| | |

Federal Government’s Clean Technology Investment Tax Credit Sweetens the Pot

August 1, 2024

clean technology

The Clean Technology ITC may be used retroactively for eligible equipment put into operation as early as March 28, 2023

The federal government is spurring investment in the transition to a low-carbon economy. On June 21, 2024, the Government of Canada launched its first Clean Economy Investment Tax Credits (ITCs), representing $93 billion in federal incentives by 2034-2035. Through this initiative, investment in innovations will include five ITCs for: Clean Technology, Carbon Capture, Utilization and Storage (CCUS), Clean Technology Manufacturing, Clean Hydrogen, and a soon to be released ITC for Clean Electricity this fall. 

Most notably for the Canadian building sector, the Clean Technology ITC is a refundable tax credit of up to 30 percent of the capital invested in the adoption and operation of new clean technology (CT) property. The ITC may be used retroactively for eligible equipment put into operation as early as March 28, 2023. This credit will be reduced to 15 percent for equipment put into service in 2034 and will not be available for equipment put into service after the end of that year.

The Clean Technology ITC applies to heat pumps (both air-source and ground-source heat pumps), clean electricity generation such as wind turbines and solar PV, solar thermal, stationary electrical energy storage, and non-road zero-emission vehicles (i.e., heavy-duty construction machinery) and charging equipment.

The Canadian Revenue Agency (CRA) is responsible for administering the Clean Technology ITC, while Natural Resources Canada (NRCan) provides engineering and scientific guidance on what qualifies as a clean technology property. The equipment must be situated in and intended for use exclusively in Canada. Only the taxable Canadian corporation or real estate investment trusts can access the currently released ITCs, providing critical support to those investing capital in specified clean technologies in Canada.

These refundable tax credits for clean technology serve as yet another lever for lowering the capital costs of acquiring, developing and/or operating green, zero -carbon buildings. While the provision is intended to facilitate transfers of clean technology property within corporate groups, the relief will not be available to partnerships and real estate investment trusts within a corporate group. 

Source

Related Story

Government of Canada Launches the First Clean Economy Investment Tax Credits

As countries around the world race to seize the economic opportunities associated with a net-zero future, the Government of Canada is taking bold action to ensure Canadian workers and industry succeed. The Clean Economy Investment Tax Credits (ITCs), representing $93 billion in federal incentives by 2034–35, will play an essential role in attracting investment, supporting Canadian innovation, creating jobs and driving Canada’s economy toward net zero by 2050.

On June 21, the Honourable Jonathan Wilkinson, Minister of Energy and Natural Resources, and the Honourable Marie-Claude Bibeau, Minister of National Revenue, announced the passing into law of the first four Clean Economy Investment Tax Credits: the Clean Technology ITC, the Carbon Capture, Utilization and Storage (CCUS) ITC, the Clean Technology Manufacturing ITC, and the Clean Hydrogen ITC.

Related Articles



Editor’s Pick: Featured Article

Weidmüller’s u-control 2000: The Automation Controller

Weidmüller’s u-control 2000: The Automation Controller

Weidmüller’s scalable engineering software, u-control 2000, adapts individually to your requirements. And, the u-control is powerful, compact and fully compatible with Weidmüller’s I/O system u-remote. This article looks at what makes u-control the heart of your automation.

Programmable logic controllers (PLCs) are one of the main components of any automated system. A typical control system has inputs, outputs, controllers (i.e., PLCs), and some type of human interaction with the system, a human machine interface (HMI), for example.

Read More



Latest Articles

  • Advanced Barcode Technology for Traceability 4.0 and Supply Chain Precision

    October 30, 2024 Omron is a market leader in barcode verification and compliance solutions. In an era where efficiency and accuracy are paramount, the latest advancements in barcode technology are setting new standards for seamless traceability. With enhanced imaging capabilities and adaptive lighting, these innovative solutions are designed to tackle the most challenging conditions in… Read More…

  • Rethink Robotics Rises from the Ashes, Better, Faster, Stronger

    October 28, 2024 By Krystie Johnston Rethink Robotics is making a powerful comeback. They recently relaunched, rebranded, and revealed a new lineup of products at IMTS 2024. Their Rethink Reacher cobots have been designed for precision and performance, their Rethink Ryder autonomous mobile robots (AMRs) offer effortless efficiency, and their Rethink Riser elevates operations by… Read More…