Quebec’s Innovation Zones: Driving Growth and the Energy Transition

Introduction

Premier François Legault’s long-standing goal is for Quebec to close its wealth gap with Ontario. In his book “Cap sur un Québec gagnant – Le projet Saint-Laurent”, published in 2013, he spoke of creating innovation zones to help Quebec prosper. This strategy took shape back in February 2022. The Prime Minister has since announced the creation of the first three innovation zones.

In this book, the Premier expressed the wish that Quebec’s future innovation zones be inspired by technologically advanced and attractive locations such as Boston or Zurich. This economic development strategy for Quebec would combine development between the economy, research, education, and quality of life for residents and workers.

This text addresses what an innovation zone is, its objectives, its eligibility requirements, its selection process and the three existing innovation zones.

What is an innovation zone?

An innovation zone is a delimited geographic territory, within one or more municipalities, where stakeholders from several sectors (research, innovation, industry, entrepreneurship) are grouped and work together to innovate and leverage the sustainable competitive advantages of the territory they occupy. The pooling of resources and interactions between stakeholders make innovation zones attractive places of expertise for different business sectors, exploiting cutting-edge technologies.

The innovation zones’ infrastructure fosters exchanges both inside and outside the zones, making them attractive places to live. In addition to a significant concentration of businesses, they include research and innovation infrastructures, business incubators and accelerators, and scalable transport and communications infrastructures. Each innovation zone is tailored to the reality of the territory it occupies, promoting its assets and the collaborative networks that exist between the various stakeholders.

Innovation Zone Objectives

In line with the Premier’s vision, the goal of an innovation zone is to help Quebec prosper, create high-paying jobs and a distinctive Quebec trademark. This trademark is part of the government’s strategy for attracting foreign investment and talent.

In concrete terms, an innovation zone has three objectives: to move ideas from the drawing board to the market, to attract investments and to support the transition to a clean, sustainable economy. An innovation zone enables the creation and growth of innovative companies and the opening of new markets through the development of innovative products and technologies. It attracts investments to help companies grow and increase their productivity. Finally, through the sectors it targets, it enables the transition to an economy with a low ecological footprint.

An innovation zone must contribute to:

  • Improve the socio-economic performance of territories;
  • Increase business productivity;
  • Create high value-added businesses;
  • Increase Quebec exports;
  • Attract more local and foreign private investment;
  • Represent Quebec on the international stage;
  • Attract, develop, and retain talent;
  • Enhance quality of life;
  • Reduce Quebec’s environmental footprint.

Eligibility Requirements

To be eligible for designation as an innovation zone, an applicant must submit all the required documents to the Minister of Economy and Innovation. Whether the applicant is an organization, a group of organizations and businesses, or a company, it must demonstrate the commitment of public and private sector stakeholders to the project, as well as determine the governance structure, implementation, monitoring and reporting mechanisms for the creation and management of the innovation zone.

Eligible projects must then meet six eliminatory success criteria (evaluation grid 1), then satisfy three selection criteria (evaluation grid 2), demonstrating how their project meets each of them.

The success criteria (evaluation grid 1) are as follows:

Industrial

  • The project is based on more than one economic sector, including a growing and innovative one, in which the region can acquire sustainable comparative advantages, on a national or international scale, catering to a variety of customer groups.
  • The project brings together a critical mass of innovative companies of all sizes, from SMEs to multinationals.

 

Entrepreneurial

  • The project will host startups and pre-commercialization companies.
  • The project includes entrepreneurial spaces for co-creation and manufacturing.
  • The project provides for both the availability and use of venture and development capital, as well as support for the commercialization of innovation.

 

Knowledge

  • The project includes research or educational institutions as stakeholders.
  • The project proposes measures to develop and attract skilled labor.

 

Connected

  • The project includes modal infrastructure to facilitate the mobility of people and goods.
  • The project ensures access to high-speed Internet services in the targeted territory.
  • The project relies on the presence of infrastructures such as technology and industrial parks, industrial port zones and logistics hubs.

 

Collaborative

  • The project includes tools and mechanisms to facilitate collaboration and the sharing of strategic information between stakeholders.
  • The project provides a structure and socio-cultural activities that encourage networking and collaboration between stakeholders.
  • The project includes mechanisms and tools to facilitate collaboration within and outside the zone.

 

Sustainable

  • The project relies on an urban, economic, and social development plan with a view to sustainable development, shared by all stakeholders.
  • The project aims to develop social innovations and create diversified living environments conducive to quality of life and personal well-being.

 

The success criteria (evaluation grid 2) are as follows:

Project quality

  • The project presents a vision for the development of an innovation zone that is clear, coherent, and complementary to existing realities and initiatives in the area.
  • The project includes a development plan that is sufficiently detailed and precise to indicate the major stages in its realization.
  • The project depicts the target territory on a map with sufficient details to reflect the area’s development vision and to distinguish major projects and the boundaries of the territory in question.
  • The project relies on private investment at various stages of completion. It also identifies the main public investments required, over a timeframe of more or less five years.
  • The project mentions the main stakeholders, their responsibilities, contributions, and commitments, as well as their interests and expectations.

 

Project relevance (ability to address key issues and objectives)

  • The project specifies the means and operational mechanisms that will increase the transition from idea to market, attract private and foreign investments, and promote clean, sustainable growth.
  • The project has strong potential to improve socio-economic and environmental performance, as well as the quality of life of Quebecers, and can demonstrate its specific benefits in a precise and realistic manner, notably in the following areas:
    • the productivity of companies in the regional or national ecosystem;
    • the creation of innovative companies in leading-edge sectors or offering high value-added products and services;
    • export potential for products and services;
    • attracting private investment from Quebec and abroad;
    • attracting talent from Quebec and abroad.

