Top 5 Government Funding Programs for Canadian Cleantech Innovation

The Government of Canada is dedicated to building a strong, green economy by supporting Canadian businesses in the research and development of sustainable clean technologies with a variety of cleantech funding programs. Canadians are being urged to bring forward new innovative ideas that will lead to the commercialization of important cleantech solutions across all industries to lower emissions.

“Investments in clean technology help harness made-in-Canada sustainable solutions to accomplish two goals at once: create economic opportunities and reduce Canada’s environmental footprint.”
– Navdeep Bains, Minister of Innovation, Science and Industry

Clean technology and innovation funding will help Canada meet climate change goals, reduce the country’s environmental footprint, and continue Canada’s progress towards becoming global leader in clean technology so that all Canadians may benefit from a cleaner country and an advancing cleantech sector.

Government Funding for Canadian Cleantech Solutions  

With the need for cleantech solutions rising around the world, so are government programs designed to fund projects which aim to position Canada as a more sustainable and environmentally friendly nation.

To help Canada reach and exceed its goals in tackling climate change impacts, here are five government funding programs that are currently available to support Canadian businesses with the research and development of sustainable innovation projects:  

Industrial Research Assistance Program (IRAP)

The Industrial Research Assistance Program (IRAP) is a funding program designed to accellerate the research and development projects of Canadian innovators. Businesses developing and implementing industrial process solutions can apply for research funding contributions through IRAP. However, large-scale technology adoption projects that lead to new, more sustainable capabilities are also considered.

Amount: Funds up to 60-80% of internal technical labour and subcontractor expenses.

Eligibility: Employ 1-500 staff, incorporated for ≥2 years, committed to internal R&D activities.

Timeline: Projects require approval prior to spending and funding runs from April 1 to March 31 to align with the government fiscal year.

Project Activities: Develop innovative products, processes, and services. Projects must focus on solving an internal technical challenge by adopting/developing technology & processing enhancements.

Innovative Solutions Canada (ISC)

ISC provides government grants and procurement contracts to stimulate technology research, development, and commercialization. This program helps Canadian start-ups and small to medium-sized businesses (SMEs) overcome technology development hurdles to produce globally demanded products and services and improve government operations.

Amount: Phase 1: Grants up to $150k; Phase 2: Grants up to $1M; Phase 3: Procurement contracts – no maximum.

Eligibility: For-profit, privately held Canadian businesses with a maximum 499 full time employees.

Timeline: Ongoing departmental innovation challenges each have a unique application deadline. Phase 1 projects may last up to six months while Phase 2 projects may span up to two years.

Project Activities: Proof of concept and prototype development projects to solve federal government departmental innovation challenges. Specific projects depend on challenges currently open for application.

Next Generation Manufacturing Program (NGen)

Administered by Next Generation Manufacturing Canada (NGen), this funding program taps into Innovation Superclusters Initiative (ISI)funding that supports groups of businesses to develop high potential technologies, create ground-breaking process transformation, and de-risk the adoption of technology to help manufacturers compete globally.

Amount: Offsets up to 37% of eligible project expenses. Project costs should be between $1M and $20M, providing non-repayable funding of approximately $444,400 to $8,880,000.

Eligibility: Projects must be transformational in scale or impact and be of wider benefit to Canada’s advanced manufacturing ecosystem. Must have a minimum of three private-sector project partners who are all NGen members.

Timeline: This program is currently closed.

Project Themes: Collaborative technology development and application with wide-reaching impacts that expand the potential of Canadian manufacturers.

Sustainable Development Technology Canada (SDTC)

The SDTC Tech Fund  supports Canadian companies, especially clean technology leaders, to research, develop, and demonstrate new environmental technologies that address climate change, clean air, clean water, and clean soil. The average funding awarded has been between $2 million to $4 million.

Amount: Program provides a 33% towards eligible expenses, paid one funding milestone in advance.

Eligibility: Applicants must be Canadian companies planning to undertake an R&D and/or demonstration project to prove emerging and novel clean technologies and innovation. Projects must be in late-stage development / pre-commercialization (TRL 3-7).

Timeline: This program has a continuous intake and expects four to six milestones in each eligible project.

Project Activities:  Projects must lead to significant environmental impacts including GHG emissions reductions, clean air, clean water, and clean soil.

Strategic Innovation Fund (SIF) – Net Zero Accelerator

The SIF’s Net Zero Accelerator Program supports rapid decarbonization projects from large carbon emitters, research and development, commercialization scale-up of clean technologies, and acceleration of industrial transformation to help reduce greenhouse gas emissions.

Amount: Up to 50% in grant and/or loan funding for a minimum $10 million project budget.

Eligibility: Businesses must be operating in Canada. Projects can come from any industry sector, but the company should have high growth potential, and projects must result in significant environmental and economic benefits to Canada.

Timeline: Continuous application intake.

Project Activities:  Projects should lead to significant environmental impacts and benefits to Canada or support the growth of Canada’s low-carbon economy. Three focus areas include: 

• Development/adoption of clean tech for all industrial sectors
• Cleantech development in aerospace and automobile manufacturing sectors
• Development of a Canadian battery innovation and industrial ecosystem

Canadian Grants and Loans for Cleantech and Innovation

Visit our detailed Cleantech Funding page to learn more about the numerous Canadian government funding programs available that support innovative projects across the country by providing financial assistance in the form of grants and/or loans.

Innovation is a mindset that businesses must adopt to remain relevant to consumers. Without research and development, your client base will eventually find more appealing alternatives to your product(s), service(s), and/or solution(s).

Download our free Collaborative Research Project Guide resource to learn more about the processes of Canadian businesses working on innovative research and development products, services, and solutions, and how to maximize project turnaround times by collaborating with other likeminded and motivated organizations.