Question Period Note: Strategic Innovation Fund Net Zero Accelerator

The Standing Committee on Environment and Sustainable Development (ENVI) is questioning the Government’s failure to provide the committee with documents relating to the $8 billion Net Zero Accelerator Fund. ENVI members are likely to ask what the SIF NZA is, how it works and what ECCC’s role is.

• The Strategic Innovation Fund’s $8 billion Net Zero Accelerator (NZA) initiative is advancing Canada’s climate goals by decarbonizing heavy emitters, supporting industrial transformation, and promoting clean technology development and the battery ecosystem.
• The NZA supports projects that will contribute to a low carbon economy, either directly through retrofits, or indirectly by fostering new technologies – all while securing good, well-paying jobs, and helping businesses move towards a net zero future. 
• Environment and Climate Change Canada (ECCC) supports Innovation, Science and Economic Development Canada (ISED) in implementing this program by providing technical advice and reviewing projects in the context of GHG emissions reduction potential and Canada’s climate plans. 

ECCC’s mandate letter indicates the Minister will provide support to the Minister of Innovation, Science and Industry to help implement the $8 billion Strategic Innovation Fund SIF NZA. NZA funding is being delivered under three main pillars:
1. Decarbonization of large emitters (for deployable technologies to drive domestic greenhouse gas (GHG) reductions by 2030);  
2. Industrial transformation (to help industries unlock decarbonization pathways in support of net-zero by 2050); and  
3. Clean technologies and battery ecosystem (to support innovative technologies for emission reductions and a domestic battery supply chain). 
The investment included $4 billion for pillar 1 and the remaining $4 billion to be invested in pillars 2 and 3 combined. Funding under pillars 2 and 3 is fully committed. To drive submissions under pillar 1, Innovation, Science and Economic Development Canada (ISED) launched a call to action in Spring 2022 to solicit applications from large emitters to drive domestic GHG reductions in the near-term. Letters of Intent have been sent to nine of the prospective recipients. Projects are not moving forward as quickly as expected. Proposals are currently in various stages of due diligence with some progress towards term sheet negotiations.
ECCC is engaged in the Net Zero Accelerator initiative at various levels, ranging from Ministerial support to evaluation of emission reductions and due diligence reviews of applications.
The Minister of Environment and Climate Change provides letters of concurrence for NZA-related Strategic Innovation Fund projects seeking over $50 million in investment from the NZA. Letters of Concurrence signal ECCC support for ISED to proceed with negotiations to finalize the terms of the project.

ECCC does not participate in the negotiation of final terms with successful applicants. Contribution agreements are negotiated and managed between ISED officials and applicants.