Details on Transfer Payment Programs

Name of transfer payment program: Investments in Forest Industry Transformation Program (Voted)

Start date: June 17, 2010
End date: March 31, 2018

Fiscal year for terms and conditions: 2013-14

Strategic Outcome: 1 – Canada’s Natural Resource Sectors are Globally Competitive

Link to department’s Program Alignment Architecture : 1.2 – Innovation for New Products and Processes and 1.2.2 – Forest Sector Innovation

Description:
The objective of Investments in Forest Industry Transformation is to support forest industry transformation that will make the forest industry more economically viable and environmentally sustainable. The objective will be achieved by investing in innovative technologies that lead to a more diverse, higher-value product mix including bioenergy and renewable power, as well as biomaterials, biochemicals, and next generation building products.

The Program will fund innovative projects implementing transformative technologies at the pilot to commercial scales that direct wood fibre and by-products from wood processing into higher value uses, which 1) increase the total revenues available from a log, 2) diversify product lines for the forest industry, stabilizing economic performance, and 3) produce renewable energy and other products that are beneficial to the environment. By providing funding to Canadian forest firms for capital investments in bioenergy or bioproduct industrial processes to advance these technologies towards full, commercial-scale implementation, this Program will broaden and build upon previous investments in forest sector transformation.

This transfer payment program does not have any repayable contributions.

Results achieved:
Over the past, year two new high-value next-generation building product projects were completed at facilities in Canada. These include:

The deployment of advanced technology to manufacture a new cross-laminated timber (CLT) product, the EcoStructure Wall System was deployed. It provides an innovative, renewable alternative to more traditional, energy-intensive building materials such as concrete and steel. CLT panels are created by gluing layers of lumber panels perpendicular to each other, which can then be processed into specific sizes for use in building framing.

Canada’s first manufacturing plant for prefabricating a panelized system that meets the rigorous Passive House Standard was built. The project will make use of new manufacturing methods to create an innovative, value-added wood building product that will meet stringent building efficiency requirements.  

As well, with the renewal of the program in March 2014 for another four years to 2018, a third call for proposals was launched in June 2014. As a result of this call, 79 formal proposals were received from forest companies across Canada. Announcements for new projects being funded under this call are upcoming. The interest shown by industry demonstrates its strong desire to continue its commitment in bringing the next wave of innovation to market and will solidify Canada’s position as a leader in forest industry transformation.

Comments on variances:
N/A

Audits completed or planned:
Recipient audits were performed on 9 of the 14 projects (64%) funded by the Program by the end of 2014-15.

Evaluations completed or planned:
An overall multi-program forest innovation evaluation was completed in 2014-15. Aspects directly concerning the IFIT program were completed in 2013-14.

Engagement of applicants and recipients:
Program applicants are supported through the establishment of a dedicated program website (www.forest-transformation.nrcan.gc.ca), which includes access to program guides, eligibility requirements, and project announcements, as well as program administration contact details (ifit@nrcan.gc.ca). Calls for Proposals were widely advertised through public press releases, e-mail distribution lists, and liaisons with a wide range of associations, other government departments, and other stakeholders. Selected program recipients are further engaged through regular communication with program administrators to monitor progress on the achievement of program objectives.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	21,705,420	25,625,000	6,000,000	6,000,000	6,000,000	0
Total program	21,705,420	25,625,000	6,000,000	6,000,000	6,000,000	0

Name of transfer payment program: Investing in Canada’s Forest Sector – Forest Innovation Program and Expanding Market Opportunities Program (Voted)

Start date: March 12, 2009
End date: March 31, 2017

Fiscal year for terms and conditions: 2012-13

Strategic Outcome: 1 – Canada’s Natural Resource Sectors are Globally Competitive

Link to department’s Program Alignment Architecture : 1.1 – Market Access and Diversification and 1.1.2 – Forest Products Market Access and Development; 1.2 – Innovation for New Products and Processes and 1.2.2 – Forest Sector Innovation

Description:

• Forest Innovation Program (FIP) – aims at supporting the goal of sustainable natural resource development by enhancing the long-term economic opportunities for Canada's forest sector through increased investment in forest innovation.
• Expanding Market Opportunities (EMO) – aims at maintaining and growing international wood product markets, expanding wood use in the North American non-residential and mid-rise construction market, and promoting the strong environmental credentials of Canadian forest products.

This transfer payment program does not have any repayable contributions

Results achieved:

Expanding Market Opportunities
The EMO program continued to increase the use of wood in various applications, both domestically and abroad. Under the offshore component of the Program, exports of wood products to offshore markets between 2009 and 2014 increased by 110% from $2 billion to $4.2 billion. In 2014-15, proponents continued to build on their successes and have now established a strong presence and Canadian brand recognition in markets such as Japan, China and Korea. They are also making in-roads in emerging markets, such as India and the Middle East. Specific achievements in 2014-15 included:

• Japan: Canadian wood exports to Japan totaled $1.1 billion in 2014. Although export levels to this mature market have softened over the last decade, they still remain 39.1% greater than in 2009. Sustained investments by EMO are maintaining the presence of Canadian wood products in this market. For example, 2014 marked the 40^th anniversary of the introduction of platform frame construction in Japan by Canada. During this time, more than 2.3 million 2x4 structures have been built in Japan and it is becoming a mainstream building method in this market. In addition, there is continued interest in 2x4 construction to build elderly care facilities in Japan. This can be attributed to Canadian promotional programs and activities, such as technical tours and training, targeting this sector. In 2014, the Japan 2x4 Home Builder Association reported receiving 20 elderly care fireproof building applications. Now a total of 120 elderly care facilities in Japan have been or will be built with Canadian wood and construction systems.
• China: Canadian wood exports to China grew to $1.92 billion in 2014 – a five-fold increase since 2009. As this market matures, EMO investments remain key to fostering greater acceptance of Canadian wood products and knowledge of wood-frame construction systems. Quality support and training services remain the cornerstone of our activities delivered by in-market-staff. In addition, NRCan established a Memorandum of Understanding (MOU) with the Tianjin Binhai New Area to facilitate the next steps in the development and implementation of the Sino-Canadian Low-Carbon Eco District Demonstration Project. This initiative aims to develop a sustainable community in China that will feature a variety of Canadian wood-frame building systems and wood products, as well as Canadian energy-efficient and renewable energy technologies.
• Korea: Canada celebrated the opening of the Canadian Maple Hall, a community centre valued at $2.5 million and built with Canadian wood products. Named in honour of Canada’s contribution, the hall sits at the heart of a new energy-efficient, wood-frame housing development in Seoul that is the largest of its kind in Korea. The predominance of Canadian wood products in the project is the result of technical expertise provided by Canada Wood Korea staff, support from Canada’s forest industry and efforts by Canada to promote the use of Canadian wood and wood-frame expertise in fast-growing emerging offshore markets like Korea. Additionally, NRCan signed an MOU on forest cooperation with the Republic of Korea that provided a mechanism for beginning to address a potentially significant market access issue related to new technical standards for forest products, and hosted an incoming delegation of Korean officials and technical experts in March 2015 to advance technical discussions on lumber grading and marking, which began in October 2014.
• India: Product trials are a key way to engage with and motivate Indian manufacturers to convert existing or new production to Canadian species. Nine product trials are underway with Indian window, door and furniture manufacturers using Canadian western hemlock, Douglas fir, and spruce/pine/fir (SPF). Previous product trials have resulted in demand for Canadian wood products. For example, after two successful product trials, Ekbote furniture purchased two containers of western hemlock and is in negotiations for another five containers of Canadian wood. Ekbote has 22 depots throughout western and southern India, and is an influencer among Indian furniture manufacturers. Given this, Ekbote’s decision to use Canadian wood represents an important connection for Canadian wood product producers in this market.
• Middle East: NRCan appointed a new Trade Commissioner to work with the Canadian Embassy team in the United Arab Emirates to promote Canadian wood products in the region. As of January 2015, the new Trade Commissioner has been leading market development activities in the Gulf Cooperation Council (GCC), an organization of Persian Gulf states made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. This appointment will bolster Canada’s capacity to seize opportunities to increase exports of wood products to the region where surging construction activity has driven demand for wood products. Saudi Arabia, Qatar and the United Arab Emirates, in particular, have turned to wood-producing countries to meet their ever-growing needs for wood products.
• Europe: Wood pellets are an important commodity in Europe, comprising almost 42% of all Canadian wood products exported to this market. The use of wood pellets to generate heat began to grow rapidly in 2013. In 2014, Canadian exports to the European heat market doubled to 200,000 tonnes from 100,000 tonnes in 2013. The value of all Canadian wood pellet exports to Europe (for the heat and electricity markets) reached $190.9 million in 2014, an increase of 32% over 2009 export levels. In addition, EMO continues to advance the interests of Canadian wood pellet producers in Europe through its support for the Wood Pellet Association of Canada (WPAC). For example, WPAC participation in regulatory discussions is helping to ease international shipping rules for wood pellets without additives and binders; making it easier for Canadian wood pellet producers to ship their products to offshore markets.
• EMO also continued to promote the sector’s environmental performance to address market access and regulatory issues in offshore markets. These issues can limit trade in Canadian forest products.
• North America: Research and code development work supported by NRCan has influenced changes to municipal, provincial and national building codes in Canada to better support the construction of wood-frame buildings up to six storeys (also known as mid-rise buildings). In the past year, Alberta and Ontario joined British Columbia and Quebec on the list of provinces that accept mid-rise wood-frame buildings. At the national level, on March 29, 2015, the Canadian Commission on Building and Fire Codes unanimously approved wood-frame construction up to six storeys. As a result, the 2015 edition of the National Building Code of Canada will contain new provisions that better enable the construction of larger, taller wood buildings and will help foster greater use of wood in mid-rise public and private buildings. These changes are expected to be published by the end of 2015. A report, titled A Case Study on NRCan Investments in the Process and Effects of Building Code Changes Regarding Wood Frames for Multi-Storey Structures in British Columbia and Canada, provided evidence that NRCan helped advance the adoption of codes and standards related to the multi-level wood frame construction by at least five years and possibly by as much as 15 years. All of these efforts are expected to improve the competitiveness of Canada’s forest sector.
• NRCan continued to position Canada as a world leader in sustainable forest management, as well as provided scientific and technical information, which supported the implementation of the Canadian Boreal Forest Agreement (CBFA). The CBFA, signed in May 2010, is a private agreement between 19 forest companies, who are members of the Forest Products Association of Canada, and seven non-governmental environmental organizations. The Agreement seeks to develop a new model of collaboration among these parties to enable a stronger, more competitive forest industry and a better protected, sustainably managed boreal forest. It also provides export markets with tangible evidence of Canada’s strong environmental record in forestry.
• Changes to Bill 301 eliminated the ban on the use of dimensional wood framing in school construction in the state of Georgia in the United States (US). This is a significant achievement as 2013 construction data listed Georgia as the 4^th largest contributor to new school construction based on square footage. For WoodWORKS! USA, this milestone is the culmination of years of technical support for and contribution of resources to the Georgia Forestry Commission, which led the effort to change Bill 301. Since the ban was lifted on July 1, 2014, the WoodWORKS! team has been providing technical support for the Georgia School for Innovation and the Classics, a public charter school that is being built with wood. The school is expected to open in August 2015.
• Through support provided to the WoodWORKS! programs in Canada and the US in 2014-15, EMO influenced the use of wood in 341 non-residential and mid-rise construction projects, resulting in incremental wood sales amounting to $215 million.

Forest Innovation Program:
The FIP continued to help develop and commercialize new technologies for Canada’s forest sector and assist in its ongoing transformation by providing funding support to FPInnovations to facilitate the forest industry’s adoption and deployment of these emerging technologies and processes.

Specific achievements in 2014-15 included:

• Published the first edition for light-frame buildings of a Best Practice Manual For Managing Noise in Mid- and High-Rise Multi-Family Construction. The manual, developed for engineers, architects and designers, is the result of several years of research and testing. Since noise transmission is a key concern of building designers, the manual can help foster increased use of wood in multi-family construction markets currently dominated by non-wood building solutions.
• Partnered with a 3D feedstock supplier and a Vancouver university to identify and accelerate demonstrations of potential forest fibre applications suitable for 3D printing technologies. Despite experiencing rapid international growth over the past few years, 3D printing-related products use petroleum-based materials known as thermoplastics. Users of 3D printing products are now looking for greener substitutes and FPInnovations is pursuing opportunities for fibre-based biomaterials in this new and fast-growing industry.
• Enabled Canada’s first commercial-scale lignin extraction system at West Fraser Timber Company Limited’s pulp mill in Hinton, Alberta. The system, known as LignoForce, is the result of years of research, development, and pilot testing by FPInnovations. It provides Canadian pulp mills with an opportunity to both increase their pulp production and produce lignin, a valuable bio-product from that pulp. Additional research conducted by FPInnovations has also helped the company develop a commercial application for lignin that can be used as a substitute for petroleum-based glues. This has helped reduce West Fraser’s supply costs and enabled it to produce new, greener plywood products for the marketplace.
• Provided the necessary technical support and data to permit mill trials of scaling incoming logs with whole-log laser scanners. Scaling is a process that measures wood volume received by a mill. It also forms the basis of the stumpage fees the mill pays to the province. FPInnovations estimates that cost savings of scanning scaling are $7 million per year. In 2014, pending formal regulatory amendments under the Weights and Measures Act, Measurement Canada temporarily approved the use of laser scanners for log scaling.
• Helped optimize processes and operations at Canadian pulp and paper mills to improve their water and energy efficiency. This optimization work, led by scientists from FPInnovations and NRCan’s CanmetENERGY in collaboration with industry partners, is undertaken to ensure pulp mills operate at full efficiency so that new biomass conversion processes and equipment can be introduced into their operations in a cost-efficient manner. This is a key step in a pulp mill’s transition into becoming a forest bio-refinery able to produce a wide array of bio-products such as biofuels, biomaterials, and bio-chemicals.
• Provided hands-on support to small and medium-sized enterprises in the value-added wood products manufacturing sector. FPInnovations industry advisors performed 513 mill visits or assessments and provided 283 technical interventions or enquiries across Canada.
• Helped four Atlantic companies implement new technologies in their operations, resulting in productivity gains of up to 30%. Additional industry advisor support provided to these companies in marketing saw their web traffic rise by up to 700%. It also helped raised their visibility on social media. 

Comments on variances:
Due to stringent financial management requirements for funding recipients, FIP and EMO were able to effectively manage unspent funding and limit the variance to $3,006 out of $34.6 million in contributions (less than .01% of the total contribution).

Audits completed or planned:
EMO: In 2014-15, nine recipient audits were completed.  In 2015-16, four recipient audits will be undertaken and are expected to be completed by December 31, 2015.

FIP: A recipient financial and compliance audit was conducted in 2013-14.

Evaluations completed or planned:
FIP was evaluated as part of the evaluation of the Forest Innovation sub-program in 2013-14. http://www.nrcan.gc.ca/evaluation/reports/2014/17126

An evaluation of the EMO program is currently underway. It is expected to be completed by December 2015.

Engagement of applicants and recipients:

A formal call for proposals for 2014-15 was issued via email on November 1, 2013, to all eligible organizations in the EMO online application system. In addition, leading up to the call for proposals, a webinar was held with all proponents to explain the implementation of an earnable administration fee.

In advance of the launch of EMO’s 2015-16 call for proposals on November 3, 2014, EMO management met with the heads of the associations to discuss changes to the on-line application form and related manual. In early November 2014, senior EMO program officers held one-on-one training with proponents in British Columbia and Quebec to go over the changes and provide direction about the type of information EMO requires throughout the application and reporting process. Webinars were also offered for proponents that could not attend sessions in person. The training and call for proposals were open to all proponents registered in the online system.

Under the FIP, as FPInnovations is the primary recipient, regular meetings were held between senior FPInnovations and NRCan officials to discuss program strategy and delivery. In addition, all research activities funded under the FIP are vetted through the FPInnovations program advisory committee process, which ensures industrial relevance and alignment of the funded work with industry priorities. FIP research and development activities are also aligned with academic initiatives.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	44,033,586	37,992,188	34,600,000	34,600,000	34,596,994	(3,006)
Total program	44,033,586	37,992,188	34,600,000	34,600,000	34,596,994	(3,006)

Name of transfer payment program: Canada-Newfoundland Offshore Petroleum Board (Statutory)

Start date: 1985-86
End date: Perpetuity

Fiscal year for terms and conditions: N/A

Strategic Outcome: 1 – Canada’s Natural Resource Sectors are Globally Competitive

Link to department’s Program Alignment Architecture : 1.4 – Statutory Programs — Atlantic Offshore

Description:
NRCan pays 50% of the operating costs of the Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB). The Province pays the other 50%. This is done pursuant to section 27 of the Canada-Newfoundland and Labrador Atlantic Accord Implementation Act. Approximately 75% of the Board’s operating budget is cost recovered and remitted to the governments of Canada and Newfoundland and Labrador on a 50-50 basis.

This transfer payment program does not have any repayable contributions.

Results achieved:
The transfer to the Canada-Newfoundland and Labrador Offshore Petroleum Board was completed in a timely manner.

Comments on variances:
NRCan pays 50% of the approved C-NLOPB budget.
The variance in planned and actual 2014-15 spending is based on two factors:

1. The 2014-15 Planned Spending was set in August 2013 and was based on the approved C-NLOPB budget for 2013-14. The C-NLOPB's approved Budget for 2014-15 was $17.67 million. The Government of Canada's share was $8.84 million, which represented a 14% increase over the approved budget in 2013-14. 
2. The C-NLOPB cost recovers 75% of its budget from industry on a voluntary basis and 50% of this amount is then remitted to NRCan. C-NLOPB has remitted $3.45 million to NRCan. These remittances are not reflected in the expenditure forecast, but they do result in lower year end actual expenditures.

These two factors net out to $5.4 million in actual spending in 2014-15.

Audits completed or planned:
No audit was conducted in 2014-15.

Evaluations completed or planned:
No evaluation was conducted in 2014-15.

Engagement of applicants and recipients:
Before budgets are recommended for ministerial approval, officials engage with Board officials to understand the budgetary request and consult with provincial officials to understand their position.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	3,346,925	4,708,800	7,756,000	5,384,778	5,384,778	(2,371,222)
Total program	3,346,925	4,708,800	7,756,000	5,384,778	5,384,778	(2,371,222)

Name of transfer payment program: ecoENERGY for Biofuels (Voted)

Start date: April 1, 2008
End date: March 31, 2017

Fiscal year for terms and conditions: 2009-10

Strategic Outcome: 2 – Natural Resource Sectors and Consumers are Environmentally Responsible

Link to department’s Program Alignment Architecture : 2.1 – Energy-efficient Practices and Lower-carbon Energy Sources and 2.1.3 – Alternative Transportation Fuels

Description:
ecoENERGY for Biofuels supports the production of renewable alternatives to gasoline and diesel and encourages the development of a competitive domestic renewable fuels industry. The $1.48 billion, 9 year program provides an operating incentive to facilities that produce renewable alternatives to gasoline and diesel in Canada, based on production and sales volumes. The program has been closed to new applicants since March 31, 2010, and based on current estimates, it is expected that almost $1 billion will be spent by the program end in March 2017.

This transfer payment program does not have repayable contributions.

