The federal government is putting home energy costs at the centre of its push to expand Canada’s clean electricity economy, committing $2 billion to support one million residential retrofits across the country.
Announced by Prime Minister Mark Carney on October 8 in Dartmouth, Nova Scotia, the investment is part of the government’s National Electricity Strategy and is designed to help households and apartment building owners improve energy efficiency while reducing emissions.
A major component is a new National Heat Pump Rebate intended to help as many as 820,000 households switch to electric heat pumps. Eligible households with below-median incomes will be able to receive rebates of up to $10,000 toward the purchase of a heat pump, while other eligible households will receive $2,000. Both can be combined with existing provincial programs.
The program is also being structured to address one of the realities of home heating: replacements are often unexpected. About one million Canadian homes replace their heating systems each year, with more than 80 per cent doing so after an existing system breaks down without warning. Under the new program, approvals can be confirmed within 24 hours, allowing a heat pump to be installed as quickly as a furnace.
For households currently relying on oil or electric baseboard heating, the government estimates switching to a heat pump could save an average of $1,400 annually.
The initiative also extends beyond single-family homes. Working with the Canada Mortgage and Housing Corporation and Canada Infrastructure Bank, the government plans to support retrofits for 280,000 apartment units over the next eight years.
Through its Multi-Unit Mortgage Loan Insurance product, CMHC will help retrofit up to 250,000 additional units, building on more than 140,000 energy-efficient units already supported by the program. The Canada Infrastructure Bank’s Building Retrofits Initiative will support another 30,000 apartment and multi-unit residential units, while the Deep Retrofit Accelerator Initiative is being renewed to assist building owners throughout the retrofit process.
“Affordable housing is also about affordable energy bills. By supporting energy-efficient retrofits in apartment buildings and multi-unit housing, we’re helping lower costs for Canadians, improve housing quality, and build more sustainable communities,” said the Honourable Gregor Robertson, Minister of Housing and Infrastructure and Minister responsible for Pacific Economic Development Canada.
The connection between affordability and efficiency is already being demonstrated through projects supported by the Canada Greener Affordable Homes Program.
“The investment through the Canada Greener Affordable Homes Program demonstrates that manageable rents and sustainability go hand in hand. At the Housing Trust of Nova Scotia, we are committed to providing high-quality homes that are energy-efficient, environmentally responsible, and offer manageable rents to working households. This funding has helped us reduce operating costs, improve resident comfort and well-being, and ensure that rents remain stable and manageable over the long term. In this massive undertaking, we ensured that every resident remained in place – no displacements. We are grateful to the Government of Canada and Minister Gregor Robertson for supporting solutions that strengthen communities while advancing Canada’s housing and climate goals,” said Brian Tabor, Chair of the Housing Trust of Nova Scotia.
Charity Carr, Advisory Member with the Housing Trust of Nova Scotia, pointed to collaboration as a way of pursuing environmental improvements without sacrificing housing affordability.
“As a long-standing member of the Housing Trust of Nova Scotia and with a passion for environmental impact, I have had the pleasure of working alongside a group that understands that in partnership, we don’t have to risk manageable rents, to achieve important environmental impacts. We can advance work that achieves two social impacts, through collaboration and partnership.”
Martha Casey, Interim President and Chief Executive Officer of EfficiencyOne, similarly highlighted energy efficiency as a tool for addressing both household costs and broader economic and environmental goals.
“Investing in energy efficiency is one of the most practical ways to make life more affordable for Canadians while building a cleaner, more competitive economy. By helping more households access efficient technologies like heat pumps and supporting upgrades across homes and buildings, these investments will lower energy costs, improve comfort and deliver lasting benefits for communities across the country.”
Together, the measures are expected to support one million home retrofits and reduce Canadian emissions by more than 25 megatonnes — an amount the government says is equivalent to taking nearly 8.5 million cars off the road for one year.
The investment represents a major residential component of the National Electricity Strategy, which aims to double Canada’s electricity grid while expanding access to clean, reliable and affordable power. With more than seven million Canadian households still relying on oil, propane, diesel, electric baseboards or outdated furnaces for heating, the retrofit program is intended to translate that broader infrastructure strategy directly into lower household energy costs.
