Government of Canada announces plans to provide support for energy-efficient projects and equipment in small- and medium-sized businesses


On October 23, 2018, the Government of Canada announced details of its carbon pollution pricing system. This included where the system would apply as well as initial details on how proceeds would be returned to the jurisdictions in which they are collected.

In provinces that have either requested the federal system or have not proposed a system that meets the federal standard (currently Manitoba, New Brunswick, Ontario and Saskatchewan), approximately 90 percent of proceeds from the fuel charge will be returned directly to individuals and households through Climate Action Incentive payments when they file their tax returns.

The remainder of the revenues are intended to support small and medium-sized businesses, municipalities, universities, colleges, schools, hospitals, not-for-profit organizations and Indigenous peoples through the Climate Action Incentive Fund (CAIF).

Details were released today on CAIF SME Project funding for larger energy-efficiency retrofit projects undertaken by small- and medium-sized businesses. SMEs would be eligible to receive up to 25% of their energy-efficient project costs. Small- and medium-sized businesses in all sectors are eligible to apply to the Fund, which will be open for applications in the coming weeks.

The Minister plans to release details about the CAIF Rebate program, for the purchase of specified energy-efficient equipment, in June. The rebate would cover up to 50% of eligible costs. There is no minimum amount per application.

These programs are subject to Royal Assent of the Budget Implementation Act and subsequent decisions from the Minister of Finance.

Funds available through the CAIF for small- and medium-sized businesses in 2019-20 will come to $150 million, based on the percentage of revenue collected within each province:

  • $13 million in Manitoba
  • $5 million in New Brunswick
  • $102 million in Ontario
  • $30 million in Saskatchewan

The support for individual projects and rebates for energy-efficient equipment is expected to help thousands of small- and medium-sized businesses. Between 2019 and 2024, nearly $1.5 billion would be available to support energy efficiency efforts by small- and-medium-sized businesses.

Environment and Climate Change Canada plans to establish an External Advisory Committee for the Climate Action Incentive Fund, made up of experts and representatives of business associations, to provide advice on outreach to small- and medium-sized businesses and continuous improvements to the delivery of funds.

Canadian inventors and investors, engineers, and entrepreneurs, from all sectors, from coast to coast to coast, are coming up with the solutions the world needs to fight climate change. The Climate Action Incentive Fund would encourage recipients to adopt clean technologies that reduce energy usage and achieve cost savings, while reducing greenhouse gas emissions.

Programming in the four eligible provinces would help small- and medium-sized businesses in all sectors implement projects, such as building retrofits, improved industrial processes, cleaner transportation, fuel switching and the production of renewable energy for the use of applicants. These funds would be in addition to tax benefits from the Accelerated Capital Cost Allowance changes announced in 2018.

In addition to the Climate Action Incentive Fund, small businesses in all parts of Canada will also be able to apply for funding through the $10 million Low Carbon Economy Fund Partnerships stream. This funding round offers more options to smaller business by allowing applicants to propose smaller projects and to bundle similar projects together. This funding opportunity will soon be available to businesses in all provinces and territories.

Associated links

Report a problem or mistake on this page
Please select all that apply:

Thank you for your help!

You will not receive a reply. For enquiries, contact us.

Date modified: