Navigating The Canadian Emissions Funding Obstacle Course

Photo credit: Yangarra.

The Obstacle Course

There has been a flurry of funding announcements provincially and federally for emissions reduction projects. Each program differs in scope, eligibility requirements, timelines, and opportunity. Significant trade-offs exist among programs, and to complicate matters, various governments, agencies, and funding partners are named in these announcements. How can companies navigate this obstacle course to maximize benefits from these opportunities?

Companies have many competing priorities: they must optimize return on investment, maximize profit, ensure regulatory compliance, and report on environment, safety, and governance (ESG) — all while ensuring that day-to-day operations are efficient and minimize down time. On top of this, navigating trade-offs among carbon markets, the various funding opportunities, and the constantly changing landscape of regulations and technologies can feel like a full-time job.

Yet leveraging these opportunities appropriately can lead to thousands, if not millions of dollars in your pocket. Highwood Emissions Management estimates that over $1 billion in funding currently exists for emission reduction projects in Canada.

Why is it important to have a robust funding strategy for my company?

  1. Over $1 billion is on the table. Leaving it there is bad business.
  2. Several opportunities support progress towards reductions that are or will be required by law. In other words, these are upgrades that must be made to be compliant with regulations.
  3. Most funding opportunities require significant up-front effort during the application phase and there is often a short window of time during which applications are accepted.
  4. Some funding opportunities can be stacked to cover a majority of project expenditures.
  5. A strategy is required to understand how to navigate trade-offs among funding opportunities that cannot be stacked (i.e., which do I choose) and whether to opt instead for generating carbon credits that can be sold on the regulatory offset market.
  6. In the near future, access to investment and the ability to sell differentiated product at a premium will depend on your company’s ability to demonstrate strong reductions in methane emissions.

What funding opportunities exist in Western Canada?

Which of these opportunities should my company leverage?

There is no simple answer. Whether and when to apply for each opportunity depends on a multitude of company-specific considerations. Several critical questions must be considered when navigating these opportunities:

  • What funding opportunities can my project/ technology access?
  • Can we stack funding options?
  • When does funding expire?
  • What are the limitations of the funding?
  • In what jurisdiction is funding available?

To demonstrate the importance of an emissions reduction strategy, consider the following case study of a pneumatic instrument retrofit journey in Alberta. According to the Alberta Energy Regulator’s Directive 060, pneumatic devices in existing well sites must vent less the 0.17m3/h as of Jan. 1, 2023, and most sites have devices that exceed those limits.

As a producer, it might be tempting to retrofit your facilities with low-bleed instruments that exactly meet the regulatory requirements. Yet companies that do so may be missing great opportunities for generating additional value by going above and beyond the regulations. Numerous options exist and their trade-offs must be carefully considered.

For our pneumatic retrofit example, let us assume that we have a facility with a variety of pneumatic instruments and pneumatic pumps. We have various options to reduce our emissions: low bleed devices, electrification, instrument air, gas capture, and other novel technologies. Now, let us consider our options for funding this project:

  • MTIP
    • Requirement fulfilled: Low bleed device replacement/ electrification/ instrument air/ gas capture utilization or destruction
      • Cost: 50% of total project costs
      • Payment occurs upon procurement and commissioning
      • Forfeit offset credits
  • NRCan ERF
    • Requirement fulfilled: Emissions reduction project
      • Repayable loan
      • Offset credits available
      • Stackable with MTIP
    • Requirement fulfilled: Emissions elimination project
      • Portion (up to 50% is non-repayable)
      • Repayable component is eligible for offsets
      • Stackable with MTIP
  • Offsets
    • Requirement fulfilled: Venting reduction/ elimination projects with specific protocols
      • Project development costs are high
      • Not able to access MTIP
      • Private or public (ERF) funding is available

For any specific example like this one, several options will exist. Ultimately, an economic analysis must be performed to compare the various options and the financial returns they will yield. In choosing the best opportunity, a number of common pitfalls must also be avoided:

  • Not considering all the abatement options;
  • Not adequately understanding the detailed eligibility requirements of each project;
  • Not understanding stackability of grants and leaving money on the table;
  • Not looking holistically at each facility to understand if there are vent limit concerns;
  • Not considering capital costs required at a future date when funding is no longer available.


Having a robust funding strategy will save you money. It might appear complicated (it is!) but understanding how to leverage the right opportunities can make a big difference to your bottom line. As an Albertan, born and raised in the oil and gas industry, I have seen many of these opportunities come and go. Be sure to leverage these opportunities now — when you have the chance — to ensure that your company, alongside the broader Canadian oil and gas industry, remains healthy and strong.

Jessica Shumlich (P.Eng., MM) is the chief executive officer and co-founder of Highwood Emissions Management. She has a decade and a half experience working for energy companies, governments, technology developers and various start-ups. Her expertise lies in holistic greenhouse gas emissions management including evaluation of how to implement cost effective solutions that reduce emissions.

Thomas Fox is president of Highwood Emissions Management. He completed a Ph.D. at the University of Calgary Centre for Smart Emissions Sensing Technologies, where he held a Vanier scholarship. He holds a M.Sc. from McGill University in satellite remote sensing and agricultural land-use and a B.Sc. in Environmental Science. From 2017-2020, Thomas led the invention of the Leak Detection and Repair Simulator (LDAR-Sim), an open-source software product designed to evaluate emerging leak detection technologies, methods, programs, and policies.



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