On Thursday, Minister of Environment and Climate Change, Catherine McKenna, announced the launch of the Climate Action Incentive Fund (CAIF).
CAIF funding will be available to small and medium-sized companies in provinces where the federal price on pollution applies, including Ontario, Saskatchewan, Manitoba and New Brunswick. To benefit from the program and be eligible for funding between $20,000 and $250,000, companies must undertake projects to boost their energy efficiency.
“In communities across Canada, small and medium-sized businesses are proving that taking action on climate change is good for business,” said Minister McKenna.
She added “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.”
According to a press release from the federal government, recent analysis showed that every $1 spent on energy efficiency programs generates $7 of GDP. The same study found that from 2017 to 2030, Canada’s GDP would see a net increase of $356 billion from implementing the energy efficiency measures in Canada’s climate plan.
Wesley Johnston, CanSIA President and CEO said “The Climate Action Incentive Fund will help to create jobs, grow the economy, and help small and medium businesses save money on their energy bills by helping them adopt solar energy.”
Eligible projects include building retrofits, improved industrial processes, cleaner transportation, fuel switching, and the production of renewable energy, including solar energy projects. According to the Federal Government, the fund will be open for applications in the upcoming weeks.
The program follows the Canadian government’s recent reduction in the small business tax rate to nine per cent, the lowest among G7 countries.
Mary Ng, Minister of Small Business and Export Promotion said “our government is helping small and medium-sized businesses invest in energy-efficient equipment that will not only cut their pollution, but also increase their productivity.”
Funds available through the CAIF for SMEs in 2019-2020 will come to a total of $150 million, based on the percentage of carbon revenues collected within each province:
- $102 million in Ontario
- $30 million in Saskatchewan
- $13 million in Manitoba
- $5 million in New Brunswick
These funds would be in addition to tax benefits from the Accelerated Capital Cost Allowance changes the federal government announced in 2018, that allows businesses to immediately write off the full cost of specified clean energy equipment, including solar energy and energy storage equipment.
The programs are subject to passage of the Budget Implementation Act and subsequent specifications by the Minister of Finance.