Innovation Ecosystem Enablers – Call for proposals applicant guide

Contents

• 1. Introduction
  • Objectives
  • Delivery
• 2. Focus areas
  • Process and technology testing facilities
• 3. Application process
  • Phase 1. Expression of interest (EOI)
  • Phase 2. Full project proposal (FPP)
• 4. How to apply
• 5. Contact us
• 6. Use of artificial intelligence in preparation of applications
• 7. Disclaimer
• Annex
  • 1. Definitions
  • 2. Intellectual property (IP) requirements
  • 3. Inclusion, diversity, equity and accessibility (IDEA) workplaces and policies
  • 4. Related definitions
  • 5. Eligible, ineligible, in-kind, and non-permissible expenditures
  • 6. Eligible expenditures – costing memorandum
  • 7. In-kind contributions – costing memorandum
  • 8. Reporting requirements

1. Introduction

Advancing energy innovation requires more than breakthrough technologies — it requires a strong and robust innovation ecosystem. Bringing new energy solutions from development to deployment relies on a set of foundational enabling conditions: shared infrastructure that gives innovators access to the spaces and tools they need; intellectual and technical capital that sustains a skilled, capable workforce; market validation that builds confidence in emerging technologies; and generation of knowledge and evidence that informs sound policy, regulatory, and market-shaping decisions. When any of these elements is absent or underdeveloped, the innovation pipeline can stall — regardless of the quality of the technologies within it. This call for proposals (CFP) aims to support these important key enabler projects across the energy innovation system to drive clean energy solutions for Canada.

This CFP is delivered by the Office of Energy Research and Development through the Energy Innovation Program (the Program). For general information on the application process and applicant guidance, visit the Process and Guidance for Applicants of the Energy Innovation Program (EIP) webpage.

Objectives

This CFP will support projects that deliver broad-based ecosystem benefits across Canada's energy innovation landscape, with the aim of addressing the following objectives:

• Strengthen Canada's capacity to develop and commercialize innovative energy solutions by funding enabling activities across multiple focus areas, each addressing a specific gap in Canada's energy innovation ecosystem;
• Accelerate the transition of energy innovations from development to deployment by addressing critical gaps in shared infrastructure, intellectual and technical capacity, market confidence, and/or policy and regulatory framework.

Delivery

The CFP will consist of multiple focus areas. Each focus area will accept applications on a rolling basis. Focus areas will target specific categories of ecosystem enabling projects, aligned with evolving Program priorities and sector needs.

Currently, the following focus areas are accepting applications:

• Process and technology testing facilities

We encourage interested candidates to review the eligibility criteria and application requirements of a given focus area above and to apply when ready. Any updates to the CFP, focus areas and/or application intake will be posted on our webpage.

To stay informed as new focus areas are launched, you are encouraged to join our email list for our latest news and funding opportunities, follow NRCan on LinkedIn, or check the Energy Innovation Program webpage regularly for updates and announcements.

2. Focus areas

Process and technology testing facilities

Introduction

Access to world-class testing and validation infrastructure is a foundational requirement for advancing energy technologies from early development through to commercial deployment. Testing facilities play a critical role across the innovation lifecycle, enabling technology developers to verify performance, meet certification and standards requirements, and de-risk scale-up in controlled environments, while also enabling potential adopters to assess technology performance before deployment — reducing the time and cost of bringing new solutions to market. Without adequate domestic testing capacity, Canadian innovators often need to rely on foreign facilities for critical validation steps, which can undermine the competitiveness of Canadian value chains and limit the domestic benefits from the innovations.

To strengthen Canada's energy innovation infrastructure, this focus area will fund the establishment of new testing facilities and the expansion and/or modernization of existing facilities that provide broad-based, shared-use testing and/or validation services to energy innovators. It will support projects that demonstrate clear, unmet market demand for testing capabilities not currently available in Canada, as well as a credible path to long-term operational sustainability. By supporting a broad range of facility types — from standards and certification labs, to prototyping and technology demonstration facilities, to systems integration testbeds and academia-based testing facilities — this focus area aims to deepen critical innovation capabilities, support domestic workforce capacity, and ensure that Canadian technologies can complete the full validation journey within Canada while positioning Canada to attract international innovators seeking access to unique testing capabilities.

