The Coal Community Transition Fund is open to municipalities and First Nations affected as Alberta phases out coal-fired electricity by 2030 to focus on renewables and natural gas.
Economic Development Minister Deron Bilous says the government wants to ensure these communities thrive through the transition.
The coal-mining town of Hanna, northeast of Calgary, has already received $450,000 through the program to work on economic diversification.
The application deadline for the coal transition fund is the end of November.
A provincial advisory panel is also expected to report back this fall on ways to create new jobs and retrain workers during the coal phase-out.