Cleantech innovation is an essential pathway to building faster, cheaper, and more energy-efficient housing—Budget 2025 ties this commitment into its industrial strategy.

The housing crisis is top of mind for Canadians. With high prices and even higher demand, it is no surprise it plays a huge role in Mark Carney’s 2025 budget. The government promises to invest $25 billion over 5 years into the housing sector and makes one thing abundantly clear: solving the housing crisis requires industrial scale cleantech deployment. 

November 22 is National Housing Day—an opportunity to look closely at Budget 2025 and analyze the key wins and massive opportunities for cleantech innovation in the country’s housing sector. There are numerous areas where cleantech will have an significant impact on the government reaching its housing goals. These primarily relate to supply, industry, regulations, affordability, and upskilling. Foresight’s work as the lead Scaling Hub for CMHC’s Housing Supply Challenge: Level-Up, in addition to our cleantech programs and services, has already positioned us at the forefront of this national scaling effort.

To understand how the federal government plans to execute this industrial-scale transformation, we must examine the specific mechanisms designed to accelerate both the demand for and the supply of modern, sustainable housing solutions.

"Canada can significantly increase its supply of affordable homes and become a global leader in housing innovation, including in construction techniques, sustainable materials, and leading-edge manufacturing."

The newly formed Build Canada Homes (BCH) will receive an initial investment of $13 billion over five years and includes leveraging modern and sustainable building methods like factory-built, modular, and mass timber construction, as well as utilizing low-carbon materials and efficient design. One of BCH’s top priorities is to “deploy capital, secure demand, and harness innovative housing technologies to build faster and more sustainably, 365 days a year.”

The budget also introduces a powerful tax incentive to rapidly scale up the production of homes and support cleantech. This measure grants businesses a 100% deduction in the first year for capital investments in factories dedicated to manufacturing and processing (M&P). 

This could be a game-changer for companies producing modular housing components and high-efficiency cleantech systems like heat pumps, smart windows, and building integrated PV or other distributed energy systems. This reduces the risk for innovators, allowing them to claim 100% of the factory investment cost as a tax deduction in the first year, drastically improving immediate cash flow and reducing the net financial exposure associated with large-scale capital projects. 

In addition, this incentivizes the rapid construction and operationalization of M&P facilities (for modular housing and cleantech components), allowing innovators to scale production and deliver products faster than competitors under traditional, multi-year depreciation schedules. This increased, efficient production is intended to reduce overall supply costs, acting as a direct pressure point to drive down housing prices while simultaneously promoting the adoption of sustainable technologies that cut long-term utility bills for homeowners.

Foresight has accelerated numerous companies dedicated to solving the housing crisis with innovative, market-ready solutions for affordable, sustainable, and efficient homes. This includes Rohe Homes, a Vancouver company revolutionizing home building with their clever, foldable, and modular designs.

"Build Canada Homes will work with First Nations, Inuit, and Métis leadership to determine how this mission-driven organisation [(BCH)] and the catalysation of this new modern housing industry can best contribute to First Nations, Inuit, and Métis identified needs and priorities."

For Indigenous communities, particularly those in northern and remote regions, the budget’s housing investments—totalling $2.8 billion—are designed to yield much more than just units. The outcomes will include enhanced energy independence, cost savings, and community resilience.

This funding transforms remote construction into a crucial national innovation test bed. Cleantech enables the integration of decentralized solutions—such as solar, wind, and community micro-grids—directly into new housing. This dramatically lowers high-emission diesel consumption and dependence on vulnerable supply chains, leading to lower utility bills, the freeing up of community capital, and increased energy security through localized power generation. The investment ensures that solutions tested here for challenging remote environments can be scaled and adapted for resilient, sustainable construction across Canada.

Foresight recently served as the lead Scaling Hub for Round 5 of CMHC’s Housing Supply Challenge, which focused on unlocking system-level change to tackle one of the biggest barriers to housing delivery: entrenched inefficiencies. Foresight’s role was to accelerate the companies and systems Canada needs to build housing faster, smarter, and affordably. 

