On June 2, 2021, the Government of Canada launched the Smart Renewables and Electrification Pathways Program (SREPs) in order to support the country’s ongoing effort to reach net-zero emissions by 2050.
Under the new program, $964 million will be invested over a time period of four years for smart renewable energy and grid modernization projects. With the program, the authorities expect to significantly reduce Canada’s greenhouse gas emissions by incentivizing the replacement of fossil-fuel generation with renewables.
The program will incorporate funding requirements that are intended to foster an equitable transition to a more sustainable and green generation. Moreover, since the project has been launched on a federal level it is applicable to many provinces in the country including Alberta, British Columbia and Saskatchewan.
In this blog, we have discussed the main rules of the program and have also explained the application process for your ease.
SREPs define four funding streams, each of which has distinct requirements that projects must meet in order to be eligible for funding. These streams have been defined based on certain available technologies, market maturity, and project types. The eligible projects for this new initiative include:
- Established renewables: These include onshore wind power or solar photovoltaic plants. Renewables projects must have a minimum 4MW of net installed capacity to be eligible.
- Emerging technologies: These include energy storage, geothermal energy, tidal energy, non-utility led grid modernization projects, and retrofits to enable grid services on existing renewable energy plants.
- Grid modernization: These include microgrids, virtual power plants, data management and communication, hardware or software retrofits to existing renewable energy and electric vehicle (EV) integration.
- Strategic Dialogue Linked Projects (SDLPs): These include projects that fall into any of the other three streams, but that are a part of an established federal-provincial/territorial dialogue.
Each defined stream has a funding limit based on a percentage of total project cost. This percentage varies according to project stream, with a $50-million cap on any single project.
The maximum eligible percentage of the project cost for every stream is:
- 10 percent of established renewables
- 30 percent of emerging technologies
- 50 percent of grid modernization
In addition to this, the maximum funding percentage for a project that falls under more than one stream will be determined according to the proportion of eligible expenditures in each program stream.
To help Indigenous recipients and projects that may benefit Indigenous communities, the Canadian government has announced that the program will evaluate and provide a greater percentage of funding to Indigenous-owned projects. In addition to this, smaller-sized projects are encouraged to apply. They will also receive more funding.
However, Indigenous-owned projects must represent meaningful ownership according to the following criteria:
- Indigenous ownership of 25% to 49.9% – They will receive 50% of the total project cost.
- Indigenous Recipient (ownership 50% to 100%) – They will receive 75% of the total project cost.
The minimum System Size that is required by indigenous-owned projects to be eligible is 500KW compared to the 4MW minimum for non-indigenous-owned projects.
Stacking Financial Assistance
Before the contribution agreement for the project is signed on an annual basis, the applicant will be required to disclose all the funding sources whether they are Canadian or Non-Canadian. This also includes the industry’s sources, approved in-kind funding, and contributions from other Canadian government sources.
While the SREP program allows stacking, note that the maximum level of total Canadian government funding authorized under SREPs is 75 percent of total project costs when the applicant is a for-profit organization.
The application process includes a total of three steps:
- Project registration
- Technical and Financial Project Application
- Project Evaluation
To apply for the funding formally you have to complete and submit a Project Registration Form as outlined in Appendix A. After you have a confirmed receipt of the Project Registration Form and eligibility for the proposed project, you will receive a notification whether you are eligible to apply or not.
After this, you must demonstrate that the proposed project is:
- At a sufficiently advanced stage of planning and development
- In accordance with grid service capability requirements
- Provides information required for the contribution agreement
You must meet the requirements outlined in Appendix B as applicable to your project. If the review for the Technical and Financial Project Application is positive you will be notified about the availability of funding and the approval of your application.
How Dandelion Renewables can help
If you are not sure about your project eligibility, or need a financial feasibility study, or front-end engineering completed for your renewable project, feel free to reach out to our highly skilled team in Dandelion Renewables. We will be happy to help you to make an educated choice and optimize your project!
Finally, Dandelion Renewables is open to partner on some of our own ongoing projects with First Nation communities.
Dandelion Renewables contributes to the planet’s sustainable energy future by offering healthy environmental solutions. We aim to reduce carbon footprints and offear our clients consultation, feasibility studies, knowledge, and complete installation services regarding energy-efficient upgrades and solar. We are proud to be one of the top-rated solar and renewable energy contractors in Western Canada. Contact us for more information.