This version is effective April 1, 2007 to August 31, 2008.

This Guidance Document should be read in conjunction with the ecoENERGY for Renewable Heat program Terms and Conditions document and the application forms, both of which are available at http://www.ecoaction.gc.ca/ecoenergy-ecoenergie/heat-chauffage/index-eng.cfm.

This document is important as reference material when applying under this program, however, only the signed contribution agreement between Natural Resources Canada and the applicant will form the legal basis of the rights and obligations of the parties.

The terms and conditions for the program and the application forms may change from time to time. Applicants are advised to consult with program administrators or online at http://www.ecoaction.gc.ca to ensure that they are using the most recent versions.

An applicant is entitled to payment under the ecoENERGY for Renewable Heat program if the program has entered into a contract, known as a "contribution agreement", with the applicant. The Program will enter into a contribution agreement if it is satisfied that its requirements are met by the applicant and that funds allocated annually for the program by the government are available. Contribution agreements will include provisions for cancellation or reduction of transfer payments in the event that departmental funding levels change. Note that projects are funded on a first‑come, first-served basis, and after all program funds have been committed to other projects, further projects cannot be funded.

All projects that have signed contribution agreements for eligible systems will be posted on Natural Resources Canada's (NRCan's) ecoENERGY for Renewable Heat program Web site. The information posted will include the name of the recipient, type of system installed, location of installation, projected system output, contribution amount and the expected or actual date of commissioning of the system.

Interpretation of Terms

In this document and the related Terms and Conditions document:

“the program” means the ecoENERGY for Renewable Heat program of Natural Resources Canada

“the applicant” means the business or institutional entity applying to the program for an incentive

“the recipient” means the successful applicant that has received or will receive an incentive from the program

 “an active solar heating system” means one that uses a fan or a pump to circulate air or liquid through a solar collector, as opposed to a “passive” solar system (e.g. a Trombe wall, a south-facing window or a skylight), which has no motorized mechanical parts

“commissioned” means inspected (by either a Professional Engineer, a Certified Engineering Technologist or a CanSIA Certified Solar System Installer with a current Canadian certification) and found to be fully operational and installed in accordance with the current code (CAN/CSA F-383)

“a remote community” means a community not connected to the North American electrical grid or piped natural gas network which is a permanent or long-term (at least 5 years) settlement with at least 10 permanent residences.

“an installation” means one installed solar heating system

“revenues” means all consideration received by the recipient as a result of the project, less returns actually credited and any applicable sales taxes

Line 1a.    Only those expenses indicated in Section 4 of the terms and conditions are eligible for an incentive. The incentive is increased to 40 percent of eligible project costs in remote locations to reflect the higher cost of installations in these areas.

Line 1b.    There is no limit on the total project cost, but the maximum incentive paid will be $80,000 per installation.

Line 1c.    A single business entity may apply for incentives on more than one project. However, over the life of the program, an entity cannot receive incentives totalling more than $2 million. A project consists of the solar thermal installation at one location. Funding will not be provided for more than one installation servicing a single heating load. Separate solar water and solar air projects can be funded at the same location.

Line 1d.    Applicants are encouraged to obtain funding from other federal, provincial and municipal government programs that may provide support for projects funded by this program. If the total funding from all levels of government exceeds 50 percent of the total eligible project costs, the contribution from this program will be reduced to bring the total government contribution to not more than 50 percent of total eligible project costs.

Line 1e.    Because municipalities and not-for-profit organizations obtain the majority of their funds from governments, total project support from all levels of government may be up to 100 percent of eligible project costs. If the total government funding exceeds 100 percent of the total eligible project costs, the contribution from this program will be reduced to bring the total government contribution to not more than 100 percent of total eligible project costs.

Eligibility

Line 2a.    A business that proposes to install a solar thermal system on a building that it rents, may be an eligible recipient, if the business demonstrates permission for the installation from the building owner. A business that proposes to install and retain ownership of a solar thermal system for the purpose of selling the heat produced by the system or leasing the system, must demonstrate that it has a contract for at least 10 years for that purpose.

