itself is a step toward saving the world
NU E Power | 36
Savvy business model leverages North America’s race to build renewable energy
20th Anniversary Roundtable
Interview | 40
Learn about the history of the Exchange and what’s in store for the future with four senior leaders at the CSE
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EDITOR-IN-CHIEF
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EDITORS
Peter Murray
Libby Shabada
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ART DIRECTOR
Nicole Yeh
WRITERS
William Farrington
Oliver Haill
Angela Harmantas
Emily Jarvie
Peter Murray
Libby Shabada
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TERRITORY ACKNOWLEDGEMENT
The Canadian Securities Exchange acknowledges that our work takes place on traditional Indigenous territories.
Letter from the Editor
Of the many things entrepreneurs are good at, seeing solutions where others see crises is one of them. Daily, across all media, we are being bombarded with news about climate change and planetary boundaries being exceeded, and so, there couldn’t be a more salient group of entrepreneurs to hone in on for this edition of Canadian Securities Exchange Magazine than those working in CleanTech.
In marking our 20th anniversary, we wanted to make this issue extra special. In addition to highlighting six innovative CSE listed CleanTech companies, we also wanted to make space, with imagery and interviews, to celebrate and showcase our own journey, as well as to offer a view of what the future may hold for the Exchange.
Getting the Exchange to where it is today was no small feat. As the first new stock exchange in Ontario in over 80 years (at the time the Exchange launched), it is abundantly clear through the retrospectives and interviews with senior leaders at the Exchange that many novel and creative solutions were required to improve the capital markets landscape in Canada.
What we have achieved is a testament to the dedication, agility, ingenuity and resilience of the leadership and staff at the CSE. I can say, without question, that we are Canada’s most entrepreneurial securities exchange.
In terms of the CSE listed issuers featured in this issue, we aimed to provide a panoramic view of the multitude of approaches to improve the outcomes for people and planet that CleanTech as a sector represents.
Whether it’s cleaner sources of energy generation and storage, like solar, wind and of increasing interest, hydrogen, at companies like NU E Power and Hybrid Power Solutions; the work being done by SHARC International Systems to improve the efficiency of water and energy systems; natural fertilizers
from Replenish Nutrients; healthier cooking oils courtesy of Beyond Oil; or, one of the loftiest challenges, carbon dioxide removal by the team at BluSky Carbon – these stories collectively demonstrate CleanTech entrepreneurs are actively seeking solutions to the defining challenges of our times and the capital markets are going to play a pivotal role in catalyzing innovation to address these truly global issues.
While it is difficult to know what the next 20 years will look like, both in terms of the state of the planet and the resulting economic landscape, I am fully confident that entrepreneurs will be at the forefront of solutions to navigate whatever is coming next.
Certainly, we remain always invested in listening to and acting in the best interests of all our key stakeholders, including our most important collective stakeholder: the planet.
James Black Editor-in-Chief james.black@thecse.com
CSE TV
Keep your finger on the pulse of what's happening in the capital markets. Join our community of savvy subscribers who tune in to CSE TV for insightful content about developments in CleanTech and beyond. Subscribe now: go.thecse.com/CSETV
THE EXCHANGE FOR ENTREPRENEURS PODCAST
Listen to a variety of in-depth conversations with thought leaders and innovators on Season 4 of The Exchange for Entrepreneurs Podcast. You can find it on Apple Podcasts, Google Play, Spotify, Stitcher, YouTube, and iHeartRadio. Tune in: blog.thecse.com/cse-podcasts
20th Anniversary Milestones
Here are our top 10 highlights from the past 20 years
2004
The CSE – then CNQ – becomes a recognized stock exchange, the first in Ontario since the 1920s.
2007
The CSE launches the first-ever continuous auction market, Pure Trading, to trade securities listed on other Canadian exchanges.
2009
The CSE is approved as a “Designated Stock Exchange” by the Department of Finance Canada, making its listed securities eligible for RRSPs and TFSAs.
2010
The CSE is designated as an “offshore securities market” by the U.S. Securities and Exchange Commission.
2014
The CSE lists its first medical cannabis company, initiating an era of rapid growth in listings and establishing the Exchange as the global leader in publicly listed cannabis securities.
2024
The CSE celebrates 20 years as a recognized stock exchange alongside friends and supporters at events and special ceremonies in cities across Canada.
2022
The CSE launches CSE2, its second trading book, which offers a rebate fee model to traders looking to better manage their trade execution costs for marketable orders.
2023
The CSE positions itself for its next phase of growth by initiating a rebrand and launching the Senior Tier for larger and later stage issuers.
2019
2017
The CSE25 IndexTM , an index of the Exchange’s top 25 listed securities by market capitalization, launches.
The CSE welcomes its 500th issuer, doubling the listings total in four years.
A Special 2 0th Anniversary Interview with
Richard Carleton
Hear our CEO’s thoughts on what has contributed to the CSE’s success and the lasting impact the Exchange hopes to make
Throughout the 20th anniversary year, the CSE has reflected on and shared many of the important milestones and achievements of the Exchange’s journey thus far. In this exclusive conversation with the CSE’s Richard Carleton, CEO, and Renée Colyer, Director of Strategic Planning & Brand Development, we offer readers insight into the themes underpinning the Exchange's success and what may be on the horizon.
Read on to learn more about the CSE’s vision for the future, potential new product offerings and opportunities the CSE is pursuing, as well as the impact the Exchange hopes to make.
Exchange. And of course, that had a virtuous cycle effect, where more and more issuers saw the success that the original folks had in terms of raising capital and providing liquidity for their shareholders. It really built on itself. But again, it would've been difficult for anybody to predict that.
Over the last few years, there’s been a tremendous resurgence of the mining industry in Canada and overseas. We’ve seen companies using the facilities of the Canadian Securities Exchange to secure the capital they need to pursue the exploration, and in a few cases, the development of actual mines to go from the exploration phase to the production phase.
Renée Colyer, moderator (M): The CSE has been part of the Canadian financial landscape for 20 years. As we've heard from you previously, it went from a struggling startup to one of the fastest-growing exchanges in North America with a diversified issuer base, so I'd love to know your thoughts on the CSE's vision for the future.
Richard Carleton (RC): Well, we remain steadfast to our original vision, which is to build a great exchange. That really guides all the things that we do and think about.
Of course, we're always asked about what areas we are focusing on or what sectors we are trying to emphasize. And the reality is we can't predict too far in advance what the trend is going to be in terms of new companies coming into the markets.
For example, nobody would've predicted that we would become the global location for finance in the cannabis industry until we began to see a significant number of investorbacked companies come onto the
With gold at record highs recently and silver starting to head upward, we’ve seen more precious metals companies coming onto the Exchange. And importantly, precious metals companies that are already listed have been able to successfully raise capital investment.
So, I would love to say that next year's flavour will be artificial intelligence or communications technology or life sciences breakthroughs and so on. We can't, however, predict what the market is going to be funding next year, the year after that, and the year after that.
Ultimately, our goal is to continue providing the products and services that issuers need to raise money from the Canadian public capital markets and do so at the lowest possible cost.
M: The CSE has a long history of having corporate listings. We've outpaced TSXV in terms of our IPOs with corporate companies. Are you looking at any different types of listings like CDRs or ETFs? Are any of these on the radar for the CSE?
RC: One of the components of the work that we did on our listings
policies over the last couple of years; – which among other things created a Senior Tier of stocks along with our traditional Venture Tier; – was to expand the opportunity to list financial products of various kinds.
That would include, as you mentioned, ETFs and other exchange-traded products. We're still a little ways away. We have some infrastructure work to do in order to accommodate the manufacturers of these funds.
It is a very competitive field in Canada and North America, but we certainly hope to open opportunities for, frankly, more CSE companies to be participants or included in ETF portfolios, to provide more liquidity and price discovery and to ensure investor awareness for the companies that are included in those ETF portfolios.
It's a 2025 goal at this point with the technology work that we have to do, but it's something that we're very much looking forward to.
M: With respect to global partnerships, are there any new and exciting opportunities that you might have going on?
