Last week was a big week of announcements from the Alberta Government on its plans to reduce greenhouse gas emissions and diversify the Alberta economy. On December 5, 2017, the creation of a $1.4 billion Energy Innovation Fund to diversify the economy and reduce carbon pollution in the province was announced. The bulk of the funding for the Energy Innovation Fund results from the carbon levies that are being collected under the Climate Leadership Plan.
The Energy Innovation Fund has five categories:
- Oil Sand Innovation Fund – $440 million to help oil sand developers increase production and reduce emissions, while adjusting to the new Carbon Competitive Incentive rules for large emitters. Funding in the Oil Sand Innovation Fund will start at $40 million a year in 2019-20, rising to $80 million in 2020-21 through 2024-25 until the $440 million fund has been depleted.
- Innovation Across Sectors – $225 million for projects across sectors that support research, commercialization and investment in new technologies that reduce emissions in two program areas: Emissions Reductions Alberta ($80 million) and the new Climate Change Innovation and Technology Framework ($145 million). This new Climate Change Innovation and Technology Framework will help manage government investments in research, innovation and technology and will help commercialize products.
- Industrial Energy Efficiency – $240 million for projects that help companies reduce emissions and costs by upgrading equipment or facilities to lower energy use. Support will be available for large industrial, agricultural and manufacturing operations.
- Bioenergy – $63 million in grants for bioenergy projects, including biodiesel and ethanol – as well biomass-based electricity generation. Alberta’s existing Bioenergy Producer Program will be adjusted to provide grants to dedicated biofuel-producing facilities.
- Green Loan Guarantees – $400 million in loan guarantees to support investment in efficiency and renewable energy measures to reduce risk for financial institutions and make it easier for companies to invest.
If you would like to learn more about how the funds may impact your business, the Energy, Environmental and Regulatory Group at McLennan Ross would be pleased to assist you.