Extending Tax Incentives for Renewable and Alternative Energy

Budget 2003 broadens eligibility for capital cost allowances in Class 43.1 to include certain stationary fuel cell systems, equipment acquired for electricity generation using bio-oil (created from biomass found in forestry and plant residues), and certain types of equipment used in greenhouse operations, such as ground source heat pumps. The Government will continue to review the list of eligible investments under Class 43.1 to ensure appropriate tax treatment for renewable energy and energy conservation investments. In 2001, the Government announced consultations with industry to identify additional improvements to capital cost allowances in Class 43.1, which provides accelerated tax depreciation for certain renewable and alternative energy investments.

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