How to Apply for the Output-Based Pricing System Proceeds Fund

If your business operates in a carbon‑intensive sector, lowering emissions often means spending a lot upfront. The Output-Based Pricing System Proceeds Fund (OBPS Proceeds Fund) helps by returning federal carbon pricing proceeds to industrial projects that cut greenhouse gas emissions. This guide explains how to apply for the Output-Based Pricing System Proceeds Fund and what to expect at each step.

What Is the Output-Based Pricing System Proceeds Fund?

The Output-Based Pricing System Proceeds Fund is a federal funding program managed by Environment and Climate Change Canada (ECCC). It gives back some of the carbon pricing money collected under the federal Output-Based Pricing System (OBPS) to eligible facilities. The goal is to support clean technology and projects that lower emissions.

Key facts:

Jurisdiction: Federal
Program status: Open (intake-based)
Funding type: Non-repayable contribution
Purpose: Support projects that reduce greenhouse gas emissions and improve industrial energy efficiency

Who Is Eligible to Apply?

Eligibility depends on the federal OBPS.

You may qualify if:

Your facility is regulated under the federal Output-Based Pricing System
You operate in an industrial sector covered by OBPS carbon pricing
Your project is located in a province or territory where the federal OBPS applies

The fund is mainly for large industrial facilities. If your facility reports emissions under OBPS, you are probably eligible.

What Types of Projects Are Funded?

The OBPS Proceeds Fund supports capital projects that show clear emissions reductions.

Examples of eligible projects:

Switching to lower‑carbon energy sources
Improving industrial processes to reduce emissions
Upgrading energy efficiency for covered facilities
Installing clean or low‑emissions technologies

Projects must show direct greenhouse gas reductions. Routine upgrades or maintenance are not usually funded.

Funding Details

There is no set maximum funding amount for the OBPS Proceeds Fund. The amount you can receive depends on:

The total carbon pricing proceeds available
The size of your project and how much it reduces emissions
The intake’s criteria and assessment process

Funding is not guaranteed. You must apply and compete for available funds. The program provides non-repayable contributions, meaning you do not need to pay the money back as long as you follow the agreement.

Keep in mind:

Funding can sometimes be combined with other government programs, but stacking limits apply.
Most projects require matching funds or contributions from the applicant.
Government contributions are usually considered taxable income. Check with your accountant for details.

Step-by-Step: How to Apply for the Output-Based Pricing System Proceeds Fund

1. Watch for Intake Announcements

Applications are only accepted during specific intake periods, announced by ECCC. Deadlines and program streams can change each year.

2. Check Facility and Project Eligibility

Before you apply, make sure:

Your facility is regulated under the federal OBPS
Your project matches the fund’s emissions‑reduction goals

GrantHub’s eligibility matcher can help you quickly filter programs by jurisdiction and funding type.

3. Prepare Your Project Proposal

You will need to include:

Project scope and timeline
Expected greenhouse gas reductions
Total project costs and the amount you’re asking for
How your project goes beyond what is required by regulations

Strong applications clearly connect funding to measurable emissions outcomes.

4. Submit Your Application

Follow ECCC’s instructions for submitting your application, usually through a formal proposal package. Late or incomplete applications are not reviewed.

5. Undergo Technical and Financial Review

ECCC will check:

Technical feasibility
Impact on emissions reduction
Cost‑effectiveness
Alignment with OBPS goals

If your application is approved, you will sign a contribution agreement before receiving any funds.

Tips for a Strong Application

Be specific: Clearly explain how your project will reduce greenhouse gas emissions, and provide calculations or models to support your claims.
Show additionality: Highlight how your project goes beyond current regulations or business-as-usual activities.
Demonstrate readiness: Include a realistic timeline and budget. Projects that are ready to start soon after approval are often preferred.
Document everything: Attach all technical, financial, and environmental documents required. Missing information can delay or sink your application.
Stay informed: Monitor ECCC announcements for intake dates and program updates. GrantHub tracks hundreds of active grant programs across Canada, so you can compare options and deadlines.

Common Mistakes to Avoid

Applying without OBPS coverage
If your facility is not regulated under the federal OBPS, your application will be rejected.
Not providing enough documentation
Emissions calculations and technical details must be clear and well‑supported.
Thinking funding is guaranteed
The OBPS Proceeds Fund is competitive. Being eligible does not mean you will get funding.
Ignoring stacking limits
Funding can be combined with other programs, but total government support is usually capped.

Frequently Asked Questions

Q: Is OBPS Proceeds Fund funding repayable?
No. Funding is given as a non‑repayable contribution, based on the terms of the agreement.

Q: Can the OBPS Proceeds Fund be combined with other grants?
Yes, in most cases. But stacking rules apply, and total government funding cannot go over program limits.

Q: Are funded contributions taxable?
Usually, government contributions are taxable income. Ask your accountant about tax treatment.

Q: When are application deadlines?
There is no fixed deadline. Intakes are announced by ECCC and change each year.

Q: Does the fund support feasibility studies?
The fund mainly supports implementation projects. Feasibility studies are not usually funded.

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Next Steps

Applying for the Output-Based Pricing System Proceeds Fund starts with confirming your OBPS status and building a strong project case focused on emissions reduction. GrantHub tracks hundreds of active grant programs across Canada, including federal climate and clean technology funding. Comparing programs that fit your facility and project can help you find the best options and avoid missing deadlines.

How to Apply for the Output-Based Pricing System Proceeds Fund