Submission by QUEST Canada to the House of Commons Standing Committee on Finance: Pre-Budget Consultations in Advance of Budget 2026

Recommendations

Recommendation 1: That the Government of Canada invest $40 million over four years to establish a Community Energy Readiness and Implementation Fund to help communities and project partners align earlier around local energy infrastructure opportunities before projects reach formal approval and delivery processes. This initial investment would support readiness work in approximately 100 communities or regional project clusters, while also funding shared tools, training, Indigenous and regional partnerships, and a distributed national implementation network.

Recommendation 2: That the Government of Canada build on existing Indigenous consultation, impact assessment, and public participation requirements by requiring federally supported major, place-based electricity and energy infrastructure projects to include a community readiness and benefit-alignment plan. This plan should demonstrate how affected communities were engaged before key project decisions were effectively fixed, including decisions about need, location, route, technology, ownership, financing, benefits, and mitigation; what decisions remained open during engagement; how local risks and benefits were considered; and how community priorities shaped project development. 

Recommendation 3: That, as part of the proposed $40 million Community Energy Readiness and Implementation Fund, the Government of Canada support a distributed national community energy implementation network to standardize tools, share leading practices, train local actors, and reduce duplication across jurisdictions.

Introduction

Canada is entering a period of major energy infrastructure investment. The federal government has made clear that electricity is central to Canada’s economic security, industrial competitiveness, affordability, emissions reduction, and long-term resilience. The objective of significantly expanding Canada’s electricity system by 2050 is appropriate to the scale of the challenge.

However, Canada’s energy infrastructure ambitions will not be achieved through capital investment, federal-provincial-territorial alignment, workforce development, and domestic supply chain investments alone. They will also require the local readiness, trusted relationships, and practical implementation pathways that allow projects to move.

Budget 2026 should therefore invest not only in generation, transmission, storage, efficiency, clean technology, workforce, supply chains, and grid modernization, but also in the community readiness infrastructure required to make those investments successful.

This should not be treated as municipal funding alone. It should support the broader ecosystem that helps communities, Indigenous governments, utilities, developers, and local institutions move from concern to informed participation and implementation readiness.

Canada does not just need more energy infrastructure. It needs the governance, relationships, and local capacity to build that infrastructure well.

The Missing Implementation Layer

Much of Canada’s electricity infrastructure is planned, regulated, and delivered at the provincial and territorial level. Utilities, system operators, regulators, developers, Indigenous governments, municipalities, and local communities all hold different pieces of the implementation challenge. The federal government does not control the whole system, nor should it.

But that is exactly why the federal role matters.

When no single actor owns the whole implementation challenge, the interfaces become critical: between federal ambition and provincial jurisdiction; between utilities and communities; between Indigenous governments and infrastructure proponents; between regional economic development and energy system planning; and between national priorities and local realities.

Today, those interfaces are too often weak, inconsistent, underfunded, or activated too late.

Federal programs have made important investments in clean electricity, smart renewables, energy efficiency, Indigenous ownership, clean economy tax credits, and infrastructure financing. These tools are important. But they are often designed around capital deployment, technology adoption, or project finance. They do not consistently fund the upstream work required to build community understanding, decision readiness, local benefit alignment, and implementation confidence.

Communities have long been on the receiving end of major energy infrastructure decisions. What is changing is the scale, pace, and cumulative impact of what is now being contemplated: transmission lines, generation projects, storage facilities, district energy systems, thermal energy networks, industrial decarbonization projects, electrification initiatives, and efficiency programs.

In many cases, communities are expected to respond to infrastructure plans after key decisions about need, location, timing, technology, or ownership have already begun to take shape.

Communities are not opposed to energy infrastructure. But they need to understand what is being proposed, what problem it solves, what alternatives were considered, what risks and benefits exist, who benefits, what trade-offs are involved, and how local priorities can shape outcomes.

Too often, communities are engaged after major decisions have already narrowed. Routes are identified, financial models are developed, technology choices are advanced, and timelines are compressed before local actors have had a meaningful opportunity to influence the project. This creates a familiar pattern: decide, design, announce, consult, defend.

That model is not fast. It invites conflict and moves it to a later, more expensive stage.

Weak engagement can result in regulatory delay, political resistance, legal challenge, project redesign, community distrust, and reputational damage. By contrast, early and well-supported engagement can improve project design, identify local benefits, surface risks earlier, and build the alignment required for durable implementation.

Early community engagement is not a communications exercise. It is part of implementation. It is part of risk management. And it is part of good governance.

Why Budget 2026 Should Act

The federal government has a clear interest in ensuring that major energy investments proceed in ways that are affordable, reliable, competitive, and trusted. That interest applies whether federal support is provided through direct programming, tax measures, the Canada Infrastructure Bank, Indigenous loan guarantees, regional development agencies, major project coordination, or other investment tools.

If Budget 2026 invests heavily in energy infrastructure without also investing in community readiness, Canada risks underfunding the very conditions that allow projects to proceed.

Community readiness is not an added step after decisions are made. It is a risk-reduction measure that helps projects move with greater confidence, fewer delays, and stronger local value.

A community readiness approach would help local actors ask the right questions, understand trade-offs, identify opportunities, and participate constructively before projects become polarized. It would also help developers, utilities, governments, and regulators understand local priorities earlier, when projects can still be improved.