Line 2b.    Businesses must demonstrate that they are registered to do business in Canada by providing their business registration number.

Line 2c.    Although hospitals, schools and other entities can be eligible for the incentive under provincial jurisdiction, the provincial departments themselves are not eligible under the program.

Line 2d.    Under the Financial Administration Act, federal organizations eligible under this program are Crown corporations listed in Section 83 and Part I of Schedule III, a division or branch of the public service set out in Schedule 1.1, or a departmental corporation named in Schedule II.

Qualifying Systems

Line 3b.    Multi-unit residential buildings are the only residential buildings potentially eligible for the incentive.

Line 3c. Solar heating systems installed must use only collectors accepted by the program.

Note to suppliers and manufacturers
To be accepted by the Program, solar collectors must meet the CAN/CSA-F378-87 (R1992) standard or equivalent.  Suppliers or manufacturers who want to have their collectors accepted by the Program must demonstrate that their collectors meet the standard or equivalent. Testing reports from a recognized testing agency (e.g. NSTF, FSEC, SPF) must be submitted for collector acceptance.

Line 3d.    NRCan aims to encourage cost-effective projects. To be eligible for an incentive, solar thermal projects must not exceed the following maximum cost per square metre of collector area:

Solar Air Systems:

• unglazed transpired air  – $550/m²
• unglazed back-pass air  – $400/m²

Solar Water Systems:

• unglazed water              – $300/m²
• glazed flat-plate water    – $1200/m²
• evacuated tube water     – $1600/m²

Applications for projects with costs in excess of the above thresholds will be subject to both an administrative and a full technical review before the preparation of a contribution agreement. In the case of a favourable technical review, such higher-cost projects will only be eligible for the incentive if all costs can be shown to be related to specific, reasonable system design or installation requirements.

Eligible Expenses

Important:  Payment will be made only for expenses incurred after the contribution agreement is signed, with the exception of expenses for feasibility, permits, design and simulations, which may be incurred before the contribution agreement is signed.

Line 4a.    Feasibility and design work directly related to the solar project (not to exceed 10% of eligible project costs) will be accepted as eligible costs only if the project is accepted for program funding and is completed and successfully commissioned.

Simulation costs will be considered eligible only for work done using one of the following simulation programs:

• RETScreen
• SWIFT
• WATSUN (not yet available on-line)
• TRNSYS
• T*Sol (except in the case of unglazed collectors)
• Enerpool
• Polysun

Line 4b.    Only costs associated with qualifying new (as opposed to used, recycled or refurbished) equipment and its installation are eligible.

Line 4f.    Commissioning of the system must be done by a Professional Engineer, a Certified Engineering Technologist or a CanSIA-Certified Solar System Installer with current Canadian certification.

Non-Eligible Expenses

Line 5a.    GST, PST and HST must be removed from the total project costs.

Line 5b.    Although used, recycled and refurbished components and their installation costs are not eligible, the program will consider eligible the purchase and installation costs of qualifying new equipment installed during the refurbishment or upgrading of an existing solar heating system.

Environmental Assessment

Line 6a.    The Canadian Environmental Assessment Act requires that a solar heating project undergo an environmental assessment if the solar installation:

• increases the footprint or height of the building by more than 10 percent
• increases the footprint of the building by 25 m² or more
• involves any construction within 30 m of a body of water
• involves the likely release of a polluting substance into a body of water

The applicant must provide information on the application form to enable program officers to determine whether an environmental assessment is required. The cost of an environmental assessment is the responsibility of the applicant and is not an eligible expense under the program. Very few solar installations are likely to require an environmental assessment.

Applications will be approved for funding only if program administrators determine that the proposed project is not likely to cause significant adverse environmental effects.

