Federal investment in home and building retrofits will help reduce costs for Canadians

Today’s announcement marks an important step toward improving affordability, reducing emissions and strengthening Canada’s housing stock. 

The Canada Green Building Council (CAGBC) welcomes the federal government’s announcement of a new investment package designed to support one million home retrofits across Canada, expand retrofit financing for multi-unit residential buildings, and renew support for deep retrofit market development. The measures announced today include a new National Heat Pump Rebate Program, expanded financing for multi-unit rental housing retrofits through Canada Mortgage and Housing Corporation (CMHC) and the Canada Infrastructure Bank (CIB), and renewed support for the Deep Retrofit Accelerator Initiative (DRAI).

Together, these measures recognize a reality that Canadians already understand: housing affordability is about more than rent or mortgage payments. It is also about utility bills and resilience to rising energy costs.

Energy as a defining issue

Recent polling commissioned by CAGBC found that rising energy costs are increasingly affecting Canadian households. In Energy, Affordability and the Canadian Reality Nearly, three-quarters of respondents reported higher utility bills over the past year, while almost half described themselves as either struggling financially or just getting by. Canadians consistently identified energy efficiency as an important factor in housing decisions, but many reported being unable to pursue upgrades because of upfront costs and limited access to financing.

The findings highlight growing concerns over energy costs and identify energy efficiency improvements as a practical path to improving housing affordability for Canadians.  

The federal government’s new commitment to support fuel switching through heat pumps can help address these challenges. According to the government, eligible households adopting electric heat pumps could save an average of more than $1,400 annually on energy costs while benefiting from both heating and cooling capabilities.

For Canadians facing affordability pressures, reducing monthly energy costs can provide meaningful financial relief while improving comfort and resilience.

Building better homes, not just more homes

As governments work to address Canada’s housing shortage, it is essential that new and existing homes deliver long-term value for residents.

CAGBC has been advocating for performance-based approaches to housing through its recent research, Making Performance a Hallmark of Build Canada Homes, which outlines how financing programs can encourage better-performing homes that lower operating costs, improve resilience, and deliver greater long-term value for Canadians.

Better-performing homes reduce lifetime operating costs, improve resilience, support occupant health, and protect public investments. To maximize the benefits of today’s announcement, retrofit programs should prioritize performance outcomes rather than simply funding equipment or upgrades.

Investments should encourage: 

• Reduced energy consumption 

• Lower operating costs

• Improved building resilience 

• Verified emissions reductions 

• Better indoor environmental quality 

By measuring outcomes after projects are complete, governments can ensure public dollars deliver lasting value for Canadians.

As new retrofit and housing programs are implemented, these same principles can help ensure investments translate into measurable improvements for households rather than simply funding individual technologies or projects.

Expanding support for deep retrofits 

Beyond individual homes, the expansion of retrofit financing for multi-unit residential buildings is an important development for Canada’s broader building stock.

Today’s announcement also builds on momentum created by the federal government’s support for market transformation through the Deep Retrofit Accelerator Initiative (DRAI), which has helped accelerate the development of retrofit projects across Canada’s commercial, institutional, and multi-unit residential building sectors.

Through funding provided under DRAI, CAGBC and Purpose Building created Retrofits Now, a national industry initiative that provides building owners, investors, and asset managers with practical guidance, case studies, market insights, and resources to support deep retrofit planning and implementation.

Recent findings published through Retrofits Now’s Accelerating Deep Retrofits report show that market confidence is growing, but financing complexity, uncertainty around costs, and policy fragmentation continue to slow scaling efforts across Canada. Continued federal support can help address these barriers and expand retrofit activity across the country’s existing building stock.

These investments are particularly important for aging rental housing, where improved performance can help lower costs, improve comfort, and extend building life while reducing greenhouse gas emissions.

Turning investment into results 

Today’s announcement demonstrates growing recognition that energy efficiency and building performance contribute directly to affordability and resilience.  

The next step is ensuring that retrofit programs are designed to reward and verify outcomes. By tying financing and incentives to measurable performance improvements, Canada can maximize the return on public investments while delivering buildings that are more affordable, resilient, and comfortable for the people who live in them.

CAGBC is ready to work with governments, industry, and financial institutions to connect these investments with measurable performance outcomes, ensuring Canadians benefit from lower energy costs, more resilient housing, and buildings that deliver lasting value.