Canada's Clean Economy Investment Tax Credits: Five Refundable Credits Now Fully In Force

Federal clean economy investment tax credits have existed in draft or partial form since 2023, but a meaningful piece was still missing until Bill C-15 received Royal Assent on March 26, 2026, formally enacting the Clean Electricity credit and extending favourable rates on another[1]. All five credits are now law, and all five pay out in cash.

The Five Credits, At A Glance

• Clean Technology ITC (30%). Available for qualifying expenditures between March 28, 2023, and December 31, 2034, covering property such as solar, wind, and other clean electricity generation equipment used in a business's own operations[2].
• Clean Electricity ITC (15%). Enacted by Bill C-15, applying to qualifying expenditures incurred between April 16, 2024, and December 31, 2034, and notably the only one of the five credits available to certain tax-exempt entities such as pension plans[2].
• Clean Hydrogen ITC (15% to 40%). Tiered based on the carbon intensity of the hydrogen production process, rewarding cleaner production methods with a higher rate[2].
• Carbon Capture, Utilization and Storage ITC (up to 60%). The 2026 Spring Economic Update expanded eligible uses for captured carbon to include enhanced oil recovery, at half the rate applicable to other eligible uses[3].
• Clean Technology Manufacturing ITC (30%). Covers investment in manufacturing and processing equipment used to produce clean technology, and is the only one of the five never subject to the labour requirement rule[2].

Why "Refundable" Actually Matters

Unlike a non-refundable credit, which only offsets tax otherwise owing, a refundable credit is paid out in cash by CRA regardless of the claimant's actual tax liability[2]. For a growing business investing heavily in qualifying equipment while generating little or no taxable income, this is the difference between a credit that sits unused on paper and one that shows up as real cash supporting the investment.

The Labour Requirement That Costs 10 Points

Four of the five credits, Clean Technology, Clean Electricity, Clean Hydrogen, and CCUS, offer their full headline rate only if the claimant elects to meet specific labour requirements covering wages paid to covered workers and apprenticeship hours[4]. Failing to meet, or failing to elect into, these requirements reduces the applicable rate by 10 percentage points, a meaningful reduction on a large capital investment. The Clean Technology Manufacturing ITC is the sole exception, available at its full 30% rate with no labour condition attached[4].

The Filing Deadline

Bill C-15 extended the filing deadline for these credits to the later of December 31, 2026, and one year after the claimant's tax return filing due date[1]. This gives businesses that made qualifying investments in earlier years, potentially back to March 2023 for the Clean Technology credit, a genuine opportunity to claim credits on past capital expenditures they may not have realized qualified.

Is This Actually For Your Business

These credits are frequently assumed to apply only to large energy or industrial projects, but the Clean Technology ITC specifically covers equipment many smaller and mid-sized businesses already purchase for their own operations, on-site solar, battery storage, and certain heat pump systems among them[5]. Before writing off any of these five credits as irrelevant, it is worth checking recent and planned capital expenditures against the specific eligible property definitions for each credit, since eligibility often turns on equipment type rather than company size.