Together for the Future

Letter to our stakeholders

Local governments understand the time for climate action is now. Across Canada, communities are experiencing the impacts of climate change as extreme weather events happen more frequently and with greater intensity. Canada’s average temperatures are rising at twice the global average, and three times as fast in the North. That’s why Canada has committed to reducing greenhouse gas (GHG) emissions to 40 percent below 2005 levels by 2030—and to reaching net-zero emissions by 2050. These are ambitious targets. FCM’s Green Municipal Fund will continue to play a critical role in bringing municipalities together to meet those targets, while also building resilient communities that thrive despite the impacts of climate change that have already occurred.

Our federal partners see this clear need and know they can rely on GMF to help deliver the tools municipalities need to both mitigate against, and adapt to, our changing climate. So, in November 2022, we welcomed the federal government’s investment through the Government of Canada Climate Adaptation Action Plan (GoCAAP). It entrusted $530 million in GMF to help municipalities in their efforts to support, accelerate and scale up community-based climate adaptation initiatives.

That’s a game-changing amount of funding—and we’re ready to put it to good use. But given the enormity of the challenges that lie ahead, it has become increasingly clear that the public purse can’t shoulder this burden alone. We need to find new sources of capital and leverage private sector investment to maintain momentum. Collaborative approaches, cooperation and communal spirit have always been at the heart of what we do. Now, only by coming together with new industries and pulling in the same direction will we be able to confront a global threat like climate change. Through our deep networks of local governments and municipal associations across Canada, GMF is uniquely positioned to bring people together from across all sectors so they can listen to, learn from, and inspire each other to better our communities.

We saw the results of that in February 2023 when, for the first time since 2018, we were able to gather again in person at our Sustainable Communities Conference (SCC). The conference was an inspiration, generating unprecedented levels of energy and excitement. Over the course of three days, close to 600 sustainability champions and changemakers exchanged ideas and gained new insights on how to tackle Canada’s most pressing sustainability issues. Events like SCC will be increasingly important as more communities and their partners look to come together to better understand and mitigate the impacts of floods, heatwaves, storms, and wildfires.

The 2022–2023 fiscal year marked the end of our previous five-year plan. We have made significant strides over the last five years, launching new initiatives and raising our funding levels to help more communities across Canada. We are now transitioning to a new Three-year Plan, which will transform the sector in entirely new ways.

It also marked a milestone for our operational excellence as the GMF Council was selected as a winner of Governance Professionals of Canada (GPC)’s 2022 Excellence in Governance awards. This achievement recognized our accomplishments in organizational governance, highlighting how efficient program administration is key to supporting local governments in the fight against climate change.

As we look ahead to the future, we want to be an even stronger partner, not just to municipalities, but also to all orders of government and the private sector. We are committed to finding ways to provide multi-solving benefits, foster a low-carbon future, and integrate community resilience throughout the full breadth of our programming.

Together with communities across the country, we will create something greater than the sum of our parts: a prosperous and sustainable future for all Canadians.

Communities are the central hubs for Canadians’ every day lives—the places we live, work, and gather. In these shared spaces, our actions can become bigger than ourselves. Cities, communities and municipalities have an essential role to play in climate action as economic centres, knowledge hubs, product and material consumers, and waste producers. But as much as we face similar challenges, we also have unique contexts, experiences and insights. In our differences, we find new perspectives and innovative approaches to face climate change head on.

For more than two decades, FCM’s Green Municipal Fund (GMF) has provided Canadian communities a globally unique and catalyzing mix of funding and capacity building support. GMF brings municipalities of all sizes across Canada together, connecting them with each other and to the resources they need to make a tangible, lasting impact on climate change. GMF leverages a $1.65 billion (and growing) investment from the Government of Canada to give municipalities the tools required to accelerate their transition to a resilient, net-zero, sustainable future—and help Canada reach its 2050 targets for net-zero emissions. Through our support, communities nationwide are adopting high-performing climate solutions and practices faster that are reducing pollution, improving energy efficiency, and revitalizing public infrastructure.

