Government of Canada Launches Strengthened Heat Pump Program with PEI

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Making the switch from home heating oil to a heat pump will save Canadians thousands of dollars each year on their energy bills. By driving down both energy bills and harmful pollution, the benefits of switching to a heat pump are clear, and the Government of Canada has been bringing these benefits to Canadians through the Oil to Heat Pump Affordability (OHPA) program.

Today, the Honourable Ginette Petitpas Taylor, Minister of Veterans Affairs and Associate Minister of National Defence, and Bobby Morrissey, Member of Parliament for Egmont, on behalf of the Honourable Jonathan Wilkinson, Minister of Energy and Natural Resources, and the Honourable Steven Myers, Minister of Environment, Energy and Climate Action, Government of Prince Edward Island (PEI), announced that Canada and PEI are fully co-delivering the strengthened OHPA program.

Low- to median-income households in PEI that heat with oil can apply to receive a free heat pump, which will heat and cool their entire home. The Government of Canada’s OHPA investment of up to $15,000 per eligible homeowner will not only provide thousands more dollars to Prince Edward Islanders to switch to a heat pump but will also allow for additional measures such as switching to electric water heaters, supplemental electric resistance heaters, electrical upgrades, and the safe removal of oil tanks.

Eligible applicants also receive an upfront, one-time payment of $250 from the federal government. As of July 5, a total of 7,403 heat pumps have been installed under the plan nationally and 10,568 Canadian households have received upfront payments.

The federal government currently has co-delivery arrangements in place with Nova Scotia, Newfoundland and Labrador and British Columbia and looks forward to co-delivering the program with other provinces and territories soon.

In jurisdictions without federal-provincial/territorial co-delivery arrangements, oil-heated households have been and will continue to be able to apply for up to $10,000 in federal OHPA funding through the national portal managed by Natural Resources Canada. The Government of Canada is currently working with other provinces and territories to deliver new, strengthened OHPA co-delivery agreements to make heat pumps even more affordable for even more Canadians across the country.

In addition to the OHPA program, in June 2023, Environment and Climate Change Canada announced up to $16.8 million from Canada’s Low Carbon Economy Fund to support low-income homeowners’ transition from home heating oil to more-affordable low-emitting heating technologies, like electric heat pumps in Prince Edward Island. The Governments of Canada and PEI are working closely together to finalize the delivery of this funding.

Quotes

“Making the switch to more energy-efficient heating systems can help Canadians save thousands on their energy bills, reduce their energy use, and decrease their carbon footprint. That’s why we are strengthening the Oil to Heat Pump Affordability program and ensuring that families are supported in making the switch from heating oil to an efficient heat pump.” —The Honourable Jonathan Wilkinson, Minister of Energy and Natural Resources

“Installing a heat pump in your home is one of the best ways to save on your monthly energy bills while reducing emissions. This announcement builds on the success we are already seeing across Atlantic Canada, making life more affordable while protecting our environment and growing our economy.” —The Honourable Ginette Petitpas Taylor, Minister of Veterans Affairs, and Associate Minister of National Defence

“Canadians should be able to save on energy bills by heating and cooling their homes more efficiently. This is especially true in Atlantic Canada, where many are facing high energy costs. That’s why this federal government is helping Canadians switch from expensive home heating oil to lower-cost and lower-emission heat pumps through the Oil to Heat Pump Affordability program. This next step in the Program is a win-win: it will provide even more support for low-to-medium-income Islanders who are looking to reduce their energy bills while also reducing pollution.” —Bobby Morrissey, Member of Parliament for Egmont, P.E.I.

“With over 12,500 free heat pumps installed through the Government of Prince Edward Island’s free heat pump program, we know Islanders are on board to do what’s right for the environment. We appreciate efforts by the Government of Canada to assist our provincial government in making life more affordable for Islanders while we work towards our province’s net zero goals.” —The Honourable Steven Myers, Minister of Environment, Energy and Climate Action, Government of Prince Edward Island

Quick facts

Heat pumps are two to three times more efficient than oil furnaces. The fact that heat pumps simply move heat, rather than generate it, is a large part of why they are more efficient and less costly than alternatives.
The average Canadian home that uses heating oil spends $2,000 to $5,500 on energy bills per year, depending on the province or territory — making it the most expensive heating option. Homeowners who switch from an oil furnace to a cold-climate heat pump could save approximately $1,500 to $4,500 per year on their home energy bills.
Oil furnaces and boilers in Canada’s homes generate around three million tonnes of carbon dioxide (CO₂) every year — the equivalent generated from approximately 920,000 cars. Oil combustion in heating systems also generates nitrogen oxide, sulphur dioxide and fine particles that can be harmful to human health and the environment.
OHPA has already issued 5,000 grants to PEI applicants.