Results achieved:
The ecoENERGY for Biofuels program met its original program target of 2 billion litres of ethanol and 500 million litres of biodiesel domestic production capacity by signing 37 contribution agreements (16 for ethanol and 21 for biodiesel). This would have resulted in the built production capacity of 2.032 billion litres per year of ethanol, and 660 million litres per year of biodiesel in support of the Renewable Fuels Regulations. However, due to market challenges, several producers were unable to meet their contractual terms and their agreements were terminated early.

By December 2012, the Program had a built production capacity of 1,881 million litres of ethanol and 555 million litres of biodiesel.

In 2014-15, the program had 21 active contribution agreements (14 ethanol, 7 biodiesel) representing a production capacity of 1,818 million litres of ethanol and 217 million litres of biodiesel. In March 2015, 12 contribution agreements successfully ended their seven year term. The nine remaining agreements will end over the remaining two years of the Program. 

As the program winds down, NRCan will continue to diligently manage existing contribution agreements and monitor industry performance as it enters a post-incentives environment.

Comments on variances:
The variance in planned and actual 2014-15 spending is largely due to the fact that biodiesel producers are challenged by market condition and therefore are not accessing the full amount of incentives possible under their agreements.

Audits completed or planned:
Recipient audits are conducted every year resulting in each proponent being audited at least once by the end of the program. In 2014-15, four recipient audits were completed and four audits will be conducted in 2015-16.

Evaluations completed or planned:
An evaluation was not completed during the reporting year. The next program evaluation will be in 2017-18.

Engagement of applicants and recipients:
The deadline for submitting an application to the program was March 31, 2010. The program is no longer accepting applications.

The program engages recipients through regular calls on project process; monthly, semi-annual and annual financial and environmental reporting, progress of construction and commissioning reports, technical and environmental site visits, and recipient audits.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	130,046,621	113,656,336	145,700,000	139,035,000	93,942,654	(51,757,346)
Total program	130,046,621	113,656,336	145,700,000	139,035,000	93,942,654	(51,757,346)

Name of transfer payment program: ecoENERGY for Renewable Power (Voted)

Start date: April 1, 2007
End date: The program’s authority to enter into contribution agreements ended on March 31, 2011. However, allocated funding will be issued to program participants until 2020-21.

Fiscal year for terms and conditions: 2008-09

Strategic Outcome: 2 – Natural Resource Sectors and Consumers are Environmentally Responsible

Link to department’s Program Alignment Architecture : 2.1 – Energy-efficient Practices and Lower-carbon Energy Sources and 2.1.1 – Renewable Energy Deployment

Description:
The ecoENERGY for Renewable Power program is investing $1.4 billion over 14 years to increase Canada's supply of clean electricity from renewable sources such as wind, biomass, low-impact hydro, and solar photovoltaic energy. It is intended to help position low-impact renewable energy technologies to make an increased contribution to Canada’s energy supply and thereby contribute to a more sustainable and diversified energy mix. Payments of the incentive will be paid over a 10-year period to qualifying projects.

This transfer payment program has repayable contributions.

Results achieved:
The program managed 104 contribution agreements which were signed by the end of 2010-11, representing 4,458 megawatts (MW) of renewable power capacity and commitments of $1.39 billion over 14 years. The electricity generation under this program results in 6 megatons of GHG reductions annually.

Comments on variances:
Actual spending was less than planned spending because not all project applicants met the March 31, 2011 deadline for project commissioning.  As a result, not all of the funds originally available under the program were allocated.  In addition, some projects qualifying for the incentive produced less energy than anticipated, resulting in lower actual spending than anticipated. 

Audits completed or planned:
The program completed five recipient audits in 2014-15.

Evaluations completed or planned:
The program, along with other renewable energy deployment programs, participated in a departmental evaluation during 2014-15.

Engagement of applicants and recipients:
Applications are no longer accepted for the ecoENERGY for Renewable Power program, as the commitment period ended on March 31, 2011. The Department continues to engage with recipients to ensure compliance with the requirements of the contribution agreements.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	127,584,238	127,117,878	137,939,000	132,891,000	128,067,145	(9,871,855)
Total program	127,584,238	127,117,878	137,939,000	132,891,000	128,067,145	(9,871,855)

Name of transfer payment program: Payments to the Newfoundland Offshore Petroleum Resource Revenue Fund (Statutory)

Start date: April 1987
End date: Perpetuity

Fiscal year for terms and conditions: N/A

Strategic Outcome: 1 – Canada's Natural Resource Sectors are Globally Competitive

Link to department’s Program Alignment Architecture : 1.4 – Statutory Programs — Atlantic Offshore

Description:
The Minister of Natural Resources is responsible under section 214 of the Canada-Newfoundland and Labrador Atlantic Accord Implementation Act to make payments to the province of Newfoundland and Labrador equivalent to the revenue amounts received by Canada in relation to offshore oil and gas activities in the Canada-Newfoundland and Labrador offshore. The Newfoundland Offshore Petroleum Resource Revenue Fund Regulations prescribe the time and manner for making the transfer payments. The funds are drawn from the Consolidated Revenue Fund.

