The government of Canada has launched a new C$150 million ($110.95 million) incentive program, the Climate Action Incentive Fund (CAIF), to help fight climate change, the federal minister of environment and climate change announced last week.
The program is designed to support small- and medium-sized enterprises in Ontario, Saskatchewan, Manitoba and New Brunswick, all of which have established provincial-level schemes to put a price on pollution. Businesses that plan to build renewable energy projects are eligible to receive up to 25% of project-related costs, with funding ranging from C$20,000 to C$250,000.
The list of eligible projects includes clean transport initiatives, as well as the production of renewable energy, such as solar. In the coming weeks, businesses can start applying for funding from the program. Through next year, the fund will offer up to C$150 million, with C$102 million to be allocated to Ontario, C$30 million to Saskatchewan, C$13 million to Manitoba, and C$5 million to New Brunswick.
“In communities across Canada, small- and medium-sized businesses are proving that taking action on climate change is good for business,” said Catherine McKenna, Canada’s Federal Minister of Environment and Climate Change. “To build on their leadership and ensure more small- and medium-sized businesses have the means to take action, we are helping business owners invest in new equipment and retrofits to be more energy efficient, cut pollution and save money.”
Last November, the Canadian government targeted renewable energy deployment in the commercial and industrial sector with a new policy under which businesses that adopt clean energy solutions can qualify for full tax write-offs for the fiscal year in which they commission their systems. It allows businesses to reduce their taxable income and tax liabilities, nationwide.
The announcement was part of the government’s Fall Economic Statement 2018. Ottawa says the policy will be in place for assets that were acquired after November 20, 2018. It will be gradually phased out from 2024 to 2027. Eligible projects include solar arrays, battery storage systems and electric-vehicle charging projects.
In March, Canada released its 2019 federal budget, Investing in the Middle Class. The document outlines plans to significantly increase spending on the energy transition. In particular, the budget includes C$1.01 billion to improve energy-efficiency standards in buildings.
The federal government also plans to improve efficiency standards through the wider adoption of distributed energy assets. It will allocate another C$2.2 billion to support community energy systems and the planning of clean energy projects, as well as other “actions that help smooth Canada’s transition away from coal-fired power.” In addition, the government will use C$300 million to provide purchase incentives for electric vehicles.