The Federation of Canadian Municipalities (FCM) is using its $2.4-billion Green Municipal Fund to advance climate resilience, create jobs and improve affordability across Canada, according to its 2025-26 annual report.

The Ottawa-based non-profit, which represents hundreds of municipalities, outlined its progress in the report, titled Building Canada's Sustainable Advantage, detailing how it deployed capital through the Green Municipal Fund (GMF) to support sustainable and resilient infrastructure across Canada.

The report aligns “with some of the advocacy work that FCM has been doing, particularly in relation to the infrastructure deficit that Canadian municipalities are facing,” Kitchener Mayor and GMF Council chair Berry Vrbanovic said in an interview with Sustainable Biz Canada.

From 2025 to 2026, the FCM neared full allocation of the $950 million in federal funds it received in 2019 for priorities like affordable housing and retrofits of homes and municipal buildings, Vrbanovic said.

Retrofit success stories

During the period covered by the report, the GMF supported six initiatives, including $37 million for climate adaptation solutions, $35 million for community-building retrofits and $51 million for the Sustainable Affordable Housing initiative.

Vrbanovic pointed to Better Homes Kingston as a success story. Nearly $11 million funded deep energy retrofits, including heat pumps and air sealing, in 356 homes.

It ultimately led to “lower energy costs for people, ” Vrbanovic said. Many of the residents would not have been able to afford the retrofits without Better Homes Kingston, he added.

He also highlighted a $1.8-million investment into the Willows Community Care Residence in O’Leary, P.E.I. Built to near net-zero standards, the 50-unit care facility prioritized affordability for seniors to reduce cost pressures for residents, Vrbanovic said.

Investing in resilience and economic gains

A key element to the FCM’s work is extracting economic gains by investing in sustainability. As communities face growing risks from extreme weather intensified by climate change, proactive action on resilience can mitigate some of the damage. A 2022 report by the Canadian Climate Institute found every $1 spent on adaptation measures can return $13 to $15 in direct and indirect benefits.

The FCM launched the Local Leadership for Climate Adaptation (LLCA) initiative in 2024 in response, which provides funding and skills development so municipalities can build resilience to climate impacts. Under LLCA, the Residential Resilience Financing (RRF) offer was launched, which mixes energy-saving home retrofits with climate resilience upgrades.

“When we can undertake efforts that help manage (climate adaptation) and ultimately lead to savings for municipalities, it leads to better outcomes, and ultimately leaves dollars on the table for municipalities to invest in other priorities,” Vrbanovic said.

Another effort that combines energy and financial savings is Community Efficiency Financing (CEF). The FCM provides financing to make energy-saving retrofits more affordable and accessible for homeowners. More than 16,000 retrofits have been completed through the CEF, resulting in average annual household energy-cost savings of about 30 per cent and more than 39,000 tonnes of greenhouse gas emissions reductions. The program has also supported more than 3,000 jobs and contributed $293 million to Canada's GDP.

Since 2000, the FCM has helped avoid over three million tonnes of greenhouse gas emissions and led to $9.4 million in energy cost savings for municipal buildings in their first year of operation. In 2025-26 alone, it approved $229 million in funding and 170 projects.

Looking ahead, the FCM plans to maintain the GMF’s focus on climate mitigation and adaptation, with continued support for home retrofits, existing-building upgrades and affordable housing, Vrbanovic said.