If you are a homeowner heating with oil, you are likely interested in the $5,000 the Federal Government will pay you to convert from oil to cold climate air source heat pump heating.
Is this program different than other incentives out there? Yes, it’s different. Unlike the Greener Homes program, homeowners don’t have to spend money to install a heat pump and then receive a rebate, the Government is providing eligible applicants $5,000 up front, to go towards the cost of a heat pump.
Here’s How to Qualify For $5,000
- Your after-tax household income is at or lower than the the amount specified for your province and household size
- Your home is single, semi-detached, townhome, row house, mobile home on a permanent foundation, permanently moored floating home, low-rise multi-unit residential building, mixed use building residential portion
- You are the primary resident
- You have purchased at least 1,000 litres of heating oil in the past 12 months to heat your home
- You have not already received money for a heat pump from the Canada Greener Homes Grant or Loan
- You are able to complete the work within 6 months of receiving the upfront payment
- Your home is connected to a North American electricity grid – if you’re off grid, you don’t qualify for the grant
Here’s What You Need For Your Application
- Valid government-issued identification
- Proof of home ownership
- Heating oil fuel bills or invoices
- Quote(s) from your contractors for a cold climate air source heat pump that is on the approved list and will be installed by a licensed professional, a signed attestation form, purchased from a distributor in Canada
- Social insurance number
Read the full details of how to provide a full application from Natural Resources Canada.
Why Would I Switch to an Air Source Heat Pump
The short answers is: it will save you thousands of dollars every year by switching to a cold climate air source heat hump.
Cost to Heat Your Home With Oil
It may have cost you around $5,000 to heat your 1,500 sq foot home with oil in 2022, and it may end up costing you over $6,000 in 2023, for a family of 4 people.
Typical 1,500 sq foot home, annual oil heating volume: ~3,500 litres.
Typical 1,500 sq foot home, annual oil heating cost in 2022: $5,250 at $1.50/litre.
Typical 1,500 sq foot home, annual oil heating cost in 2023 (scenario): $6,100 at $1.75/litre.
Typical 1,500 sq foot home, annual oil heating costs from 2024 – 2030 could rise to $10,000+ , when carbon is priced into the heating oil.
Cost to Heat Your Home With a Cold Climate Air Source Heat Pump
An air source heat pump with electric furnace backup, is projected to cost $3,500 – $4,500 annually in electricity to heat and cool a 1,500 square foot home.
Annual Cost Savings
It’s projected that a cold climate air source heat pump will save you $1,500 – $3,500+ annually when compared with your current oil heating costs.
It’s possible that you will save more than $5,000 each year as of 2030 as the cost of oil continues to rise.
Up Front Heat Pump Installation Costs
It’s estimated that a heat pump for a 1,500 sq ft home will cost $8,000-11,000.
The government is providing $5,000 up front to put towards the cost of your eligible air source heat pump. Based on market information, your new heat pump will cost you more than the grant you will receive.
You may not be able to afford to pay the additional $3,000 – $6,000 for your air source heat pump. The Federal Government and the City of Ottawa are both providing interest free loans to get you the remaining cash you need to get your heat pump installed. Once installed, you can also apply for an additional $5,000 rebate. You may be able to get your air source heat pump mostly funded through grants and rebates, with a loan for any additional costs.