Canada Commits $2 Billion to One Million Home Energy Retrofits

Canada has committed $2 billion over eight years to support up to one million home energy retrofits, including a new National Heat Pump Rebate expected to reach as many as 820,000 households. The federal government is also working with the Canada Mortgage and Housing Corporation and Canada Infrastructure Bank to support retrofits across 280,000 apartment units. Together, the measures are expected by the government to reduce emissions by more than 25 megatonnes while lowering household energy use and costs.

 

Heat Pumps Are the Largest Part of the Household Programme

 

The new National Heat Pump Rebate will support households replacing oil, propane, diesel, electric baseboards or older furnaces with more efficient electric heat pumps. More than seven million Canadian households still rely on these heating systems, according to Environment and Climate Change Canada.

The programme is designed to simplify access. Applications will be handled through an online portal, with no energy audit required before or after installation and approvals expected within 24 hours. That is intended to make the rebate practical for households replacing systems after an unexpected breakdown, which the government says accounts for around 80% of replacements.

 

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Apartment Retrofits Will Rely More Heavily on Financing

 

The package also targets larger residential buildings, where retrofit costs and financing requirements are typically much higher than for individual homes. Canada Mortgage and Housing Corporation will use its Multi-Unit Mortgage Loan Insurance Select programme to support retrofits across up to 250,000 additional units.

The Canada Infrastructure Bank’s Building Retrofits Initiative will cover at least another 30,000 apartment and multi-unit residential units. The government is also renewing the Deep Retrofit Accelerator Initiative to provide building owners with support through planning and implementation.

 

The Measures Tie Affordability to Decarbonisation

 

The programme is being positioned around both household affordability and emissions reduction. Better insulation, more efficient heating systems and other building upgrades can reduce energy demand, while electrification can shift heating away from direct fossil fuel use.

Wade Grant, Parliamentary Secretary to the Minister of the Environment, Climate Change and Nature, said the measures are intended to help households "use less energy and take advantage of Canada’s clean electricity advantage." The government estimates the combined measures will cut more than 25 megatonnes of emissions.

 

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The Retrofit Push Sits Within a Much Larger Electricity Strategy

 

The measures form part of Canada’s Powering Canada Strong strategy, announced in May 2026. The strategy aims to double national electricity grid capacity by 2050, strengthen connections between provincial grids and expand domestic production of electricity technologies and components.

The government estimates the wider strategy could generate up to $15 billion in cumulative energy savings by 2050 and lower overall energy costs for seven in 10 Canadian households. Energy efficiency is also identified by Natural Resources Canada as a central tool for reducing household bills and emissions.

 

Delivery Across One Million Homes Will Be the Main Test

 

The scale of the announcement is significant, but implementation will determine its impact. Reaching one million homes will require households, contractors, lenders, apartment owners and public financing institutions to move projects from eligibility into completed installations.

The heat pump rebate could accelerate smaller household upgrades, while the financing programmes for apartment buildings address a different barrier: access to capital for more complex retrofits. The key measure of success will be whether the programmes reach their stated retrofit targets and translate the projected 25-megatonne emissions reduction into actual energy savings.

 

Source: Environment and Climate Change Canada