Canada announces $2-billion investment to help households cut heating costs

ASM, Philippine Canadian Inquirer
October 18, 2026

Photo courtesy: The Canadian Press

OTTAWA, Canada — Nearly one million Canadian homes are expected to benefit from a $2-billion federal investment in energy-efficient upgrades, as the government moves to reduce household heating expenses and support the country’s transition to cleaner energy.

Prime Minister Mark Carney announced the initiative on October 8, introducing a new national rebate program designed to make electric heat pumps more affordable for homeowners.

The investment, spread over eight years, aims to support home retrofits across Canada, with up to 820,000 households eligible for assistance in replacing older heating systems with more energy-efficient alternatives.

The Prime Minister’s Office also highlighted the initiative on its official X account, emphasizing the government’s efforts to lower heating costs while reducing emissions and strengthening Canada’s energy infrastructure.

Homeowners could receive up to $10,000 in rebates

Under the new National Heat Pump Rebate program, eligible households earning below the median income could receive up to $10,000 toward purchasing an electric heat pump.

Other qualifying homeowners would be eligible for a $2,000 rebate. These federal incentives may also be combined with existing provincial programs, potentially reducing the initial cost of installation.

Heat pumps provide both heating and cooling by transferring heat rather than generating it through conventional combustion or electric resistance.

According to federal estimates, households currently relying on oil, propane or electric resistance heating could save an average of more than $1,400 annually by switching to a heat pump. Actual savings will depend on the home’s existing heating system, energy prices and usage.

The government said more than seven million Canadian households continue to use older or less-efficient heating systems, making energy upgrades an important part of its affordability strategy.

Faster applications and approvals planned

The federal government also intends to simplify the rebate application process, particularly for homeowners who need to replace a heating system unexpectedly.

Under the proposed system, applicants will be able to submit their information through an online portal without undergoing energy audits before or after installation.

The program is designed to provide approvals within 24 hours, allowing eligible households to proceed with purchasing and installing a qualifying heat pump. Homeowners would then submit their receipts for reimbursement, with payment approvals expected within five days.

The government plans to work with heating, ventilation and air-conditioning installers to support the program’s rollout.

These timelines are part of the announced program design and do not mean that every application or installation will necessarily be completed within those periods.

Apartment buildings included in energy upgrade plans

Beyond individual homeowners, Ottawa is working with the Canada Mortgage and Housing Corporation (CMHC) and Canada Infrastructure Bank (CIB) to support energy-efficient upgrades in apartment buildings.

The initiative is intended to help retrofit approximately 280,000 apartment units over eight years through financing and investment programs.

CMHC is expected to support upgrades involving up to 250,000 units, while the CIB will assist with projects covering another 30,000 units.

These measures are designed to improve energy efficiency in multi-unit residential buildings, potentially benefiting renters through more efficient heating and cooling systems. However, any direct savings for tenants would depend on how building owners manage energy expenses and rental arrangements.

Lower bills and cleaner energy remain key goals

The investment forms part of Canada’s broader National Electricity Strategy, which aims to expand the country’s electricity grid and increase access to reliable, affordable and lower-emission power.

The federal government estimates that the announced home upgrades could collectively save Canadian households more than $1 billion annually in energy costs once fully implemented.

Ottawa also projects that the measures could reduce emissions by more than 25 megatonnes, although those benefits depend on the successful rollout and uptake of the programs.

For Canadian households, particularly those preparing for higher heating expenses during the colder months, the initiative offers a potential opportunity to reduce long-term energy costs.

However, the upfront price of heat pumps, eligibility requirements and availability of qualified installers will remain important considerations for homeowners evaluating the program.