This transfer payment program does not have any repayable contributions.

Results achieved:
The transfer to the Province of an amount equivalent to the amounts received by Canada in relation to oil and gas activity in the Canada-Newfoundland and Labrador offshore area was completed in a timely manner, as set out in sections 97, 214 and 217 of the Canada-Newfoundland and Labrador Atlantic Accord Implementation Act.

Comments on variances:
The difference between Planned Spending and Actual Spending is mainly due to lower than anticipated production levels and crude oil prices which reduced royalties collected by the Federal government that were transferred through the Newfoundland Offshore Petroleum Resource Revenue Fund.

Audits completed or planned:
No audit was conducted in 2014-15.

Evaluations completed or planned:
No evaluation was conducted in 2014-15.

Engagement of applicants and recipients:
N/A

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	566,121,270	731,533,986	1,199,509,000	751,940,157	751,940,157	(447,568,843)
Total program	566,121,270	731,533,986	1,199,509,000	751,940,157	751,940,157	(447,568,843)

Name of transfer payment program: Nova Scotia Crown Share Adjustment Payments (Statutory)

Start date: June 1, 2012
End date: Perpetuity

Fiscal year for terms and conditions: N/A

Strategic Outcome: 1 – Canada's Natural Resource Sectors are Globally Competitive

Link to department’s Program Alignment Architecture : 1.4 – Statutory Programs — Atlantic Offshore

Description:
The Minister of Natural Resources is responsible under sections 246 to 249 of the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act to make Crown Share Adjustment (CSA) payments to the Province of Nova Scotia from the Consolidated Revenue Fund.

The Government of Canada obtained a 25% carried interest in all offshore projects under the National Energy Program (NEP) which was initiated in 1980. The Province of Nova Scotia subsequently negotiated the right to acquire a portion of any federal interest in oil and natural gas projects in the Canada-Nova Scotia offshore area under the 1982 Canada-Nova Scotia Agreement on Offshore Oil and Gas Management and Revenue Sharing (the “1982 Agreement”). When the NEP was discontinued after the 1984 federal election, Nova Scotia subsequently negotiated CSA payment provisions as part of the 1988 Accord Act. These provisions of the Accord Act essentially provide Nova Scotia with an equivalent financial benefit to what it would have achieved had the federal government had an interest and Nova Scotia had been able to exercise its Crown Share right under the 1982 Agreement.

This transfer payment program does not have any repayable contributions.

Results achieved:
Statutory requirements relating to Nova Scotia Crown Share Adjustment Payments were managed in a timely manner.

Comments on variances:
The main driver for the variance is pricing and updated information. The pricing assumptions such as exchange rate and commodity prices used for 2014-15 Planned Spending were based on projections in 2013-14. The updated forecast now reflects actuals. The model to calculate CSA payment uses a variety of contributing factors, one of which is project specific production and cost information provided by the provincial offshore boards. This information was updated to reflect the current year actuals and projections, which were lower than anticipated when forecasted in 2014-15 Planned Spending.

Audits completed or planned:
No audit was conducted in 2014-15.

Evaluations completed or planned:
No evaluation was conducted in 2014-15.

Engagement of applicants and recipients:
The province of Nova Scotia is involved in the methodology and calculation of the CSA payment and agrees upon the amount of the payment in advance of the transfer.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	57,774,592	12,855,636	14,394,000	5,376,337	5,376,337	(9,017,663)
Total program	57,774,592	12,855,636	14,394,000	5,376,337	5,376,337	(9,017,663)

Name of transfer payment program: Payments to the Nova Scotia Offshore Revenue Account (Statutory)

Start date: 1993-94
End date: Perpetuity

Fiscal year for terms and conditions: N/A

Strategic Outcome: 1 – Canada's Natural Resource Sectors are Globally Competitive

Link to department’s Program Alignment Architecture : 1.4 – Statutory Programs — Atlantic Offshore

Description:
The Minister of Natural Resources is responsible under section 219 of the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act (the “Accord Act”) to make payments to the province of Nova Scotia equivalent to the revenue amounts received by Canada in relation to offshore oil and gas activities in the Canada-Nova Scotia offshore. The Nova Scotia Offshore Revenue Account Regulations prescribe the time and manner for making the transfer payments. The funds are drawn from the Consolidated Revenue Fund.

This transfer payment program does not have any repayable contributions.

Results achieved:
The transfer to the Province of an amount equivalent to the amounts received by Canada in relation to oil and gas activity in the Canada-Nova Scotia offshore area was completed in a timely manner, as set out in the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act.

Comments on variances:
The difference between Planned Spending and Actual Spending can be attributed to the depreciation of the Canadian dollar (CAD) compared to the US dollar (USD). Since sales of natural gas are often denominated in USD, but royalties and transfers are paid in CAD, actual expenditures were higher than forecasted in the Main Estimates.

Audits completed or planned:
No audit was conducted in 2014-15.

Evaluations completed or planned:
No evaluation was conducted in 2014-15.

