Carney announces $2 billion plan to retrofit one million Canadian homes, with heat pump rebates of up to $10,000

The government says the measures will lower heating bills and cut emissions by more than 25 megatonnes, equivalent to taking nearly 8.5 million cars off the road for a year.

"Canada strong starts in a warm home," Carney said. "Today, we are helping one million more Canadian households make energy efficient retrofits. We are lowering costs, reducing emissions, and building a stronger and more sustainable economy for all."

Heat pump rebate

The new National Heat Pump Rebate is meant to help up to 820,000 households install electric heat pumps. Eligible below-median-income households can receive up to $10,000 toward the purchase of a heat pump.

Other eligible households will receive $2,000. The government said both amounts can be combined with existing provincial programs.

Applications will go through an online portal, with no energy audit required before or after installation. The government said approvals will be confirmed within 24 hours, so a heat pump can be installed about as quickly as a replacement furnace.

That speed is aimed at emergency replacements. The government said about one million Canadian homes replace their heating system each year, and more than 80 per cent of the time the old system has failed without warning.

Ottawa said heat pumps are more efficient, cleaner and safer than oil and electric furnaces, and estimated they will save households currently heating with oil or electric baseboards an average of $1,400 a year. More than seven million Canadian households still heat with oil, propane, diesel, electric baseboards or outdated furnaces, according to the government.

Apartment buildings

A second part of the plan targets multi-unit housing, with the goal of retrofitting 280,000 apartment units over the next eight years. The government is working with the Canada Mortgage and Housing Corporation (CMHC) and the Canada Infrastructure Bank (CIB) on the effort.

Through its Multi-Unit Mortgage Loan Insurance product, CMHC is expected to help retrofit up to 250,000 additional units. The government said the product has already supported more than 140,000 energy-efficient units.

The CIB, through its Building Retrofits Initiative, will support owners of apartment and multi-unit buildings in retrofitting 30,000 units. Ottawa is also renewing the Deep Retrofit Accelerator Initiative, which supports building owners through each stage of a retrofit.

Housing and Infrastructure Minister Gregor Robertson tied the apartment measures to affordability. "Affordable housing is also about affordable energy bills," he said, adding that the retrofits would help lower costs and improve housing quality.

Environment Minister Julie Dabrusin said that when families make their homes more energy efficient, "they use less energy, save more on their bills, and reduce the emissions that drive climate change."

Part of the electricity strategy

The announcement fulfils a commitment in Powering Canada Strong, the national electricity strategy Carney launched in May 2026. The strategy aims to double the capacity of Canada's electricity grid by 2050.

The government says it is expected to deliver up to $15 billion in total energy savings by 2050 and lower total energy costs for seven in 10 households.

The new measures build on earlier programs, including the Oil to Heat Pump Affordability program and the Canada Greener Homes Affordability program. The government noted that about 80 per cent of Canada's electricity already comes from non-emitting sources.