RC: Well, one of the features of the recent capital markets is that it's been extremely challenging for early-stage companies to raise money in Canada. As a result, we have seen our issuers going farther afield to the U.S., Europe, the U.K., Australia and South Asia to raise capital. In some cases, investors in those different parts of the world are looking to trade those shares locally and priced in a local currency.
Our issuers, therefore, are considering listings and quotation services, perhaps on the Frankfurt Stock Exchange, AIM or Aquis in London or the ASX in Australia. A handful of companies have interlisted with NASDAQ in the U.S., and of course, a great number of our companies have opted to be quoted on one of the regulated boards, either the QB or the QX or the OTC markets in the United States.
So, one way of looking at it is that we're working with regulators, exchanges and market facilities in all of these places
to see what we can do to make it easier for our issuers to interlist or access the capital in those markets because, of course, they're heavily regulated here in Canada, right? There's a very specific, and frankly, world-leading oversight of these companies in terms of their continuous disclosure and the financial statements they provide, as well as the secondary market oversight that's provided by CIRO. So again, there are probably a lot of additional regulatory obligations that would ordinarily be required by virtue of listing in these different markets that in fact would be duplicated or duplicative.
The other way of looking at it is, how do we make it easier for investors in those countries to trade the stocks in Canada? So, improve their access to the CSE.
To that end, we're working with a variety of partners that are looking to facilitate the processing of orders from different parts of the world into Canada – or the United States as the case may be – to help them, in effect, manage the investment they're making in CSE listed companies.
I'm not sure yet how or which way it's going to go and which channels are going to prove to be the ones that help the companies address these challenges the best, but we're certainly working on both sides of that equation. And again, we hope to be delivering tangible progress for companies for the remainder of this year and certainly into next.
M: That sounds very exciting for the CSE. Are there any challenges, other than what you've mentioned? Anything else standing in the way of some of those initiatives that you've spoken about?
RC: The investment climate for our issuers is extremely challenging right now. A lot of companies have had a very difficult time raising capital, whether it's their secondary financing to extend the drill program, for example, or to raise the capital required to meet the requirements of the exchange when they originally list.
And when interest rates were, I wouldn't say historically high because I'm old enough to remember the 18% to 20% overnight rates from the early '80s, but certainly when they were high in comparison to where they were in the pandemic, we saw a retreat of investment money from the small cap space – not just in Canada but really around the world.
We are, however, seeing a few preliminary signs of a shift. North American central banks appear to be on a rate-cutting trajectory; there’s increasing secondary market turnover, and some companies are, in fact, raising money. Again, it's slow, but the fact that specific transactions are getting over the finish line suggests that things are going to be more robust in the fourth quarter and certainly into next year as well.
M: Let's focus on the CSE's impact so far. What long-term impact would you like the CSE to have on the Canadian marketplace? What did the CSE do and what would you like it to continue to do in terms of its long-standing reputation, its overall impact on Canadians and the Canadian economy and marketplace?
RC: The touchstone for us has always been about building a great exchange. And so, if our issuer customers feel as if their company was listed with a high degree of customer service from the Exchange; our investor customers believe they have interesting companies to trade; and our dealer customers know that our trading systems provide the visibility, fairness, and transparency they need to have confidence in trading on the secondary market, then I believe we’ll continue to see success. Really, it's a whole bunch of little things that we hope will add up to an extremely positive experience for all of our stakeholders.
Ultimately, where we want to be is to have all of our stakeholders sit back and say, "That was a fantastic experience I had dealing with that exchange.”
Editor’s Note: This interview has been edited for clarity and length.
On a Positive Note
CSE listed issuers and financiers share their experiences in working with the Exchange
As part of a recent review of service levels at the CSE, we commissioned a survey of clients and key capital markets stakeholders. Here is a small sample of the very kind comments respondents shared with us about their experiences working with the Exchange.
Editor’s Note: Names of respondents have been anonymized to preserve confidentiality.
"I think the experience with CSE was refreshing, very refreshing. I've dealt with a lot of different stock exchanges, [...] but on the CSE, we find it very customer-centric, friendly, and at the same time if you have a problem, they will talk and sort out those things."
- Listed Issuer
“[T]he CSE in the small-cap markets was a great place for Canadian companies or non U.S.-based companies that were getting traction to use this as an alternative way to raise capital and grow. [...] We spent three years building a relationship with the CSE. The people really made a difference.”
- Listed Issuer
“Having great people there for a long time is a testament to the Exchange.”
- Financier
“We decided on the CSE for a few different reasons. It was partly, I believe it's a slightly faster process [and] a little less restrictive, and, especially important for junior exploration companies, that listing costs are lower.”
- Listed Issuer
“[A]s an early-stage venture company, you want to get up as quick as possible. You want to make it easy as possible, you want to make it as cheap as possible. And once you get public, you want to make sure there's liquidity and there's exposure. [...] So that's why we chose the CSE.”
- Listed Issuer
“I have no hesitation; if it fits the profile of under $50 million, to go with [the] CSE.”
- Financier
"I've listed [lots of] companies on the CSE before, and it was no different where it was seamless in all regards."
- Listed Issuer
Celebrating
20 Years
Enjoy these moments captured at our anniversary parties in Toronto and Vancouver
Hybrid Power Solutions
Product quality and local manufacturing are just two of the key advantages this battery maker enjoys
By Peter Murray
Batteries have been around since 1800, when Alessandro Volta employed zinc and silver discs, among other components, to create a device (the voltaic pile) that generated electrical current. Well over two centuries later, Volta’s invention is more important than ever, with battery technology continuing to evolve at a breakneck pace.
Hybrid Power Solutions (CSE:HPSS) is an Ontario-based company with a home-grown take on the power storage industry that is proving to be a good match for today’s competitive landscape.
The company’s focus on batteries that operate to extremely high standards, thanks in no small part to domestic manufacturing with North American components, has won it a list of clients of which any entity would be proud. Colony Hardware, the United States Armed Forces, plus
major power utilities and mass transit systems are all part of the customer base. It reflects a commitment to understanding user needs and delivering top-quality products that completely fulfill them.
“When I started Hybrid Power Solutions, the focus was on how to use batteries to transform the way the industrial and commercial sectors operate,” explains Hybrid Chief Executive Officer Francois Byrne. “What I mean by that is better performance, better safety, better ROI and zero compromise to what you are doing.”
A review of product specifications helps to illustrate this concept. Hybrid’s products operate in greater temperature ranges than those of its competitors, most of them from China, which is important given that many of its customers use products outdoors or in environments
Francois
Byrne Chief Executive Officer
Company
Hybrid Power Solutions
CSE Symbol
HPSS
Listing Date
November 29, 2023
Website investhps.com
where operating conditions can reach extremes.
The Hybrid lineup comprises batteries from 3,000 watts up to 150,000 watts, with the ability to go even higher based on client requirements.
“We can power your welder off this battery, your crane off that one and your trailers off these ones,” says Byrne, highlighting a construction site scenario. “We bring the hybrid side as well with solar power generation. Essentially, we are transitioning our customers to a clean future without having to say ‘clean’ or ‘green’ or any of those things. We are selling clean technology based on performance and cost savings, and the side benefit is that we are sustainable and a better option.”
The Hybrid Power Solutions concept traces back to when Byrne was racing hybrid cars as a student while earning a degree in Carleton University’s Sustainable and Renewable Energy Engineering program. It was clear to Byrne that the torque performance characteristics that worked so well for race cars could be applied in commercial settings and meet industrial standards.
“We made a conscious decision early on that we were not going to be
a consumer-grade product. Our focus has always been on manufacturing to a professional standard. Essentially, you are making your living using our product, and if it goes down it is dollars lost, not just an inconvenience,” says Byrne.
“
We are selling clean technology based on performance and cost savings, and the side benefit is that we are sustainable and a better option.
— Byrne
That commitment to understanding quality from the customer’s perspective is bearing fruit, with multiple users placing repeat orders after having a good experience with their initial deployment of Hybrid batteries.
Byrne tells the story of a Californiabased utility that contacted Hybrid
after seeing a product review on YouTube.