This matters for large transmission and generation projects. It also matters for smaller and distributed solutions: district energy, thermal energy networks, local generation, storage, demand-side solutions, building retrofits, fleet electrification, and resilience investments. These solutions often depend on local coordination, municipal planning, utility alignment, community trust, and practical implementation capacity.

Budget 2026 should treat community readiness as enabling infrastructure for Canada’s energy buildout.

Recommendation 1: Establish a Community Energy Readiness and Implementation Fund

QUEST Canada recommends that the Government of Canada invest $40 million over four years to establish a Community Energy Readiness and Implementation Fund.

This is proposed as an initial, scalable investment rather than the full cost of community readiness across Canada. It reflects an estimated average of approximately $200,000 per community or regional project cluster for early engagement, decision support, pathway mapping, local opportunity analysis, and implementation readiness.

The proposed investment would support direct community and regional readiness work, as well as the shared tools, training, partnerships, administration, and coordination needed to make that work consistent, repeatable, and scalable.

Relative to the scale of Canada’s expected electricity and energy infrastructure investment, this is a modest risk-reduction investment aimed at improving project readiness, reducing duplication, strengthening local alignment, and avoiding costly delays.

The fund should support early-stage, pre-development work that helps communities and project partners move from interest, concern, or uncertainty to informed participation and implementation readiness. Eligible activities should include:

• local and regional energy readiness assessments;
• community decision-support and pathway-mapping processes;
• early benefit, risk, trade-off, and opportunity analysis;
• municipal-utility-Indigenous-regional alignment;
• Indigenous partnership readiness and broader community engagement design;
• local energy opportunity mapping, including thermal energy, distributed energy, storage, demand-side solutions, and resilience opportunities;
• pre-feasibility and project initiation work for community-scale energy projects;
• local implementation roadmaps, procurement readiness, and governance support; and
• standardized tools and templates that can be adapted and reused across communities.

The fund should be open to the range of actors needed to support community readiness. Eligible applicants should include municipalities, Indigenous governments and organizations, regional partnerships, community-facing charities and non-profits, local economic development organizations, and multi-partner consortia. Utilities, developers, and technical partners should be eligible as project partners, with appropriate cost-sharing, where their participation strengthens local readiness and implementation.

Applicants should not be required to have a municipality as the sole lead organization. Many energy infrastructure opportunities require regional, Indigenous-led, utility-community, or third-party intermediary models. Program design should reflect how implementation actually happens: across jurisdictions, institutions, and sectors.

It should also avoid forcing every community to reinvent the wheel. Canada needs repeatable frameworks and shared learning that can be tailored to the local context.

Recommendation 2: Require Community Readiness and Benefit-Alignment Plans for Federally Supported Projects

Where federal dollars, tax measures, financing, guarantees, approvals, or major project coordination support electricity and energy infrastructure, the Government of Canada should build on existing Indigenous consultation, impact assessment, and public participation requirements by requiring proponents to demonstrate how community readiness and benefit alignment have been addressed.

This should not become another compliance checklist. The goal should be better project development.

A community readiness and benefit-alignment plan should demonstrate:

• which communities may be affected and how they were identified;
• how Indigenous rights, interests, governance, and partnership opportunities are being addressed;
• how communities were engaged before key decisions about need, location, route, technology, ownership, financing, benefits, and mitigation were effectively fixed;
• what decisions remained open during engagement and what information was provided to support informed participation;
• how local risks, benefits, alternatives, and trade-offs were considered;
• how community priorities influenced project design, benefits, ownership, procurement, workforce, affordability, or resilience outcomes; and
• how concerns will be addressed over the life of the project, not only during approvals.

This would help ensure that the federal government’s emphasis on speed is matched by an equally clear expectation for early alignment, practical implementation readiness, and durable trust.

Recommendation 3: Support a Distributed National Community Energy Implementation Network

Canada also needs a stronger community readiness ecosystem. This includes Indigenous-led organizations, municipal and regional partners, utilities, developers, technical experts, local economic development actors, and independent community-facing charities and non-profits that help translate national and provincial energy objectives into locally understood and locally supported implementation pathways.

QUEST Canada recommends that Budget 2026 support a distributed national community energy implementation network, as part of the proposed Community Energy Readiness and Implementation Fund, to:

• share leading practices in early community engagement and implementation readiness;
• develop common tools for local decision-making, benefit alignment, and project initiation;
• train community-facing practitioners;
• connect communities with technical, financial, and governance expertise;
• identify recurring barriers across jurisdictions; and
• support federal, provincial, territorial, Indigenous, municipal, utility, and developer alignment.

This network should not duplicate existing capital programs or become another stand-alone funding stream. Its purpose should be to strengthen the connective tissue between programs, projects, communities, and implementation partners.

Conclusion

Canada’s energy infrastructure ambitions are necessary. They are also complex, jurisdictionally fragmented, and deeply local in their impacts.

Budget 2026 has an opportunity to strengthen the missing implementation layer between national ambition and local delivery. By investing in community readiness, requiring better benefit alignment for federally supported projects, and supporting a distributed implementation network, the Government of Canada can help energy projects move faster, with less conflict, stronger local value, and greater public confidence.

The greatest risk to Canada’s energy infrastructure agenda is not only technical feasibility, labour availability, supply chains, or capital. It is the gap between the infrastructure Canada needs and the trust, alignment, and local readiness required to deliver it.

Funding community readiness is how Canada builds faster.

Submission to the House of Commons Standing Committee on Finance: Pre-Budget Consultations in Advance of Budget 2026

Submitted by: QUEST Canada
Date: May 22, 2026