How to Finance Home Energy Upgrades in Ontario

The best way to finance home energy upgrades in Ontario is usually to start with free programs and rebates, then cover the rest with the lowest-cost borrowing you can access, typically savings, a home equity line of credit or a municipal property tax loan where available. Contractor financing and equipment rentals are convenient but often cost more overall, so compare every option by total cost, not monthly payment.

With the federal Canada Greener Homes Loan closed to new applications since fall 2025, homeowners need to piece together their own financing. This guide sets out the options in order, with worked examples and questions to ask.

Step 1: Check free and income-qualified programs first

Before borrowing anything, check whether you qualify for no-cost upgrades:

• Energy Affordability Program (EAP) from Save on Energy: free energy-saving upgrades such as insulation, appliances and smart thermostats for income-eligible households and those receiving certain social assistance.
• Enbridge Home Winterproofing Program: free insulation, air sealing and thermostats for income-eligible Enbridge customers.
• Oil to Heat Pump Affordability (OHPA) in Ontario: for income-qualified households switching from oil heat, co-delivered by Canada and Ontario through Save on Energy. Confirm current intake status, since the federal national intake closed 31 July 2026.
• OESP and LEAP for help with electricity bills.

Our income-qualified programs guide explains eligibility.

Step 2: Line up rebates, and plan for the timing gap

The Home Renovation Savings Program, delivered jointly by Save on Energy and Enbridge Gas, has offered rebates for heat pumps, insulation, windows, smart thermostats and more. Key points for financing:

• Rebates are paid after the work is complete and documents are approved, which can take weeks or months.
• Heat pumps require a participating contractor and pre-installation approval before work starts.
• The assessment stream has 2026 deadlines reported for completing work and scheduling post-retrofit assessments.

Confirm all terms on saveonenergy.ca (opens in a new tab). Our Home Renovation Savings Program guide has the details, and our rebate finder shows what may apply to your home.

Step 3: Compare ways to finance home energy upgrades

Option	Typical cost	Pros	Watch for
Savings	No interest	Simplest, cheapest	Keep an emergency fund
Home equity line of credit (HELOC)	Usually among the lowest rates; often variable	Flexible, can pay down anytime	Rates can rise; secured on your home
Mortgage refinance or renewal add-on	Mortgage rate over long term	Low monthly cost	Long terms increase total interest; penalties if mid-term
Municipal property tax loan (LIC)	Often below consumer loan rates	Repaid with property taxes; tied to property	Limited availability; approval steps
Unsecured line of credit or personal loan	Higher than secured	No home equity needed	Rate depends on credit
Contractor or manufacturer financing	Varies widely; promotions common	Convenient, fast approval	Dealer fees built into price; rate after promo period
Equipment rental or lease	Monthly fee, often for 10–15 years	No upfront cost	Total cost; buyout terms; registrations on title
Credit card	Very high	Fast	Avoid for large projects

Municipal loans are explained in our guide to municipal home energy loans.

How much does financing actually cost?

The table shows a $15,000 project (for example, a ducted cold-climate heat pump after rebates) at illustrative rates. Actual rates depend on your lender and credit.

Financing	Term	Monthly payment	Total interest
6% secured loan	5 years	~$290	~$2,400
7% loan	10 years	~$174	~$5,900
8.99% contractor loan	7 years	~$241	~$5,300

Longer terms lower the monthly payment but increase total interest. Compare these payments with your expected energy savings. For a gas-heated home switching to a heat pump, annual operating savings can be modest since the federal fuel charge on natural gas was removed on 1 April 2025. Many heat pump projects are justified partly by adding air conditioning, replacing end-of-life equipment, or comfort, rather than by bill savings alone. Our heat pump vs gas furnace cost guide runs the numbers.

Tip: Ask every contractor for a cash price and a financed price. If the cash price drops when you skip financing, the "low rate" is being paid for through the equipment price.

Equipment rentals: understand the full cost

Rentals of water heaters, furnaces and air conditioners are common in Ontario. They avoid upfront cost, but:

• monthly fees over 10–15 years often total well above the purchase price;
• contracts can include escalating fees and expensive buyouts;
• notices of security interest (NOSIs) registered on homes have been a major consumer problem. Ontario passed legislation banning NOSIs on consumer goods, with protections taking effect in phases. Verify current rules on ontario.ca (opens in a new tab).

Since 1 March 2018, Ontario has banned unsolicited door-to-door contracts for furnaces, air conditioners, water heaters and several other products. If someone at your door offers a rental or financing deal, you are not obliged to engage. See our water heater rentals guide for buyout considerations.

Matching financing to the project

Project	Typical approach
Smart thermostat, LED bulbs, air sealing kit	Pay from savings; check product rebates
Attic insulation	Savings or line of credit; check HRS standalone insulation rebate
Heat pump water heater	Savings, line of credit; compare against rental
Heat pump replacing failed furnace and AC	HELOC, municipal loan or contractor financing compared on total cost; apply for rebate before install
Deep retrofit (insulation, windows, heat pump)	Municipal loan where available, HELOC, or mortgage renewal

Financing checklist

1. Check income-qualified programs and rebates first.
2. Get two or three quotes with cash prices from different contractors.
3. Confirm rebate pre-approval steps before work begins.
4. Ask your bank or credit union for secured and unsecured rates.
5. Check whether your municipality offers a property tax loan.
6. Calculate total cost of borrowing for each option.
7. Read all contracts for fees, escalation, buyout and anything registered on title.
8. Keep invoices, permits and model numbers for rebate claims.

Frequently asked questions

Is there a replacement for the Greener Homes Loan?

No federal replacement had been announced for the interest-free loan at the time of writing. Some municipalities offer low-interest loans, and provincial rebates remain available. See our post on what to do now that the Greener Homes Loan is closed.

Should I finance a heat pump or wait?

If your furnace or air conditioner is failing, planning financing early prevents a rushed decision. If your equipment is working well, saving up and applying for rebates in advance usually costs less.

Does contractor financing hurt my credit?

Any new credit can affect your credit file. Ask whether the application uses a soft or hard credit check.

Can I get a rebate on a rented heat pump?

Ontario's HRS heat pump rebates have applied to owned equipment. Confirm current eligibility on saveonenergy.ca before signing a rental or lease.