Methane Reduction Deployment Program (MRDP)Up to $2M per parent company, and up to $1M per technology category

Status: this is the ERA door that is actually open

The Methane Reduction Deployment Program runs continuous intake through March 31, 2029, or until its funding is fully allocated. As of September 2026 it is the largest Emissions Reduction Alberta program accepting direct applications, and that is worth stating plainly because most of ERA is currently shut to new applicants. The Industrial Transformation Challenge is between annual rounds. SEMI is waitlist only across all four of its activity streams. The three Continuous Intake streams accept no direct application at all. If you are an Alberta oil and gas operator looking at ERA today, this is the program to look at.

The envelope is $41.8 million, blended from two governments: $22.4 million from Alberta's TIER fund and $19.4 million from Canada's Low Carbon Economy Fund. That structure matters more than it sounds, because a continuous-intake program against a fixed pot behaves differently from a competition. You are not being ranked against a field on a deadline. You are drawing against a finite envelope that depletes. The binding constraint is when you file.

ERA expanded this program twice in 2026, and both changes are easy to miss

If you or an adviser assessed MRDP before mid-2026 and set it aside, the assessment is out of date. Two rule changes materially widened it.

The caps moved on June 10, 2026. In ERA's words: "On June 10, 2026, ERA updated the parent company funding cap from $1 million to $2 million. We also introduced a new $1 million cap per technology category." The headline is the doubling, but the more consequential half is the new per-category cap. A parent company that wants the full $2 million now has to be deploying across at least two distinct technology categories. Going deep on a single category tops out at $1 million no matter how large the operation is.

Eligibility opened up as of August 2026. ERA states: "Previously, participation by TIER-regulated facilities was limited to aggregated facilities. Under the updated program rules as of August 2026, all regulated facilities are now eligible to receive MRDP funding for eligible methane reduction projects." Large Final Emitters are eligible too. This is the change most likely to have been missed, because the previous rule excluded precisely the larger regulated operators who have the most methane infrastructure to retrofit. Written summaries of this program published earlier in 2026, including an earlier version of our own SEMI page, carry the superseded rule.

The gates that disqualify projects

These are hard exclusions rather than scoring penalties, and most rejected projects fail on one of them rather than on technical merit.

• Retrofits only. Greenfield projects and new construction are ineligible. ERA funds upgrades, modifications and retrofits at existing facilities.
• You must beat the regulations, not meet them. Projects have to exceed what AER Directive 060 and Directive 087 already require. Activities undertaken solely to satisfy a regulatory obligation are ineligible. This is the subtlest gate and the one worth the most attention, because a great deal of methane work in Alberta right now is compliance-driven, and compliance-driven work does not qualify no matter how many tonnes it removes.
• Upstream and midstream only. Downstream applications, including municipal utilities and retail customers, are outside the program.
• Monitoring alone is not a project. Detection and monitoring technology is ineligible on its own and must be paired with a technology that actually reduces emissions, with the monitoring equipment remaining installed alongside the abatement equipment.
• LDAR is currently out. Leak detection and repair projects that exceed regulatory requirements are, as things stand, ineligible. This one catches people because it sounds like a natural fit.

What is eligible, and the category ceiling nobody mentions

ERA's eligible technology list runs to engine optimization, surface casing vent flow capture, tank and compression venting mitigation, pneumatics electrification and conversion, casing gas solutions, digital solutions, and other innovative methane reduction technologies. On vapour handling the line is specific: destruction through combustors, incinerators and catalytic oxidizers qualifies, while flare stacks used to combust captured gas do not.

One category carries a ceiling of its own. ERA has allocated a maximum of $15 million across the entire program to methane slip from engine operations. That category can therefore exhaust before the overall envelope does, which is a timing argument for any operator whose plan is engine-led.

The cost timing rules, which are unusually precise

Read these before you spend anything, because the sequence is where money is lost.

• Work cannot have started before January 1, 2025.
• Only costs incurred between the program launch date of November 12, 2025 and March 31, 2029 are eligible.
• Some pre-approval spending is allowed: FEED studies, flow rate measurements, gas composition analysis, and ordering equipment.
• Construction or installation cannot occur before your project is approved. Start early and you have disqualified the work you were trying to fund.
• All pre-approval spending is at your own risk. If the project is not approved, none of it is reimbursed.
• Projects must be complete within two years of executing the Participant Agreement, or by March 31, 2029, whichever comes first.

