Have you heard about the new federal home retrofit program for Canadians? If you’re a home business owner planning to do some renovations in the foreseeable future, read on. Even if you’re just an entrepreneur who wants to save on their home energy bills, you’ll want to know about this new initiative, which covers renewable energy home improvements like solar panels.
Canada Greener Homes Grant
The Government of Canada launched a new federal program called the Canada Greener Homes Grant that offers Canadians grants of up to $5,000 to pay for energy-saving upgrades to their homes like replacing windows and doors, adding insulation, sealing air leaks, improving heating and cooling systems and installing solar panels.
The program will invest $2.6 billion over the next seven years. The initiative will also recruit up to 2,000 new energy advisor jobs across the country with emphasis on advancing inclusion and diversity in the workforce by including women, Indigenous peoples, persons with disabilities and racialized Canadians.
Reasons to retrofit your home
Everyone has their own reasons for doing home improvements and upgrades. If you own a home or home business, yours could be making your home more comfortable, saving on energy and utility bills, adding value to your home and helping the environment.
Focusing on what’s important to you can help you decide what retrofits to make. Even small changes can improve the energy efficiency of your home and provide lasting impacts on your home’s overall safety and maintenance. These improvements could be in your kitchen, bathroom, living room, dining room or office.
And while this investment cannot be used as a tax write-off, free money is always good from an entrepreneur’s perspective, am I right?
Which home improvements qualify for the grant?
Wondering what types of retrofits qualify? Eligible home improvements and upgrades include the following:
- Increasing your home insulation (up to $5,000) — Slow the rate of heat loss and improve your energy use.
- Sealing air leaks (up to $1,000) — This is the single most important retrofit to improve energy efficiency.
- Replacing windows and doors (up to $5,000) — You can do a total replacement or add inserts.
- Adding a smart thermostat (up to $50) — Save money on your energy bill and reduce your carbon footprint. This must be combined with another retrofit to be eligible.
- Improving heating systems (up to $5,000) — Space heating accounts for over 60% of the energy used in the average Canadian home.
- Installing solar panels (up to $5,000 and an extra $1,000 for a battery unit, like the Tesla Powerwall) — It appears that residential solar panels are finally starting to become economical in Alberta, even without incentives. Learn more in the next section.
You can review the full list of eligible retrofits on the Government of Canada website. Just remember that while you can do more than one of the retrofits, the maximum reimbursement is $5,000 in total.
This summer, they’re also announcing a $40,000 interest-free loan to help pay for bigger upgrades! Register to receive updates on this loan initiative.
More on solar panels in Alberta
Did you know that the cost of solar panels have come down 90% in the last 10 years? There are a couple of other reasons why solar energy in Alberta makes a lot of sense:
- Alberta has a deregulated electricity market, the only one in Canada. This means that private companies can generate power and sell it to the grid. Companies such as Amazon, Labatt, Maple Leaf and Shell are currently building gigantic solar farms in Alberta to offset their carbon footprint and get to net zero.
- Because Alberta is particularly sunny, a residential system could produce 1,100 to 1,300 kWh of energy annually, which is much higher than most parts of the world.
There is one caveat. With so much supply of power coming into the electricity grid from all of these giant solar projects, electricity prices in Alberta could be permanently low. While this would attract electricity-intensive businesses like crypto mining and data centres, these same cheap prices would mean a longer payback period for your own solar power investment.
The Arc Energy podcast, hosted by Peter Tertzakian and Jackie Forrest, is one of my favourites as they keep you up-to-date on what’s happening in the Alberta energy industry. Their June 8, 2021 episode goes deep into what’s changed in solar for Albertans. I highly recommend giving it a listen.
And if you want to nerd out on the economics of residential solar power, here are a few Alberta-specific articles:
- The Cost and Economics of Installing Solar Panels in Alberta (Virtuoso Energy)
- Economics of Solar Power in Alberta (Neighbour Power)
- The Cost of Solar Panels (Kuby Energy)
The timing of this new federal home retrofit program is ideal if you’re thinking of adding solar panels to your home. Only residential properties are eligible for the grant, which is a shame because solar energy would be ideal for small businesses. At our two offices in Bridgeland and Okotoks, we consume energy during the day while we work (and the sun shines), and then shut down at night.
Eligible property types
The property needs to be your primary residence, unless you’re the owner of the property and the tenants are Indigenous.
Sorry new homeowners, you're not eligible for this grant. A homeowner’s primary residence must be at least six months old from the date of occupancy by the first homeowner. Thankfully, new homes are built with efficiency in mind these days, so you're still ahead of the game.
Eligible grants for a home retrofit in Alberta
As part of this program, here’s what you can claim:
- Maximum of $600 for a EnerGuide evaluation to help you plan your retrofits
- Maximum of $5,000 total to make energy-efficient retrofits to your primary home, such as better insulation
Who’s eligible? First of all, only one homeowner per home can register. And you’ll need to show proof of ownership and residence. You’ll need:
- Your property tax bill number. You can find this on your city property documents.
- A government-issued ID with your address or a utility bill.
Local Indigenous governments and housing management bodies partnering with Indigenous organizations are eligible for the program, and are allowed to register multiple homes.
Requirements for the Canada Greener Homes Grant
Before you start tearing down walls and reimagining your home office space, make sure you review the grant requirements:
- You’ll need to do a home energy evaluation on your primary residence before and after your renovations.
- From your home energy evaluation, complete at least one recommended retrofit. Your evaluation must be done after December 1, 2020. Please note that you won’t be reimbursed for your pre-retrofit evaluation if you don’t complete any of the recommendations.
- Make sure you hang onto all copies of your documents until March 31, 2028. (Remember that the federal grants are not taxable and do not have to be declared as income.)
- You are expected to buy all products within Canada. If you order online, they must be from an online distributor located in Canada.
Keeping receipts and documentation
It’s important to provide and keep copies of all your receipts and documents. Without them, you may not be reimbursed for your expenses. To verify your eligible retrofits, the CRA needs:
- Receipts for your EnerGuide home evaluations (before and after)
- Receipts and invoices for buying and installing the retrofit products
Start your retrofit journey
Ready to start? Make sure you consider how much budget you have before you begin — this will play a major role in deciding what home renovations you can do. (And don’t forget about the $40,000 interest-free loan they’re announcing this summer!)
To apply for the Canada Greener Homes Grant, visit the Government of Canada website. Here’s your to-do list:
- Apply for your energy efficiency home evaluation.
- Complete your home retrofits. Some, like heat pumps and solar panels, you can do yourself. Other renos like air sealing, home insulation and new windows and doors, are best left to the professionals.
- After your renovations, schedule your post-retrofit evaluation (and remember to keep all your documents!). Apply for reimbursement.
- Enjoy your new home improvements and sleep better knowing that you’re saving money and helping the planet.
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