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Canada has committed to increasing defence spending by 5% under the new NATO investment pledge.
This means defence spending will reach $63 billion this year, rising to $150 billion annually by 2035, the largest investment shift in a generation.
Under this commitment, 3.5% will be allocated toward core military capabilities, the modernisation of equipment, and the strengthening of defence industries. 1.5% will fund “critical defence and security-related investments,” including new airports, ports, telecommunications systems, emergency response infrastructure, and other dual-use projects that support both military and civilian readiness.
This creates one of the most significant funding windows Canada has ever seen, and it arrives at a moment when cleantech companies are under pressure to commercialise faster, diversify markets, and find stable demand signals.
Canada’s cleantech sector hasn’t stalled, but investment has become more selective and competitive. Companies now need clearer pathways to revenue, long-term buyers, and strategic partners who can help them scale beyond pilot projects.
Defence spending creates that pathway. Military sites require low-carbon, resilient, and mission-critical systems, the same systems communities need for climate preparedness: microgrids, cold-climate wind and solar, EV and hydrogen transport, resilient telecom, advanced storage, low-emission heat, and remote-ready infrastructure.
When defence and civilian needs overlap, a single investment can create dual outcomes and generate the scale that cleantech suppliers need. Defence budgets also operate on predictable, multi-year cycles. That stability is valuable for companies that require long lead times to manufacture, deploy, or build new facilities.
Finally, national security now includes critical minerals, battery materials, and domestic clean energy supply chains. This aligns directly with Canada’s push to shore up its battery ecosystem, processing capacity, and climate technology industries. This is where defence and cleantech naturally meet, not as two separate sectors, but as one ecosystem with shared needs.
The Arctic is becoming a strategic priority, and most northern defence locations still rely on diesel. As operations expand, hydro, wind, solar with storage, and renewable microgrids can serve both local communities and military outposts, reducing logistics costs while improving regional resilience.
Linking isolated grids can support military bases, industrial hubs, and remote regions. These projects create scale for clean power and reduce vulnerability during extreme weather or geopolitical risk.
Regions with potential: Northern Québec, Nunavut, Alberta’s Industrial Heartland, Northern Manitoba, Labrador.
Canada is already home to early-stage carbon removal pilots. Defence agencies have a growing interest in carbon-negative infrastructure, base decarbonization, and climate-resilient operations.
Alberta’s Deep Sky Alpha and similar pilots can become testbeds for integrating military energy demand with carbon-removal technologies.
Many defence supply chains overlap with regions already deploying clean-energy projects:
Defence procurement can de-risk technologies in these areas and accelerate commercial deployment.
For cleantech companies, the first step is to treat defence procurement as an early demand signal. Registering with Defence Construction Canada and Public Services and Procurement Canada builds credibility and opens the door to dual-use infrastructure projects, from microgrids to resilient telecom systems.
Most major defence contracts flow through large prime contractors and established infrastructure firms. The fastest path into this market is by building partnerships and subcontracting arrangements with these primes.
Investors evaluating the sector increasingly pay attention to clean technology tax credits, federal innovation programs, Indigenous financing models, and export incentives designed for dual-use technologies.
These mechanisms reduce commercialisation risk by aligning private capital with defence spending cycles. Companies that understand these funding channels are better positioned to build long-term revenue foundations that defence-related projects can offer.
Defence-related work is promising, but it comes with real constraints.
Procurement cycles can be slow. Cleantech firms can move faster by subcontracting through primes or targeting pilot sites that allow rapid validation before full procurement.
Regulations are complex, especially when technologies cross civilian and defence standards. Bringing compliance and legal review in early helps prevent delays.
Geopolitical priorities can shift, so companies should diversify their operations across provinces and buyer types, rather than relying on one department or region.
ClimateDoor sits at the intersection of founders, investors, Indigenous partners, and global markets. We help cleantech companies turn strategic shifts, like this defence-driven investment surge, into real commercial traction.
We embed directly inside climate ventures to help them secure capital, land customers, and close partnerships. Our work includes outreach, positioning, and building materials that accelerate deal flow.
We connect founders with investors and strategic buyers who understand dual-use technologies and long deployment cycles.
We work with First Nations organisations and leaders to support land-based projects, energy resilience initiatives, and community-led development models that align with both climate and economic goals.
By sitting at the centre of these networks, ClimateDoor helps companies navigate complexity, build credibility, and accelerate commercial adoption, without needing to understand every layer of defence procurement or policy.
Canada’s defence investment surge is more than a budget announcement. It’s a structural shift that can scale solutions across the North, coasts, and industrial regions while strengthening domestic industries.
With the right mix of commercialisation support, Indigenous partnership, and market insight, this moment can accelerate cleantech deployment and position Canada as a global leader in climate-resilient infrastructure.
At ClimateDoor, we help founders and investors turn these windows into real outcomes, stronger pipelines, faster commercialisation, and global growth grounded in Canadian strengths.
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