The Challenge showcased numerous innovative companies supporting the development of housing across Canada, including in rural, remote, and Indigenous communities, with many integrating sustainable solutions. Two participating innovators, One Bowl Housing Corporation and Rural Impact Canada, have launched the podcast "Can I Stay? Rural, Remote, and Ready to Build" with Foresight’s support. This series provides firsthand accounts and expert perspectives on the housing shortages faced in rural, remote, and Indigenous communities.

"Canada must build an enormous amount of infrastructure at speeds and scale not seen in generations…building clean power grids for a sustainable future, expanding our ports to accelerate our trade, and unlocking the full potential of Canada’s critical minerals."

The Climate Toolkit for Housing and Infrastructure, a new initiative under Housing, Infrastructure and Communities Canada (HICC), was announced, with the goal of helping communities across Canada build resilient and low-carbon housing and infrastructure. $17.2 billion will be invested in new infrastructure to support housing development, including water, wastewater, roads, and public transportation. 

Cleantech will play a critical role in this initiative through technologies like smart water management, grid modernization, and low-carbon utilities such as district energy systems. The Climate Toolkit also offers “a suite of tools and services to help understand risks, calculate greenhouse gas (GHG) emissions, develop projects that are resilient to climate change, and inform actions to reduce emissions.”

Foresight is uniquely positioned to support the Climate Toolkit for Housing and Infrastructure. Our programs cover a wide range of sectors, including water tech, transportation, and the built environment, accelerating the very technologies—like smart water management and low-carbon utilities—that communities need to meet the Toolkit’s goals: reducing GHG emissions, building climate resilience, and integrating the necessary infrastructure improvements to support sustainable community growth.

"The Government of Canada will catalyse a more productive homebuilding industry with fewer barriers and less red tape so that builders can build homes at the scale we need."

Budget 2025 highlights that increasing Canada’s housing supply is not just an economic issue—it also requires eliminating the regulatory barriers that developers and construction companies face. The government hopes to streamline these efforts and introduce more standardization across the country. This commitment moves beyond traditional financial subsidies, signalling that the government's priority is to address two deep-rooted challenges facing the construction sector: low productivity and high systemic friction. 

This includes incentivizing the adoption of modern construction methods (e.g., modular or pre-fabricated housing) and new technologies to boost output per worker and removing expensive multi-year delays caused by complex permitting and zoning regulations, allowing Canada to reach housing supply targets faster and more affordably. This ensures that innovative, high-performance building materials and technologies can be approved and deployed quickly, without being stalled by outdated codes or bureaucratic hurdles. Canada cannot hit its housing targets unless it accelerates permitting and modernizes building codes.

Foresight’s Cleantech Adoption Services support this mandate to eliminate regulatory barriers and red tape by de-risking and validating market-ready sustainable housing solutions. This involves providing the necessary performance data for regulators and driving the standardization required for modern construction methods.

"Budget 2025 proposes to provide $75 million over three years, starting in 2026-27, to Employment and Social Development Canada to expand the Union Training and Innovation Program, which supports union-based apprenticeship training in the Red Seals trades."

The new budget supports building a skilled cleantech workforce by directly investing in specialized union-led training programs. Canada currently faces a cleantech skills gap. To keep up with industries worldwide by adopting sustainable methods, we need our workforce to also keep up. 

The Red Seal Program ensures that any electrician, plumber, or refrigeration mechanic trained in one province meets a nationally recognized standard. This is vital for cleantech, where specialized knowledge (like installing a modern heat pump or EV charger) must be consistent across the country. Hitting housing targets will depend on the availability of a skilled workforce trained in modern construction and sustainable housing solutions. Cleantech skilled trades unlock faster installs, lower costs, and higher performing buildings. 

Initiatives like Foresight’s custom Upskilling Programs are a solution to closing this skills gap and removing this bottleneck, offering tailored training to employers in multiple industries. Through modules built around real industry needs, organizations can equip their employees with the latest skills in innovation, sustainability, and advanced technologies.