“They bought a unit and six months went by and we hadn’t heard anything. We contacted them to see how things were going, and they said our battery worked phenomenally and was the only one that did exactly what they needed it to do. We received a second order, and then about three months ago they came back with a third order, this time for 105 units.”
Estimates of the size of the battery energy storage market vary, but one guideline, a recent report published by Fortune Business Insights, suggested US$114.05 billion by 2032, representing a compound annual growth rate (CAGR) of 20.88%.
With so much at stake, competition is sure to increase. It is going to be the companies that combine effective marketing with modern technology that succeed in the long run, a concept not lost on Byrne.
“Innovative technology is at the forefront of our strategy, but that will only get you so far,” says the CEO. “I’ve seen incredible technology that never gets into a revenue-generating company because the sales process wasn’t there. This is where we differentiate ourselves
– our partnerships with large distribution channels and tier-one clients will enable us to scale in a way that other companies cannot.”
And given the geopolitical state of the world, where new global alliances are drawing battle lines that directly threaten the status quo, regional security concerns are playing a role in shaping the future of technology and the opportunities available to the corporate sector.
Byrne says that consumers don’t seem to care that much about where their products are made, whereas attitudes on the commercial side have shifted noticeably over the past few years. Business leaders increasingly feel that the West would be well advised to learn to fend for
itself, so local manufacturing is taking on greater importance and becoming more appealing to purchasing managers.
“A lot of our products have parts not only from Canada but from the U.S. as well,” Byrne observes. “And while I’m not saying that it isn’t a challenge, as North America is lagging in certain manufacturing capabilities, we are seeing a transition. It is all leading to a holistic and North American-based manufacturing ecosystem.”
Clearly, Hybrid has established a strong base from which to support management’s longer term plans to aggressively scale the business. The market is there, the technology is there, not to mention accolades from an expanding list of customers.
As with many young companies, now Hybrid mostly needs time to grow to the level of operations it has in mind. And that is one of Byrne’s key messages for the investment community.
“This is a real company with real technology, and our door is open to our investors to come and see what we do,” Byrne says in offering some final thoughts. “How we take a raw cell and build it into something that will power your welder for three shifts straight. That kind of thing is difficult to do, but we’ve done it and we expect this company to grow to new heights. We need investors to believe in what we do in the same way our customers believe and help us scale this to a level where every construction, railway, mine and military site out there is using our product.”
About the Author
Peter Murray oversees a national editorial and broadcasting team as President of Proactive Canada. He spent several years managing the English news desk at Nikkei’s head office in Tokyo and has worked with research teams at Asian and European investment banks. Peter is based in Vancouver.
SHARC International Systems
Clean energy from an unlikely source catches on across North America
By William Farrington
Vancouver is a city known for its beautiful natural surroundings, rich history and a location that today serves as a gateway to the Asia-Pacific region.
Few people would rank wastewater management on a top 10 list of the city’s best features, but it deserves recognition nonetheless, as there is plenty to deal with, and municipal officials view wastewater not only as an item for mass disposal but also as a valuable resource.
In 2023, Vancouver sought to expand a system that, at the time, heated 5 million square feet of properties, including the 1,100-unit Olympic Village mixeduse community.
The goal it had in mind was to increase that square footage to a total of 22 million, in part by capturing heat from sewage wastewater and recycling it back into the
system via a process called wastewater energy transfer, or WET for short.
It was the largest WET project in North America at the time, and a local company by the name of SHARC International Systems (CSE:SHRC) played a central role. SHARC secured a deal to supply and commission five of its WET systems to perform sewage screening for the False Creek Neighbourhood Energy Utility, marking its biggest sale to date.
“We’re part of a system in Vancouver that provides heat and hot water to 22 million square feet of property that includes apartment buildings and stretches for about 2 miles (3.2 kilometres) along Second Avenue,” explains SHARC President and Chief Executive Officer Lynn Mueller.
“Most buildings in that area are connected to the False Creek Energy Centre,
which is powered by our system. We also have a project that covers 250 acres in Denver, so the scalability is definitely there, and the systems are only getting bigger as demand increases.”
The benefits of WET technology are easy to understand. The world needs more energy than ever, and millions of potential megawatts in the form of heat flow down drains with regularity. After spending huge amounts of money to heat water, letting it flow down the drain and into the ocean or local watersheds when an alternative to recapture it exists is a wasted opportunity, if not irresponsible.
Now, what if we could capture some of that heat and cycle it back into local heating networks? This is the concept that makes SHARC such an intriguing company.
“Many people think we generate electricity, but what we actually do is move thermal energy,” explains Mueller. “Our systems are thermal energy networks, so we measure in megawatts the amount of heating or cooling we can move. For instance, the system in downtown Vancouver is around 10 megawatts. The big advantage is that we’re reusing the same thermal energy day in and day out.
You give people hot water, they use it, throw it away, and we recover that heat from the wastewater. It’s a circular economy at its finest.”
Wastewater, such as sewage from residential or commercial properties, is typically around 15 degrees Celsius to 16 degrees Celsius due to daily activities such as showering and doing laundry. SHARC systems tap into this heat source by diverting a portion of the wastewater into a heat exchanger.
Utilizing the WET approach, the SHARC system extracts the thermal energy from the wastewater and transfers it to a building’s heating or cooling loop. The energy can then be used to heat spaces, provide hot water, or even cool buildings by reversing the process.
Once the heat is captured, the wastewater is returned and the system can extract energy from the next batch of wastewater. The opportunity to reduce dependence on natural gas and other carbon-intensive energy sources, thereby lowering both energy costs and greenhouse gas emissions, is obvious.
By design, SHARC systems are scalable, with solutions available for individual buildings or even entire districts,
“ When I first got into this, no one had even heard of sewage heat recovery. Now, every major city is exploring it as a way to reduce their carbon footprint.
— Mueller
making them a sustainable solution for urban areas.
The company markets two systems, one named SHARC and the other, PIRANHA.
“They are similar in function but very different in design,” Mueller notes. “The SHARC system is much larger and is meant for institutional-sized applications – think municipal or district-wide systems. The PIRANHA is designed for single-building use, like a residential or commercial property. But the concept behind both is the same.”
As far back as 2015, SHARC installations were commissioned for use at the Sechelt Water Resource Centre not far from Vancouver.
In 2020, the company put its technology to use for a multi-family residential project spearheaded by Morgan Creek Ventures in Boulder, Colorado.
And today, SHARC technology can be found in residential complexes and campuses across North America.
The company’s revenue for the first half of 2024 reached $1.56 million, nearly matching the total for all of 2023. In the second quarter alone, revenue was $780,000, a 72% increase compared to the same period the previous year.
And as of late August 2024, SHARC’s order backlog stood at $2.7 million.
Clearly, there is demand for the company’s approach to sustainable heating that should only grow as the concept becomes known by more developers and communities. And as it grows, SHARC is virtually guaranteed a large portion of it.
“The market is huge – easily in the billions,” says Mueller. “There are really only two companies in the world that do sewage heat recovery, which would be us and one based in Germany. Every city is starting to look at this technology as a serious alternative to traditional energy sources. When I first got into this, no one had even heard of sewage heat recovery. Now, every major city is exploring it as a way to reduce their carbon footprint.”
Looking ahead, SHARC is targeting large markets, such as California and New York, that already lean toward clean technology on multiple fronts.
Among the projects for which it has secured orders is one involving four PIRANHA
T15 WET systems for a mixed-use development in Berkeley, California. That project, the largest yet for the PIRANHA line, underscores the growing demand for SHARC's WET solutions in the U.S.
In New York, meanwhile, SHARC will be part of a US$1.2 billion redevelopment project in Brooklyn.
Hearing all this, one gets the sense that the potential for this technology is as untapped as the renewable resource being released into our sewers.
“We’re seeing a lot of growth, and our sales pipeline is the largest it’s ever been,” says Mueller. “We used to get one strong lead per week, but now we’re getting two or three every day. It’s really exciting to see how far we’ve come and how much potential lies ahead. The opportunities are enormous, and now that people are coming to us, rather than us having to convince them, it’s incredibly rewarding. We have a great team in place, and I’m confident we’ll continue to lead the way in wastewater energy transfer."
