Canada Greener Homes Initiative – February 2024 Update
The Government of Canada has invested over $15 billion in programs to help Canadians upgrade their homes and in turn, save up to hundreds of dollars per year on their energy bills. These programs include, but not are not limited to, NRCan’s Canada Greener Homes Grant Program, CMHC’s Canada Greener Homes Loan Program and NRCan’s Oil to Heat Pump Affordability Program. An update on these programs can be found below.
The Canada Greener Homes Grant Program – as of January 22, 2024
Through the Greener Homes Grant program, the Government of Canada has been providing Canadian homeowners with grants of up to $5,000 since December 1, 2020 to improve the energy efficiency of their homes and reduce their energy bills. The Government of Canada has also been providing up to $600 in grants to help Canadians cover the cost of their pre and post home improvement evaluations under the program.
In just three years, over half a million Canadians have applied for a Canada Greener Homes Grant, with the highest number of applicants coming from Ontario (around 227,500), Quebec (around 85,600), Alberta (70,600), British Columbia (55,400) and New Brunswick (20,800) respectively.
As of the end of January, out of the over half a million households who have applied for a Greener Homes Grant to-date, over 165,000 households have received grants, upgraded their homes, and are now positioned to save an average of $386 per year on their home energy bills. Given that, on average, 1.2 tonnes/year of pollution is reduced for every home that receives a Greener Homes Grant, this has meant a reduction of 194,700 tonnes/year of pollution under the program to-date, the equivalent of taking almost 60,000 cars off the road. Of the nearly 165,000 households that have received a Canada Greener Homes Grant to-date, the percentage by province is: 34.2% Ontario, 20.8% Quebec, 12.3% British Columbia, 10.6% Alberta, and 8.7% Nova Scotia.
Since program launch, the Canada Greener Homes Grant has supported over 75,000 jobs in the retrofit economy, ranging from jobs in construction, made-in-Canada manufacturing, home energy auditing, sales, clean technology and financial services. The program has propelled a transformational and lasting shift in consumer preferences for more energy efficient homes and a robust made-in-Canada green buildings supply chain. As Canadians’ demand for home upgrades continues to increase, so too will the demand for the jobs and skilled workforce to enable them.
Over the last three years, thousands of Greener Homes Grants have been issued for windows and doors, air sealing, insulation and solar panel installations, however, demand for heat pumps has significantly outperformed all other retrofits. Of the over 165,000 households that have received a Greener Homes Grant to-date, over 82,000 households (50%) have purchased and installed a heat pump. Over the next few years, we expect to help 250,000 Canadians purchase and install a heat pump through the Greener Homes Grant program alone.
Over the coming months and years, hundreds of thousands of Canada Greener Homes Grant applications will continue to be processed and approved by the Government of Canada and Greener Homes Grant co-delivery partners in Ontario (Enbridge), Quebec (Rénoclimat) and Nova Scotia (Efficiency One). Hundreds of thousands of post-retrofit evaluations by certified energy auditors – a requirement under the program to authorize grant payments to homeowners – will also be needed and will continue to take place. In total, it is expected that by 2027, the Greener Homes Grant will have helped over half a million Canadians upgrade their homes, save an average of $386/year on their home energy bills and reduced the equivalent amount of emissions as taking nearly 185,000 cars off the road.
The higher-than-expected uptake of heat pumps under the Greener Homes Grant program and the relatively high cost of heat pumps (compared to other retrofits) has meant that the average grant payment size to Canadians under the Greener Homes Grant program (over $4,200) has been significantly higher than initially expected. As hundreds of thousands of applications continue to be submitted and processed, it is expected that this number will continue to remain higher than NRCan’s original projections.
The speed at which Canadians are applying and getting approved for Greener Homes Grants has also been significantly faster than NRCan’s initial expectations and has skyrocketed since the fall. By way of example, at the end of November 2023, the average number of Canadians who were issued a Greener Homes Grant per day was 830 ($3.5 million worth of grants per day). As of mid-January 2024, that number has increased to 1,200 per day ($5.1 million worth of grants per day).
The success of the Canada Greener Homes Grant to-date has made it clear that Canadians are eager to make their homes more energy efficient, including by purchasing and installing a heat pump. The Greener Homes Grant program, however, has been a program of general application, meaning that Canadians regardless of income have been able to apply for and receive a grant. The Government of Canada recognizes that even with a $5,600 Greener Homes Grant and other available supports, there are still many Canadians who aren’t in a financial position to benefit from the program and take on the remaining upfront cost associated with an energy efficiency upgrade. The estimated average cost for installation of eligible energy efficiency retrofit measures and/or heat pump equipment is $13,500 per eligible household.
Building on the enormous success of the Canada Greener Homes Grant program and in response to the evolving needs of Canadians, the Government of Canada is currently adjusting the Greener Homes program. Under the next, new phase of the Canada Greener Homes Initiative, which will be a key part of the forthcoming Canada Green Buildings Strategy, the Government of Canada intends to offer support targeted to Canadian households with low-to-median incomes, so that cost-savings are available to those who need them most.
As the Government of Canada finalizes the next phase of the Canada Greener Homes Initiative, it is still accepting new applications under the Canada Greener Homes Grant program for up to two weeks. Homeowners who have already applied to the program can expect that their applications will be processed and that they remain eligible for program support. The Government of Canada will share more details on the next phase of the Canada Greener Homes Initiative in the coming weeks and encourages homeowners who are looking to make their homes more energy efficient to explore existing programs, such as the Canada Greener Homes Loan and the Oil to Heat Pump Affordability Program.
