Eligibility criteria – Eligible expenditures

All projects, regardless of funding activity type, are subject to the following project expenditure requirements.

Eligible expenditures:

• Professional services
• Salaries
• Benefits
• Reasonable travel costs
• Overhead expenses directly related to the project
• Honoraria and ceremonial costs
• Licence and permit fees
• GST, PST, and HST
• Capital expenses

Ineligible expenditures:

Ineligible costs are costs considered ineligible for NRCan’s contribution, but are still project-related costs that count towards the Proponent’s contribution and the total project costs. Examples of ineligible costs include:

• Costs incurred outside the eligible expenditure period, including those for preparing this application
• In-kind costs
• Legal costs for legal issues that arise during the project.
• Overhead expenses not directly linked to the project (i.e. ongoing operating costs, electricity consumption, operation, maintenance, networking fees, subscription fees, etc.)
• Hospitality and catering services (e.g., for event participants)
• Any exceptions under the eligible expenditures specified in the key definitions below.

Eligible expenditure period:

• The eligible expenditure period for the proposed project begins after the signature of a Contribution Agreement (CA) between NRCan and the applicant. Any expenditures incurred before the signature falls outside of the eligible expenditure period and are not reimbursable.
• Eligible expenditures will be eligible for reimbursement from the time that a Contribution Agreement is signed by Natural Resources Canada until the Project Completion date stated in the Contribution Agreement or until Program funding authority ends.
• Program funding currently ends March 31, 2027, therefore, all eligible expenditures for reimbursement must be incurred by that date. However, projects have until March 31, 2029, to be completed.

Key definitions:

Professional services

Professional services are defined as costs for the purchase of additional support required for the completion of the project. These costs can cover the following types of services: scientific, technical, consulting and/or management; contracting; engineering; construction; installation, testing, and commissioning of equipment; training; marketing; data collection; logistics; maintenance; printing; distribution; and audit and evaluation. This can include legal fees associated with reviewing contracts or agreements directly related with this project. The amount eligible from a subcontractor, a consultant, or service provider must be the actual contract amount, and a copy of the contract must be kept on file. Note: Hospitality and catering services (e.g., for event participants) are not eligible for reimbursement by NRCan.

Salaries

Salaries include wages for all personnel with direct involvement in the project, such as project management and administrative staff. All eligible personnel must be employees on the Proponent’s payroll. Payments such as shares, stock, and stock options are not eligible. The amount invoiced must be actual gross pay for the work performed and shall include no markup for profit, selling, administration, or financing. The eligible payroll cost is the employee’s gross pay (normal periodic remuneration before deductions). Normal periodic remuneration rates are the regular pay rates for the period, excluding premiums paid for overtime or shift work. The payroll rate does not include any reimbursement or benefit conferred in lieu of salaries or wages. When hourly rates are being charged for salaried personnel, the hourly rates shall be the periodic remuneration (e.g., annual, monthly, weekly) divided by the total paid hours in the period, including holidays, vacation, and paid sick days. Labour claims must be supported by suitable documentation, such as time sheets and records, and be held for verification at time of audit. Management personnel are required to maintain appropriate records of the time devoted to the project.

Benefits

Benefits are defined as a reasonable prorated share of expenses associated with the direct labour cost, such as the employer’s portion of the Canada Pension Plan, Quebec Pension Plan, and employment insurance; employee benefits such as health plan and insurance; workers’ compensation, sick leave, and vacation; plus, any other employer-paid payroll-related expenses. Expenses with no relationship to the project or that have been charged on an indirect basis are ineligible. The determination of the fringe benefit amount shall be in accordance with general accepted accounting principles (GAAP). In general, the fringe benefit rate provided in the project estimate shall be computed once during the life of the project and agreed on prior to the signing of the agreement. If retroactive adjustments are made, they must be indicated on claims for progress payments for NRCan approval.

Reasonable travel costs

Unless stated otherwise in the Contribution Agreement between NRCan and the Proponent, allowances outlined by Treasury Board in effect at the time of signing the Contribution Agreement shall be used for reimbursing the initial recipient’s expenses for travel, food, and lodging costs necessary for project activities. Reimbursement of travel costs may be estimated using the National Joint Council Travel Directive as a guideline, based on the period during which the trip took place.

