Applicant’s Guide – Zero-Emission Trucking Program

From: Transport Canada

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Overview

The transportation of goods by medium and heavy-duty vehicles is a significant source of greenhouse gas emissions (GHG) in Canada. Meeting Canada's emissions reduction targets requires increased adoption of zero-emissions technologies in the trucking sector. To this end, the Government of Canada launched the Zero Emission Trucking Program (ZETP) as part of a suite of initiatives announced in the March 2022 Emissions Reduction Plan. The ZETP will contribute to the safe and secure deployment of medium- and heavy-duty zero-emission vehicles (MHZEV) on Canadian roads and associated charging and refuelling infrastructure.

Important notice

The ZETP call for proposals is currently open. We are accepting applications until October 03, 2023.

In this guide

Program Objective

The objective of the Program is to provide contribution funding to projects that accelerate readiness for medium and heavy-duty zero-emission freight-haul and vocational vehicles (for example, class 8 tractors, straight trucks, walk in vans, refuse, etc.) across the provinces and territories (PT). To help promote a clean transportation system by reducing air pollutants and/or greenhouse gas emissions from transportation, projects that advance, align, and modernize MHZEV and associated charging and refueling infrastructure policy, curricula, guidelines, codes, standards, and regulations will be considered for funding.

Available Funding

The Program will provide funding over a period of up to four fiscal years. All activities must be completed by March 31, 2027.

The Program will reimburse Recipients up to 75% of eligible expenditures incurred towards the project. The maximum contribution per project is $1,000,000.

Eligibility Assessment Criteria

Eligible Recipients

  • Provinces and Territories, including Provincial- and Territorially-owned transportation entities
  • Municipalities , including Municipally-owned entities, and local and regional governments
  • Indigenous governmentsFootnote 1, tribal councils and other forms of regional government, nationally or regionally representative Indigenous organizations, and/or Indigenous development corporations
  • Public Sector OrganizationsFootnote 2
  • Canada Airport, Port (subject to section 25 of the Canada Marine Act), and Standard Development Organizations (SDO)

Eligible Activities

Contributions will be provided to fund the following eligible activities, so long as they contribute to the Program's objective:

  • Development of guidelines, codes, standards, and regulations, including research to inform their development.
  • Undertake research and associated knowledge-sharing activities related to the evaluation, testing, or measurement of technologies that contribute to reducing or measuring emissions, or improving emission intensity.
  • The design, development, testing, demonstration, deployment and/or installation of technologies and equipment, including associated training.
  • Supporting research and knowledge-sharing activities, and improved solutions that contribute to reducing or measuring emissions, or improving emission intensity.

Examples of eligible activities include the following:

  • Hire dedicated personnel to develop, modernize, and align codes, standards and regulations for zero-emission medium and heavy-duty trucking.
  • Consult and engage specialists (e.g., engineering, IT, policy, etc.) to inform the development, modernization, and alignment of infrastructure codes, standards and regulations relating to zero-emission trucking operations.
  • Participate in interprovincial and/or international fora to support the development, modernization, and alignment of codes, standards and regulations relating to zero-emission trucking operations (e.g., road and infrastructure signage, charging/refuelling infrastructure; weights and dimensions regulations, etc.).
  • Support participation in zero-emission trucking project governance and federal-provincial-territorial (FPT) negotiations through the Council of Ministers and Deputy Ministers.
  • Undertake data collection, analysis and/or targeted studies to support the modernization of provincial and territorial jurisdiction's zero-emission heavy-duty vehicle oversight regimes.
  • Initiate or collaborate on zero-emission trucking tests, trials, and/or deployments to inform code, standard and regulatory development.
  • Develop and/or update codes, standards and regulations required to enable the safe and efficient introduction of emerging zero-emission trucking solutions.
  • Develop and/or update curricula and training regimes for zero-emission heavy-duty vehicles (e.g., first responders, roadside inspections, maintenance personnel, etc.).
  • Deliver courses and training to implicated individuals (e.g., first responders, roadside inspections, maintenance personnel, etc.).

Proof of funding

Applicants are required to demonstrate that they have secured sufficient funding for the project by identifying any and all sources of funds in their application.

Eligible Expenditures

Eligible expenditures include the following, as necessary to execute eligible activities as defined in Section 3:

  • Staff salaries and benefits (such as wages; employer's portion of: Employment Insurance, Canada Pension Plan/Quebec Pension Plan, and disability insurance; private insurance; and benefits paid to staff working on the project);
  • Professional fees for contracted services (e.g., accounting, audit, communications services, consultation);
  • Translation costs;
  • Expenditures related to the preparation, construction, improvement, installation, rehabilitation or retrofit of assets (e.g., to vessels, vehicles, locomotives, aircraft, refueling/charging infrastructure, and facilities);
  • Purchase, lease and/or installation of assets, technology, equipment and supplies;
  • Purchase of low carbon intensity fuels (e.g., hydrogen);
  • Licenses and permits;
  • Rents, leases, leasehold improvements and insurance;
  • Expenditures for Indigenous consultations, specifically project-related consultation activities pursuant to the Crown's legal duty to consult, which may include expenditures associated with meetings, travel costs, expenditures related to the preparation of consultation materials, professional fees, communication and translation costs, and administrative expenditures (travel expenditures to be in accordance with the Travel Directive of the National Joint Council);
  • Administrative expenditures (including general administration expenditures, rent, insurance, office equipment rental, and membership fees), not to exceed 15% of total project costs;
  • Travel expenditures (including the cost of accommodations, vehicle rental and kilometric rates, bus, train, airplane or taxi fares, allowances for meals and incidentals). Travel and per diem expenses cannot be more than the rates and allowances determined in the Travel Directive of the National Joint Council, available at the following link: https://www.njc-cnm.gc.ca/directive/d10/en ;
  • Other expenditures not included in the categories above, as identified in the application for funding, and approved by the Minister or delegated authority, to achieve the objectives and results of the program.

Note: Transport Canada will not contribute more than fifteen percent (15%) of its total contribution to a project for administrative expenses.

The above eligible expenses may, in certain circumstances, include cash equivalent expenses to in-kind contributions. These expenditures may take the following form:

  • Assets, services or goods consumed by the recipient for which costs are incurred and for which no cash is exchanged.
  • Donations of goods, services or assets to the Recipient for which no costs are incurred and no money is exchanged.

Although donations are eligible cash equivalent expenditures that may form part of the total project cost, they will not be eligible for reimbursement because the recipient incurs no cost to obtain the good, service or asset. However, donations may form part of the recipient's share of the total eligible expenses for a project.

Ineligible Expenditures

Certain expenditures are not eligible for funding and therefore will not be considered in the calculation of the total eligible expenditures of the project, including:

  • Expenditures for provincial sales tax and Goods and Services Tax, or the Harmonized Sales Tax, where applicable, for which the recipient is eligible for a rebate, and any other costs eligible for rebates;
  • The cost of purchasing land and/or buildings, including associated real estate and other fees;
  • Financing charges and interest payments on loans;
  • Expenditures which have been reimbursed under other federal statutes or programs;
  • Costs incurred before the project approval date or after the final claim date.

Eligible Project Durations and Approvals

  • The Projects may begin to incur costs on the date of approval of the project by the Minister and must be completed by March 31, 2027.
  • Projects may be single-year or multi-year.
  • Projects may begin to incur costs upon approval; however, no reimbursements will be provided until a funding agreement is signed.

Merit Selection Criteria

Applicants must provide the following information to support this assessment (Refer to Section 10).

Relevance of the Project

How closely the proposed project aligns with the ZETP objectives. Projects must promote a clean transportation system by reducing air pollutants and/or greenhouse gas emissions from transportation by developing, aligning, and modernizing curricula, guidelines, codes, standards and regulations to enable and accelerate the safe deployment of zero-emission medium and heavy-duty trucking in Canada, as well as their associated charging and refueling infrastructure (See Section 1).

Project Selection Criteria

Projects will be selected based on how they address the following criteria:

  • The project leverages participation from other public and private entities;
  • Demonstrated commitment on the part of the recipient to the project;
  • The technology, knowledge, practice can be used by others;
  • The project includes a plan to broadly disseminate research findings to industry and academia;
  • The projects will provide other associated benefits, including:
    • Improved transportation system safety;
    • Development of highly qualified personnel.

Quality of the Project Plan
The degree to which the planned activities, schedule, budget, results, roles and responsibilities are clear, realistic and consistent with the proposed project's objectives. The proposed project will be assessed against the following criteria:

  • Clearly stated goals, objectives and outcomes; and
  • A realizable project plan, concrete deliverables, budget and timelines.
  • A detailed risk analysis and a mitigation strategy; and,
  • An experienced and qualified project manager with their and their staff’s roles and responsibilities in the project clearly established.

Value for Money
How well the proposal sets out the efficient use of resources and plans for producing outputs in an affordable manner.

Notifications and Service Standards

After the project proposal has been assessed, the applicant will be informed if they have been selected for funding or not. Transport Canada reserves the right to accept or reject any project proposal.
In an effort to continually improve service and conduct a transparent process, the following service standards have been established:

  • Our goal is to provide applicants with written acknowledgement of receipt of their application and/or project proposal within 10 business days of the application deadline date.
  • Our goal is to issue payments within 20 business days following the notification to the recipient that the requirements outlined in the funding agreement have been fulfilled.

Note: If the Program cannot meet the above standards, we will advise recipients in a timely manner.

Funding Agreements

A funding agreement signed by both the recipient and Transport Canada is required to receive ZETP funding. The following sections highlight some of the key areas of this legal document.

Risk-based Funding Agreement

A risk assessment of the project will be conducted prior to signing a funding agreement. This ensures that funding agreement requirements correspond to the project's risk levels, and the recipient's capacity to deliver results. The project risk assessment will determine:

  • How often the recipient must report project progress;
  • Financial documentation the recipient must submit with payment claims;
  • How often site visits will be made with and/or contact the recipient; and
  • Audit requirements (all funding agreements indicate our right to audit).

