Canadians shaken by the havoc wreaked on the country’s economy as a result of the slump in oil prices should take heart.

The same forces that have pummeled oil—and decimated the Canadian dollar—are creating huge opportunities in the clean energy sector. And Ontario is perfectly positioned to seize them.

Like wood, metals, and wheat – the core commodities that have seen boom and bust cycles in this country – the oil sector continues to face an uncertain future. In comparison, the building blocks of Ontario’s cleantech energy sector – wind, sunlight, flowing water, biological waste – are not subject to this same market volatility, making them a platform on which to build and grow a stable sector.

A survey by the Frankfurt School of Finance and Management for the UN Environment Program shows that global investment in renewable energy projects has exceeded $200 billion every year since 2010. A recent Deutsche Bank report titled “Crossing the Chasm,” predicts that nearly 10 per cent of global electricity production will come from solar over the next 20 years as costs fall steadily to compete with conventional generation.

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This surge in investment is being made not just in solar. It is also being seen in technologies that will enable renewables to be integrated seamlessly into the grid and will store energy for use in peak periods, and devices that empower energy consumers to manage and control their energy use. Several Ontario-based companies in energy storage, analytics and control have the potential to scale globally. Hydrostor, a company that uses the water pressure off Toronto Island to store compressed air that can be used to generate electricity when needed, is one of Ontario’s cleantech stars. It is a cutting-edge technology that, if scaled globally, could provide clean energy solutions to coastal cities. Other local companies in energy efficiency and automation such as Nanoleaf, Ecobee, MMB Networks, and Circuit Meter are starting to significantly affect our use of electricity.

And other innovations are on the horizon. MaRS is proud to host this year’s CIX Cleantech conference on October 15, where top start-ups from across the country will make pitches, Dragon’s Den style, to potential investors.

The oil industry once looked impregnable. And it’s true that, for many, it still does. But we have seen other apparent economic strongholds fall victim to disruptive technology. As Bank of England Governor Mark Carney warned recently, the challenges posed by climate change are a “tragedy of the horizon,” one that could undermine the hydrocarbon sector very quickly, stranding huge reserves of Canadian oil, gas and coal.

If Carney is right, this will add to pressure on the Canadian dollar by slashing oil, gas and coal exports even further. But it could also boost Ontario’s cleantech sector even more. Canadian clean energy companies developing technology for export are seeing a 25 per cent cost advantage because of the dollar’s fall. Likewise, foreign investors looking for cleantech opportunities are enjoying a 25 per cent premium on their investments. The drop in the dollar increases the competitiveness of Canadian firms to the hotbeds of innovation in the U.S. with lower wages and rent.

With all the advantages of cleantech, it’s worth considering why there is still widespread public skepticism about the technology. The greatest resistance by the public stems from the notion that clean energy is too expensive. While wind and solar are currently more expensive than the output from Ontario’s existing nuclear plants, that won’t be the case much longer. Those plants are aging, and if we replace them with new nuclear plants they would struggle to compete against the shrinking costs of wind and solar. Not to mention the life cycle cost associated with radioactive waste.

Natural gas-fired plants look attractive at current gas prices, certainly, but hands up – who wants a new gas plant in their neighbourhood? How about a pipeline? True cost comparisons must weigh technologies on the basis of new generating facilities. They must also recognize that renewables like wind and solar have zero fuel cost (and zero risk of fuel cost increases) and produce little waste. With renewable generation, as installation increases and manufacturing volumes climb, prices continue to fall.

The Cleantech sector cannot be dismissive of the concerns of those who point to wind turbines dramatically altering the landscape of wide swathes of rural Ontario. Yes, all local residents share the impact of the turbines, while only some derive any revenue from them. However, unlike its competitors, clean technology does not pass the burden of profits onto the environment, or our health care system.

Changing our focus from hydrocarbons to renewables and other forms of cleantech energy is a long-term project. In the short run, we cannot wipe out the pain that the change in the oil economy has inflicted on many Canadian businesses and households.

What Canadian businesses and policy makers must do in the days ahead is take a clear look at the deep-rooted changes taking place in the energy economy. Last year, Germany’s top utility, E.ON, underwent a restructuring to focus on renewable energy in response to the dramatic changes in the power generation and utility business. The surge in new energy technology around the world has utilities staring at what has been referred to as the “utility death spiral” – energy demand falling, and renewable energy driving down wholesale prices and decreasing the value of fossil fuel generation. E.ON is not alone. These fundamental changes in the sector are fueled by innovation, and there is an opportunity to put Canada in a position to take full advantage of it.

Canada’s political parties are talking about kick-starting innovation potential with new investments. Yet investing in new technology is only part of the equation. Governments need to create an environment for consumers to embrace that technology. If Canada wants to be part of this global energy transformation, it has to adopt the policies and regulations to get products from the factory floor to store shelves, and to leverage the access to new markets promised by the Trans-Pacific Partnership deal. Focusing on the challenges of technology adoption will enable further innovation, positioning Canada as a leading exporter in the new energy economy.

Jon Dogterom is managing director of Cleantech Venture Services at MaRS Discovery District.

Image credit: Niko Vujevic / Thinkstock