William Farrington reported for a fintech company with a focus on cryptocurrency and blockchain technology prior to joining Proactive, where he now covers financial markets from a variety of perspectives. He has also covered election results for Sky News and written for a legal publication. William is originally from Queensland, Australia.
Replenish Nutrients
Growing demand for natural fertilizers sets the stage for major capacity expansion
By Peter Murray
Humans could live without cars if they had to, computers too and, yes, even their mobile phones. You could arguably get by without modern forms of shelter as well, but food is nonnegotiable – we all have to eat.
Replenish Nutrients (CSE:ERTH) utilizes a natural approach to formulate fertilizers for the farmers who grow our fruits and vegetables. Its products are designed not only to feed the plants in farmers’ fields but to nurture and repair those fields as well. “Treat the soil with respect and it will respect you back” is one way to summarize the company’s way of thinking, and if demand for Replenish products is any indication, it’s working.
Replenish Nutrients Chief Executive Officer
Neil Wiens spoke with Canadian Securities Exchange Magazine in early September about business to date, feedback from the farming community and expansion plans designed to take operations to the next level.
The essence of your business is using natural methods over industrial ones to serve a sector we rely on every day: agriculture. Tell us in your own words what Replenish Nutrients does and why you started it.
Replenish is a natural fertilizer company using biochemistry, rather than chemistry, to liberate nutrients from mineral fertilizer sources. We use
non-leachable fertilizer products that hang out until biology does what it is supposed to, which is to liberate these elements and make them available to the plant in the right place at the right time.
Let’s use a phosphorous product as an example. We use rock phosphate, just like any phosphate fertilizer company. But instead of putting it through a chemical process, adding sulphuric acid and creating waste, we utilize the full rock phosphate mineral. When we do that, not only phosphate reaches the soil but also calcium, magnesium and iron, so the plant is getting the micronutrients it needs.
Essentially, we are adding micronized sulphur and solubilizing bacteria and fungi that will give the phosphate, calcium and magnesium full availability when the plant needs it the most.
Our products restore soil health while also reducing the sector’s overall carbon emissions by as much as 200,000 CO2 equivalent tonnes annually via a low-emission manufacturing process that produces a low-salt alternative to synthetic fertilizers.
What feedback has the farming community provided along the way that was unexpected or helped you to further refine your products?
I am an animal nutritionist by trade and so I always look at treating the soil as the world’s largest
feedlot. You have billions of microbes in the soil, and if you feed it the same as a human – give it a balanced diet – the soil reacts as our bodies would.
I would say the biggest feedback we get from farmers is that they see good things such as ladybugs showing up on their crops and also less fungicide use. These were things I was not anticipating originally; we were just trying to fertilize the plants and get a better nutrient density. But the farmers brought us consistent feedback that they were getting beneficial microbes and beneficial insects that they had not seen on their plants for 10 or 15 years.
What is the economic case for farmers using your products? Do Replenish products offer a greater yield increase per dollar, for instance?
As far as the economics are concerned, we basically say that you are not going to lose yield. You could gain it, but you won’t lose it. So, you are as good as conventional methods.
On the other side, it goes back to my previous answer where farmers are realizing that their crop inputs have decreased. They are not using as many pesticides or fungicides as they typically would, and so that all of a sudden creates
a better ROI. And that’s as early as a year or two into the program.
How about product distribution? Farming is a long-established industry. How does a soil replenishment company market its products? What does the sales cycle look like?
We market in two different buckets. Our main bucket has thus far been a blended type of product that we went direct-tofarm with because logistically it was hard to manage. With a blended product, we have all the ingredients to bake a cake, if you will, and we’ve mixed them, but we haven’t put them in the oven.
On the other side of distribution, which we really focus on and believe will eventually show in our results, is that we have spent a lot of dollars and effort on our IP and how we actually bake the cake. We’ve figured that out – we have these ingredients and we know they work together. Now we have to put it in a form that all the farmers are used to using, which is a little granule. It also has to be able to keep microbes alive and play nice with the existing chemical fertilizer because nobody is going to go 100% off of that way of thinking.
So, we utilize that granule and distribute it through our partners who are
“ ...the farmers brought us consistent feedback that they were getting beneficial microbes and beneficial insects that they had not seen on their plants for 10 or 15 years.
— Wiens
independent fertilizer dealers such as CropMaxx or AgroPlus.
Our main focus has been Alberta because it is our backyard. But we have moved into Saskatchewan, Manitoba and, most recently, the Fraser Valley in the Pacific Northwest. The Fraser Valley market will probably expand the fastest for us because you have all of these phosphorous regulatory rules in place there, and our product fits what they require. Plus, blueberries and strawberries and vegetables just love our products.
Repeat orders are an important indicator for investors trying to understand the strength of a business like yours. Do customers tend to stay loyal to the brand?
If you look at our financials, we have been pretty consistent around the $15 million per year sales mark for the last few years because we have not expanded our granulation facilities, and those are the same customers every year. So, as repeat business, it has been awesome. And this is that initial product that I was talking about, the blended product. It is static business and repeat and consistent.
On the granulation side, this is where our growth is coming as we plan to expand to 2,000 tonnes of production
per month. This is what the independent dealers are after, and another name I will mention, especially in the Fraser Valley, is TerraLink, who has been using a lot of our granules. Our dealers go through the granules like crazy, and now it’s just a matter of supplying them with what they can sell.
You just mentioned facility expansion. Can you share more detail?
One thing we have done, and unfortunately it’s about a year later than we’d hoped because of technical challenges, is spend the past six to eight months refining the process to the point where we are now in expansion mode at our Beiseker facility, which was our initial commercialization plant. We were at about 2 tonnes per hour capacity potential, and by the end of November or beginning of December, we are looking at expansion to 5 tonnes per hour.
Replenish released quarterly financial statements in late August and revenue was on the soft side. Was that just seasonality that works itself out through the balance of the year?
The main improvement will be that fall is a better time of the year, so Q3 and Q4 are always stronger, and you are going to see those numbers increase.
A lot of farmers had great crops this year, particularly in zones that we have been targeting in the past two years. These farmers have cash flow and liked their product over the past year because it did well for them. So, that will help that end of things.
And really the main thing that is going to guide us into 2025 is going to be that 5-tonne-per-hour capacity, which equates to 2,000 tonnes of granulation
per month. That is our main target for our revenue expansion.
Is there anything we have missed?
We’re proud to be a partner of Emissions Reduction Alberta and the Alberta Government. We’ve received a $7 million grant to replicate Beiseker in DeBolt, Alberta. And we have further plans for expansion, too. There are good jobs in rural communities to be had from what we’re up to.
We also haven’t mentioned that our main product is a zero-waste product, non-chemical and we thrive on small footprints. As a result, the IP we have developed can be replicated anywhere on the globe. So, take that as you will as for what our plan is. But what I will say is that it gives us the optionality to go and do this in Africa, in India or in areas of the Pacific Northwest where being local makes for good logistics. We are potential exporters of made-on-thePrairies Canadian ingenuity.
Neil Wiens Chief Executive Officer Company
Replenish Nutrients
CSE Symbol ERTH
Listing Date January 10, 2019 Website replenishnutrients.com
Peter Murray oversees a national editorial and broadcasting team as President of Proactive Canada. He spent several years managing the English news desk at Nikkei’s head office in Tokyo and has worked with research teams at Asian and European investment banks. Peter is based in Vancouver.
Beyond Oil Israeli FoodTech company helps alleviate health concerns related to commercial frying
By Angela Harmantas
Beyond Oil (CSE:BOIL) is aiming to improve the health of untold numbers of people who enjoy the occasional guilty pleasure at their favourite restaurant: deep-fried food. Diners will probably never be aware of the healthier cooking going on behind the scenes thanks to this revolutionary technology, but it is important and deserves recognition.
While it took nearly 15 years to perfect, the company now has a powder that addresses the degradation of frying oil. Harmful carcinogens such as acrylamide, as well as free radicals with the potential to cause cell damage, can build up in oil used for commercial frying. Customers and kitchen staff are both exposed to serious health risks as a result.
