OTTAWA—The federal Tories instituted in the 2014 document a Capital Cost Allowance (CCA) system that provides accelerated amortization deductions for certain clean energy generation and energy conservation equipment acquired before 2020.
The budget expands eligibility for accelerated capital cost allowance for clean energy generation equipment to include water-current energy equipment and a broader range of equipment used to gasify eligible waste.
The budget item includes a variety of stationary equipment that generates energy by using renewable energy sources or fuels from waste, or conserves energy by using fuel more efficiently. It allows the cost of eligible assets to be deducted for tax purposes at a rate of 50 per cent per year on a declining-balance basis—faster than would be implied by the expected useful life of the assets.
The feds estimate these measures will reduce federal revenues by a small amount in 2014–15 and by $1 million in 2015–16.
The CCA applies to equipment acquired after February 10, 2014, that had not previously been used or acquired for use.