We went from $3,000 to about $1,000 a year to heat the house and that includes AC in Summer which we did not have before. It was cleaner, more efficient, less drafty and made the house more comfortable all around. I highly recommend to anyone who is thinking about it to make the switch [to a heat pump] and I am very grateful to the Federal and provincial governments for the grant, without which we probably would not have been able to make the change. - Gary, British Columbia Homeowner, Canada Greener Homes Grant Participant
NRCan’s Canada Greener Homes Grant and CMHC’s Canada Greener Homes Loan Program by the numbers – January 22, 2024
The Canada Greener Homes Loan Program – as of January 22, 2024
The Canada Greener Homes Loan program is administered through CMHC and provides interest free loans of up to $40,000, repayable over 10 years, to Canadians for the same kinds of retrofits eligible under the Greener Homes Grant program. This low-cost financing option for home retrofits results in energy cost savings for Canadians that can then be used to help repay the loan over a 10-year time-period. In order to qualify for the Greener Homes Loan program, a mandatory pre and post retrofit evaluation by an energy auditor has and will continue to be a requirement under the program.
From when the first phase of the program first launched in June 2022 until January 28, 2024, the Canadian Mortgage and Housing Corporation (CMHC) has received nearly 62,000 Greener Homes Loan applications across Canada. Of these applications, over 53,000 Canadians have been approved for a Greener Homes Loan, valued at approximately $24,000 per loan on average. Of the total number of loan agreements that have been signed to-date, 45% of loans have included federal funding for a heat pump. After heat pumps, the most popular retrofits supported by the Loan program have been windows and solar panels. The Loan program has seen the most amount of uptake in Ontario, followed by Alberta, Quebec and British Columbia and is expected to continue to provide support to Canadians for years to come.
The Oil-to-Heat-Pump Affordability Program – January 22, 2024
Making the shift from an oil furnace to an electric heat pump can help Canadians save between $1,500 to $4,700 per year on their home energy bills. The Government of Canada has been helping Canadians make this switch through a range of programs, including through NRCan’s Oil to Heat Pump Affordability (OHPA) program.
In November 2022, the Government of Canada announced the OHPA program. Since early 2023, through OHPA, the Government of Canada has been providing an upfront, advance payment of up to $10,000 to low-to-median income Canadian households that use home heating oil to help them cover the cost of purchasing and installing an eligible heat pump system.
On October 26, 2023, the Government of Canada announced enhancements to the OHPA program to help make the switch from heating oil to electric heat pumps even easier and more affordable for more low-to-median income households. Under the enhanced OHPA program, strengthened OHPA grants of up to $15,000 from the Government of Canada are available to households in jurisdictions that are stepping up with provincial/territorial funding to further help lower-income, oil-heated households make the switch to a heat pump where the federal government has a co-delivery arrangement in place that includes provincial and territorial contributions.
With combined support from the Government of Canada and provinces and territories, and the average cost of an oil to heat pump conversion, including oil tank removal and other expenses, amounting to $18,400, the goal is to be able to cover the cost of the average heat pump to low-to-median income households in any jurisdiction with whom the government has a co-delivery agreement. In addition to these strengthened heat pump grants, successful applicants also receive an upfront, one-time payment of $250 from the federal government.
The federal government currently has co-delivery arrangements in place with Newfoundland and Labrador, Nova Scotia and Prince Edward Island and has been providing strengthened OHPA grants of up to $22,000 to households in Newfoundland and Labrador since mid-December 2023. The Government of Canada looks forward to announcing the launch of the Strengthened OHPA program in Nova Scotia and PEI in the coming weeks.
The Government of Canada is also actively working with the governments of British Columbia, Manitoba, Ontario, Yukon and New Brunswick to deliver the strengthened OHPA program to Canadians in these jurisdictions. The Government of Canada is keen and remains ready to develop and finalize strengthened OHPA co-delivery agreements with all provinces and territories that wish to bring these benefits to their residents. The OHPA program has received 9,400 applications to date. This includes up to 1,566 households in Newfoundland and Labrador, 1,334 households in PEI, 4,962 households in Nova Scotia, 346 households in British Columbia, 438 households in Quebec and 460 households in Ontario. As many as 1,565 heat pumps have been installed through the support of the Oil to Heat Pump Affordability Program alone to-date and the Government of Canada expects to help around 50,000 Canadians purchase and install a heat pump through the OHPA program over the coming years in total.
Given that, on average, 2.8 tonnes/year of pollution will be reduced for every home that receives an OHPA grant, this means a reduction of 4,380 tonnes/year of pollution under the program to-date, the equivalent of taking almost 1,342 cars off the road so far. By the end of the program, we expect this to reach the equivalent of 42,500 cars off the road.
Taken together, these programs have and will continue to help thousands of Canadians upgrade their homes and save hundreds of dollars on their energy bills every year. They have propelled a transformational shift in consumer preferences for more energy efficient homes and contributed to a robust made-in-Canada green building supply chain. As demand for home energy renovations continues to increase, so too will the skilled workforce and jobs to enable them. Given that Canada’s building sector is the third-largest source of emissions and the Canada Greener Homes Grant and OHPA programs alone will lead to the emissions reductions equivalent to removing 227,500 cars off the road, these programs will also continue to play an important role in Canada’s climate plan.
The Government of Canada will be providing updates to Canadians on its programs to improve energy efficiency and reduce energy bills on a more frequent basis and looks forward to sharing more details on the next phase of the Greener Homes Initiative in the coming weeks.
- Date modified: