Federal budget boosts cleantech and green engineering opportunities

Canada’s 2023 federal budget focuses on new investment tax credits for clean technology, as well as enhancements to credits that target carbon capture. Photo credit: AA+W, stock.adobe.com

When it comes to highlights in Canada’s 2023 federal budget, engineering groups across Canada are mostly pointing to the $20-billion investment in cleantech and green infrastructure projects that will create significant opportunities for firms involved in their design, construction and operation.

Ottawa is also investing over $33 billion to fund public infrastructure projects nationwide with an emphasis on renewable energy installations, electric vehicle charging stations, and clean hydrogen production facilities.

“We are beginning to see the funding match the rhetoric around Canada’s new industrial strategy,” announced the leadership of the Association of Consulting Engineering Companies (ACEC) in an analysis of the new budget.

“That includes incentives to promote carbon capture and storage, as well as more ambition around harnessing hydrogen as a cleaner, viable fuel source for the future.”

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The budget focuses on new investment tax credits for clean technology, as well as enhancements to credits that target carbon capture.

Budget 2023 proposes to provide $500 million over 10 years to the Strategic Innovation Fund to support the development and application of clean technologies in Canada. The Strategic Innovation Fund will also direct up to $1.5 billion of its existing resources towards projects in sectors including clean technologies, critical minerals, and industrial transformation.

“We are pleased to see Budget 2023’s investments in key industries in which engineers play a leading role, like the electricity industry, buildings, and critical minerals,” said Gerard McDonald, CEO of Engineers Canada, in a statement.

Notably, Budget 2023 includes measures aimed at reducing emissions from buildings, such as a new retrofit program for commercial and institutional buildings and a commitment to net-zero emissions from federal buildings by 2050.

While the Federation of Canadian Municipalities (FCM) praised the federal government’s investment in cleantech and biofuels to support Canada’s progress towards a net-zero GHG emission future, the federation expressed disappointment over the lack of predictable, long-term funding through the Disaster Mitigation and Adaptation Fund. From forest fires to destructive storms and floods, extreme weather events continue to be very real threats that require preparation, the group stated.

“FCM is leading the charge for action and investment to protect against the damage caused to local economies, infrastructure, and homes,” said a statement from FCM President Taneen Rudyk. “The draft National Adaptation Strategy, released in November 2022, was an important step, and signaled the government’s intention to increase funding for climate resilient municipal infrastructure. FCM is disappointed that Budget 2023 did not follow through on this commitment, and we continue to call for predictable, long-term funding through the Disaster Mitigation and Adaptation Fund — critical investments that will protect communities for the next fire, storm, or flood.”

Many investments in clean power and green infrastructure will come through the Canada Infrastructure Bank, which just recently loaned $277 million to begin building the country’s largest biorefinery and electrolyzer in Quebec to create green hydrogen and oxygen.

The budget highlights the importance of clean fuels and battery manufacturing in Canada’s plan to reach net-zero by 2050. In the months ahead, the federal government will engage with the biofuels industry to explore opportunities to promote its growth in Canada.

ACEC’s leadership said they were part of the budget deliberation process, “sharing ideas as early as last September with officials at Finance Canada.”

They noted that the budget placed an “enormous emphasis” on attracting investment for major projects to Canada’s shores.

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