Rebates for Electrically Heated Homes in Ontario

In short

There is no Ontario rebate for a new electric furnace or baseboard heaters. A home heated by electricity instead qualifies for $1,250 per ton, up to $7,500, on a cold-climate air-source heat pump through the Home Renovation Savings Program, and the existing electric heat can stay as backup. Income-eligible households can receive the heat pump free through the Energy Affordability Program.

How much you can get

Replacement electric furnace or baseboard heaters No rebate
Cold-climate air-source heat pump, electrically heated home $1,250 per ton, up to $7,500
Ground-source heat pump, electrically heated home $2,000 per ton, up to $12,000
Heat pump water heater replacing an electric tank (assessment stream) $500
Cold-climate heat pump through the Energy Affordability Program (income-eligible) No cost to the household
Smart thermostat, attic insulation and other measures See the program page

Who qualifies

The house is connected to the Ontario electricity grid and electricity is its primary heat, whether through baseboards, an electric furnace or radiant panels.
Which utility sends the bill does not matter: Hydro One, Burlington Hydro, Milton Hydro, Alectra and Halton Hills Hydro customers are all on the Ontario grid.
Apartment-style condo units are outside the housing types the program lists; houses, semis, row houses, townhomes and mobile homes on permanent foundations are inside it.
No heat pump for space heating may already be installed, so a baseboard house with an older ductless heat pump is not eligible for another.
For a ductless system, the indoor heads and the outdoor unit are installed together as a complete new system.
The Energy Affordability Program has its own test: household income under the limit for your household size, or receipt of a listed benefit such as the Ontario Electricity Support Program.

Electric resistance heat turns one unit of electricity into one unit of heat. A cold-climate heat pump moves two to three units of heat for the same electricity over a season, which is why the program pays the most where it replaces resistance heat.

Is there a rebate for an electric furnace in Ontario?

No. A new electric furnace is not a measure in the Home Renovation Savings Program or in any Save on Energy offer, and neither are baseboard heaters. If the electric furnace has failed and you replace it like for like, the job is paid in full.

The rebate applies when a heat pump is added to that furnace or takes its place. The program states that electrically heated homes may keep their existing electrical backup, so a working electric furnace can stay as the air handler and backup heat behind a new heat pump. That is usually the least disruptive route in a ducted house.

How much an electrically heated home receives

The air-source rate is $1,250 per ton of rated heating capacity at 8.3 °C. Sizing comes from the heat loss of the house, and the rebate follows from it:

2-ton system, a small bungalow or a well-insulated townhouse: $2,500.
3-ton system, a typical detached house: $3,750.
4-ton system, a larger or older house: $5,000.
6 tons of capacity, rare in a single house: the $7,500 maximum.

A rented heat pump drops to $500 per ton with a $2,000 ceiling, so in an electric home buying the equipment is worth far more than renting it. Ground-source systems are paid at $2,000 per ton up to $12,000, calculated on closed-loop heating capacity.

Baseboard houses have no ducts, so the heat pump is ductless

A baseboard-heated house has no furnace and no ductwork, so the practical heat pump is a ductless multi-split: one outdoor unit and a wall or floor-mounted head in each main zone. The baseboards stay on the wall as backup for bedrooms and for the coldest nights. Our published bands for that work are:

Single zone, one indoor head: $4,000–$7,000 installed.
Dual zone: $7,500–$11,000 installed.
Three to four zones: $10,000–$16,000+ installed.
Cold-climate models add roughly $500–$1,500 per zone, and cold-climate is what the rebate requires.

One electrical detail helps here. A house built for baseboards or an electric furnace already has a large service and many 240-volt circuits, so panel capacity is less often the obstacle it is in a gas-heated house. The new circuit still needs an ESA notification. The work is described on our baseboard to heat pump conversion page.

Rural Caledon, Lowville, Kilbride and Flamborough: where this applies locally

Natural gas mains stop short of many rural lots above the Niagara Escarpment and north of the built-up parts of Caledon. Houses there heat with electricity, propane, oil or wood, often with a private well and a century farmhouse or 1970s side-split to work with. All four fuels sit in the same $1,250 per ton tier, so the electric-heat rules on this page carry over to a propane or wood-heated neighbour.

Electric furnace searches from Caledon are common for a reason: on those lots the electric furnace is frequently the original equipment. If yours still runs, adding a heat pump to it is the upgrade that earns the rebate. If it has stopped, electric furnace repair gets heat back while the pre-approval is filed.

Income-eligible households: the heat pump is free

The Energy Affordability Program offers cold-climate air-source heat pumps at no cost to income-eligible households with electric heating, with assessment and installation included. Homes heated by electricity can also receive attic or basement insulation, draft proofing and a thermostat through it. Apply through Save on Energy before paying for anything, because this program and the per-ton rebate cannot be combined on the same heat pump.

When you call, we confirm the heating fuel, count the zones, run the heat loss and give you a written price with the rebate shown separately. The heat pump rebates in Ontario page covers the other fuels, the rebates hub lists everything we track, and you can book a free assessment to start.

How ZK Mechanical helps

Tell you whether your electric furnace is sound enough to stay as the air handler, or whether a ductless system makes more sense.
Run a heat-loss calculation room by room, which matters more in a zoned baseboard house than anywhere else.
Place indoor heads where they will heat the house, not where the line set is easiest to run.
Check the panel and arrange the ESA notification for the new circuit.
Send income-eligible households to the free program before quoting, and handle the rebate paperwork for everyone else.

Frequently asked questions

My electric furnace just died, so can I still get the heat pump rebate?

Yes, if you get approval before the heat pump goes in. The house is still electrically heated, which is what sets the tier. The risk is timing: the program refuses installations done before pre-approval. Have the furnace repaired or use the baseboards and portable heaters safely for the interim, then install once the approval arrives.

Do I have to remove my baseboard heaters to qualify?

No. The program says electrically heated homes may keep their existing electrical backup. We recommend leaving baseboards in bedrooms and bathrooms, turned down as a safety net, and removing them only where a wall is needed for furniture. They cost nothing to keep and they cover the rooms a ductless head does not reach directly.

Will a smart thermostat rebate work with baseboard heat?

Usually not directly. The thermostats on the program's eligible list are low-voltage models made for furnaces, air handlers and heat pumps, and baseboards run on line-voltage thermostats. A home that heats or cools electrically is eligible in principle, so the rebate becomes useful once a ducted heat pump or electric furnace with a compatible control is in place.

Does a condo with electric baseboards or a fan coil qualify?

A condo townhouse does, because row houses and townhomes are on the eligible list. An apartment-style unit in a mid-rise or tower does not appear on that list. Owners in those buildings should ask the condominium corporation what it permits, since any outdoor unit or change to building systems needs its approval before a quote means anything.

How much will a heat pump lower the hydro bill in an electric home?

Save on Energy says switching from an electric furnace or electric baseboards to a cold-climate air-source heat pump could save up to 50% on the heating portion of the electricity bill. Your result depends on insulation, air leakage and how much the backup heat runs. We do not quote a dollar saving, because the house and the winter decide it.

Official sources

All Ontario HVAC rebates Energy Affordability Program Baseboard to heat pump conversion HVAC service in Caledon All rebate programs