The increasingly anemic Canadian economy was administered a
boost in the form of an unprecedented stimulus package announced in
the federal government's Budget 2009 released on January 27,
2009. The budget contains a number of programmes and incentives to
promote "green" projects and the development of clean
technologies and renewable energy. While the exact details are
still to be provided, the "green" budget highlights are
The budget contains a pledge by the federal government to
provide $1 billion over five years to support a Green
Infrastructure Fund. The Green Infrastructure Fund will be used by
the government to support green infrastructure projects on a
cost-shared basis. The budget states that green infrastructure
includes infrastructure that supports a focus on the creation of
sustainable energy - infrastructure such as modern energy
transmission lines and other projects that will contribute to lower
Clean energy fund
Noting Canada's commitment to reduce greenhouse gas
emissions by 20 percent by 2020, the budget lays out the
government's objective to support clean energy research and the
development of clean energy technologies. The budget contains a
commitment of $150 million over five years to be used for clean
energy research initiatives, and a commitment of $850 million over
five years for the development and demonstration of "promising
technologies", including large-scale carbon capture and
storage projects. The government predicts that through this support
over the next five years, a total investment of at least $2.5
billion will be generated in clean energy technologies.
Capital cost allowance for carbon capture and storage
Since 2006, the government has been a significant proponent of
the development of carbon capture and storage technologies. The
budget notes that $375 million has already been provided to support
the development of these technologies, including $250 million in
the Budget 2008 for a commercial demonstration of the technology in
Saskatchewan and research in Nova Scotia. The remaining $125
million is available for carbon capture and storage projects under
the ecoENERGY Technology Initiative of Natural Resources
The budget contains a pledge by the government to consult with
carbon capture and storage stakeholders to identify specific assets
used in carbon capture and storage technology with a view to
providing accelerated capital cost allowance in respect of such
investments. Such accelerated capital cost allowance advances the
timing of capital cost deductions for tax purposes thereby
deferring taxation and improving the financial return from
investment in an asset.
Energy efficient homes
On an individual level, the budget contains measures designed to
promote energy efficiency and conservation through a retrofit
program intended to provide home and property owners with grants of
up to $5,000 to offset the costs of making energy-efficiency
improvements. The budget states that grants will apply to a variety
of measures that reduce energy consumption, from increasing
insulation to upgrading a furnace. The budget pledges $300 million
over two years to this program to support an estimated 200,000 home
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