Solar Tax Credits, Incentives and Solar Rebates in Ontario
Summary Data for Ontario
Ontario is the leader for grid-connected PV systems in Canada. Thanks to generous feed-in tariff programs, solar energy really took off in the province. While those feed-in tariff programs are now closed, homeowners and businesses in Ontario will soon benefit from the new GreenON Solar Rebate program (coming summer 2018).
At 16.32 cents/ kWh, the electricity prices in the province are above the national average of 12.61 cents / kWh. When it comes to average electricity consumption per household, residents of this province consume 8,580 kWh per year, below the national average of 13,300 kWh.
Ontario is a grid parity province, making solar power cheaper than the residential utility rates. The incentives listed below can significantly reduce the cost of installation of solar panels for your home or business.
- GreenON's Solar Rebates
PROGRAM CLOSED - The Green Ontario Fund will offer rebates for Solar PV and Energy Storage systems to help Ontario homeowners and businesses use renewable electricity and reduce their greenhouse gas emissions.
- FIT Program (Feed-in Tariff Program)
THIS PROGRAM IS OFFICIALLY CLOSED The FIT Program is open to projects with a rated electricity generating capacity greater than 10 kilowatts (kW) and generally up to 500 kW. Approved projects receive a fixed price for the electricity produced over a 20-year contract period. For the latest feed-in tariff rates, please visit the program website.
- Micro-FIT Program
THIS PROGRAM IS OFFICIALLY CLOSED The program provides homeowners and other eligible participants with the opportunity to develop a small or "micro" renewable electricity generation project (10 kilowatts (kW) or less in size) on their property. Under this program, homeowners will be paid a guaranteed price over a 20-year term for all the electricity produced and delivered to the province's electricity grid. For the latest feed-in tariff rates, please visit the program website.
Electricity consumers in Ontario who produce some of their own power from a renewable resource (systems that are 500 kW or less) may take advantage of the "net metering" initiative. Net metering allows Ontarians to send excess electricity generated from renewable resources to the distribution system for a credit toward energy costs. In essence, it is a "trade" of electricity supplied against electricity consumed.
- 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.
- Capital Cost Allowance (CCA) Renewable Energy
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.
- Canadian Renewable and Conservation Expenses (CRCE)
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.
- 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.
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