The risk assessment will be based on, but not limited to, the information provided in the applicant's project proposal.

Project Scope and Agreement

The applicant's project proposal will form the foundation of the project scope, mandatory legal documentation, clauses, terms and conditions, and payment structure that are included in the funding agreement. Once the funding agreement is signed, no change to the scope of the project (including budget, structure, timelines, etc.) is possible without prior written agreement between the recipient and Transport Canada.

Reporting Requirements

Reporting requirements will be established in the funding agreement and may include: providing financial claims, list of invoices, progress reports, annual reports and a final report, among other elements.

Progress Reports

Recipients must submit written progress reports biannually, or other frequency, as identified in the funding agreement. Progress reports will identify the progress achieved during the reporting period and accompany financial claims. Periodic meetings may be organized with Transport Canada throughout the duration of the agreement period. These will be confirmed at the agreement negotiation stage.

Annual Reports

In the case of multi-year projects, the recipient will be required to produce an annual report. This report will include, but may not be limited to, the following:

  • A detailed description of the project's progress and major achievements during the year, and an update on how the project is moving forward and how it relates to initial objectives and final results;
  • Updated data and reporting on performance indicators indicated in funding agreement compared to the start of the project;
    • The recipient will ensure that appropriate data collection processes are in place to enable the capture and reporting of performance indicators used to measure the achievement of the project's outcomes;
  • Annual reporting on the recipient's eligible expenditures incurred and based on the breakdown of the eligible expenditures claimed, in accordance with the funding agreement budget;
  • Summary of project communications activities during the reporting period, if applicable; and
  • Issues, areas of concern or risk factors that may affect completion, the schedule or the budget of the project as per original plans, and also proposed mitigation strategies to correct any issues.

Final Report

When the project is complete, recipients will be required to submit a final report. The final report should be the overall roll-up of the information required in the annual reports and verification of all project activities, costs and outcomes. Under the funding agreement, we must receive the final report before we will pay the final expense claim.

Along with the information required in the final report, recipients may also be asked to include an overall assessment and analysis of the objectives met, outcomes achieved and lessons learned.

Financial Claims

Recipients can only submit claims for reimbursement of expenditures incurred that are identified in the funding agreement. Recipients will be provided templates that reflect the eligible expenses as indicated in the funding agreement. Recipients will also be required to submit a list of invoices with each claim.

Official Languages

All recipients must respect the Official Languages Act when delivering a project funded under ZETP. Linguistic requirements may apply to projects depending on their scope (national, regional or local), or on the specificity of the regions and targeted audiences of projects. Transport Canada will work with successful recipients to determine how this applies to their projects.

How to Apply

The following sections detail the documents required to submit a proposal.

The application package must include the following:

  1. Title of project and executive summary
  2. Applicant's information
    • Legal name of the applicant organization
    • Name and position of the primary contact(s) for applicant organization
    • Contact information such as mailing address, office phone numbers, email/Internet address, etc.
  3. Organizational profile
    • Type of organization in accordance with the listing identified from the Section 3.1
    • Organizational structure and governance
    • Mandate of the organization
    • Organizational activities
  4. Project management personnel
    • Designated project manager
    • Project manager's qualifications and experience
  5. Declarations
    • Conflict of interest questionnaire
    • Declaration by applicant organization attesting to the accuracy of the project proposal and the commitment of the organization to carry out the project signed by an authorized agent
  6. Project description
    • Project objectives and goals
    • Location of project delivery
    • Proposed start and completion dates
    • Major activities for the project
    • Project work plan
    • Partners and contributions
    • Risk assessment and mitigation measures
  7. Communication plan, if applicable
  8. Annexes
    • Evidence to validate the Project Manager's credentials, e.g., résumé
    • Letters of financial support (if applicable)
    • Legal Documents of the Organization
    • Completed Project budget and cashflow template - detailed project costs, by fiscal year, including all cash and in-kind contributions from the public or private sector, clearly broken down by organization.

Important Note: The Project proposal template and Budget and cash flow template are attached to the invitational email. Please use these templates for your project proposal.

Submitting an Application

Application Deadline

Applications must be received by October 03, 2023.

Note: All applications and project proposals must be signed, complete and accurate using the templates provided. All applicants must provide legal documentation confirming their organization is a legal entity (for example, using letters of patents, certificates of incorporation or other such legal documents). Missing or incomplete information will slow the processing of the application and may result in its rejection.

An application package must be submitted by email.

An electronic application package must be in MS Word, MS Excel or PDF format. Applications and inquiries concerning the application process must be sent to: ZETProgram-ProgrammeCZE@tc.gc.ca.

Transport Canada will confirm receipt of application packages.

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For assistance

Our service hours are Monday to Friday from 8:00 a.m. to 6:00 p.m. (local time) and closed on statutory holidays.

By email: ZETProgram-ProgrammeCZE@tc.gc.ca

By mail:
Transport Canada (AHSB)
330, rue Sparks
Ottawa (Ontario)
K1A 0N5

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