Reuters has reported that Canadian industry is growing frustrated with a hold-up in the flow of money coming from promised investment tax credits, Canada’s answer to the generous incentives available to industry in the United States under the Inflation Reduction Act.

The Canadian government has two sets of ‘clean’ investment tax credits, the first of which is CAD$10 billion (€6.9 billion/US$7.4 billion) for renewable energies and carbon capture and storage, which concluded its industry consultation phase earlier this month, after being announced 17 months ago. The second is CAD$17 billion for clean hydrogen, electricity and manufacturing, which was announced 6 months ago and has not finished consultation. With these relatively lengthy periods making the incentives significantly lag those available south of the border, many billions of CAD$ of projects are waiting on the tax credits to be available to proceed, according to various industry bodies and sources.

Bob Masterson, president and chief executive of the Chemistry Industry Association of Canada, has said that across more than a dozen projects in his industry, there is “well beyond C$25 billion of proposed investments”, while Lafarge has said that the tax credits “will certainly help the business case [for its planned project in Exshaw, Alberta] and in ensuring investment in decarbonisation occurs in Canada”. Canadian Manufacturers & Exporters’s president Dennis Darby has also called for urgency, saying that the 2,500 companies the CME represents has CAD$25-50 billion in investments to make in the next four to five years.

An unnamed source told Reuters that tax credits will apply retroactively, and that some businesses are already going ahead with Canadian projects on that basis.