The Canadian Ministry of Energy has announced up to CAD$500 million ($362.1m) in funding for its Smart Renewables and Electrification Pathways program (SREPs) Utility Support Stream.

The SREPs program received nearly CAD$2.9 billion ($2.1bn) in the Canadian government’s 2023 budget to support clean electricity infrastructure, including renewable energy technologies, energy storage, and grid modernization projects, to enhance the strength and reliability of its electricity grid.

A portion of this has now been allocated to the utility support stream, which is now open for expressions of interest from utilities, system operators, and industry groups aiming to modernize their infrastructure for better renewable energy integration or expand transmission and distribution networks.

Since 2021, SREPs have approved funding for 72 projects, deploying around 2,700MW of new renewable energy capacity.

The government has said more intake processes for other types of projects will be launched over the next few months.

Jonathan Wilkinson, Canada’s minister of energy and natural resources, commented on the announcement stating: “I am pleased to celebrate the ongoing successes of this program and to announce the opening of the Utility Support Stream as of today. This next step will allow us to support even more projects as we work with provinces, territories, Indigenous governments, and non-governmental partners toward an energy-efficient and money-saving clean grid.”

This is good news for the Canadian data center sector, projected to grow significantly over the remainder of the decade.

The growth in the market is expected to be driven by a surge in cloud service adoption in Canada, particularly with significant providers establishing cloud regions.

For example, Microsoft currently has two Canadian Azure regions; one in Toronto, Ontario, and one in Quebec City. Both opened in 2016. Currently, the Quebec region operates with only one availability zone.

Microsoft announced a significant expansion of its footprint in Canada in late 2022, with multiple new data centers planned in Quebec.

As a result, forecasts have projected that the market value of the data center sector in Canada will grow from $5.03 billion in 2023 to $9.04 billion in 2029, representing a compound annual growth rate of 10.2 percent.