The Low Carbon Economy Fund has been established in Canada as “an important part of the Pan-Canadian Framework on Clean Growth and Climate Change.”
This framework was adopted by Canadian First Ministers in December 2016 to respond to international commitments (such as the Paris Agreement) and to take action on climate change. Saskatchewan and Manitoba have yet to adopt the framework.
The $2 billion Low Carbon Economy Fund will support implementation of the framework by “leveraging investments in projects that will generate clean growth and reduce greenhouse gas emissions towards meeting or exceeding commitments under the Paris Agreement.”
The fund will provide money over the next five years and will be split into two parts:
Low Carbon Economy Leadership Fund (launched June 15) to provide $1.4 billion to provinces and territories that have adopted the framework. Provinces will be eligible for funding of a base amount of $30 million plus funding based on population.
Low Carbon Economy Challenge and implementation of the framework. The challenge will be launched in the fall of 2017 to support projects submitted by all provinces and territories, as well as municipalities, indigenous governments and organizations, businesses, and not-for-profit and for-profit organizations.
Over the summer of 2017, the government of Canada will engage provinces and territories on their proposed projects under the Low Carbon Economy Leadership Fund. After project approval, bilateral funding agreements will be put in place with provinces and territories so that projects can begin in the fall and winter.
Although the government doesn’t explicitly indicate how hydropower is included in the fund, hydro provides 63% of the country’s electricity, with 76,000 MW installed and technical potential of 160,000 MW, according to the Canadian Hydropower Association.
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