Beyond Oil's powder absorbs harmful elements and extends the oil's lifespan while maintaining its quality. First tested and now selling commercially in Israel and Canada, the product has been shown
to improve food quality and support environmental sustainability.
The next phase of the growth strategy calls for expanding adoption of the product across North America. In an interview with Canadian Securities Exchange Magazine, Beyond Oil Vice President Robert Kiesman discussed the company’s origins and its efforts toward achieving this important goal.
What inspired the development of Beyond Oil’s solution for improving the health profile of oil when it is used for cooking?
Our Founder and President, Michael Pinhas Or, is the inventor of the product, and he started it due to a personal health condition related to acidity. Like many Israelis, he approached the issue as a layperson, learning everything he could. He studied intensively and spent about seven years in his backyard shed going through trial and error. Or invested his family’s fortune into developing the product. After his “aha”
Robert Kiesman Vice President Company
Beyond
Oil
CSE Symbol
BOIL
Listing Date May 25, 2022
Website beyondoil.co
moment, the inventive breakthrough, he secured a patent, as well as clearance to sell from the FDA and Health Canada. Since then, he has remained heavily involved, and his son, Jonathan, became Chief Executive Officer after the company went public.
One of the reasons Beyond Oil is such an easy story to tell is because it connects to something universal: food. Everyone, no matter where they live, eats fried food, whether it’s fries or other items unique to their region.
When people see the photos comparing black, smelly, smoky oil to a jar of clean Beyond Oil, the reaction is clear. They don’t want to eat food fried in dirty oil; they want food cooked in clean oil. These visuals stick in people’s minds, which is a big reason why our story is catching on so well.
Can you explain how the technology works?
It’s a powder that needs to be filtered out. Most restaurant fryers use built-in filtration, external filtration or paper filtration. The good news is that Beyond Oil works in all three contexts. We are classified by regulators as a filtration aid, not a food
additive, which makes it much easier to get regulatory approval in many countries.
The process is simple. You add the powder at the end of each day, the powder mixes with the molecules of toxins and attaches to them and then it all gets filtered out, which removes the toxins from the oil.
These toxins include trans fats, total polar materials (TPM), acrylamide and others. There are dozens of these toxic compounds.
One reason oil smokes when it gets old is that plastic-like molecules form in it, meaning you’re essentially burning plastic into the air. Beyond Oil works to clear that out.
Is there a rationale for restaurants using Beyond Oil’s product aside from serving healthier food to their customers?
The biggest part of our story is that we offer a legitimate health solution with positive ESG outcomes, and we also save restaurants money because they don’t need to replace the oil every two or three days. They can use it longer because the oil stays cleaner. How many stories do you know that have a positive health outcome, provide an environmental benefit and save businesses money?
The environmental benefits are clear. Producing oil requires water, electricity and fuel. By extending the oil’s life, we reduce the demand for oil, meaning less oil production, transportation and disposal. So, in addition to the health and cost benefits, there’s also a legitimate environmental impact.
Could you elaborate on the specific markets you’re targeting?
We're focusing on two main uses for Beyond Oil. The first is restaurants, and the second, which is much larger, is the industrial frying market. These are large industrial factories that use thousands of litres of oil and typically freeze the fried food before sending it to retailers like Costco or Superstore. This is a much more sophisticated context for us to be working
“
Producing oil requires water, electricity and fuel. By extending the oil’s life, we reduce the demand for oil, meaning less oil production, transportation and disposal.
Kiesman
in, and while we’re publicly focused on restaurant deals and the rollout, we're quietly advancing into the industrial market as well.
In the industrial sector, we've conducted pilot programs with several large, multibillion-dollar companies in North America. We also announced that we signed a letter of intent (LOI) with a multinational company that designs and builds highly sophisticated filtration systems for these large frying factories. The goal is to run full-scale pilots with these industrial operations because our powder seems to be compatible with their filtration systems, which is a significant breakthrough for us.
What kind of feedback have you received from these initial industrial tests, and how do you plan to scale this system globally?
The feedback has been tremendous. First, I want to highlight that we have two main
distributors – one in Canada and one in Israel. Both distributors, who are now selling our product commercially, made strategic investments in our company during the first six months of this year. This is a significant achievement for a small-cap company and indicates their strong confidence in our product.
We’ve received a range of positive feedback from end users. Firstly, our customers report a decrease in oil consumption. Secondly, they find the product healthier due to fewer toxins. Thirdly, the food tastes better because the oil is cleaner, resulting in crispier, fresher and lighter food that isn’t soaked in oil.
Additionally, we've received unexpected ancillary feedback. Customers need less warehousing for oil and experience reduced steam and smoke. Multinational customers examine the out comes in great detail and are providing valuable insights, such as improvements in flavour. Overall, the feedback has been overwhelmingly positive, with no significant negative comments.
What catalysts can investors anticipate in the near future?
We're expecting catalysts in all three areas of focus that I've outlined: expanding into the West with the two multination al fast food chains that we are now selling to in Israel, adding new U.S. chains as customers and getting fully commercial ized into the industrial frying market. I'd also like to point
out that we have hit major milestones on a consistent basis since the beginning of the year.
But as impressive as our performance has been this year, it's not going to be a major success story until we hit it big in North America. The plan now is to take the success that we've had in Israel and Canada and really push it west into Europe and then into the U.S. We have all the regulatory approval we need in Canada and the United States. Success in the U.S. is unlike success anywhere else.
Angela Harmantas is a senior financial journalist with Proactive. She has 10 years’ experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from multiple countries, including Canada, the U.S., Australia, Brazil, Ghana and South Africa. Prior to joining Proactive, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government. Angela currently resides in Toronto.
Image credit: Shutterstock
BluSky Carbon
Carbon removal that powers itself is a step toward saving the world
By Emily Jarvie
With the urgent need to remove billions of tonnes of carbon dioxide (CO2) from the atmosphere annually by 2050 to mitigate the impact of climate change, BluSky Carbon (CSE:BSKY) is stepping up with a cutting-edge solution designed to store carbon for thousands of years while at the same time producing low-cost energy.
Carbon removal is set to become a huge business, according to BluSky Co-Founder and Chief Executive Officer William Hessert, who spoke recently with Canadian Securities Exchange Magazine
“There’s quite a bit of money being poured into this industry, and this is catalyzing it and creating opportunities for reputable suppliers like BluSky,” Hessert explains. “Carbon removal will likely generate more revenue in 2050 than many major tech companies put together.”
Hessert sees governments pivoting to a compliance market for carbon dioxide in coming years, with the U.S. government set to essentially become a carbon credit consumer when tax credits become technology-neutral.
“There are 66 gases regulated in the U.S., and carbon dioxide will become number 67,” he says.
“The companies building the voluntary market like BluSky are the bridge to the compliance market. That is how carbon removal becomes a multi-trillion-dollar market.”
BluSky captures carbon through the pyrolysis of biomass such as organic waste, which involves heating the waste to a very high temperature with low oxygen levels.
When undergoing pyrolysis, the waste splits into a char and a gas. The char, known as biochar, can store carbon for thousands of years. Meanwhile, BluSky’s pyrolysis process produces enough gas to power itself, thus making it self-sufficient.
The company’s biomass pyrolysis pilot system, the Vulcan II, was successfully commissioned in January 2024 and is designed to remove up to 800 tonnes of CO2 per year.
BluSky is now developing Vulcan Heavy, described by Hessert as the “crown jewel” of pyrolysis, which will convert 5 tonnes of waste per hour into biochar.
Surplus energy from the pyrolysis process is used to power BluSky’s Kronos system, a direct air capture process that removes more CO2 from the atmosphere.
“Typical direct air capture systems can be north of 2,000 kilowatt hours for a tonne of CO2. It affects the net amount of CO2 captured,” Hessert points out.
Adding a third dimension, BluSky’s Medusa carbon mineralization system captures the CO2 from the bioenergy’s exhaust. The Medusa then converts the CO2 into stone as a replacement for underground storage wells. The company completed a Medusa prototype in January 2024 with a larger version currently under development.
BluSky has been able to keep the cost of its system down when compared to other carbon removal technologies due to its feedstock of choice, which requires minimal input costs.
William Hessert Co-Founder and Chief Executive Officer Company
BluSky Carbon
CSE Symbol
BSKY
Listing Date
June 18, 2024
Website bluskycarbon.com
“It’s waste products like wood chips. The American forestry industry is buried in wood chips right now,” Hessert says.
The company’s hybrid carbon removal process was designed to be capital-efficient and scalable to effectively address climate change.
“Our focus has been on building something that can essentially be copied and pasted over and over again to take advantage of different geographies and that can add to economic development,” says Hessert.
This includes being able to “mass-produce’” site selection, feedstock selection, permitting and so on.
“Everything we envision should be coming off an assembly line because to remove billions of tonnes of CO2, we need to be deploying millions of tonnes of capacity every week,” Hessert adds.
“For example, the Medusa and Kronos systems are essentially going to be massive stainless steel towers that are going to remove CO2 both from the bio exhaust and from the atmosphere and then ramped up with the ability to accredit carbon credits and be mass-produced over and over again.”
BluSky aims to have a facility capable of removing more than 150,000 tonnes of carbon per year in 2025.
He compared this to Climeworks’ industry-leading Orca plant in Iceland, which uses direct air capture to remove about 4,000 tons of CO2 from the atmosphere each year.
BluSky expects to achieve initial profitability from equipment sales and the sale of carbon credits from the production of biochar.
It has already secured a US$686,155 contract to build pyrolysis machinery for the City of Minneapolis, Minnesota.
And in late September of this year, the company announced an agreement with a purchaser based in the United States to sell biochar over a 10-year term with a total value of US$105 million.
On the carbon credits side, the company is forging partnerships with various entities that have experience selling carbon removal credits to major companies in the technology, energy and industrial sectors.
Hessert highlights the importance of communicating to enterprises the difference between carbon removal, which involves taking CO2 out of the atmosphere, and carbon offset, which could involve avoiding deforestation or other activities.
“Quite a few of the largest companies, such as Microsoft, are pouring money into
“ The companies building the voluntary market like BluSky are the bridge to the compliance market. That is how carbon removal becomes a multi-trilliondollar market.
better for shareholders and better for the planet.”
BluSky has also partnered with Cula Technologies for data verification services to ensure transparency for carbon credit certification.
Cula tracks machines, feedstock inputs, output quality and shipped products to verify that one tonne of carbon removal is truly equal to one net tonne of carbon. It uses sensors inside biochar machinery to monitor the temperature of the reaction, confirming its quality. Higher temperature pyrolysis creates higher carbon biochar.
As a carbon removal pioneer, BluSky will benefit from new opportunities as major players enter the space, bringing their own capital and connections.
“What they are missing is the technology provider and subject matter experts, which paves the way for joint ventures or partnerships,” Hessert notes. “That’s going to allow us to scale even faster.”
While the rate of carbon removal required to achieve climate change goals is daunting, Hessert believes BluSky’s team is positioned to tackle this challenge.
carbon removal, and it’s looking like they’re only going to increase their investments. So having partners that can communicate in a way that allows us to grow and remove more carbon is
“It creates a level of transparency that is truly unmatched,” Hessert says. “It gives greater assurances to a carbon removal credit buyer. The more assurances they have, the more comfortable they’ll feel purchasing carbon removal credits.”
“We’re trying to save the world here,” he says. “We operate like a sports team. This is the major leagues. The championship we’re fighting to win is billions of tonnes of CO2 removed from the atmosphere. We’re sprinting toward it and this is the team to do it.”
Emily Jarvie began her career as a political journalist in Australia. After she relocated to Canada, she worked as a psychedelics journalist, reporting on business, legal and scientific developments before joining Proactive in 2022. Emily has worked as a reporter in Australia, Europe and Canada.
Emily Jarvie began her career as a political journalist in Australia. After she relocated to Canada, she worked as a psychedelics journalist, reporting on business, legal and scientific developments before joining Proactive in 2022. Emily has worked as a reporter in Australia, Europe and Canada.
About the Author
Hessert
NU E Power
Savvy business model leverages North America’s race to build renewable energy
By Oliver Haill
While Europe gets much of the credit for leading the global push to adopt renewable energy, the United States and Canada are actually among the world’s top power producers from clean sources, thanks in large part to an abundant water supply for hydroelectric stations.
But solar and wind feature more prominently than most people probably realize, particularly on a total output basis in the United States. In both countries, multiple forms of renewable energy play a role in shaping the supply profile for regional power grids.
The stage is thus set for viable new renewable projects to help North America meet its increasing need for electricity, and NU E Power (CSE:NUE) is playing a role with an early focus on solar opportunities in Alberta.
NU E Chief Financial Officer John Newman spoke with Canadian Securities Exchange Magazine in mid-September about Canada’s renewable energy market, the company’s business model and near-term plans for growth.
Let’s begin with a look at why NU E Power was first established.
NU E was founded in 2021 by Devon Sandford, an electrician who specializes in the construction of utility-scale solar facilities and is also an entrepreneur. His vision was to develop a solar-to-hydrogen model, which was the initial business plan of the company. Back when we were looking for the capital to develop these projects, we were introduced to Low Carbon out of the U.K. and were able to strike what I think is a very unique joint venture with them.
“ At the end of the day, NU E ends up with a 25% share of each SPV. [...] It's a very unique situation and that's something we want investors to understand – that this is really a very attractive venture for us as a company. Newman
Can you tell us how the joint venture with Low Carbon Investment Management works?
NU E is responsible for sourcing and developing solar projects in North America. We source the projects, we move through the regulatory process to get approval, and Low Carbon is responsible for funding all of the construction and development costs.
Once it gets to the investment decision date, we undertake a third-party valuation and the development is sold by the joint venture to a specific special purpose vehicle (SPV) set up for the purpose of constructing and operating the solar farm.
At the end of the day, NU E ends up with a 25% share of each SPV. So, for us, it’s basically a free carry on 25% interest in the solar farm. It's a very unique situation and that's something we want investors to understand – that this is really a very attractive venture for us as a company.
How long does the process take from beginning to end?
It's a fairly lengthy regulatory process; from start to finish it can be 12 to 18 months. We source access points into the grid, we source available land, and then once we find suitable locations, we commence the regulatory process. We have a couple of developers on staff and Low Carbon pays 100% of their costs, as well as some of the management costs, and they basically pay 50% of our general and administrative expenses, excluding any kind of public costs and things like that.
Tell us about the joint venture’s first project.
Lethbridge One is an 8.75 MWac (MWac denotes nameplate capacity for a solar power facility) project that should go live this month. The cash flow generated from this project will be used to pay down the financing costs, so in terms of cash flow directly to NU E, it is expected to be $10.4 million over the next two years, meaning 2025 and 2026. Essentially, we're building asset value at this stage.
As we look to the future, we will see cash flow coming from the sale of developments from the joint venture to the specific operating vehicles that are set up to construct and operate solar farms.
What’s coming up after Lethbridge One?
We've got four other projects in the development pipeline, around 500 megawatts worth that are in various stages of regulatory approval. That pipeline is probably worth $750 million to $1 billion of investment into Canada before taking into account investment tax credits or other incentives that the government has put in place to encourage renewable energy development.
Lethbridge One is quite small, but it was good for both Low Carbon and NU E to embark on a project like this just to understand the process. I think we've got all of that stuff ironed out, and we're looking to much larger projects.
Can you talk about the energy market in Canada, the appeal for investors and what levels of government support and subsidies there are?
Our primary focus in Canada is Alberta. We have probably the most sunshine per year of anywhere in the country, so it's an ideal place for solar farm developments. The preference at this stage is to operate in Alberta because it's a deregulated market too.
Once you go through the approval process you can access the grid. What I think makes the renewable energy space ultimately attractive for investors is that you've got a lot of support from the government, both federally and provincially, in the form of investment tax credits on capital expenditures on renewable projects. For example, if we're spending $1 billion, we could see up to $300 million of investment tax credits, so it's a significant impact on project economics.
Another incentive is that Canada is no different than other countries in imposing a carbon tax, which is currently around $80 a tonne and I think rising to $170 a tonne by 2030, so there's a big incentive for people to utilize renewable energy.
And when it comes to energy pricing, Alberta is a deregulated market and the price does go up and down, so we look to try and put in place power purchase agreements where we can
establish an economic price for our power, which helps with financing and all sorts of things surrounding project economics. We're also looking at the possibility of putting in place battery storage, so you can store energy and then release it into the grid when the prices are right.
Having gone through the regulatory process once, what’s the expected timeline for the rest of the pipeline?
Alberta went through a bit of a moratorium on approving new power projects that started last year and ended earlier this year. That's delayed the approval process and seen some new rules around renewable energy put in place. So, it has impacted the timing to some extent, but I believe in the next 12 to 18 months that we will have approval on certainly the next two projects, Lethbridge Two and Lethbridge Three, which is around 150 megawatts of solar.
Does working with a U.K. renewable energy company set you apart in Canada?
Low Carbon is a significant player in the renewable market in the U.K. and Europe, so it gives us credibility that they’ve chosen to work with us and are prepared to operate the joint venture under the terms we have, which I think are very favourable to us. And I think it’s positive not only that we have a funding partner but also that they’re a well-recognized player in the renewable sector.
Is there opportunity for NU E to expand outside of the Low Carbon deal?
The joint venture is fairly well defined, and if there are projects that we bring
John Newman Chief Financial Officer Company NU E Power
CSE Symbol NUE
Listing Date
August 20, 2024
Website nu-ecorp.com
to the table that they're not interested in then we have the ability to pursue those opportunities ourselves.
We do have a couple of opportunities that we're working on outside of the Low Carbon deal. The original business plan behind NU E was the production of green hydrogen through solar energy and that remains one of our key targets. We’ve actually just acquired 49% of Diloo Energy, a majority Indigenous-owned and -operated green hydrogen developer in Canada. We need to look as well at opportunities that will generate cash flow in the nearer term.
Oliver Haill has been writing about companies and markets since the early 2000s, beginning as a financial journalist at Growth Company Investor and later becoming its section editor and head of research. Before joining Proactive, he worked as a freelance reporter contributing to the Financial Times Group, ITV, Press Association, Reuters and several other high-profile publishers.
2 0 th Anniversary
Roundtable Interview
Learn about the history of the Exchange and what’s in store for the future with four senior leaders at the CSE
To look back on 20 years as an exchange, Renée Colyer, Director of Strategic Planning & Brand Development, moderated a special 20th anniversary roundtable panel with four integral and long-standing members of the Canadian Securities Exchange: Tracey Stern, Chief Legal Officer and General Counsel & Corporate Secretary; Mark Faulkner, Senior Vice President of Listings and Regulation; Rob Cook, Senior Vice President of Market Development; and David Timpany, Vice President of Technology and Operations.
Enjoy this lively discussion about the history of the Exchange, what has made the “upstart exchange” so special in the capital markets landscape and what’s in store for the next 20 years.
Moderator (M): Tracey, from your perspective, thinking about your interactions with the CSE while you were on the regulatory side and since you've been here, can you talk about what has been the most rewarding part of your time in the relationship with the CSE?
Tracey Stern (TS): As a regulator, you get to see the outcome, but you don't get to inject into the process of an exchange. So, for me, it’s about being able to participate in the inner workings and work with the dedicated staff who have built something from nothing. Twenty years ago, the CSE didn't exist, and it has now become a successful part of the Canadian fabric. It’s rewarding to be a part of what’s coming next.
M: Do you have any ideas on what's coming next?
TS: My hope is getting folks internationally to know who we are and what we stand for. Being a supporter of entrepreneurs is something that CSE understands deeply, so I hope we can show entrepreneurs globally that we can support them and help them add value to their companies.
M: Mark, can you think of a time or mention a particular instance that was the most rewarding part of your time with the CSE?
Mark Faulkner (MF): There have been a lot of rewarding moments all the way through. We started with three companies when we first launched, and now we've got close to 800 listings. And even when we went through periods where we weren't listing a lot of companies, we were getting a lot of applications, moving ahead on policy proposals and/or growing our staff.
There were a lot of big hurdles when we first started, but what we used to see as big hurdles are now like curbs. Looking back and seeing what we've achieved, we now know how to get past those curbs the next time so they don't appear to be insurmountable.
M: Mark, can you tell me about the regulatory challenges that you
overcame that have paved the way for the future of the CSE? Is there anything in particular that allowed us entry into the next level?
MF: The one that people would be most familiar with if they know us would be the latest comprehensive rule changes. We introduced them last year, but it took us four to five years to get them done because we added new requirements and created another tier of listing, making it the most significant change to our policies to date. Even as we shared the changes with the dealer community, the legal community and some of our issuers, it snowballed; we were really able to increase our credibility overall when people could see where we were moving. In terms of our milestones, this was a really big one for us.
In terms of the CSE’s entire existence, however, the greatest challenge we've had is that our founders proposed something that was completely new and different from the existing exchange model – and it was approved. We’ve spent 20 years trying to demonstrate to everybody that a principles-based, disclosure-based marketplace can work.
There have been times when we've realized we can't leave this up to disclosure and principles alone; we're going to have to be a little bit more prescriptive. But we've still maintained an approach where it's primarily based on disclosure and principles so that we don't have to regulate with a heavy hand. So that's been the biggest challenge overall: maintaining those principles and that approach while we're still addressing any of the regulatory issues or integrity concerns that pop up.
M: Tracey, do you have anything that you'd like to contribute on that side of things?
TS: All the things that Mark said, I completely agree with. It’s a hurdle to get regulators to understand what the CSE is about. The policy changes escalate the CSE’s status globally. And so our membership in the World Federation of Exchanges (WFE) helps to support that.
M: Let's move on to Rob and David. Rob, can you describe the most rewarding part of your time here or a particular situation or change or development that has been particularly rewarding for you?
Rob Cook (RC): Like Mark said, there have been a number of milestones. Getting recognition in the first place from the Ontario Securities Commission was huge. When the application was first made, there was an uproar with some of the regulators. And so, we had to convince them that while we weren’t going to be the same as everybody, we would still be a stock exchange – and we proved we could do it.
The next huge milestone was when we launched the alternative market for trading in securities listed on the TSX. There were ATSs that were dark markets, but there was no continuous auction market that was visible. We patterned that essentially off of the developments south of the border where there had been several successful ATSs, known as ECNs, and we recognized that there was a demand in Canada for that so we were able to lead the industry in that way. We were the first new stock exchange in Canada in over 80 years, and then we were the first to operate an open, transparent, competitive auction trading facility for TSX securities as well.
M: You mentioned the firsts, Rob. How has the organization evolved since those firsts? What are you seeing now?
RC: Apart from getting bigger, we've got critical mass internally. When we started, we had roughly a dozen people, so a lot of people had to wear many hats. Mark and I, for example, were the only ones who understood all of the trading rules and all of the listing rules at the same time. Now, we can afford to attract and retain people with particular expertise, allowing us to have specialized teams and departments.
M: David, do you have a particular rewarding situation that you'd like to share with us?
DT: When we first started, working with everybody was always an uphill battle.
And I would say the most rewarding part is when we actually became significant and people saw the value that we were bringing to the industry as a whole. It was exciting to see the change in the attitude of some of the dealers that, at first, didn't take us seriously.
Having that respect from the dealers and vendors helped us through the stages that we've had to go through. We’ve gone through huge growth and changes, like replacing our trading system multiple times, and now we have the staff and experience to handle any type of issue thrown our way. We’re able to go head-to-head against some of the bigger competitors, and we're a significant player in the industry now. It's nice to see the respect from even our competitors as well.
M: David, you talked a little bit about growth. Everybody's talked about the growth of the Exchange. What best practices do you think should be preserved as the company continues to grow? Is there anything that we did when we were small or that we have best practices now that we should hang on to as we get bigger?