 

Governance and project continuity

  • The project relies on representative and optimal governance to ensure the zone’s continuity over time.
    • It calls for the creation of an organizational structure dedicated to the development and management of the project. This organizational structure must include on its board of directors, for example, municipal authorities, representatives of production and valorization organizations or establishments, or representatives of social organizations. A government representative must be invited as an observer.
    • It correctly defines the proposed approach and mechanisms for creating and managing the zone, as well as for monitoring and accountability to ministerial authorities.

Selection Process

Applicants must submit their innovation zone projects to the Minister of Economy and Innovation, through his or her regional offices and those of Investissement Québec. A complete file includes eight sections:

I.     Development vision for the innovation zone.

II.    Stakeholders and contributions to the project.

III.   Project governance.

IV.   Boundaries and characteristics of the area:

  • Geographical representation;
  • Characteristics of the land involved.

V.    Strategic analysis:

  • Strengths, weaknesses, opportunities, threats;
  • Target sectors;
  • Development orientations;
  • Potential for private investment.

VI.   Development plan and schedule:

  • Major development projects;
  • Schedule.

VII.  Preliminary financial package

  • Private and public investments envisaged according to major projects and spread over a time frame of more or less five years.

VIII. Target results and spin-offs

  • Demonstration of attainment of objectives and targeted benefits.

The project is then analyzed and commented by the interministerial committee on innovation zones. This committee is made up of representatives of the partner ministries determined by the MEI. Representatives of local organizations such as municipalities may also be consulted to collaborate in the analysis. The Ministry makes its decision based on the committee’s advice. The application and file reception period are open. Applications are analyzed on an ongoing basis.

The Minister of Economy and Innovation selects the projects based on the advice of the inter-ministerial committee and his own review. He then designates the corresponding innovation zones. Innovation zones and related stakeholders can benefit from financial and tax assistance programs offered by the Quebec government, as well as technical support decreed in this context.

For example, the Quebec government can contribute financially to the studies required to apply for an innovation zone project. It can also contribute financially to the creation and development of innovation zones. Some assistance may come from existing measures and programs, and additional measures may be put in place to help achieve the objectives of an innovation zone project. These contributions and assistance are subject to specific standards and are set out in a financial assistance agreement specifying the obligations of each party and the terms of payment.

The Quebec government can provide other forms of support, such as an accelerated and simplified process for obtaining authorizations or permits, or assistance from a one-stop shop. In such cases, the interdepartmental committee, MEI and Investissement Québec regional offices are called upon to help.

Renewal of recognition as an innovation zone is based on an evaluation framework that takes as a reference the implementation of the zone’s development plan and the achievement of established targets.

Existing Innovation Zones

The Quebec government has created 3 innovation zones to this day. Two are in the Eastern Townships: Sherbrooke’s quantum innovation zone, DistriQ, and Bromont’s digital technology innovation zone, Technum Québec. The Energy Transition Valley, an innovation zone focusing on the battery industry, transport, green hydrogen, and industrial and port decarbonization, is in the Mauricie and Centre-du-Québec regions – in Bécancour, Shawinigan and Trois-Rivières.

The DistriQ innovation zone increases synergy between stakeholders and catalyzes expertise and infrastructure around Sherbrooke’s quantum ecosystem. DistriQ comprises the Université de Sherbrooke, the Quantum Institute, the Interdisciplinary Institute for Technological Innovation (3IT) and the Cégep de Sherbrooke. The quantum technologies sector has the potential to revolutionize the fields of environmental protection, mobility, healthcare, and renewable energy. It could generate annual revenues of $142.4 billion and employ 229,000 people by 2040. The Quebec government has invested over $435 million in the launch of DistriQ.

Technum Québec aims to increase the commercialization, exports and collaborations required for the creation of new technologies in the Quebec economy. The innovation zone is based on an ecosystem that is already recognized in the field of intelligent electronic systems, both industrially and educationally. Technum Québec relies on the largest concentration of microelectronics jobs in Canada, shared research infrastructures and state-of-the-art equipment. The Quebec government has invested over $255 million to launch Technum Québec.

The Energy Transition Valley aims to bring about a sustainable transition to meet the challenges facing society and the environment. It intends to become a world benchmark in research, development, commercialization, and industrialization of innovation in the areas of battery technology, transport electrification, green hydrogen and industrial and port decarbonization. The governments of Quebec and Canada have contributed $300 million to the construction of Canada’s first cathode battery plant in Bécancour. Ultium CAM, a limited partnership formed by automaker GM and South Korean steel producer POSCO, will build the plant, which is scheduled to operate by 2025.

Conclusion

Several other innovation zones are expected to see the light of day over the next few years. As of June 2022, 34 innovation zone projects had been submitted to the Ministry of Economy and Innovation. For example, the city of Rouyn-Noranda has submitted a mining innovation zone project to develop a more sustainable mining industry. The city of Val-d’Or has also submitted an innovation zone project, to develop natural resources in the northern boreal environment.

The Premier’s long-standing project is taking shape and generating enthusiasm in industry and academia. It should be both a vehicle for innovation and wealth creation for the benefit of Quebec society. François Legault’s vision will bear fruit for decades to come, positioning Quebec at the forefront of the new economy.

Keep Up to Date With Trending News

How can we help support your Organization working with Government?

Looking to work or sell to government? Or want to stay up-to-date with all of the constant changes with government? Let's find some time to chat and see if we can help you reach your goals and desired outcomes.

This website uses cookies to ensure you get the best experience on our website visit.

CHG Logo.