Ontario has a new incentive encouraging homeowners to install heat pumps to reduce their energy use and lower planet-heating greenhouse gas emissions associated with home heating.
The program is being offered by the Independent Electricity System Operator (IESO) and offers homeowners in some areas up to $5,000 to install an air source heat pump, and up to $10,000 for a ground source (geothermal) heat pump, which is more complex and difficult to install. It will roll out in areas experiencing higher-than-average electricity consumption growth, including major cities and regions such as Toronto, Mississauga, Ottawa, Barrie, Muskoka, Windsor, Kingston, York Region, and Niagara Region.
The Incentives do not depend on household income, making them more accessible to a wider range of Ontario residents.
Mary Bernard, supervisor of residential program performance at IESO told Canada’s National Observer that the program’s objective is to reduce strain on the electricity grid in specific regions where urbanization and population growth is increasing. By promoting energy-efficient upgrades like heat pumps, the IESO hopes to delay or avoid expensive infrastructure upgrades, she said.
“These are areas where demand growth is happening more quickly than the provincial average and where the electricity infrastructure may need reinforcement in the years to come,” Bernard said.
Homeowners eligible for the incentives must live in one of the designated areas, own their home, and currently use electric heating. Eligible homes include single-family dwellings, semi-detached homes, duplexes, row/townhouses, and low-rise apartments or condos built before Feb. 26, 2024.
Bernard said the program covers about 30 per cent of installation costs; air source heat pumps typically cost around $15,000 and ground source systems average $30,000.
According to Bernard, air source heat pumps are the most popular. They work by transferring heat from outdoor air to heat homes in winter, and transferring heat from indoor air to cool homes in summer. Ground source heat pumps extract heat from the ground, which requires more complex excavation work but offers even greater efficiency. Air source heat pumps cut energy costs for heating by up to 50 per cent, depending on the home and system used.
Jack Gibbons, chair of the Ontario Clean Air Alliance, who recently installed a $14,000 cold climate air-source heat pump, said a heat pump can reduce heating bills by around $2,000 annually.
“Installing heat pumps in all of our electrically heated homes would also reduce the GHG pollution of our dirty gas plants by approximately 20 per cent,” Gibbons said.
While Gibbons praised the province for the new incentives, he questioned the decision to restrict them to certain communities.
“Unfortunately, the IESO is only providing these incentives in transmission-constrained regions of Ontario,” Gibbons said. “This doesn’t make sense since heat pumps can lower the electricity bills of families in every region of Ontario.”
Gibbons explained that transmission-constrained regions are areas of the province with limited excess high-voltage transmission capacity from Hydro One. These regions will require upgrades to the transmission system unless there is a reduction in electricity demand through investments in energy efficiency options, like heat pumps.
The Independent Electricity System Operator’s Pathways to Decarbonization Report predicts that Ontario might need to spend $400 billion to more than double its electricity generation capacity — from 42,000 megawatts today to 88,000 megawatts by 2050. And much of that electricity will be provided by additional polluting gas plants and high-cost nuclear reactors, Gibbons said.
Comments
Wonder why people who otherwise qualify but heat with natural gas aren’t eligible.
Oh! Of course! Enbridge wouldn’t make as high a profit AND wouldn’t like it!
Reducing CO2 is not a priority for the Ont PC government. They would only run a subsidy program because they know it will slightly reduce the massive costs they are facing to build new gas and nuke plants. Electricity generation is part of the ideology. Clean energy, not so much.
It sounds great until you realize how few homes heat with electricity only. They don't even want to pay the whole cost of heat pumps which means only a fraction will do this.
They think they may need to spend $400 billion on generation but spending a fraction on efficiency would probably decrease the need for new generation substantially.
Over and over again the Ontario government shows how stupid it is but people keep voting for them.
They should make this available to everyone . Would cut use of fossil fuel . Not everyone can afford geothermal but if air source is $15000 - $5000 = $ 10,000 that is probably not much more than a new furnace and the lower heating cost would make it a viable purchase . Our furnace is over 20 years old so I'm thinking that it is near time to replace it but I don't live in the designated area and I don't heat with electricity......bummer .
We can not afford Ford..
I would suggest getting a new furnace with a cold climate air source heat pump. There is a Enbridge HER rebate program that will give some money for a new heat pump. It's not as generous as the old program. Also there's still the Greener Homes Loan program with the federal government that gives you 0% interest on loans up to $40K over 10 years if you qualify.
Well sized cold climate air source heat pumps for homes with high efficiency natural gas/propane furnaces with dc motors could dramatically reduce the emissions of homes. I'm an energy advisors and many homeowners who installed ccASHPs hardly used gas at all last year. This combination doesn't put a strain on the grid at the coldest time of the year. If you can reduce emissions for heating by 70 to 80% or more, why aren't we doing more of this.
New high efficiency furnaces have an efficiency of 96%+. If you decide to go all electric you will be pulling electricity from the gas plants to produce heat. They aren't that efficient and when you consider transmission loss they probably aren't 50% efficient . And when it's really cold the all electric unit will probably be using resistant backup heating which is comparable to baseboard heating and will put even more strain on the grid.
Regarding ground source heat pumps. This or a district heating would be the ideal solution. If Ontario could scale the drilling, it would probably significantly reduce the cost of ground source heat pump installations. Instead of Ontario paying Enbridge to build out it's gas infrastructure, Ontario should pay Enbridge to install district heating across the province.
The truly ironic part is that if you are switching from, say, baseboard heaters, you'll have to install a ducting system as well ... as I understand it. I may be wrong about that, there may be other ways to deliver the heat. But since I was told I could still use gas backup, and use the fan system in my existing gas furnace when gas wasn't needed, it seems to me that heat pumps must require some kind of forced air.