How much greener did Canada's homes get? Report takes a closer look at federal rebate program

The federal government provided $2.6 billion for heat pumps, solar panels, insulation and other green upgrades to Canadians' homes through the Canada Greener Homes Grant. But what difference did that actually make? 

A new report released this week by the non-profit Green Communities Canada suggests the program didn't do enough to meet Canada's targets to reduce greenhouse gas emissions.

That's because "the savings aren't deep enough and because we're not doing enough retrofits," said Kai Millyard, the group's energy manager and co-author of the report.

The federal grant program launched in December 2020, with stated goals of helping Canadians lower their energy bills, create new jobs for energy advisers and fight climate change. Natural Resources Canada says buildings account for 18 per cent of Canada's emissions, making them the third-largest emitting sector of the economy, after oil and gas and transportation.

The program offered up to $5,000 per household for green retrofits that could be added to other funding, such as provincial and territorial programs. The money could be used to subsidize the costs of electric heat pumps, more energy-efficient windows and doors, air sealing, home insulation and solar panels.

Applications opened in December 2020 and abruptly closed in February 2024. While the program was supposed to last for seven years, by 2023, the government said funds were running out earlier than anticipated due to the program's popularity. However, grants are still being paid out to existing applicants.

Over 500,000 Canadian households applied to the program. As of this past January, 366,786 had completed retrofits and received a rebate averaging $4,498, the federal government reports.

It estimates that has cut 704,000 tonnes of greenhouse gases, equivalent to taking 215,670 cars off the road. On average, it says, each participating household is saving $386 on energy costs and has cut their greenhouse gas emissions 1.92 tonnes as a result of their retrofits.

About 60 per cent of applicants chose to install a heat pump, and they were the top retrofit by homeowners in British Columbia, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario and Quebec. The federal government says it expects 250,000 heat pump installations by the program's end.

Millyard acknowledges the grant program made a huge difference in adopting the electric heating technology, which replaces gas- and oil-burning furnaces and boilers in many homes — a major source of greenhouse gases from buildings.

"It's built a meaningful market," he said. "The industry is learning quickly, and there's demand all across the country for heat pumps. This has been a really important development."

There has also been an increase in solar installations over the course of the program. In 2024, they represented 56 per cent of retrofits in Alberta and were the top retrofit in P.E.I., Yukon and Nunavut.

Meanwhile, the report found that over the course of the program, the use of grants for insulation upgrades declined.

The program required people to get an energy audit from an energy adviser, who recommends what upgrades to make — a service that Green Communities Canada provided through member organizations. The audits could also be provided by private businesses.