DT: I think wanting to please the customer, working hard for our customers and keeping that same mentality. We're here to service our customers, especially on the operations side, and we want to keep that as we grow bigger. Our whole model was built to help the end users, the investors, to get the information they need – not just make money. We're here to make a difference. And I think that's what we need to keep in mind as we grow.
M: Mark, did you have anything to contribute on that front?
MF: We have to remember that we're here for the customers on the regulatory side; we have to balance that. And so, one of the most important things for us is to stay true to our principles. We set out to do something different, but for the right reasons, and we have to maintain that approach. Investors are indirectly our customers as well, and we're here to make sure that anything we do for our customers is still in the
best interest of the investors or more broadly in the public interest. And we can't forget that.
Customer service is one of the greatest challenges for any organization as it grows. Our reputation was built on customer service; as mentioned, we could respond to things quickly because we didn't have to put a decision through a huge process. But we do lose some of that naturally as we grow. And we have to remember what got us to where we are through that lens of customer service and do our best to maintain that.
M: Tracey or Rob, do you have anything to contribute on what values we should maintain going forward?
RC: Customer service has always been top of mind for me, and we started by looking at who is the customer in the first place. Stock exchanges originally evolved as a place to make trading efficient, so it was brokers that built stock exchanges and brokers that ran stock exchanges.
But particularly at the junior end of the business – because we are largely here for small cap companies – it's the issuer that really drives us. It's their shares that are out there trading. So we looked at what the issuers needed, which was access to lower cost of capital, investors and rules they could understand. We set out our rules with that in mind. And as Mark said, everything also has to be in the best interest of investors because they're the ones that are participating in the market.
The other approach that we took and continue to take is always to be honest with the customers. When we try to sell somebody on participating in our market, it's more a matter of telling them what it is and what we can’t offer rather than selling on how great we are. We don’t oversell.
Being a smaller organization, we always want to try a little harder; we don't think that we're better than all the other exchanges just because we built one and they didn't.
TS: A couple of things that come to mind following along with what Rob said. For one, being creative in solutions,
collaborating both externally with customers and internally, allowing different departments to share ideas. There's a real culture here of working together to not only support our customers but also to support each other. A lot of long-term CSE employees stayed through tough times, a testament to the supportive environment.
M: Mark and David, to Tracey's point, why did you stay when the CSE went through tough times?
DT: What made me stay was the fact that I could have an impact within the company itself, being that it's a small company with a supportive management team. I'm not just a small part of a large organization; I'm a big part of a small organization.
MF: As tough as things got, we knew we were doing the right thing, and if we found the right investors, we would not only survive but thrive – and that's exactly what happened; that's made us competitive and grow significantly. There were also some of the other milestones that we haven't really touched on, like the decision to list medical cannabis under the existing laws then and how that entire business grew, but we were there at the forefront. It wasn't just a business opportunity for us – it was the right thing to do. Plus, it put us ahead in the competitive landscape. It put us ahead for a while. Eventually everybody catches up whenever there's something new, but that worked out really well for us.
RC: Right. There was some catching up. If you look at our trading of TSX securities, we started it, but there were several competitors that came in after us, always sponsored by much larger organizations with much more capital. But we were clearly the ones that led the way. I’m reminded of a market participant in Vancouver, who after we'd been around two years, said to me, "You guys have proved that you can do it [...] now you just need to survive until you win." And that's what it was like at the time.
M: Thinking about all of this, are there any changes that you hope to see within
the next few years of growth at the CSE? Anything that we should evolve or strive to be?
RC: I hope that we can attract more listings of some financial products and instruments, like ETFs or Canadian deposit receipts for foreign companies. There are opportunities out there, and we have a market that can handle them. Additionally, I'm looking forward to the Market on Close facility. I'm hoping that that facility will be the thin edge of the wedge for us in getting some of these financial products that are indexbased primarily.
M: Tracey, are there any changes that you're looking toward that you're anticipating are going to be beneficial for the CSE or things we should explore?
TS: I think it's just continuing the momentum and continuing to gain exposure internationally so that when entrepreneurs think about raising capital in public markets, they think of CSE first. That's where the change or the movement should go toward, in my opinion.
M: Do you think that we've evolved to a point where we've shed that old perception of who we were, and we're now at a place where, like Mark said earlier, we've gained the respect of the community and we're no longer the cowboy exchange, so to speak?
TS: We're well on our way, but I think we have some work to do in terms of getting ourselves out there and speaking to different constituencies to get our message across and for people to understand that our approach may be different. It's principles-based and disclosure-based, but that doesn't mean increased risk or less well-regulated; it just means different. We have taken all the steps that everyone else has taken to manage all of the investor protection and capital markets concerns, and we uniquely understand the journey that entrepreneurs face.
RC: Tracey's right. There are always more people out there that we can educate and get them to buy into what we do. I often said that there were only two kinds of people out there: those
Renée Colyer
Director of Strategic Planning & Brand Development
Interview Moderator
Tracey Stern Chief Legal Officer and General
Counsel
& Corporate Secretary
Mark Faulkner
Senior Vice President of Listings and Regulation
Rob Cook
Senior Vice President of Market Development
David Timpany Vice President of Technology and Operations
who like us and those who don't know us yet. One example of this was Ned Goodman, well-known financier, and entrepreneur in Canada, who brought us an issuer after a few years and liked our exchange so much, he wanted to buy in.
MF: Yes, especially when they're still bringing us companies twenty-something years later, and the same people are still bringing us companies that much later. We're still dealing with a lawyer who brought one of our first three companies. And she's still representing companies here and bringing listings, so that's someone who was sold on the model from the beginning.
M: And David, are you looking for any technological or operational changes in the future? What would you like to see at the CSE?
DT: I think we're now in a position where we have the luxury of thinking longer term on projects like Market on Close or new trading systems – three of which we’ve gone through so far and now have one with almost all the functionality that’s needed. Now, we can start looking at other products or industries that we want to bring into this type of infrastructure.
As well, I think we also need to integrate and sell ourselves internationally, as has been mentioned. We've built the respect in Canada. Now we've got to do the same thing around the world.
M: Sounds like a great vision. Every single one of you have said exactly the same thing in one form or another, so it looks like we're off to the races. I'm going to leave you with one final question, and that is, what legacy do you hope the CSE leaves behind for future generations?
MF: When I started working here, I remember telling my grandparents what I was doing and they said, "How do you just start up a stock exchange?" I said, "It's just like that. You just start up a stock exchange, but then you have all these hurdles to jump through." We'll know that we've been successful when we get to that point where we don't explain to anybody who we are – people will just accept it as having always been there and been part of the capital markets in Canada.
RC: Great answer. I'll adopt that one.
DT: For me, I moved to Kelowna and people asked me where I worked, and I said, "the
Canadian Securities Exchange," and four years ago, very few people knew about us. Now, everywhere I go, when I say that, people actually do recognize the name of the company. And I think it's been a huge change in just the last four years with recognition.
When I retire, I want to be able to say, "I worked at the Canadian Securities Exchange." And people can say, "Oh, I know that. That's that upstart exchange that started, and look at how well they've done. Now they're a major part of the industry, and they've really helped to deliver good customer service.” That's what I'm hoping for our legacy.
RC: You used the term “upstart.” That used to be in every article ever written about us – we were described as the “upstart exchange.”
DT: As you said, Rob, we actually created the road that everyone else travelled behind us, and I don't know if we've got the recognition for that. I remember when we started, they all waited for us to go first before anybody did anything because they wanted to see all the problems and let us deal with them first.
TS: That's really true from a regulatory perspective. I think that there may have been an ATS that launched before the CSE, but the real push came from when we started operations. And following that was the discussion about data consolidation, and the following that was the discussion about multiple marketplace surveillance. It really was the disruptor that it was meant to be.
For me, legacy is when the CSE comes to people’s minds – they think that we’re the exchange that really works with and supports its issuers and clients to make sure that they are successful. And I think that's an important legacy we want to maintain.
Editor’s Note: This interview has been edited for clarity and length.
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