Engagement of applicants and recipients:
N/A

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	55,120,298	43,861,520	68,216,000	72,159,315	72,159,315	3,943,315
Total program	55,120,298	43,861,520	68,216,000	72,159,315	72,159,315	3,943,315

Name of transfer payment program: Wind Power Production Incentive Program (Voted)

Start date: April 1, 2002
End date: The program’s authority to enter into contribution agreements ended on March 31, 2007. However, allocated funding will be issued as per signed contribution agreements with program participants until 2016-17.

Fiscal year for terms and conditions: 2005-06

Strategic Outcome: 2 – Natural Resource Sectors and Consumers are Environmentally Responsible

Link to department’s Program Alignment Architecture : 2.1 – Energy-efficient Practices and Lower-carbon Energy Sources and 2.1.1 – Renewable Energy Deployment

Description:
The Wind Power Production Incentive (WPPI) Program was set up to help establish wind energy in Canada by providing a financial incentive of about 1 cent per kilowatt-hour produced from the installation of up to 1,000 megawatts (MW) of new wind power capacity in Canada by 2007. Eligible recipients claim payment of the incentive over a 10-year period. The program contributes to the production of new electricity from wind energy projects. The program approved 22 wind projects for a total capacity of 924 MW.

Results achieved:
The program managed contribution agreements with 22 wind farms that were commissioned under the program, representing 924 megawatts of wind energy capacity in Canada and about $314 million in contribution funding over 15 years. Electricity generation from this program in 2014-15 was 2.6 TWh.

Comments on variances:
Some projects qualifying for the incentive produced less energy than anticipated, resulting in lower actual spending. 

Audits completed or planned:
The program completed one recipient audit in 2014-15.  All projects under the program have been audited at least once.

Evaluations completed or planned:
The program, along with other renewable energy deployment programs, participated in a departmental evaluation during 2014-15. The results of the evaluation are expected in the summer of 2015.

Engagement of applicants and recipients:
Applications are no longer accepted for the WPPI Program, as the commitment period ended on March 31, 2007. The department continues to engage with recipients to ensure compliance with the requirements of the contribution agreements.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	29,604,000	25,304,000	$22,704,000	$22,704,000	22,113,496.	(590,504)
Total program	29,604,000	25,304,000	$22,704,000	$22,704,000	22,113,496.	(590,504)

Name of transfer payment program: Clean Energy Fund (Voted)

Start date: April 23, 2009
End date: October 31, 2016

Fiscal year for terms and conditions: 2012-13

Strategic Outcome: 2 – Natural Resource Sectors and Consumers are Environmentally Responsible

Link to department’s Program Alignment Architecture : 2.2 – Technology Innovation and 2.2.3 Clean Energy Science and Technology

Description:
In support of Canada’s commitment to reduce greenhouse gas (GHG) emissions, the Clean Energy Fund provides $795 million over six years for clean energy demonstration and research and development (R&D), delivered in three components: (1) large-scale carbon capture and storage (CCS) demonstration projects undertaken by external recipients, (2) renewable energy and clean energy demonstration projects undertaken by external recipients, and (3) clean energy R&D to be carried out in federal laboratories.

The Clean Energy Fund was announced as a $1 billion program. In December 2009, in response to unprecedented demand for the ecoENERGY Retrofit Homes program, the Government of Canada allocated $205 million from the Clean Energy Fund to finance up to 120,000 additional home retrofits.

Transfer Payments for Demonstration Projects are not intended for recipients to generate profits or to increase the value of their business. If a transfer payment leads to a profit, the recipient will be required to repay the transfer payment. The requirements that may trigger repayments are detailed in the contribution agreement, along with the process for repayment.

Results achieved:
As of March 31, 2015, 20 contribution agreements were underway providing funds for academia and industry to undertake clean energy technology projects to demonstrate innovative solutions addressing environmental challenges in the energy sector. Of these, nine projects were completed in 2014-15, bringing the total number of projects completed to 16. 

Comments on variances:
The variance of $2,806,700 between actual spending and planned spending is due to minor delays and underspending on small scale demonstration projects.

Audits completed or planned:
Nine recipient audits were completed during the reporting year.

Evaluations completed or planned:
An evaluation of the Clean Energy Fund was completed with a final report released in June 2014.

http://www.nrcan.gc.ca/evaluation/reports/2014/16323

Engagement of applicants and recipients:
NRCan solicits project proposals through announcements on its website. There is no current call for proposals, and the Department does not expect that there will be any further calls.