Objectives

This focus area will fund projects that address the following objectives:

• Support broadly accessible testing facilities that respond to clear, unmet industry demands, protect client data and intellectual property (IP), and avoid duplication where adequate capacity already exists.
• Strengthen Canada’s testing, validation, and workforce capacity to enable technology demonstration and validation, reduce reliance on foreign facilities, and reinforce Canadian value chains.

Eligibility

Eligible Canadian recipients

Eligible Canadian recipients will be:

• legal entities validly incorporated or registered in Canada including:
  • for profit and not for profit organizations
  • Canadian academic institutions
  • utilities
• provincial, territorial, regional and municipal governments and their departments and agencies where applicable
• Indigenous:
  • communities or governments
  • tribal councils or entities that fulfill a similar function (for example, general councils, land claim organizations)
  • national or regional Indigenous councils, or tribal organizations
  • for-profit or not-for-profit organizations (majority owned and controlled by Indigenous people)

The applicant must be the entity responsible for the establishment, expansion, and/or modernization of the testing facility infrastructure for which funding is sought.

Eligible projects

In addition to meeting both focus area objectives, eligible projects must:

• involve buildout and/or deployment of physical and/or digital infrastructure that result in new and/or expanded service offering(s) that support one or more of the following types of activities:
  • technology testing, validation, and/or performance verification prior to commercialization
  • demonstration, pilot testing, prototyping, and/or technology scale-up in controlled environments and/or operationally-integrated test environments
  • certification, standards testing, and/or system integration validation
• address a clear, demonstrable unmet need in Canada's energy innovation ecosystem
• demonstrate a credible pathway to long-term operational sustainability without ongoing government support
• demonstrate that the facility's governance or operating model allows energy innovators beyond the founding organization and its core affiliates to access its services. This can be satisfied through a commercially available service open to external clients, or through a multi-stakeholder governance structure that permits new members or users to be added over time. Facilities built exclusively for an organization's internal use do not meet this criterion
• have a confirmed location in Canada for the project – either a new facility or an upgrade to an existing facility (note: deferred maintenance costs are not eligible)
• have identified all non-NRCan funding sources

Project development status

To assess eligibility, this focus area will use a project readiness framework below that describes the level of development maturity applicants are expected to have reached with regards to the service offering to be eligible to apply. Note that in the case of existing facilities expanding their service offerings, the readiness framework will be applied to those offerings, not the facility as a whole.

Project development status

Phase	Focus	Key Activities	Eligibility
Concept and pre-development	Project scoping	Market analysis, feasibility studies, demand assessment, site identification	Not a Funded Phase Pre-development activities are outside the scope of this focus area and should be complete before application
Development ready	Project specifications complete	Site and facility requirements confirmed, partnerships and co-funding commitments secured, procurement plan defined, regulatory requirements identified	Eligible Minimum readiness threshold to be met before applying
Implementation — CapEx	Physical or digital infrastructure buildout and deployment	Delivery milestones established, equipment procurement and deployment plan finalized, operational model and user access framework defined, team capacity confirmed	Eligible
Early operations — OpExFootnote *	Serving first customers while working toward financial self-sufficiency	Facility operational and ready to accept customers, pathway to self-sufficiency demonstrated	EligibleFootnote *
Full commercial operationFootnote *	Financially self-sufficient, fully operational test centre serving the market	–	Not a Funded Phase

Intellectual property (IP) approach

Applicants must have an IP and data management approach in place that protects client confidentiality and ensures sensitive information is safeguarded and retained in Canada.

Any IP that arises from the funded project itself, such as testing methodologies, measurement protocols, or facility design innovations, should be vested in, or be licensed to, the Funding Recipient. Applicants will be required to describe their approaches in detail as part of the application process.

