Provincial and federal governments inject $157M to move more people off home heating oil

The government of Newfoundland and Labrador, along with the federal government, is putting forward $157 million to lure people into switching from oil to electric heating over the next four years.

The new Oil to Electric Incentive Program provides incentives for people using oil heating to switch over to other technologies like mini-splits, multi-splits, central heat pumps, electric furnaces and electric boilers.

"It's a huge factor for reducing greenhouse gas emissions," said Environment and Climate Change Minster Bernard Davis at a news conference Thursday morning.

"The positive side of this is also that it's going to be good for the pocketbooks of the individuals that are making the transition."

How much people will get back from the program depends on what they're installing. On the lower end, installing an electric furnace can return a maximum of $10,000. Installing a central heat pump could get the maximum of $17,000.

A press release from the Department of Environment and Climate Change says a household consuming 2,400 litres of fuel per year pays $3,200 in heating costs per year. That household could save up to 60 per cent of those costs —$1,900 per year — with a heat pump. For those who install an electric furnace or boiler, savings could be up to $500 per year.

Who is eligible?

An estimated 40,000 households are eligible for the new program, according to the province. The rebates are also retroactive to April 1.

The program excludes households in communities with diesel electricity generation.

Low- and moderate-income households with a heat pump, and those without a heat pump, must have an installation date and submit an invoice between April 1 of this year and March 31, 2027.

All other projects must have an installation date and an installation invoice dated between April 1 of this year and March 31, 2026. 

The money can also go toward the purchase and installation of electrical panel upgrades and the removal of oil tanks.

Heat pump systems must be used for whole house heating.

The program will be delivered through TakeCharge, a joint initiative between Newfoundland Power and Newfoundland and Labrador Hydro. 

Installers can send invoices directly to Newfoundland Power or Newfoundland and Labrador Hydro, which the province said removes the upfront istallation costs for homeowners.

Save cash and the environment

St. John's East MP Joanne Thompson said the new program is aimed at issues around affordability as well as lowering carbon emissions.

It's also another way to help people move away from oil heating to more efficient methods, while saving money, she said.

Thompson pointed to recent extreme weather events — like Snowmageddon in 2020, post-tropical storm Fiona last year and ongoing wildfires — as driving needs to lower emissions by 2030 and 2050.

Moreover, she said the cost of oil has gone up in recent years, tied to the COVID-19 pandemic and Russia's invasion of Ukraine.

"We cannot have governments in eastern Europe and the Middle East dictating what happens with our costs and really impacting on how people are able to live in a way that doesn't impact the ability, for example, to put food on the table," said Thompson.

Read more from CBC Newfoundland and Labrador