What is the Low Carbon Economy Fund?

The Low Carbon Economy Fund (LCEF) supports projects that help to reduce Canada’s greenhouse gas emissions, generate clean growth, build resilient communities, and create good jobs for Canadians. These projects are critical as Canada continues to build a sustainable net-zero emissions economy by 2050.

The fund is an important part of Canada’s clean growth and climate action plans, including the Pan-Canadian Framework on Clean Growth and Climate Change (the Framework) and the 2030 Emissions Reduction Plan - Canada’s Next Steps for Clean Air and a Strong Economy.
LCEF currently has two envelopes:

• the Low Carbon Economy Leadership Fund
• the Low Carbon Economy Challenge.

Visit the News releases section and social media platforms to learn about the latest LCEF announcements.

As announced in Canada’s 2030 Emissions Reduction Plan and Budget 2022, the Government of Canada committed to expanding the Low Carbon Economy Fund by investing an additional $2.2 billion over seven years, starting in 2022-23.

From this new funding, up to $250 million over four years will help homeowners transition from home heating oil to more affordable and greener home heating sources, like electric heat pumps. This funding, which will focus on supporting lower-income households, will help interested provinces and territories expand existing programs or create new initiatives.

The new LCEF funding will also support climate action by Indigenous Peoples with a new $180 million Indigenous Leadership Fund. This will support clean energy and energy efficiency projects led by First Nations, Inuit, and Métis communities and organizations.

Information on these new initiatives, including who is eligible to apply, will be shared in due time.

Low Carbon Economy Leadership Fund

Provinces and territories play an integral role in implementing the Pan-Canadian Framework on Clean Growth and Climate Change. That’s why the Low Carbon Economy Leadership Fund will provide up to $1.4 billion to provinces and territories that have adopted the Framework to reduce emissions, build resilient communities, and generate good jobs for Canadians.

Provinces and territories have worked in partnership with the federal government to identify emissions reduction projects to receive funding. They are eligible to receive up to $30 million, plus additional funding based on population.

From a portion of Ontario’s allocation through the Low Carbon Economy Leadership Fund, the Energy Savings Rebate program allowed Ontario retailers to offer rebates on the purchase of approved energy-efficient products until March 31, 2021. The program helped Ontarians to reduce energy use, save money and address climate change. For more information, see the Energy Savings Rebate program page.

Low Carbon Economy Challenge

The Low Carbon Economy Challenge will provide approximately $500 million to a wide range of recipients, including provinces and territories, businesses, municipalities, not-for-profits, and Indigenous communities and organizations. Successful applicants will leverage ingenuity across the country to reduce emissions and generate clean growth in support of the Framework and Canada’s strengthened climate plan. For further information, see the Challenge page.