Project location

The new facility or existing facility being upgraded must be located in Canada. While some project activities can take place outside of Canada where necessary, the project must have significant tangible benefits to Canada and preference will be given to projects with the majority of their benefits, investments, and activities in Canada by applicants, partners, collaborators, or vendors.

Preferred selection criteria

NRCan reserves the right to prioritize projects at the expression of interest (EOI) and full project proposal (FPP) stages that:

• support departmental priorities such as regional balance in Canada, strategic value and socio-economic considerations, and advancing IDEA in the natural resources sector
• serve a broad and identifiable user base
• implement open, transparent access policies, including published pricing, clear user intake processes
• implement an IP policy that does not restrict the users’ agency over their own IP strategies, avoiding mechanisms such as rights of first refusal or other elements that could constrain independent decision-making
• partner with Canadian organizations (when the project includes partnerships);
• demonstrate commercially reasonable efforts to support the Buy Canadian Policy.

Funding and support

Contributions

Contributions under the Program will be non-repayable.

The CFP is open to projects that request between $1,000,000 and $10,000,000, comprising up to 50% of eligible total project cost (or 100% for Indigenous applicants), over a period of up to a maximum of five years. Funding is available beginning on April 1, 2027.

The minimum contribution, maximum contribution, maximum government stacking percentage, and project duration are outlined in the table below:

Program Contribution Percentage (% of Total Project Cost)	Minimum Government Contribution	Maximum Government Contribution	Maximum Government Stacking Percentage (% of Total Project Cost)	Project Duration
Up to 50% (100% for Indigenous Applicants)	$1,000,000	$10,000,000	100%	Up to 5 years

Project partner contribution

While project partners do not need to be confirmed at the expression of interest (EOI) phase, applicants are encouraged to provide information if available.

Applicants that are invited to submit full project proposals (FPP) will be required to provide a letter of contribution for each partner identified. The strength of the letters of contribution will be considered during the FPP review.

Applicants are permitted to work on their project with partners that do not qualify as eligible applicants, such as federal government labs, and other government departments so long as the funding from NRCan is not being used to pay for the federal government's own internal operations, or towards the acquisition of land, buildings, works, machinery and equipment or construction or creation of assets for the federal government.

3. Application process

This CFP uses a continuous intake model, in which applications are accepted and reviewed on a rolling basis until all available Program funding has been allocated. There is currently no fixed date by which the CFP will close to applications. To apply, applicants must complete and submit their Expressions of Interest (EOI) via the application portal.

The CFP’s project selection process has two phases:

• Expression of interest (EOI) phase, open to all eligible applicants
• Full project proposal (FPP) phase, open to invited applicants only

While there is currently no fixed deadline for applications, with submissions reviewed on a rolling basis, it should be noted that the time at which submissions are received may impact the order of priority for project review and selection.

If additional information or clarification is needed to complete NRCan’s review of the EOI or FPP, the Program will contact applicants to identify what is required via an information request. The Program will consider the date of reception of the additional information as the new date of reception of the completed application and will continue its review accordingly.

NRCan will notify the applicants who are invited to the FPP phase and send them information on the FPP submission requirements. As in the EOI phase, if the FPP is incomplete, applicants will be notified and asked to submit the missing information.

The Program will evaluate FPP submissions as they are received, provided that:

• The application is complete
• Funds are available and the project may be eligible for a contribution agreement

An invitation to the FPP phase does not represent a funding commitment from NRCan. NRCan reserves the right to disqualify a project that is deemed materially different at FPP than the version presented in the EOI application. If invited to FPP, there will be an opportunity for you to fully explain the rationale for any changes since the EOI phase as these changes can have implications on project eligibility.

NRCan may request supplementary information at various points in the review process.

4. How to apply

To apply, applicants must complete and submit their application via the application portal.

• Access the applicant portal

Register or sign-in with a Canadian bank account or using a GCKey.

