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NEIA summarizes Canada’s federal budget and other recent clean growth commitments

The last 6 months have seen substantial announcements and commitments being made by the Canadian government related to clean growth and sustainability.

This post, to the best of NEIA’s ability, summarizes these funding commitments through the Federal Government’s Fall Economic Statement 2020, the release of its clean growth strategy A Healthy Environment and a Healthy Economy, and Budget 2021.

It should be noted that NEIA foresees other announcements that were not made explicitly with reference to environment, climate change, etc. – such as commitments around workforce development, technology adoption, and more – will have clean growth components when associated programming is rolled out.

Technology Development / Innovation

Net Zero Accelerator

  • $8 billion over seven years for the Net Zero Accelerator (Strategic Innovation Fund) to support projects that will help reduce Canada’s greenhouse gas emissions by expediting decarbonization projects, scaling-up clean technology, and accelerating Canada’s industrial transformation.

Re-Financing Sustainable Development Technology Canada (SDTC)

  • An additional $750 million over five years. This would support startups and scale-up companies to enable pre-commercial clean technologies to successfully demonstrate feasibility as well as support early commercialization efforts.

Carbon Capture, Utilization, and Storage

  • $319 million over seven years to support research, development, and demonstrations that would improve the commercial viability of carbon capture, utilization, and storage technologies.

Clean Energy / Electrification

Interprovincial Clean Electricity

  • $2.5 billion from the Canada Infrastructure Bank over three years to work with provinces and territories to connect parts of Canada that have abundant clean hydroelectricity with parts that are currently more dependent on fossil fuels for electricity generation—including by advancing strategic intertie projects, such as the Atlantic Loop and other regional initiatives. The government will invest an additional $25 million to support predevelopment work.

Zero-Emissions Vehicles

  • $287 million over two years to continue the Incentives for Zero-Emission Vehicles (iZEV) program until March 2022. The program provides a rebate of up to $5000 on a light-duty zero-emission vehicle.

Zero-Emissions Busses and Charing Infrastructure

  • $1.5 billion from the Canada Infrastructure Bank over three years to accelerate the adoption of zero-emission buses and associated charging infrastructure.

Charging Stations / Hydrogen Stations

  • $150 million over 3 years for infrastructure for zero-emission vehicles.

Electricity Generation

  • Work with provinces, utilities and other partners to ensure that Canada’s electricity generation achieves net-zero emissions before 2050.

Grid Infrastructure

  • $964 million over four years to advance smart renewable energy and grid modernization projects.

Home Energy Efficiency Retrofits

  • $2.6 billion over seven years to help homeowners make their homes more energy efficient. This funding will provide grants of up to $5,000, up to one million free EnerGuide assessments, and support to recruit and train EnerGuide auditors.
  • $4.4 billion over five years to the Canada Mortgage and Housing Corporation (CMHC) to help homeowners complete deep home retrofits through interest-free loans worth up to $40,000.

Large-Scale Building Retrofits

  • $2 billion from the Canada Infrastructure Bank over three years to invest in large-scale building retrofits.
  • $1.5 billion over three years for green and inclusive community buildings, and require that at least 10 percent of this funding be allocated to projects serving First Nations, Inuit and Métis communities.

Public Transportation

  • $14.9 billion over eight years for public transit projects across Canada. This funding will support new subway lines, light-rail transit and streetcars, electric buses, active transportation infrastructure, and improved rural transit, which will create affordable commuting options in communities and reduce Canada’s emissions.

Hydrogen / Biofuels Production

  • $1.5 billion in a Low-carbon and Zero-emissions Fuels Fund to increase the production and use of low-carbon fuels (e.g., hydrogen, biocrude, renewable natural gas and diesel, cellulosic ethanol) in a manner that complements federal carbon pollution pricing, regulatory efforts and other federal programming.

Rural, Remote, and Indigenous Communities

  • $300 million over five years to advance the government’s commitment to ensure rural, remote and Indigenous communities that currently rely on diesel have the opportunity to be powered by clean, reliable energy by 2030
  • $36 million over three years to build capacity for local, economically-sustainable clean energy projects in First Nations, Inuit, and Métis communities and support economic development opportunities.

Investment Attraction

Stimulating Private Sector Investment

  • $1 billion over five years to help draw in private sector investment for cleantech projects. These resources would fuel the growth of innovative Canadian companies, create jobs for highly skilled workers, and bring important environmental and climate solutions to the world. commercial scale-up, and adoption

Green Bonds

  • The government will publish a green bond framework in advance of issuing its inaugural federal green bond in 2021-22, with an issuance target of $5 billion, subject to market conditions. This would be the first of many green bond issuances.
  • Possible projects these green bonds could fund include green infrastructure, clean tech innovations, nature conservation, and other efforts to address climate change and protect our environment.

Tax Measures

Cleantech Corporate Tax Reductions

  • 50% reduction of general corporate and small business income tax rates for businesses that manufacture zero-emission technologies. Examples include: wind turbines, solar panels, and equipment used in hydroelectric facilities; geothermal energy systems; electric cars, busses, trucks, and other vehicles; batteries and fuel cells for electric vehicles; biofuels from waste materials production; green hydrogen production; electric vehicle charging systems; and certain energy storage equipment.

Tax Incentives for Adoption

  • In 2018, Canada introduced tax incentives to encourage businesses to invest in clean energy generation and energy efficiency equipment. The eligibility list will now expand to include equipment used in pumped hydroelectric energy storage, renewable fuel production, hydrogen production by electrolysis of water, and hydrogen refueling. Certain existing restrictions related to investments in watercurrent, wave and tidal energy, active solar heating, and geothermal energy technologies would also be removed.

Carbon Capture, Utilization, and Storage

  • A new investment tax credit for capital invested in carbon capture utilization and storage (CCUS) projects.

Zero-Emissions Commercial Vehicles

  • 100-percent tax write off for commercial light-duty, medium- and heavy-duty ZEVs.

Industry-Specific

Mining

  • $9.6 million over three years to create a Critical Battery Minerals Centre of Excellence at Natural Resources Canada. The centre would coordinate federal policy and programs on critical minerals, and work with provincial, territorial, and other partners.
  • $36.8 million over three years for federal research and development to advance critical battery mineral processing and refining expertise.

Forestry

  • $54.8 million over two years to enhance the capacity of the Investments in Forest Industry Transformation program, including working with municipalities and community organizations ready for new forest-based economic opportunities.

Agriculture

  • Provide an additional $200 million over two years to launch immediate, on-farm climate action under the Agricultural Climate Solutions program.
  • $60 million over the next two years to target the protection of existing wetlands and trees on farms, including through a reverse auction pilot program.
  • $98.4 million over 10 years to establish a new Natural Climate Solutions for Agriculture Fund.
  • $165.7 million over seven years to support the agriculture sector in developing transformative clean technologies and help farmers adopt commercially available clean technology.
  • $10 million over the next two years, from the Agricultural Clean Technology Program toward powering farms with clean energy and moving off diesel.

Oceans

  • $976.8 million over five years to help Canada reach its 25 per cent by 2025 target to protect the health of our oceans, commercial fishing stocks, and Canadians’ quality of life, especially in coastal communities.
  • $10 million increase to the Sustainable Fisheries Solutions and Retrieval Support Program, the ”Ghost Gear Fund” at Fisheries and Oceans Canada, to assist projects that retrieve ghost gear, dispose of fishing related plastic waste, test new fishing technology, and support international efforts to decrease ghost gear.

Environmental Protection

  • $1.4 billion to top up the Disaster Mitigation and Adaptation Fund, to support projects such as wildfire mitigation activities, rehabilitation of storm water systems, and restoration of wetlands and shorelines.
  • $200 million over three years to establish a Natural Infrastructure Fund to support natural and hybrid infrastructure projects. This would help to improve well-being, mitigate the impacts of climate change, and prevent costly natural events.
  • Invest up to $631 million over 10 years to work with provinces, territories, conservation organizations, Indigenous communities, private landowners, and others to restore and enhance wetlands, peatlands, grasslands and agricultural lands to boost carbon sequestration.
  • $3.16 billion to partner with provinces, territories, non government organizations, Indigenous communities, municipalities, private landowners, and others to plant two billion trees.
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