Sourced from water, gas, biofuel, wind, and nuclear power, energy in Canada powers our homes, cars, and businesses 24/7. Although energy seems relatively reliable and always available, there are many considerations, both financial and environmental, that must be addressed when using and regulating the use of energy. The federal government, as well as provincial governments, encourage citizens to be mindful about how much energy they use and offer tax credits on sustainable energy use as an incentive.
Federal Tax Incentives and Programs
The Federal Government of Canada offers several different tax incentives to encourage citizens to save energy and live greener lives.
Hydro/Electric Car Tax Credit
Transport Canada offers tax incentives to drivers that buy and use zero-emissions vehicles (ZEVs). To be classified as a ZEV, a vehicle must have the potential to produce no tailpipe emissions. Examples of ZEVs include battery-electric, plug-in hybrid electric, and hydrogen fuel cell cars. ZEVs, however, tend to be more expensive than conventional cars. Motivated by the fact that transportation is the second-largest source of greenhouse gas emissions in Canada, this program offers financial incentives for people who buy or lease ZEVs.
- Consumers who purchase a battery-electric, hydrogen fuel cell, long-range plug in hybrid, can be eligible for a point-of-sale incentive of up to $5,000.
- Consumers who purchase a shorter-range plug-in hybrid vehicle can be eligible for a point-of-sale incentive of up to $2,500.
It’s important to note that only new ZEVs are eligible for this incentive. This means that even if you purchase a used ZEV vehicle, you won’t be able to receive any money back.
For more information on eligibility, visit Transport Canada’s webpage.
Energy Savings Rebate Program
There are also credits offered to businesses that sell energy-efficient equipment, such as lighting, appliances, and more. The federal government has invested over $200 million to help people afford products that are energy-efficient, otherwise known as ENERGY STAR certified. This program helps consumers save up to 25% on products up to a limit of $500, excluding water heaters and air-source heat pumps, which qualify for a rebate of up to $1,000.
Some examples of ENERGY STAR certified products eligible for this program include;
- Smart thermostats
- Air conditioners
- Ceiling fans
- And more.
For more information on ENERGY STAR products, visit their webpage.
Note: The Canada Revenue Agency currently does not offer any tax considerations for energy-efficient products. In other words, you cannot apply for a tax deduction for expenses paid on energy-efficient products.
What about the GST/HST tax credit? Are you eligible?
Provincial Tax Credits and Programs
In addition to federal credits offered to encourage the conservation of energy, Canada’s provincial governments also offer incentives to encourage their citizens to save energy.
Quebec, often through local distribution companies as well as through Transition énergétique Québec, offers various energy-efficiency incentive programs, as well as one renewable incentive program and one clean transportation incentive program.
New Vehicle Rebate Program
The New Vehicle Rebate Program offers up to $8,000 to drivers who purchase ZEVs, dependent on factors such as the car make and model. It’s important to note, however, that as of January 2021, the program will no longer offer rebates for non-rechargeable hybrid vehicles and low-speed vehicles.
Transition énergétique Québec Programs
This program offers energy rebates and free personalized advice for households with low incomes. Some households may even be eligible to have thermostats installed for free.
Chauffex Vert Program
This program offers financial assistance in purchasing and installing energy-efficient heat pumps and replacing propane/oil water heaters and heating systems.
This home program helps save consumers up to 20% on their electricity costs by targeting energy-efficient construction practices when a building is built. Financial support is also available to purchasers, home owners and promoters, under certain conditions.
This program offers rebates to Quebec citizens who purchase geothermal heating systems, as well as insulation, air sealing and more.
Programs From Energy Distribution Companies
Various energy distribution companies offer energy-efficiency financial incentives as well.
Hydro Québec’s Energy Wise Program offers various promotions and rebates for purchasing energy-efficient products. This includes but is not limited to a $100 rebate when you purchase an ECOPEAK water heater.
Gazifére Green offers a few cash incentives for purchasing energy-efficient products. They offer a $350 cash incentive for air exchangers, a $100 incentive for smart thermostats, and a $500 incentive for tankless water heaters.
Énergir offers grants to customers who purchase or replace natural gas appliances. Customers might be eligible for more grants if they make energy-efficient upgrades to their homes.
There are 3 energy-efficiency rebate programs offered in Saskatchewan by SaskEnergy:
Residential Equipment Replacement Rebate
Created to encourage homeowners to pick energy-efficient space heating, ventilation, and water equipment heating, the Residential Equipment Replacement Rebate offers eligible applicants:
- Up to $2,000 for boilers,
- Up to $1,000 for combi boilers,
- $325 or $650 for various eligible furnaces,
- $100 for ENERGY STAR® certified Heat Recovery Ventilators (HRV),
- $1,000 for ENERGY STAR certified Tankless Water Heaters
- $1,000 for ENERGY STAR certified Condensing Water Heater; and
- $250 for ENERGY STAR certified Tank Water Heaters.
Commercial Boiler Rebate
This rebate encourages the use of high-efficiency heating systems in Saskatchewan.
Commercial Space & Water Heating Rebate
This rebate encourages commercial consumers to use energy-efficient gas furnaces, boilers, and various water heaters. To learn more about this rebate, click here.
Ontario has a few programs to encourage energy efficiency among residential and commercial consumers. There are also a couple of programs offered by government agencies, such as Enbridge Gas’ Home Efficiency Rebate Program.