Updates and notifications on results will be emailed from oerddonotreply-brdenepasrepondre@nrcan-rncan.gc.ca. Applicants should save this address as a trusted sender.

Should you experience any technical issues, contact the applicant portal support team at oerdportal-portailbrde@nrcan-rncan.gc.ca.

Applicants are responsible for ensuring that they meet the eligibility criteria and that their application is fully completed before submitting.

5. Contact us

Questions about the CFP or the process should be directed to: eipiee-piefei@ nrcan-rncan.gc.ca

During regular operations, NRCan will strive to respond within two business days. Please note that due to the volume of inquiries received and to ensure the fairness of the process, the Program team will not have meetings or calls with individual applicants during the intake period.

6. Use of artificial intelligence in preparation of applications

The Government of Canada’s official guidance on artificial intelligence (AI) recognizes that generative AI may be a valuable tool to applicants in the preparation of funding applications. In accordance with this guidance, applicants are responsible for ensuring that information included in their applications is true, accurate and complete and that references are appropriately cited. Generative AI in the development of an application for the Program should be used for support purposes only such as improving efficiency, assisting non-native English and French speakers, and streamlining the application writing process.

7. Disclaimer

NRCan reserves the right to alter or cancel any call for expressions of interest, call for proposals, funding amounts and/or deadlines associated with any Program component, or to cancel any application process at its sole discretion. Any changes will be communicated to registered applicants via the NRCan website.

Any costs incurred for the submission of any EOI or of FPP are at the project applicant’s own risk. In all cases, any funding under any submission, review and assessment process will be contingent upon the execution of a contribution agreement.

Until a written contribution agreement is signed by both parties, no commitment or obligation exists on the part of NRCan to make a financial contribution to any project, including any expenditure incurred or paid prior to the signing of such contribution agreement.

Annex

1. Definitions

Broadly accessible: The facility is open to external clients, either through commercially available services or membership-based governance structures, where new users can be added over time.

Indigenous: For the purposes of this Applicant Guide, the term "Indigenous" is understood to include Inuit, Métis, and First Nations individuals, or any combination thereof.

Project partners: Organizations providing in-kind or financial contributions to the project.

2. Intellectual property (IP) requirements

Projects are not required to have generated IP prior to applying; applicants may continue to work on IP during the course of the project. Projects can use IP that already exists from outside of Canada, as long as it is licensed to the applicant for use in Canada, but the Program reserves the right to prioritize projects that use Canadian IP. A successful contribution agreement with NRCan will require that all IP that arises over the course of a project be vest in, or be licensed to, the funding recipient. If no IP is required or expected to be generated over the course of the project, applicants will be required to justify this position if invited to submit an FPP.

3. Inclusion, diversity, equity and accessibility (IDEA) workplaces and policies

The Program recognizes the importance of a diverse and inclusive workforce for the resilience of Canada’s economy and the benefit of Canadian society. To better understand applicants’ approaches to creating more equitable and inclusive workplaces and policies, the Program is collecting voluntary information that will be aggregated and anonymous. This information will be used to inform future outreach, program development, and efforts to promote inclusion, diversity, equity and accessibility (IDEA) in the clean energy sector.

To further OERD’s objectives to support projects that advance IDEA, applicants will be asked to describe how their proposed project creates tangible, societal benefits and how they will be retained in Canada and made accessible to a variety of Canadians, including equity-seeking groups. Applicants will be asked to describe how their project will benefit Canadian society, including, for example, through the establishment of a diverse project team or partnerships, project-level job creation.

4. Related definitions

Accessibility: an overarching goal to realize a barrier-free environment through the proactive identification, removal and prevention of barriers in an organization’s policies, programs, practices and services. A barrier could include anything that hinders the full and equal participation in society regardless of their distinct identities and needs. Removing accessibility barriers ensures all members of society are fully supported and have opportunities to advance.

Diversity: the acceptance and respect of various human dimensions including race, gender, sexual orientation, ethnicity, socio-economic status, religious beliefs, age, physical abilities, political beliefs or other ideologies.

