Solar Tax Credits, Incentives and Solar Rebates in Canada
→ See rebates in the United States
Latest Update: December 2018
Continuous reductions in PV system costs and a handful of provincial incentive programs are slowly, but surely, changing Canada's residential electricity landscape. Motivated by environmental as well as financial reasons, more and more Canadians are switching to solar power.
With its generous rates, Ontario's feed-in-tariff program created a solar boom in this province. Currently, the vast majority of installed solar capacity in Canada is located in Ontario. However, Ontario's MicroFIT program is no longer considering applications, so homeowners that install solar panels will now be part of the province's net metering program. In Canada's other provinces and territories interest in solar energy is growing, in part as a result of new incentive programs that are designed to stimulate the demand for solar power.
Unfortunately, Canada does not have a federal tax credit for solar energy. In our opinion, a program modeled on the U.S. Federal Investment Tax Credit can be particularly effective, sending a clear message to Canadian consumers. In Canada, available incentives programs are mostly at the provincial/territorial level with a few local/municipal programs. These financial incentives and regulatory programs can significantly improve the financial feasibility of installing solar panels for your home, cottage or business. For more information on how to pay for your solar panels in Canada, click here.
Click on your province/territory to get details on incentive programs and see if solar power can save you money.
Province/Territory Capital |
Winnipeg |
Solar Value Index |
$573 |
Solar Energy Produced |
5783 kWh / year |
Average retail electricity price (2017 data) |
9.9 cents / kWh |
Average annual consumption per household (2014 data) |
17328 kWh |
Levelized Cost of Solar Electricity
|
11.41 cents / kWh |
Reached grid parity? |
Not yet |
The southern portions of the prairie provinces have the best solar energy potential in Canada. In Winnipeg alone, it's estimated that the solar photovoltaic rooftop potential is 3,000 megawatts. Up to this point, it's been hard to compete with hydro-electricity. However, the picture is set to change with significant utility rate hikes by Manitoba Hydro in the coming years. The future for solar in Manitoba is bright!
→ Should I get solar panels in Winnipeg?
List of Solar PV Incentive Programs in Manitoba
Our Residential Earth Power Loan is an option if you would like to make energy efficiency upgrades to your home, including solar photovoltaic systems. The loan is applicable to residential, non-seasonal customers only. Your monthly payment will be added to your energy bill. The minimum allowable loan amount is $500, and up to $30,000 for solar photovoltaic panels. Solar PV financing is calculated based on $3 per watt installed; the maximum term is 15 years; no down payment is required; the loan becomes due and payable when the house is sold; the loan is not transferrable; and the annual interest rate is fixed at 4.9 per cent (O.A.C.) for the first 5 years.
List of Solar PV Incentive Programs in Manitoba
Customers who own their own electric renewable generation systems may connect to our distribution system, as long as they follow procedures that have been adopted to safely protect the customer and Manitoba Hydro. Customer owned generation (10 MW or less, at a voltage no greater than 25 kV) refers to electricity production that is created by the customer using renewable energy (e.g. wind or solar) or non-renewable energy (e.g. fossil fuels). This generation must meet applicable provincial, federal, and municipal licenses, permits, and approvals. If a generator produces less than 200 kW, we will purchase excess energy at the standard residential run-off rate. For generators producing 200 kW or greater, we will negotiate a Power Purchase Agreement (PPA) with the generator based on hours of operation, type, reliability, etc. If you are generating more energy than you are using, your excess energy can be sold back to Manitoba Hydro at the excess energy price (for generators less than 100 kW). Until March 31, 2022 the excess energy price is $0.02403/kWh. This price is updated annually so that it reflects the current market value of excess energy and is not equal to MH's electricity rates.
Federal Incentive Programs
Unfortunately, there are no federal incentives for residential solar PV projects in Canada. However, if you own a business, the following programs may be applicable.
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In order to encourage the adoption of ZEVs by Canadians and Canadian businesses, the Government of Canada launched the Incentives for Zero-Emission Vehicles (iZEV) Program in May 2019. There are many different makes and models of eligible zero-emission vehicles for purchase or lease that provide consumers with iZEV Program incentives of up to $5,000. Businesses can benefit from a tax write-off. There is a limit to how many eligible ZEVs Canadians can purchase or lease under the iZEV Program. Individuals are eligible for one incentive under this Program in a calendar year. Businesses and provincial/territorial and municipal governments operating fleets are eligible for up to 10 incentives under this Program in a calendar year.
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The Government of Canada makes clean energy projects, such as solar energy, wind energy and energy from waste, more fiscally attractive for industry by providing business income tax incentives. Under Classes 43.1 and 43.2 in Schedule II of the Income Tax Regulations, certain capital costs of systems that produce energy by using renewable energy sources or fuels from waste, or conserve energy by using fuel more efficiently are eligible for accelerated capital cost allowance. Under Class 43.1, eligible equipment may be written-off at 30 percent per year on a declining balance basis. In general, equipment that is eligible for Class 43.1 but is acquired after February 22, 2005 and before year 2020 may be written-off at 50 percent per year on a declining balance basis under Class 43.2.
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CRCE is designed to encourage commercial investments in clean energy generation and energy conservation projects by providing income tax incentives for certain start-up expenses associated with these projects.
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The Greener Homes initiative offers grants of up to $5,000 to help homeowners make energy efficiency retrofits to their primary residences. To qualify, Canadians must obtain an EnerGuide assessment prior to installing any upgrades. To qualify, homeowners must verify their home meets program eligibility requirements and obtain a pre-retrofit EnerGuide home energy evaluation before completing at least one retrofit that is both eligible and recommended by their energy advisor in their report. The amount a homeowner pays for a Home Energy Assessment is $199. Homeowners who qualify for the Greener Homes program and install at least one eligible Greener Homes retrofit recommended by your energy advisor will be reimbursed $100 following your post-retrofit evaluation. The Canada Greener Homes Grant is retroactive to December 1, 2020, provided homeowners completed their pre-retrofit evaluation on or after April 1, 2020 and their home meets program eligibility requirements. Only qualifying upgrades installed on or after Dec 1, 2020 are eligible for rebates. If your pre-retrofit assessment was conducted before April 1, 2020 your upgrades are not eligible for Greener Homes incentives.
Methodology Notes
- Average monthly electricity consumption data is from the Canadian Electricity Association (2014 data).
- Utility rates for the provinces are based on a study published by Hydro Quebec. Rates in effect in April 2017. Source: Comparison of Electricity Prices in Major North American Cities. Utility rates for the territories are based on residential rate data as reported by Qulliq Energy Corporation (as displayed on 27 September 2016); Northwest Territories Power Corporation (effective 1 October 2017); Yukon Housing Corporation (effective 1 July 2016).
- Annual solar production estimates are based on the analysis performed using our own solar energy calculator, Sunmetrix Discover.
- Default installation cost is estimated to be $3/watt (in Canadian dollars).
- The estimated lifetime of solar panels is 25 years for the purposes of calculating the Levelized Cost of Electricity (LCOE).
- Installed solar PV capacity figures are from Natural Resources Canada's report entitled "Photovoltaic Technology Status and Prospects: Canadian Annual Report (2015)".
- The national average for utility rates in Canada excludes the rates in the Yukon, Northwest Territories and Nunavut.
Latest Update: December 2018
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