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Retrofit Funding: ecoENERGY Retrofit Incentive for Industry - Program Details

Organization Eligibility Criteria

To be eligible for assistance, an industrial facility must:

Project Eligibility Criteria

To be eligible for an incentive, companies must not have started or incurred any costs before their application is approved and a Contribution Agreement between NRCan and the company is signed by both parties.

To be eligible for funding, a retrofit project must:

  • involve capital expenditures that modifies or upgrades an existing building, equipment/systems or process.
  • result in a measurable and verifiable reduction of energy use
  • have a net simple payback period of more than one year

Value of Incentive

The maximum incentive per application is 25 percent of project costs or $50,000, whichever is less. The incentive is calculated on a project basis after taking into account funding from other sources and is the lowest of the following amounts:

  • $10 per gigajoule (GJ) of energy estimated to be saved by a retrofit project per year
    = estimated annual GJ of energy saved × $10
  • 25 percent of the total eligible project costs (including GST, HST and PST net of tax rebate and other incentives)
    = 25% × [total project cost – other incentives]
  • the amount required to reduce the net simple payback period for each project to no less than one year
    = dollars of annual energy savings × (net payback period in years – 1 year)
Example 1:
Single-Project Application
Incentive is the lowest of the three following calculations:
A) GJ saved = 450 × $10 = $4,500

B) 25 percent of eligible project costs
= 0.25 × ($11,000 – 0) = $2,750

C) Payback-period reduction
= $8,000 × (11000/8000 – 1) = $3,000
Annual GJ savings: 450 GJ
Retrofit cost: $11,000
Est. savings/yr: $8,000
Other funding: $0
Therefore: Company's contribution: $8,250
NRCan's contribution: $2,750

The following example illustrates how the incentive is calculated when there is more than one project in an application.

Example 2:
Multi-Project Application
Incentive is the lowest of the three following project calculations:

Project 1
A) GJ saved
= (200 × $10) = $2,000
B) 25 percent of eligible project costs
= ($2,500 × 0.25) = $625
C) Payback period
= $2,000 × (2500/2000 – 1) = $500
= Incentive based on C = $500

Project 2
A) GJ saved
= (423 × $10) = $4,230
B) 25 percent of eligible project costs
($50,000 × 0.25) = $12,500
C) Payback period
= $4,230 × ($50,000/$4,230 – 1) = $45,770
= Incentive based on A = $4,230

Project 3
A) GJ saved
= (1742 × $10) = $17,420
B) 25 percent of eligible project costs
= $39,500 - $5,000 = $8,625
D) Payback period
= $17,420 × ((39,500 - $ 5000)/$17,420 – 1) = $17,080
= Incentive based on B = $8,625
Project 1
GJ savings/yr:
Project 1: 200 GJ
Project 2: 423 GJ
Project 3: 1742 GJ
Retrofit costs:
Project 1: $2,500
Project 2: $50,000
Project 3: $39,500
Other funding:
Project 3: $5,000
Est. savings/yr:
Project 1: $ 2,000
Project 2: $ 4,230
Project 3: $17,420
Therefore: Company's contribution: $ 73,645
NRCan's contribution: $13,355
Other funding: $5,000