Thank you.
I'm a chemical engineer, not an economist, but I had to learn about the tax code probably more than most people.
Specifically, classes 43.1 and 43.2, under NRCan's rules, are where they describe accelerated depreciation of accelerated capital cost allowance. Solar, thermal, biomass, wave energy, hydro, and wind are all in there, but the funny thing is that so is geothermal power. Geothermal power is in there as an eligible renewable energy, but like solar you have to start first with heat, and then you use a power plant to make it into power. In some kind of quirky way in the tax code geothermal heat was never enshrined as a renewable energy. As an example, if we could drill some wells, and all of that exploration for the heat is not favoured with accelerated depreciation, then the minute we start to make power, that equipment is favoured.
The moment of truth for entrepreneurs is raising money to do the exploration. I don't want to overplay the risk. There's risk, and then there's costly risk. Our dollar has to compete with other people who have their risk addressed. It's that whole exploration part that is not accounted for. Furthermore, in classes 43.1 and 43.2, for geothermal power, we don't have access to transmission costs, but other renewables do. Even wave producers, who go further back than geothermal in Canada, have access to things like getting transmission included in their capital cost allowance. It seems like geothermal is somewhat there, but not fully there, and the part that's missing is early stage. Of course, you have to have early stage to get to late stage, and by encouraging late stage and not early stage it has completely put a roadblock up for finance. Even when we're comparing apples to apples, and where we are included, we're not given parity with all the different capital cost eligible expenses as the other renewables.