The aim is to boost competitiveness and mitigate the environmental footprint of the food processing sector and findings will be released to enable other facilities to implement similar technologies.
Wastewater management is a top environmental issue facing the sector in Canada with costs of water treatment doubling every six years.
MP Bernard Trottier said: "This project has the potential to increase profitability and competitiveness of processors across the country by testing innovative approaches to water treatment."
The investment, awarded to Weston Foods Canada, will pilot an onsite bio-digester for wastewater treatment which will allow water to be reused or disposed of without being discharged to municipal sanitary sewers.