Application Process

Line 7a.    The process of a successful application can be summarized as follows:

• The applicant obtains, fills out and submits the incentive application form.
• The program conducts an administrative review of the application.
• The applicant undertakes feasibility and other project development work.
• The program accepts the application and prepares a contribution agreement.
• NRCan and the applicant sign a contribution agreement, after which, the applicant may begin incurring eligible project implementation expenses. The applicant has nine months following contribution agreement signing to complete and commission the project.
• The project is completed, commissioned and the applicant submits the required paperwork.
• NRCan pays the incentive to the applicant.

The applicant will complete an incentive application form as indicated in the Terms and Conditions. If application assistance is required, the applicant may contact the ecoENERGY for Renewable Heat program by email (ecoenergyrhp@nrcan.gc.ca).

The applicant will be informed upon receipt of their application of its receipt and as to whether additional information, an immediate technical review, or an environmental assessment is required. If an application requires any of the above, a delay in the issuing of a contribution agreement will ensue.

NB: Applications that do not meet prescribed cost-per-square-metre thresholds will undergo an immediate full technical review.

Upon receipt of a fully completed application from an applicant who is found to be an eligible recipient and whose project meets the prescribed program eligibility criteria, NRCan will undertake an administrative review of the application and will aim to enter into a contribution agreement within 10 business days of receipt of the application.

After a contribution agreement is signed by the applicant and NRCan, and not beforehand, the contribution agreement is considered “in force” and the applicant may begin to incur eligible project implementation costs. Project development costs, as outlined in Section 4a above, may be incurred prior to the signing of a contribution agreement.

Provided the contribution amount stated in the signed contribution agreement is not exceeded, the funds allocated for any budget task may be adjusted by the Applicant up to and including a maximum of twenty percent (20%), provided that the Applicant submits a revised budget upon invoicing.

After the project is complete, it is commissioned by either a Professional Engineer, a Certified Engineering Technologist, or a CanSIA-Certified Solar System Installer. At the same point, a commissioning report, reflecting Schedule C of the contribution agreement, and a payment request and attestation form are submitted to NRCan by the applicant.

After all the conditions of the contribution agreement are met, NRCan will pay its contribution to the applicant.

For-profit recipients affected by the repayment provisions of the contribution agreement must submit annual reports to NRCan as indicated in “Repayment Provisions” below.

Payment

After a contribution agreement is signed by both parties, NRCan will make a payment only upon receipt of all required supporting material, as described below. With respect to eligible federal organizations, the interdepartmental transfer mechanism shall be used in lieu of contribution agreements.

Line 8a.    It is required that payment information be provided to NRCan within 30 days of the completion of the project.

Line 8 a.i   The system must be commissioned by a Professional Engineer, a Certified Engineering Technologist or a CanSIA Certified Solar System Installer within the term specified in the contribution agreement.

A commissioning report must describe the steps taken during the commissioning of the system, certify that the system was installed as described in Schedules A and B of the contribution agreement, was installed in accordance with professional practices and safety requirements and is operational.

Line 8b.    Copies of invoices must be dated within the period indicated in the contribution agreement to be considered eligible expenses.

Line 8c.    The attestation form will confirm that all claimed eligible expenses have been paid and will disclose all sources and amounts of government project funding received to date at the time of system commissioning. The form provided by the program must be used and must be signed by the applicant.

Repayment Provisions

Line 9a.    A recipient of a contribution who also receives revenues from the rental, lease or the sale of heat from equipment for which an incentive was received, must:

• report annually to NRCan all resulting gross revenues received, for 5 years following the completion of the project;
• repay to NRCan any revenues in excess of 150 percent of the total project cost, up to the total amount of the NRCan contribution to the project
• make such payments within 90 days of the submission of the annual reports

Note that, as indicated in the contribution agreement, the applicant must keep proper accounts and records of the revenues and expenditures incurred and paid, including all original invoices, receipts and vouchers relating to the solar installation, for a period of three years from the completion of the agreement.