The program engages recipients through quarterly, annual and end-of-project financial and non-financial reporting, progress updates on project activities, technical and environmental site visits, and recipient audits.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	26,469,464	9,704,540	9,400,000	7,330,606	6,593,300	(2,806,700)
Total program	26,469,464	9,704,540	9,400,000	7,330,606	6,593,300	(2,806,700)

Name of transfer payment program: ecoENERGY Innovation Initiative (Voted)

Start date: June 23, 2011
End date: March 31, 2016

Fiscal year for terms and conditions: 2013-14

Strategic Outcome: 2 – Natural Resource Sectors and Consumers are Environmentally Responsible

Link to department’s Program Alignment Architecture : 2.2 – Technology Innovation and 2.2.3 Clean Energy Science and Technology

Description:
The ecoENERGY Innovation Initiative (ecoEII) supports innovation in the clean energy sector by providing funding for research, development (R&D) and demonstration (collectively, RD&D) projects. It will provide $268 million over five years. The Initiative is integral to supporting the Government of Canada’s commitment to reduce total greenhouse gas (GHG) emissions by 17% from 2005 levels by 2020. It also contributes towards Canadian prosperity and competitiveness.

The objective of the ecoEII is to advance Canada’s environmental performance and the competitiveness of Canada’s clean tech industry through a comprehensive suite of RD&D activities in the areas of clean energy and energy efficiency. Proposed investments will build on Canada’s strengths and competitive advantage, supporting next generation technologies that target the country’s energy profile and needs, while maximizing future GHG reductions. Activities are in five strategic priority areas: energy efficiency in buildings and communities; clean electricity and renewables; bioenergy; electrification of transportation; and unconventional oil and gas.

The ecoEII has two components: one for R&D projects, and a second for Demonstration projects. Together, these will support more than 200 projects. The call for submissions is now closed.

For R&D projects, transfer payments will not be repayable. For demonstration projects, it is not expected that transfer payments will lead to recipients’ generating profits or increasing the value of their business. If a transfer payment to a demonstration project leads to a profit, the recipient will be required to repay a portion of the profits up to the value of the transfer payment. The requirements that may trigger repayments are detailed in the contribution agreement, along with the process for repayment.

Results achieved:
As of March 31, 2015, 64 contribution agreements were underway providing funds for academia and industry to undertake clean energy technology projects to research develop and demonstrate innovative solutions addressing environmental challenges in the energy sector. Of these, three projects were completed in 2014-15, bringing the total completed to twelve.  One new project started in 2014-15, with seven additional new projects approved, but planned to be started in 2015-16, bringing the total forecasted number of agreements to 72.

One specific highlight is the Tugliq Energy’s Glencore RAGLAN Mine renewable electricity smart-grid pilot demonstration project, which successfully installed and commissioned a 3MW turbine at the remote northern Quebec mine in August 2014. As of March 31, 2015, the project has already generated more than 4000 MWh of clean electricity, displaced more than 1M L of diesel and eliminated an estimated 3kt/CO₂.  Projects of this type have a significant potential to be replicated to reduce diesel use in Canada’s north.

Leverage for this grant and contribution program is forecasted to be 1:1, in line with the target for NRCan’s suite of Clean Energy Science & Technology programs.

Comments on variances:
The variance between actual expenditures and planned expenditures of $11,925,251 is attributable to various internal budget adjustments which were made to adapt to changing project funding needs.

Audits completed or planned:
An audit of the ecoEII was completed and a report released in May 2014 (AU1421).

http://www.nrcan.gc.ca/audit/reports/2014/16325

In addition, five full recipient audits were completed in 2014-15.

Evaluations completed or planned:
A Clean Energy Theme Roll Up evaluation started in 2014-15, which assesses many programs including the ecoEII. Its final report is expected to be completed and released in fall 2015-16.

Engagement of applicants and recipients:
During the Arrange phase, NRCan engaged key stakeholders through a series of Leaders’ Fora. Through these engagements, the focus of subsequent calls for proposals under the five strategic priorities was refined.

During the Assess phase, very limited interaction occurred with applicants in order to keep the process fair, open and transparent. Only guidance of a very general nature was provided, where clarifications to an Applicant’s Guide that was provided to all applicants were requested. No specific advice or help was provided under any circumstances.

During the Award phase, extensive discussions occurred with proponents to incorporate and address their needs to the extent possible within the framework of ecoEII Terms and Conditions and Treasury Board guidelines.

During the Administer phase, NRCan has regular interaction with proponents. The ecoEII has implemented regular monitoring meetings with all recipients on a quarterly or semi-annual basis. These are formal meetings in which the progress of the project is discussed. In addition to these formal meetings, the ecoEII routinely interacts with recipients. These interactions occur on a periodic basis via conference calls. These meetings are scheduled based on how the project is progressing. On these calls, as well as in the formal meetings, opportunities exist for the recipient and the ecoEII administrators to discuss issues and recipient concern.

Performance Information (dollars)

Type of Transfer Payment	2012–13 Actual spending	2013–14 Actual spending	2014–15 Planned spending	2014–15 Total authorities available for use	2014–15 Actual spending (authorities used)	Variance (2014–15 actual minus 2014–15 planned)
Total grants	0	0	0	0	0	0
Total contributions	15,858,744	34,325,606	27,926,000	40,469,394	39,851,251	11,925,251
Total program	15,858,744	34,325,606	27,926,000	40,469,394	39,851,251	11,925,251