Energy efficiency as a nation-building project
Energy efficiency is one of the most immediate, cost-effective and beneficial investments available to Canada.
It lowers energy bills, strengthens Canadian industries and skilled trades, and improves energy productivity.
Improving energy efficiency is a nation-building project — one that builds a more competitive economy while ensuring that all Canadians can afford the energy they need.
Budget 2026 can position energy efficiency as a nation-building project with five priority actions
Renew industrial energy management funding
Industrial energy management delivers rapid, tariff-proof productivity gains. Optimizing energy use in production can help firms achieve around 11% energy savings within one to three years, and up to 25% in the long term. Firms across Canada are already reaping the benefits of production flexibility and labour productivity — two strategic assets in today’s uncertain economic environment.
Yet the federal program that enables much of this work — the Green Industrial Facilities and Manufacturing Program — is about to run out of funding.
Budget 2026 should urgently renew industrial energy management funding in Budget 2026 to create good union jobs and build a more productive and resilient Canadian economy.
Capitalize a home retrofit financing system
Canadian households can reduce energy costs by 20–50% through upgrades such as insulation, windows, smart controls and heat pumps. Energy-efficient households lower bills, increase comfort and protect health.
However, high upfront costs and fragmented financing options remain major barriers to accessing upgrades. The federal government also abruptly cancelled the Canada Greener Homes Loan, reducing support for middle-income households.
Budget 2026 should establish a national home energy performance fund. This can provide low-cost, patient capital to financial institutions, utilities and community partners, which can then deliver fair deals for customers and new tools for productive home retrofit contractor businesses.
Modernize and scale building retrofits
A majority of Canada’s homes and buildings need essential upgrades to cut energy demand and improve safety, comfort and affordability. The federal government set a goal to support “energy-saving retrofits for up to one million households.”
Amid the current housing shortage, new builds are not sufficient. Yet two key federal programs guiding Canada’s retrofit system — the Deep Retrofit Accelerator Initiative (DRAI) and Greener Neighbourhoods Pilot Program (GNPP) — are about to run out of funding.
Budget 2026 should enable the creation of a new system capable of delivering more retrofits, deeper energy savings and carbon reductions consistent with net-zero emissions. It should also transition DRAI and GNPP from pilot projects toward mission-based teams.
Eliminate energy poverty
No-cost, direct-install retrofits are key to improving affordability for low-income Canadian households. Affordable energy efficiency solutions support the most vulnerable and reduce emissions. The government has begun rolling out the Canada Greener Homes Affordability Program (CGHAP), the first national energy efficiency program in decades that targets low-income Canadians.
But current funding for low-income retrofits is insufficient to support the nearly 2 million Canadian households struggling to afford the energy they need.
Budget 2026 should increase funding for low-income energy efficiency programs through CGHAP, ensuring all Canadians can access affordable, efficient and safe energy.
Fix and expand clean technology tax incentives
The Clean Technology Investment Tax Credit (ITC) aims to attract private investment in clean energy by offsetting a significant portion of costs. Projects benefit from refunds earlier in their lifecycle compared to other incentives.
However, uptake remains low due to complexity, uncertainty, and limited eligibility. Less than 24% of the projected investments were under review, and less than 1% was paid out by July 2025.
Budget 2026 should simplify and expand the Clean Technology ITC to enable pre-approval, clarify and expand eligibility, and improve coverage.
What the sector is saying
Energy efficiency delivers results across Canada
Energy efficiency is uniquely positioned to build a more competitive economy while ensuring that all Canadians can afford the energy they need. With a balanced and practical investment strategy, Canada can support households and businesses, improve international competitiveness, and cut emissions — in the short, medium and long term.
More than three-quarters of Canadians (77%) support government incentives to make energy-efficient housing more affordable.
Energy efficiency investments return $4–$7 in GDP per $1 invested while creating jobs and reducing costs for households and businesses.
Energy efficiency measures across Canada save enough energy annually to power over 20 million homes.
Get involved
Join Efficiency Canada in urging the Government of Canada to advance these solutions and to help build a stronger, more affordable, and more competitive country.
