Mr. Speaker, energy sectors are largely the jurisdiction of the provinces and territories. Those levels of government would be responsible for providing subsidies for diesel-based electricity. As a result, Crown-Indigenous Relations and Northern Affairs Canada, or CIRNAC, does not subsidize diesel-based electricity generation in northern communities, nor does the Government of Canada provide direct subsidies to diesel-based electricity generation.
Canada’s major transfer payment programs to the territories, including the territorial formula financing program, may indirectly subsidize diesel-based electricity. The territorial formula financing provides territorial governments with funding to support public services, in recognition of the higher cost of providing programs and services in the north. How the funding is used is largely at the discretion of the territories.
While the Government of Canada does not provide direct on-going subsidies for diesel-based electricity, the $400-million Arctic energy fund, announced in budget 2017 and delivered by Infrastructure Canada, provided funding for communities to upgrade existing fossil fuel based energy systems or to supplement or replace these systems with renewable energy options, thus contributing to improved reliability, efficiency as well as pollution reduction.
The Government of Canada also supports northern and remote Indigenous communities with the transition from diesel onto cleaner, renewable and reliable energy. The $300 million Indigenous and Remote Communities Clean Energy Hub helps communities access federal funding and expertise to support their clean energy priorities.