What Can the Green Freight Program Fund? Understanding Eligible Expenses
The Green Freight Program (GFP) — Repower and Replace is a vital initiative aimed at reducing greenhouse gas emissions in Canada's freight industry. By providing financial support for fleet modernization, the program encourages freight companies to adopt energy-efficient technologies and practices. This article explores what the Green Freight Program can fund, helping you understand its scope and plan your projects effectively.
Program Funding Overview
The Green Freight Program offers non-repayable contributions through Contribution Agreements. Funding is designed to support three primary project types: repowering existing vehicles, purchasing low-carbon alternative fuel vehicles, and implementing logistical best practices. The aim is to facilitate the reduction of emissions from on-road freight vehicles by adopting advanced technologies and practices.
Funding Amounts & Rates
For each project, the maximum funding amount is $5,000,000 for vehicle repowering and purchasing low-carbon vehicles, and $1,000,000 for implementing logistical best practices. The program covers up to 50% of the total project costs, with applicants responsible for the remaining 50%. However, non-profit organizations and certain governmental or Indigenous groups may receive up to 75% funding.
Eligible Expenses
Projects to repower vehicles can include engine modifications to operate on lower-carbon fuel sources like natural gas or hydrogen. Purchasing expenses cover the incremental cost difference of low-carbon vehicles over conventional diesel trucks. For logistical best practices, eligible costs include software for route optimization and load management systems.
**Repowering Vehicles:**
Engine and drivetrain modifications
Dual-fuel systems
Installation of permanent modifications
**Purchasing Low-Carbon Vehicles:**
Incremental cost differences
Hydrogen or natural gas vehicles
Ownership and registration documentation
**Logistical Best Practices:**
Route optimization software
Cargo management systems
AI-based management systems
Ineligible Expenses
The program does not cover the purchase of zero-emission vehicles, as these are funded under a separate federal initiative. Additionally, leased vehicles are ineligible for purchase funding, and projects must not exceed 75% total government funding unless specified.
Expense Documentation Requirements
Applicants must provide detailed documentation, including invoices, receipts, and proof of vehicle ownership where applicable. For logistical best practices, a strategic implementation plan and proof of completed modifications are required.
Examples of Funded Projects
A logistics company implementing AI systems to optimize route efficiency
A transport firm repowering its fleet to use hydrogen fuel
A freight company investing in new natural gas trucks
Funding Disbursement & Claiming Process
Funding is typically disbursed based on project milestones. Claim submissions must include supporting documentation to verify expenses and project completion.
Stacking Rules
Total funding from all government levels is capped at 75% of project costs, except for specific applicants like Indigenous organizations, where it can reach 100%.
Real-World Budgeting Tips
Maximize funding by prioritizing eligible costs
Plan for initial out-of-pocket expenses before reimbursement
Consider long-term operational savings when investing in new technologies
Conclusion
The Green Freight Program plays a crucial role in supporting the transition to a more sustainable freight industry in Canada. By understanding what expenses are eligible, organizations can strategically plan their projects to maximize funding opportunities and contribute to emissions reductions. For more details on applying and specific eligibility, consult the program guidelines.