Equity: a condition or state of fair, inclusive and respectful treatment of all people based on their distinct identities and needs; removing systemic barriers to ensure all members are fully supported and have opportunities to advance. Equity does not mean treating people the same without regard for individual differences.

Inclusion: the extent to which diverse members of a group (society/organization) feel valued and respected.

5. Eligible, ineligible, in-kind, and non-permissible expenditures

Related definitions

CFP contribution percentage (% of total project cost) refers to the maximum percentage of funding provided by the Program under the CFP towards the total project cost (cannot exceed the maximum contribution). The balance is to be funded by the recipient or from other sources.

Contribution: funding provided by Canada under the contribution agreement toward eligible expenditures.

Due diligence start date: the date on which the applicant was notified that they were conditionally approved for funding and invited to the due diligence stage.

Eligible expenditure period: Recipients will be allowed to start incurring eligible expenditures from the date the project has been conditionally approved (and pending a due diligence review) or April 1 of the fiscal year in which the contribution agreement is signed and ending on the contribution agreement completion date. Retroactive expenditures will be limited to 30% of the Program’s contribution.

Eligible expenditures: costs incurred within the eligible expenditure period, either directly by the recipient or a third party, which are cash disbursements made with respect to the activities set out in the project proposal.

Minimum contribution refers to the minimum amount of funding provided by the Program under the CFP towards the total project cost and must also align with the contribution percentage limitations.

Maximum contribution refers to the maximum amount of funding provided by the Program under the CFP towards the total project cost and must also align with the contribution percentage limitations.

Maximum government stacking percentage (% of total project cost) refers to the maximum level of total Canadian government (federal, provincial, territorial, and municipal) funding authorized by Program under this CFP. Prior to signing a contribution agreement, an applicant will be required to disclose all anticipated sources (Canadian and non-Canadian) of funding for the proposed project, including approved in-kind funding, clearly identifying contributions from other Canadian government sources (federal, provincial, territorial, and municipal, including federal laboratories). This stacking limit must be respected when assistance is provided. In the event that actual total government assistance to a recipient exceeds the stacking limit, the Program will adjust its level of contribution under the CFP (and seek reimbursement, if necessary) so that the stacking limit is not exceeded. Note that other programs may have different stacking limits for federal funding, and it is the responsibility of the applicant to ensure that they are within the eligible range for their project across all funding programs they apply to.

Profit: in relation to the project, net operating profit as determined by generally accepted accounting principles.

Project: the applicant’s proposal, as submitted to the Program.

Total project cost refers to the total cost of the project and includes both eligible expenditures and ineligible expenditures. (Total project cost) = (eligible expenditures) + (ineligible expenditures). Total project cost does not include non-permissible expenditures.

Eligible expenditures

Eligible expenditures for an approved project must be directly related to, and necessary for, the implementation and conduct of the project and will include:

• Salaries and benefits for employees on the payroll of the recipient for the actual time spent by the employees on the project
• Training and workshops
• Professional, scientific, technical and contracting services
• Travel expenditures, including meals and accommodation, based on National Joint Council Rates, adjusted to reflect costs in Northern and remote areas, where appropriate
• Capital expenditures such as the purchase, installation, testing and commissioning of qualifying equipment, materials and products, including diagnostic, testing tools and instruments, and original equipment manufacturer equipment warranty (including extended warranties where deemed appropriate to mitigate risk and lack of capacity)
• Other expenses related to the project or activity including:
  • laboratory and field supplies, and materials
  • printing services and translation
  • data collection services, including processing, analysis and management
  • facility costs for seminars, conference room rentals etc. (excluding hospitality)
  • construction Insurance
  • accreditation
  • license fees and permits
  • honoraria
  • training
  • field testing services
• Overhead expenditures, provided they are directly related to the conduct of the project and can be attributed to it. Overhead expenditures can be included as eligible expenditures to a maximum of 15% of eligible expenditures. Overhead expenditures include:
  • administrative and corporate support provided directly to the project by the recipient's employee(s), valued on the same basis as professional staff time
  • routine laboratory and field equipment maintenance, based on the actual expenditure to a recipient
  • office operating expenses directly related to the conduct of the project (e.g. faxes, telephone, photocopies, internet, SAT phones, and office equipment)
  • costs associated with further distribution of funding
  • a predetermined overhead percentage (based on evidence provided by the recipient of expected overhead expenditures at the time of contribution agreement negotiation), may be set and subsequently applied to each claim, in order to avoid unnecessary administrative burden to recipients
• GST, PST or HST, net of any tax rebate to which the recipient is entitled

