CanREA welcomes refundable investment tax credits that may bolster the competitiveness of Canada’s renewable-energy industry.
Ottawa, March 28, 2023 – Recognizing the necessity for a Canadian response to the Inflation Reduction Act passed last summer in the US, the Canadian Renewable Energy Association (CanREA) advocated for refundable investment tax credits for renewable energy and green hydrogen investments. Today, CanREA is worked up to see our recommendations strongly reflected in Budget 2023, presented by Federal Minister of Finance, the Honourable Chrystia Freeland.
“The selection to pursue investment tax credits for clean technology, like wind, solar, storage and green hydrogen, will allow Canada to take a competitive lead in accelerating the decarbonization of the energy sector,” said Evan Wilson, Senior Director of Policy and Government Affairs at CanREA, who was on site for the introduction of the Budget today.
As noted in CanREA’s 2050 Vision, Canada must expand wind and solar energy capability almost ten-fold in an effort to meet our commitment to achieving net-zero GHG emissions by 2050.
“The 2023 Budget demonstrates Canada’s strong leadership in leveraging policy, programs and the tax system to speed up decarbonization while supporting a robust economy, with recent investment certainty for solar energy, wind energy, energy storage and green hydrogen,” said Brandy Giannetta, CanREA’s Vice-President of Policy and Government Affairs.
With the support of those recent investment tax credits, CanREA expects the deployment of recent wind solar and storage to speed up significantly, in comparison with the Association’s most up-to-date data, released in January 2023.
“Today’s announcements are a robust and vital step, accelerating our progress toward net zero. Canadian investment tax credits will stabilize investment opportunities, while safeguarding affordability for Canadians,” said Vittoria Bellissimo, President and CEO at CanREA.
“These recent incentives will help create good jobs in clean energy and make Canada a frontrunner within the energy transition.”
Details
The 2023 Budget includes the next measures to make sure Canada can speed up the deployment of wind, solar, energy storage and other clean-energy technologies:
- Clean Technology Investment Tax Credit: A refundable 30% tax credit on capital cost of investments made by taxable entities in wind, solar PV and energy-storage technologies. This Credit can be available to all project spending starting today, March 28, 2023, though to 2034.
- Clean Electricity Investment Tax Credit: A newly announced, refundable 15% tax credit on the capital costs of investments made by non-taxable entities, equivalent to Indigenous communities, municipally owned utilities and Crown corporations that make investments in renewable energy, energy storage and inter-provincial transmission and other non-emitting electricity infrastructure.
- Clean Manufacturing Investment Tax Credit: Budget 2023 also introduces a 30% refundable ITC for investment in machinery and equipment used to fabricate clean technology and extract relevant critical minerals. This tax credit is accessible for the manufacturing of renewable energy and energy-storage equipment, and the recycling of critical minerals.
- Clean Hydrogen Investment Tax Credit: A refundable 40% investment tax credit on green hydrogen, starting in Budget 2023.
- Net-zero Transmission Project Support: There can be an upcoming consultation on the “best means” to support intra-provincial transmission that support Canada’s net-zero grid objectives.
- Canadian Infrastructure Bank: Budget 2023 also includes $20 billion in support for Clean Electricity investments, including at the very least $10 billion through the Clean Power priority area and at the very least $10 billion through the Green Infrastructure priority area.
- Recapitalization of SREPs: The Smart Renewables and Electrification Pathways (SREPs) program will receive a complete of $3 billion to support regional priorities and Indigenous-led projects.
- Canada Growth Fund: The Budget provides an enhanced commitment to carbon-price stability via recent tools within the Canada Growth Fund, which can be managed by the Public Sector Pension Investment Board.
Quotes
“Today’s announcements are a robust and vital step, accelerating our progress toward net zero. Canadian investment tax credits will stabilize investment opportunities, while safeguarding affordability for Canadians. These recent incentives will help create good jobs in clean energy and make Canada a frontrunner within the energy transition.”
— Vittoria Bellissimo, President and CEO, CanREA
“The 2023 Budget demonstrates Canada’s strong leadership in leveraging policy, programs and the tax system to speed up decarbonization while supporting a robust economy, with recent investment certainty for solar energy, wind energy, energy storage and green hydrogen.”
— Brandy Giannetta, Vice-President of Policy and Government Affairs, CanREA
“The selection to pursue investment tax credits for clean technology, like wind, solar, storage and green hydrogen, will allow Canada to take a competitive lead in accelerating the decarbonization of the energy sector.”
— Evan Wilson, Senior Director of Policy and Government Affairs Canada, CanREA
About CanREA
The Canadian Renewable Energy Association (CanREA) is the voice for wind energy, solar energy and energy storage solutions that may power Canada’s energy future. We work to create the conditions for a contemporary energy system through stakeholder advocacy and public engagement. Our diverse members are uniquely positioned to deliver clean, low-cost, reliable, flexible and scalable solutions for Canada’s energy needs. For more information on how Canada can use wind energy, solar energy and energy storage to assist achieve its net-zero commitments, seek the advice of “Powering Canada’s Journey to Net-Zero: CanREA’s 2050 Vision.” Follow us on Twitter and LinkedIn. Subscribe to our newsletter here. Change into a member here. Learn more at renewablesassociation.ca.
For more information or for interview opportunities, please contact:
Communications
Canadian Renewable Energy Association
647-268-3382
communications@renewablesassociation.ca