Our vision

GMF’s vision is that municipalities lead the way to achieving Canada’s climate change and sustainability targets. GMF aims to be the go-to resource and partner for municipalities in Canada that are accelerating their transformation to resilient net-zero communities. GMF drives municipal progress using solutions that address wider outcomes across sub-sectors. It is committed to the principles of anti-racism, equity, inclusion and Reconciliation between Indigenous and non-Indigenous peoples.

Our 10-year ultimate goals

Under our new 2023-2026 Three-year Plan, GMF has established ultimate goals as a set of guiding principles in our work to transform the sector over the next decade:

1. Municipalities can access innovative, technically, and economically viable solutions to their climate change mitigation, adaptation and sustainability challenges.
2. Municipalities have climate change mitigation and adaptation plans, and they and their partners have the capacity, knowledge, decision-making tools and support to scale-up the implementation of sustainable, resilient, net-zero solutions.
3. Municipalities can access the capital they need to invest in or fund sustainable, resilient, net-zero solutions.
4. GMF has the means, resources, and partner support to lead the transition to sustainable, resilient, net-zero Canadian communities.

Our key initiatives

Community Efficiency Financing (CEF)

This $300 million initiative helps municipalities reach environmental goals and deliver home-energy upgrade financing programs for low-rise residential properties. Taking projects from planning to implementation to scale, CEF brings jobs to communities and helps Canadians build better lives.

Low Carbon Cities Canada (LC3)

LC3 is a $183 million initiative that helps cities and communities accelerate equitable climate solutions across Canada. This partnership among FCM and seven urban centres focuses on taking proven low-carbon solutions to full-scale adoption.

Sustainable Affordable Housing (SAH)

This $300 million initiative offers support to local affordable housing providers to retrofit existing affordable housing units or construct energy-efficient new builds that emit fewer GHG emissions.

Partners for Climate Protection (PCP)

A network of more than 500 Canadian municipalities committed to taking action on climate change, PCP helps local governments reduce GHG emissions and make a difference in protecting our climate. It is a partnership between FCM and ICLEI—Local Governments for Sustainability (ICLEI Canada).

Circular Cities and Regions Initiative (CCRI)

CCRI is a collaborative initiative led by the Green Municipal Fund (GMF), the National Zero Waste Council, the Recycling Council of Alberta and RECYC-QUÉBEC, to provide local governments in Canada with the knowledge and tools needed to create local action plans to accelerate circular economy solutions.

Community Buildings Retrofit (CBR)

This $167 million initiative supports local governments and not-for-profits in retrofitting public buildings to improve energy performance, lower operating and maintenance costs, extend their life cycles and transition to cleaner energy solutions over time.

GMF core funding

Part of GMF since its inception, this initiative provides funding for plans, feasibility studies, pilot projects and capital projects centred on improving sustainability in five sectors: energy, transportation, waste, water and land use.

Municipal Net-Zero Action Research Partnership (N-ZAP)

N-ZAP is a research partnership jointly led by the University of Waterloo, the Green Municipal Fund (GMF) and ICLEI Canada, working with 11 other academic institutions, eight national organizations and 13 municipal partners. N-ZAP studies and creates improved methods for monitoring, measuring and reducing local GHG emissions, making it easier for municipalities to identify, develop and assess decarbonization initiatives and align local climate work with national commitments.

Making an impact since inception

Since its inception in 2000, GMF’s multi-solving approach has been to support local governments in pushing boundaries, delivering impact and improving the lives of Canadians.

As we look back on our achievements over the past two decades, GMF’s strong leadership role continues to be evident in bringing to life local initiatives that drive significant environmental, economic and social benefits in municipalities of all sizes nationwide.

2,100 sustainability projects approved since 2000

Environmental benefits

2.87 million tonnes of GHG emissions avoided

Economic benefits 

GMF supported projects that have generated $665M in national wages and salaries paid to households

Social benefits 

41 initiatives with specific social impact targets

Economic benefits

Through our loans and grants, we help municipalities get their net-zero and environmental sustainability projects off the ground—and get ahead financially in the process. That includes lowering the operating costs of municipal buildings and infrastructure, creating local jobs, and upgrading aging assets. For the data below, we used the Local Economic Development (LED) model to calculate the economic impact of our investments in plans, studies, pilots and capital projects.

Regional distribution of GMF funding

We tracked the regional distribution of loans and grants for sustainable community plans, feasibility studies, pilot projects and capital projects in 2022–2023.

GMF envisions a future in which Canadian municipalities lead the way in achieving Canada’s climate targets. That will require an acceleration of the transformation of the municipal sector—and more widespread adoption of the most promising solutions that will build resilient, sustainable, netzero communities across Canada. And to do that, both the public and private sectors must come together, consolidating efforts and resources to help local governments switch to net-zero practices faster, as well as advance innovative solutions to tackle environmental challenges.

With a focus on what lies ahead, with two decades of successes to build upon, we are now setting the stage for even bigger and bolder initiatives in the years to come.

We’re at the beginning of a new Three-year Plan for 2023 to 2026, which sets out new goals and priorities that will further increase the impact of our programs and initiatives. Specifically, it outlines four new strategic objectives that will guide our work over the next three years:

• Empower transformation through a complete set of programs: We will continue to scale innovation and advance new solutions from the idea phase through planning, feasibility assessment, piloting and validation, fullscale demonstration, and ultimately broad adoption/mobilization.
• Accelerate transformation by mobilizing capital through leverage: Achieving national and community climate change objectives requires collaboration with funders in the investment and financial sectors, as municipal needs far outstrip the resources available in public funds. That’s why we must accelerate investments from other actors.
• Advance numerous sustainability priorities with a multi-solving approach: We will use multi-solving principles in our project evaluation, selection and performance monitoring processes. We will address multiple problems in several sectors, using one policy or investment. This will include embedding and measuring anti-racism, equity, inclusion (AREI), and Reconciliation principles, as well as incentivizing and measuring biodiversity in all GMF capacity-building and funding.
• Build on success and create momentum: We will stimulate mechanisms across the broader municipal sector that accelerate the adoption of and demand for high-impact solutions. We will also use the strength of its brand to influence others to scale opportunities. As the market grows, we will hand over opportunities to partners that have the means and market to take solutions to broad adoption.

The new Three-year Plan was developed with an intentional focus on anti-racism, equity, and inclusion (AREI), leveraging input and ideas from internal staff members. FCM has collaborated with the Canadian Race Relations Foundation (CRRF) to advance AREI across municipalities in Canada. Moving forward, we are committed to listening, sharing and having critical conversations to ensure our own efforts and initiatives include everyone living in Canada.

We will be counted on to help the federal government deliver on the goals of the Government of Canada Climate Adaptation Action Plan by supporting, accelerating, and scaling up community-based climate adaptation initiatives. With $530 million in government funding, combined with our deep networks of municipalities and municipal associations across Canada, we will deliver adaptation-focused capacity building and grants to help local governments build climate resilient-infrastructure across the country. Our new funding offer will support more than 1,400 community-based climate adaption initiatives by 2031. To minimize the costs associated with climate impacts, we will:

• Support adaptation planning, capacity building and institutional mainstreaming
• Accelerate local-level implementation of adaptation solutions
• Develop financing adaptation projects to attract greater private sector participation

In addition, through our work in this area we will contribute to the foundational objectives and priorities of Canada’s National Adaptation Strategy:

• Everyone in Canada has equitable access to the tools and supports needed for them to prepare for, reduce and respond to climate change impacts.
• Sustained, sufficient and equitable public and private funding is in place to support adaptation to climate change.
• Local, regional and institutional capacity for adaptation contributes to self-sufficiency and participation in adaptation actions.
• We will continue to assess, develop and revise our current funding offers to make them as successful and accessible as possible. To this end, we are aiming to complete the process of redesigning our core funding offer to promote greater innovation and further increase our impact in the sector

At GMF, our vision for Canada’s future is one of collaboration and togetherness to accelerate the transformation of the municipal sector toward greater climate resiliency and net-zero emissions. To achieve a prosperous and sustainable future for all Canadians, we know that we are better together.