The Canadian renewable and conservation expenses
("CRCE") regime was introduced in March of 1996 to make
clean energy projects (e.g. wind, solar, hydro) more attractive to
industry. Under this regime, expenses incurred for specified
development work in the clean energy sector are fully deductible
when incurred and may be carried forward indefinitely. The creation
of this regime has not only been beneficial to the clean energy
sector, as upfront costs can be very significant, but also puts the
sector on a level playing field with the tax treatment of the
non-renewable resource sector (i.e. Canadian exploration
expenses).
More recently, the Minister of Finance (Canada) released the
Fall Economic Statement on November 21, 2018 which
included favourable measures for investments in clean energy
equipment. Specifically, the full cost of clean energy
equipment in Classes 43.1 and 43.2 acquired after November 20, 2018
and available for use before 2024 may be immediately