The Retrofit program offers incentives for various energy-efficient measures pertaining to lighting, HVAC, and manufacturing. Eligible applicants include commercial spaces, industrial facilities, institutional buildings, multi-family buildings, and agriculture facilities. Eligible projects are ones that provide sustainable energy savings during peak demand times.
Small Business Lighting Program
Small businesses with under 50 employees can apply to the Small Business Lighting Program, which provides up to $2,000 in funding to replace a businesses’ lighting with energy-efficient lighting.
Energy Affordability Program
Depending on your income, you could be eligible for financial support to assist you with your electricity costs through the Energy Affordability Program. Some applicants may be eligible for support with energy-efficient upgrades, and some might be eligible for a free home assessment.
Northern Ontario Energy Credit
This credit is available to Ontarians living in northern communities to help offset the higher energy costs faced by those living in the North. Eligible applicants could receive up to a $127 credit per year.
Ontario Energy and Property Tax Credit
This credit is available for eligible applicants that either rent or pay property tax. Depending on your age and living situation, you can be eligible for a credit between $25 and $1,085.
The Yukon offers rebates to energy consumers who purchase heat-recovery ventilators, insulations, appliances and more through the Good Energy Rebates Program.
Manitoba Hydro offers a few loans and financing programs, mostly centred around energy-efficiency home upgrades. Their Energy Finance Plan offers consumers up to $5,000 in funding for energy-efficient home upgrades, while their Home Energy Efficiency Loan offers financing for similar upgrades which consumers can pay for with their hydro bills.
Energy Efficiency Nova Scotia offers a variety of financial supports to encourage more energy-efficient practices. Low-income citizens can qualify for free home assessments and upgrades, such as draft proofing and insulation, to help reduce electricity bills. They also offer rebates of up to $1,900 for purchases on energy-efficient products, such as heat pumps, solar panels, insulation, and water heaters.
Prince Edward Island
Most of PEI’s energy-efficiency rebates and programs are offered by Efficiency PEI.
Energy Efficient Equipment Rebates
These rebates, offered by Efficiency PEI, apply to home air and water heating upgrades and equipment, such as heat pumps and biomass heating systems. To learn more about these rebates, click here.
Home Insulation Rebates
These Efficiency PEI rebates apply to insulation, heating, skylights, and air sealing. Learn more here.
Solar Electric Rebate Program
This solar rebate program offers an incentive of $1.00 per watt incentive for solar systems.
Winter Warming Program
Efficiency PEI also offers the Winter Warming Program for low-income consumers, which allows them to receive free installation for light bulbs, thermostats, and more.
BC hosts the most energy efficiency programs over all of the provinces. Most of their rebate programs can be found by using the Clean BC Rebate Search Tool, but we’ve listed a few of them here:
PST Tax Exemption
BC offers a 7% tax exemption for people who use alternative energy generation and energy conservation equipment, including but not limited to insulation, weather stripping, and more.
Better Homes and Home Renovation Rebate Program
Offered by Clean BC, BC Hydro, and FortisBC, the rebates under the Better Homes and Home Renovation Rebate Program apply to purchases on things like insulation, heating, heat pumps, appliances, and more.
Furthermore, Citizens of British Columbia who purchase ENERGY STAR certified products, specifically washers, dryers, or refrigerators, are eligible to apply for the BC Hydro Rebate. The amount of the rebate is dependent on your specific location within British Columbia. Additionally, Fortis BC has a rebate program for energy-efficient appliance purchasers.
BC also has a few ZEV incentives for residents. The Provincial Clean Energy Vehicle Program offers a $3,000 rebate for eligible car models, and the BC Scrap-It Program offers a rebate of up to $6,000 for consumers who trade in a gas-powered vehicle when purchasing an electric vehicle. Furthermore, BC’s Specialty Use Vehicle Incentive Program offers incentives for low-speed vehicles.
Newfoundland and Labrador
Newfoundland and Labrador’s takeCHARGE Residential Rebate Program is offered by NL Hydro and NL Power. Through this program, eligible consumers can get rebates on various energy-efficient products such as thermostats, heating appliances, energy-efficient showerheads, and more. Another program of note is the Home Energy Savings Program, which is offered by the Newfoundland and Labrador Housing Corporation. Eligible, low-income consumers can obtain a grant of up to $5,000 to make energy-efficient upgrades to their homes.
New Brunswick’s Total Home Energy Savings Program Total Home Energy Savings Program gives homeowners free energy-efficient products, like LED lights, low-flow showerheads, etc., as well as rebates on insulation, heat recovery systems, and more. This program also has a renewable energy rebate, specifically $0.20 to $0.30 per watt on solar heating systems.
Their New Home Energy Savings Program offers up to $10,000 for new homes that exceed the National Building Code for energy efficiency.
New Brunswick also offers low-income incentive programs, such as the Low Income Energy Savings Program, offering various free energy-efficiency upgrades (LED lighting, insulation, etc.) to eligible consumers. Their Community Outreach Program also gives energy-efficient products such as LED light bulbs and low-flow showerheads to not-for-profit organizations.
Making energy-efficient choices can sometimes be more costly and require more work upfront. However, the return on investment can be seen in positive results on the environment, as well as cost benefits from the programs and tax credits noted above.