6. Eligible expenditures – costing memorandum

Salaries

Salaries include wages for all personnel with direct involvement in the project such as engineers, scientists, technologists, draftsmen, researchers, laboratory, experimental and shop labour. All eligible personnel must be employees on the recipient ‘s payroll. Payment in terms of shares, stock, stock options and the like are not eligible. The amount invoiced shall 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 gross pay of the employee (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 (annual, monthly, weekly, etc.), divided by the total paid hours in the period including holidays, vacation, paid sickness time.

Labour claims must be supported by suitable records such as time sheets and records and be held for verification at time of audit. Management personnel are required to maintain appropriate records of 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 Canada Pension Plan, Quebec Pension Plan and Employment Insurance, employee benefits such as health plan and insurance, Worker’s Compensation, sick leave and vacation plus any other employer paid payroll related expenses. Items such as salary bonuses and other salary incentives, stock options or vehicle use, which have no relationship to the project, or which have been charged on an indirect basis are non-eligible. The determination of the fringe benefits amount shall be in accordance with generally accepted cost accounting principles. In general, fringe benefits 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, these must be indicated on claims for progress payments for NRCan approval.

Professional, scientific, and contracting services

Sub-contractors and consultants: The nature of goods or services to be acquired shall be set out in the proposal and the estimated cost set out in the budget. The amount eligible from a sub-contractor or a consultant shall be the actual contract amount.

Travel, meals, and accommodation costs

Unless stated otherwise in the contribution agreement between NRCan and the recipient, National Joint Council Rates that are in effect at the time of expenditure incurrence, adjusted to reflect costs in Northern and remote areas, where appropriate, shall be used in reimbursing the following expenses:

• Travel, food and lodging costs to meet with NRCan officials
• Travel, food and lodging costs necessary for other project activities, for example, field trials and demonstrations at locations away from the recipient’s usual location; project planning and review meetings between the recipient and its partner(s)

Capital expenditures

Materials

Materials include those consumed in carrying out the project, including those utilized in the production and operation of models, prototypes and pilot plants. Only utilities consumed to operate equipment, or processes are eligible and may be metered and reported separately from the total utility cost. Utilities used for buildings are not eligible.

Materials purchased solely for the project and issued from the recipient’s inventory are eligible. All materials shall be charged to the project at the net price excluding GST after deducting all trade discounts and similar credits. Surplus materials shall be credited to the project at the original purchase price.

Equipment

Equipment consists of equipment acquired or constructed exclusively for the project. In order to be eligible, such equipment must be identified in the project cost estimate and approved by the Minister. All such equipment shall be charged to the project at the net price (excluding GST) after deducting all trade discounts and similar charges.

Where such equipment is obtained from another division of the recipient or from a related company, the eligible expenditures shall not exceed fair market value and shall not include any markup for profit, administration, selling or financing expense.

Overhead expenditures

Overhead expenses may include:

• administrative support provided directly to the project by the recipient’s employee(s), valued on the same basis as professional staff time
• routine laboratory and field equipment maintenance, based on the actual cost to the recipient that is directly related to the project
• heat, hydro, and office operating costs (e.g. faxes, telephone), provided that they are directly related to the project

Overhead costs will be negotiated and agreed to on an individual basis with recipients before signing a contribution agreement. They will not exceed 15% of eligible expenditures.

Other expenses

Testing services

Eligible testing services are those conducted by testing organizations or accredited laboratories, such as the Canadian Standards Association, Underwriters Laboratories and must be essential to the success of the project. Testing services shall be charged at actual cost. Regulatory costs, where required, may be eligible. For example, testing to comply with environmental standards. All such costs should be identified in the original proposal cost estimates.

Ineligible expenditures

Costs ineligible for reimbursement from the Program under the CFP (but permitted as part of the recipients’ contribution to the total project cost) will include:

• all costs incurred within the total project cost period but outside the eligible expenditure period are considered as ineligible expenditures
• overhead expenses exceeding 15% of eligible expenditures may be included as ineligible expenditures and count towards the recipient’s portion of the total project cost provided that the sum of overhead expenses (eligible plus ineligible) does not exceed 15% of the total project cost
• the reimbursable portion of federal and provincial taxes
• in-kind contributions

From time to time, the Program may determine that some of the recipient’s project costs will not be eligible for reimbursement but may be included towards the total project cost. These costs will be considered ineligible expenditures and should be included in the ineligible expenditures section of the budget at the FPP phase. The Program will provide guidance to the recipient as required.

7. In-kind contributions – costing memorandum

The Program accepts in-kind contributions as part of total project costs. However, in-kind contributions are ineligible for reimbursement by the Program. Typically, in-kind contributions are provided by third-party (e.g., project partner) organizations rather than the recipient themselves.

Purpose

The purpose of this section is to identify the types of non-cash support (“in-kind contributions”) that are acceptable as part of the overall funding for the project from the recipient and/or project contributors, and to provide guidance on how to put a value on those contributions.

Definitions for this section

Asset section: a useful and valuable good, service or other support provided to the project.

Collaborators: organizations that are involved in the implementation of the project without providing in-kind or cash contributions to the project.

Fair market value: the average dollar value the recipient could get for a contributed asset in an open and unrestricted market, between a willing buyer and a willing seller (the recipient) who are acting independently of each other. As a guide, it should approximately represent the original cost minus the depreciation.

In-kind contribution: a cash-equivalent contribution for which no cash is exchanged but that is essential to the project and that would have to be purchased by the recipient on the open market, or through negotiation with the provider, if it were not provided to the recipient.

Internal rate: the rate that would be charged by the component of the recipient that provides the service to the component of the recipient that receives it.

Most favoured customer: a customer given the deepest discount from the normal selling price for a good or service sold to it by the recipient.

Recipient: the organization that signs and executes the project’s contribution agreement (prior to signing the contribution agreement, this organization is the “applicant”) with the Program.

Eligibility of in-kind contributions

To be eligible as an in-kind contribution:

• The contributed asset must be from one of the categories identified below under the heading “Categories of eligible in-kind contributions“.
• It must be essential to a project's success and would otherwise have to be purchased by the recipient.
• Its value must be determinable and verifiable.
• Its valuation must be confirmed by Program officials or its auditors and agreed upon by the recipient and NRCan.

Assessing the value of in-kind contributions

Two different approaches to the valuation of in-kind contributions are possible:

• Using the fair market value, as described above.
• Using the incremental cost – the cost to the project applicant or its partners and collaborators of providing the contributed asset over and above normal operating costs.

Categories of eligible in-kind contributions

Salaries and
benefits

This category addresses the provision of the project partner’s employees’ time to undertake work, such as research, technology development and assessment, and expert analysis that is wholly and directly in support of the project.

The value of services of an employee of the project’s partner provided to the recipient should be at fair market value for the type of service provided and that these services are consistent with the duty for which the employee is normally paid.

