If you're facing the need to replace your central AC or furnace, you might want to consider the installation of a heat pump. Here's how to select the right system and discover heat pump incentives available in Canada.
Is it a good idea for your upcoming furnace replacement to opt for a heat pump? To be more precise, should your next HVAC system consist of a heat pump that can both heat and cool your home, ensuring year-round comfort? Interestingly, many people are not familiar with this option, and heat pumps remain relatively underutilized. Despite the fact that the technology has been in existence since 1856, it seems to be one of the best-kept secrets in the heating and cooling industry.
Amidst the current excitement surrounding ChatGPT, I turned to it for an explanation of what a heat pump is, and it provided the following description: "A heat pump can be likened to a magical device that transports warm or cool air to maintain your home's comfort, functioning as a heating system during the winter and an air conditioner in the summer."
Beyond basic AI information, there are some compelling reasons to consider using a heat pump. The "magic" of heat pumps lies in their remarkable efficiency, being 300% more efficient than baseboard heaters and traditional furnaces, and 50% more efficient than standard air conditioning units. Additionally, they operate on electricity, not gas (unless it's a hybrid heat pump). Notably, recent studies have shown that even in cold weather conditions, heat pumps outperform gas heating systems in terms of efficiency. Furthermore, it's worth noting that in certain regions of Canada, fossil-fuel heating systems are now prohibited in new home constructions, which adds to the appeal of transitioning to a heat pump sooner rather than later.
However, despite their superior efficiency, heat pumps have not been as widely embraced in Canada compared to other parts of the world. As of 2021, only 6% of Canadian households relied on heat pumps as their primary source of space heating. This percentage pales in comparison to Europe, where an estimated 16% of residential and commercial buildings were using heat pumps as of 2022, according to information from Natural Resources Canada (NRCan). Furthermore, the disparity might grow even more pronounced, considering that heat pump sales in Europe saw a nearly 40% year-over-year increase last year, encompassing both air-heating and water-heating heat pumps, in contrast to the 11% growth observed in the rest of the world, as reported by the International Energy Agency.
So, what's preventing Canadians from embracing heat pump solutions and realizing the potential energy savings they offer? Robin Librach, the communications officer for NRCan, points to a key factor when comparing Canada to Europe, and that's energy prices. The prices of gas, electricity, and natural gas have seen significant increases in many European regions, particularly following Russia's invasion of Ukraine. As a result, European consumers are understandably seeking more cost-effective methods to heat and cool their homes.
Demand for heat pumps is on the rise
While heat pumps are not widely adopted in Canadian households, data from NRCan indicates that the situation may be changing. Since the introduction of the Canada Greener Homes initiative in May 2021, over 47,000 Canadian homeowners have been awarded grants for heat pump installations. Notably, heat pumps are the most common retrofitting choice among program participants, with windows and doors, home insulation, air sealing, and solar panels following as the next most frequent upgrades.
Presently, the Canada Greener Homes Grant offers heat pump rebates at three different tiers, varying from $2,500 to $5,000 based on the type of heat pump and its performance criteria. Meanwhile, in Ontario, where the Canada Greener Homes Grant has been succeeded by the Home Efficiency Rebate Plus program, heat pump incentives can reach as high as $7,800.
What is the price of a heat pump in Canada?
According to FurnacePrices.ca, heat pump prices in Canada can vary significantly, ranging from $3,500 to $15,000. Ductless mini-split air conditioner systems tend to be on the lower end of this price spectrum, while geothermal or ground-source heat pumps come with notably higher price tags. The final cost of a heat pump is influenced by various factors, including the size and type of the home, the type of system chosen, local installation fees, and the brand of the product.
NRCan's website offers a detailed overview of heat pumps, outlining the two primary types for residential use: air source and ground source. Air-source heat pumps extract warmth from the outdoor air in colder seasons and reverse the process, expelling heat from inside the house during warmer months. Ground-source heat pumps differ primarily in their heat source. They utilize the earth, ground water, or a combination of both to provide heating in winter and cooling in summer for your home.
Another important distinction lies in how air exchange occurs. A central ducted heat pump system operates in conjunction with the existing ductwork in your home. In cases where a home lacks ductwork, homeowners can choose mini-split system heat pumps. These systems include an outdoor compressor/condenser and one or more indoor handling units that are wall-mounted, resembling room air conditioning units.
Heat pumps are suitable for use in condominiums or apartments that have independent HVAC systems. However, if your residence is part of a comprehensive building-wide HVAC system, the choice to implement this technology will depend on the decisions made by your condo corporation or building manager. Nevertheless, the installation of a heat pump in a larger building is indeed feasible.
Considering Canada's predominantly colder climate for a significant portion of the year, the Canada Greener Homes Grant has primarily seen the purchase of cold-climate air-source heat pumps, accounting for approximately 75% of the acquisitions. These particular units are designed to function effectively in sub-freezing temperatures, with modern models capable of generating heat from air as cold as -25°C.
This brings us to the grant application process. To qualify for incentives under both the Canada Greener Homes and Home Efficiency Rebate Plus programs, you must begin by obtaining a home energy efficiency evaluation from an energy advisor registered with NRCan. Once the evaluation confirms your home's eligibility for a heat pump retrofit, the installation must be carried out by a licensed and adequately trained professional. In other words, even if you're quite skilled at home improvement, a DIY installation is not permissible.
Your chosen installation company will collaborate with you to determine the most suitable system, considering factors like whether it should be ground or air source, ducted or ductless. The specific dollar amount of the heat pump rebate will hinge on the type of system you opt for, and it must also meet predefined performance standards.
Meeting the eligibility criteria for the Canada Greener Homes Grant
In order for your heat pump to meet the eligibility requirements for the Canada Greener Homes grant of $2,500, it needs to be an Energy Star-certified air-source heat pump that can provide a minimum of 12,000 BTUs per hour of heat when external temperatures drop as low as 8.3°C. Additionally, from a cooling perspective, the unit must achieve a Seasonal Energy Efficiency Rating (SEER) equal to or greater than 15.2, within the SEER ratings range that spans from 13 to 30.
To provide a better understanding of SEER, Mitsubishi Electric describes it as the HVAC equivalent of miles per gallon, indicating how much electricity a unit needs to operate at full capacity over a specific duration. In Canadian terms, it's akin to thinking about kilometers per liter. Consequently, a higher SEER signifies that the unit requires less electricity for operation. Generally, a heat pump with a higher SEER rating tends to come with a higher price tag.
Under the Canada Greener Homes grant, you can receive a $2,500 rebate for mini or multi-split cold-climate air-source heat pumps. Energy Star-certified air-source heat pumps designed for centrally ducted systems or split systems with three or more air supply outlets qualify for a $4,000 rebate. Furthermore, cold-climate air-source heat pumps intended for central or ductless systems with three or more outlets are eligible for a $5,000 rebate.
Additionally, all these systems must meet the specified minimum heating and cooling performance standards outlined earlier. Moreover, it's essential to note that all products and equipment must be bought within Canada to qualify for the grant.
It is advisable to seek guidance from your local heat pump installer to understand the available options in your region. For those looking to conduct preliminary research, NRCan provides a comprehensive list of the various heat pump grants, including information on exclusions. If you reside in Ontario, you can explore the dedicated Enbridge Gas webpage for details on the Home Efficiency Rebate Plus program, which is a partnership between NRCan and Enbridge.