Note: NRCan does not provide reimbursement for incidentals or per diems under this funding opportunity. All travel costs requested for reimbursement must be fully substantiated with supporting invoices/receipts.

Overhead expenses

Overhead expenses will be negotiated and agreed to on an individual basis with proponents before signing a Contribution Agreement. These expenses may include:

• heat, electricity, and office operating costs (e.g., Internet and telephone), if they are directly related to the project.

Note: All overhead expenditures claimed for reimbursement must be fully substantiated (with supporting documentation, including an explanatory note, invoices, and detail regarding the pro-rated calculation, if applicable) and must not exceed 15% of Eligible Expenditures. NRCan does not reimburse overhead expenses at a flat rate of 15%.

Honoraria and ceremonial costs

Costs for Indigenous peoples, particularly elders and knowledge keepers, to participate in project activities, including engagement on design and evaluation following the program, are eligible.

Licence and permit fees

Licence and permit fees typically include any municipal, provincial, or federal licences or permits for setting up project. This can include safety permits, business permits, environmental permits, etc.

GST, PST, and HST

Any taxes claimed must always be net of any tax rebate to which the Proponent is entitled.

Capital expenses (including charging and refuelling infrastructure)

Capital expenditures are defined as an expenditure that results in a long-term benefit, as required by the project. For example:

• The retrofitting or upgrading of existing capital assets (fleet vehicles) as defined in the funding activity/project type section.
• The purchase of a fleet vehicle as defined in the funding activity and project type section.
• If an applicant chooses to include the purchase or installation of on-site charging and refuelling infrastructure as a capital expense to the project, it must meet the following requirements: 
  • be directly linked to the on-site refuelling needs necessary to the achievement of one or more of the three eligible funding activities (repowers of existing vehicles, the purchase of low-carbon alternative fuel vehicles and/or implementation of logistical best practices)
  • The program will not fund stand-alone infrastructure projects (i.e. infrastructure without corresponding trucks)
  • not exceed more than 40% of the total project costs
  • be private charging and refueling infrastructure behind a fence
  • be manufactured in countries with which Canada has a free trade agreement
• GFP defines the manufacturing country based on where the equipment was substantially manufactured (country of origin).
• GFP reserves the right to validate the import transaction number issued by the Canadian Border Services Agency at any given point to determine the origin of the equipment.

Eligible capital expenditures associated with on-site charging and refuelling infrastructure expenditures could include:

• Costs associated with enhancing or retrofitting a warehouse to accommodate the installation of on-site refuelling infrastructure and/or equipment necessary for the refuelling needs of the proposed project (e.g. a poured concrete pad).
• Costs associated with installing on-site refuelling stations (or apparatus/equipment) to fuel the newly purchased or retrofitted fleet vehicles or for the implementation of the logistical best practice.
• Costs associated with the equipment needed to access the required alternative fuel on-site (e.g. fueling nozzle).

Ineligible capital expenditures include:

• Cost associated with producing alternative fuels. NRCan will not fund the extraction or production of the fuel itself, nor will it fund electrical grid upgrades.
• Retrofitting and Upgrading of Existing Capital Assets that are not directly linked to the on-site refuelling needs of the core project activity type.

In-kind costs:

Proposed in-kind contributions that are deemed acceptable by NRCan officials must be supported by a formal commitment from the applicant to provide them prior to any commitment of funding to the proposed project being made.

In-kind support refers to a cash equivalent contribution in the form of a good or service for which no cash is exchanged, but which is essential to the project and which the applicant would have to purchase on the open market or through negotiation with the provider.

Fair market value: The average dollar value the provider could get for a contributed good or service in an open and unrestricted market, between a willing buyer (the applicant) and a willing seller acting independently of each other. It should represent approximately the original cost.

In-kind cost requirements:

• Cost must be essential to a project’s success and would otherwise have to be purchased by the applicant;
• Its value must be determinable and verifiable; and
• Its valuation must be confirmed by NRCan and agreed upon by the applicant and NRCan.

Assessing the value of in-kind contributions (two different approaches to the valuation of in-kind support are possible):

• using the fair market value, as described above; and
• using the incremental cost; that is, the cost to the applicant or its partners and collaborators for providing the contributed good or service over and above normal operating costs.