The practical reading is that you can do the engineering and even order long-lead equipment while your application is in, but the moment a wrench turns on installation before approval, that project's costs stop being fundable.

Stacking, and what happens to your carbon credits

Participants can stack MRDP with other funding programs provided total funding does not exceed 100% of project costs, and all funding sources have to be disclosed. That is a straightforward rule and more permissive than many programs.

The credits question is the one that matters for Alberta operators, and the answer is good. A project can generate and retain both Emission Performance Credits and Emission Offset Credits, and ERA states MRDP funding may be combined with EOC revenue where the project meets all applicable eligibility requirements. You are not choosing between the incentive and the credit revenue.

There is one trap inside that. The costs of generating EPCs and EOCs, meaning the quantification and verification work specific to those credits, are themselves ineligible expenses under MRDP. Budget for them, but keep them out of the funding request, because including them invites a reduction of the eligible cost base rather than an increase in the award.

How ERA decides when demand exceeds the envelope

ERA computes abatement cost as the funding requested divided by tonnes of CO2e reduced. Projects above approximately $500 per tonne of CO2e may be asked to demonstrate alignment with Canada's 2050 net-zero goal rather than being rejected outright. More importantly for a program drawing on a depleting pot: where multiple projects exceed the combined caps, ERA either pro-rates or funds the lowest abatement-cost project first.

That makes right-sizing the ask a strategy decision. A maximum request attached to modest reductions scores worse on the only quantitative measure ERA applies here than a smaller request attached to deep reductions. The instinct to ask for everything available is the wrong instinct in this program.

How to apply, and the packaging rules that force resubmissions

The application must be submitted by the participant, meaning the facility owner or operator. Contractors and service providers can assist and often do most of the technical work, but they cannot submit on your behalf, and service providers have to register separately as eligible contractors. Participants register on the program portal at portal.mrp-deployment.ca to reach the application.

Two packaging rules decide how many applications you file:

• Multiple technologies can be aggregated into a single application only if they belong to the same parent technology type. Different parent technologies require separate applications.
• Multiple sites can be combined in one application only if they use the same technology type and all sit within the same Alberta economic region.

A multi-site operator with a mixed retrofit programme is therefore filing several applications by design, not by mistake, and mapping that structure before you start is what keeps the per-category cap working in your favour rather than against you.

On confidentiality: all IP remains with the original owner, application details stay permanently confidential, and ERA reports outcome data such as emissions reductions and job creation on an aggregated basis.

Why applications fail

The project was compliance work in disguise. The single most common structural problem. If the retrofit is what Directive 060 or Directive 087 already obliges you to do, it is ineligible. The fundable version is the increment beyond the requirement, and defining that increment cleanly is the work.

Installation started before approval. Operators used to moving on their own schedule begin the retrofit while the paperwork is in progress and disqualify the costs.

A maximum ask on modest tonnes. Abatement cost is the measure ERA applies, and it is a ratio. The numerator is the part you control.

Monitoring submitted as the project. Detection technology has to ride alongside abatement technology, not stand in for it.

Wrong packaging. Bundling different parent technology types, or sites in different economic regions, into one application.

Assuming the old eligibility rules. The inverse failure, and the expensive one: regulated facilities and Large Final Emitters that never applied because the pre-August 2026 rules excluded them.

What to do now

MRDP is open, and unlike almost everything else at ERA there is no call to wait for. The sequence that works is short.

First, separate your methane work into compliance and beyond-compliance buckets before anything else. That single exercise determines whether you have a fundable project at all, and it is the step most operators skip.

Second, map your retrofit plan against ERA's technology categories, because the $1 million per-category cap alongside the $2 million parent company cap means the shape of your programme decides your ceiling. An operator working in one category is capped at half of what an operator working in two can access.

Third, get the baseline measurement done. ERA's quantification guides in the portal set out acceptable data sources, and pre- and post-project exhaust testing is itself an eligible expense where applicable. The tonnes are the denominator of the only ratio ERA scores on.

Fourth, do not start installing. Engineering, measurement, gas composition analysis and equipment ordering are all permitted before approval. Installation is not.

If MRDP does not fit, say because the work is compliance-driven or the facility is downstream, the honest answer is usually a different program rather than a reworded application. Our ERA program map covers all six routes and which ones accept direct applications, the Industrial Transformation Challenge is the annual competition for demonstration-stage technology at a much larger scale, and SEMI covers industrial efficiency retrofits on an entirely different basis. We will tell you plainly which one fits, including when the answer is none of them.