carbon pricing revenue

Retrofit fund draws on carbon pricing revenue

Thursday, July 18, 2019

The application process for Canada’s Climate Action Incentive Fund (CAIF) is now open, making grants of up to $250,000 available to business operators in New Brunswick, Ontario, Manitoba and Saskatchewan for energy-saving and emission-reducing projects. More than $106 million will be disbursed in this first round of a promised program to allocate the carbon pricing revenue the federal government is banking in the four provinces.

To qualify, project proponents must employ no more than 500 people, be based in one of the designated provinces and have an identified site or sites where the funds will be invested. Eligible recipients can receive grants of $20,000 to $250,000 in each of the provinces where they hold a site to cover up to 25 per cent of the project costs for: building retrofits and/or fuel switching; cogeneration or renewable energy systems for their own use; hook-up to district energy; industrial or agricultural process improvements; heavy-duty or marine vehicle retrofits; and energy efficiency in waste management.

“In communities across Canada, small and medium-sized businesses are proving that taking action on climate change is good for business,” asserts Catherine McKenna, Minister of Environment and Climate Change (ECCC).

The largest chunk of funding — $72.4 million — is slated for Ontario-based businesses, with $21.3 million to be distributed in Saskatchewan, $9.3 million in Manitoba and $3.7 million in New Brunswick. That’s prorated to each province’s input, largely collected from the $0.0442 per litre charge now applied to gasoline and a levy of $0.0391 per cubic metre on natural gas purchases, and also highlights the vastly different carbon intensity of Saskatchewan and Manitoba’s electricity supplies.

Accompanying ECCC information indicates this is “approximately half” of funds to be channelled through this initiative in 2019-20. Two other streams of CAIF programs will make funds available for retrofits in municipal, education and health care facilities, and for rebates on energy-efficient equipment purchased for small and medium sized businesses or not-for-profit organizations.

Applications for the first round will be open until mid-October or until the available funding is depleted. A range of building retrofit measures qualify, including upgrades to the building envelope, lighting, HVAC and water heating systems, motors, controls and building automation systems. This must occur in an existing commercial or industrial facility.

Once selected, proponents will have 45 days to sign an agreement with the federal government, and must complete the project no later than March 31, 2021. They will be required to provide energy consumption data for before and after the implementation of the project and may also be subject to site visits or audits.

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