A recipient's own salaries and benefits are not considered in-kind. Salaries and benefits of employees who are on the payroll of the recipient (successful applicant) can only be categorized as cash contributions, which are eligible expenditures, for which the recipient can submit a claim to the Program for reimbursement. In the case of academic recipients, the Program considers the recipient to be the university itself, rather than a department within the university. Therefore, use of university lab space or equipment would not be considered in-kind if it is owned by the recipient (i.e., the university). Instead, costs that would be incurred by the university, such as electricity usage for labs, purchase of materials, equipment maintenance, would be considered as an eligible expense rather than an in-kind contribution.

Professional,
scientific and
contracting
service

This category addresses the provision of analytical and technical services. Analytical and technical services include routine laboratory and field technical services such as data collection, laboratory analyses and measurements, and field measurements, exclusive of equipment maintenance. These services may be provided by a component of the recipient’s overall organization or provided to the recipient by a third party.

The value of analytical and technical services provided by or to the recipient should be the lesser of the recipient’s internal rate for the service if that service is provided internally (that is, within the recipient's organization), or the incremental cost to the recipient if it is provided by a third party.

Capital
expenditures

This category includes equipment, laboratory supplies and field supplies that are provided by or to the recipient, and the provision of access to, and use of, proprietary software and databases owned by or provided to the recipient.

Values assessed for equipment and laboratory and field supplies and materials provided to the project must meet the following criteria:

• The value of supplies and materials shall not exceed the selling price to the provider’s most favored customer at the time of provision.
• The value of equipment shall not exceed the fair market value of equipment of the same age and condition at the time of provision.
• If the equipment is special purpose, one-of-a-kind, its value shall not exceed the cost to the provider of its design, testing and manufacture.
• The value of access to, and use of, proprietary software and databases should be the incremental costs to the recipient of providing that access and use, such as staff time involved, including providing any required instruction on their use. Costs associated with developing the software or databases are ineligible as an in-kind contribution.

Travel
expenditures
including meals,
and
accommodation

Unless stated otherwise in the contribution agreement between the NRCan and the recipient, National Joint Council Rates that are in effect at the time of expenditure incurrence, adjusted to reflect costs in Northern and remote areas, where appropriate, shall be used in assigning a value to the following expenses:

• Travel, food and lodging costs to meet with NRCan officials
• Travel, food and lodging costs necessary for other project activities, e.g. field trials and demonstrations at locations away from the recipient’s usual location; project planning and review meetings between the recipient and its partner(s).

Overhead expenditures

With regard to overhead expenditures, they may include:

• Administrative support provided directly to the project by the recipient’s employee(s), valued on the same basis as professional staff time (as described under category 1);
• Routine laboratory and field equipment maintenance, based on the actual cost to the recipient that is directly related to the project;
• Heat, hydro, and office operating costs (e.g. faxes, telephone) telephone, provided they are directly related to the project;
• Overhead costs will be negotiated on an individual basis with recipients. The total of overhead expenses (eligible and ineligible) will not exceed 15% of the total project cost.

Non-permissible expenditures

The Program uses transfer payments to provide financial assistance in the form of grants and contributions to other organizations selected to undertake their activities or projects. These funds cannot be used for the federal government's own internal operations, or towards the acquisition of land, buildings, works, machinery and equipment or construction or creation of assets for the federal government.

Additionally, expenditures ineligible either for reimbursement or for inclusion as part of the total project cost (non-permissible expenditures) include the purchase of land.

8. Reporting requirements

Outcome reporting

After entering into a contribution agreement with NRCan, recipients will be required to submit a series of reporting documents quarterly, annually, at the end of the project, and on the anniversary of the project’s completion each year thereafter, for five years to ensure that targets and objectives are being met.

The frequency of reporting will be determined based on the risk of the recipient/project as established by the departmental risk management model but will include, at a minimum, annual reporting.

Knowledge dissemination

Applicants will also be asked to describe the knowledge products that will be produced as part of the project and how these products will be disseminated. Knowledge dissemination, including the sharing of project insights, successes, and barriers, is a key element of clean technology innovation. Applicants are required to provide Program officials with copies of their knowledge products (e.g., summary report, slide deck, data, infographics) as part of regular reporting expectations.