Federal Minister says $20 million to move New Brunswick households off furnace oil just a start

Ottawa is pumping in $20 million to get more New Brunswick households off furnace oil and add heat pumps and insulation, a measure that will help only a small fraction of homes.

Federal Environment Minister Steven Guilbeault announced in Fredericton on Monday his Liberal government would provide the money to the province so that NB Power can ramp up its enhanced energy savings program.

“Home heating oil is the most costly, polluting and inefficient way of heating a home, which is why we decided to target first and foremost this form of energy,” Guilbeault told reporters at St.Thomas University in Fredericton.

“What we discovered is that for many homeowners, especially in Atlantic Canada but not only Atlantic Canada, being able to make the transition to home heating oil to something else was very difficult to do because many of those homeowners tend to be low to moderate income. So they don’t have the money to pay for the upfront costs of making the transition, which is why we have come up with new programs, between the federal and provincial governments that are participating, we can pay up to 100 per cent of the cost of making that transition.”

The Opposition Conservatives and premiers in western Canada have criticized the Liberal government for putting a three-year pause on carbon tax on home heating oil last October without making a similar concession for natural gas. More Atlantic Canadians use oil to keep themselves warm, whereas far more westerners use natural gas.

The $20 million promised on Monday through the Future Electricity Fund is specifically meant for households that want to convert from oil, rather than electrical, heat. The Higgs Progressive Conservative government has already pledged up to $100 million to get people off wasteful electric baseboard heat.

Guilbeault said the new funding, combined with other federal programs, would spell the end of home heating oil.

“It will enable us to help tens of thousands of people make the transition. And then carbon pricing will come back. But by then we figure that there won’t be a whole lot of people using home heating oil.”

New Brunswick’s enhanced energy savings program allows moderate to low-income households to save money. Last year, Lori Clark, NB Power’s CEO, told a committee it was saving the average household $460 a year, slashing their heating bill by nearly one-quarter. Most of those people had been heating with electric baseboards.

Since launching on Sept. 28, 2022, the public utility has fully completed insulation and heat pump installations in more than 5,600 households and is working with contractors to do installations on another 2,600.

But those roughly 8,200 households are only the first wave. In total, more than 23,000 have signed up, leaving close to 14,800 on the waitlist.

And when you consider New Brunswick has about 338,000 households – including 118,000 that meet the household income cutoff threshold of $70,000 -you get a sense of the enormity of residential energy waste in the province.

Guilbeault admitted the $20 million the Trudeau Liberal government was returning via a carbon tax on heavy industry in New Brunswick would only make a dent.

“This is one of many announcements to come in New Brunswick as well in other Atlantic provinces to ensure we can help more homeowners reach these goals of energy efficiency,” the minister said. “Clearly, we need to do more, and in fact, we are doing more. As I said, there will be many more announcements.”

Clark said Monday’s announcement was a milestone in NB Power’s quest to green its grid, part of its overall strategic plan to stop using polluting coal to fire the Belledune Generating Station by 2030 and be a net-zero utility by 2035, meaning it won’t create any greenhouse gas emissions that warm the planet.

“Energy efficiency programs are making a tangible impact on changing the lives of our customers,” she said, adding that it allowed New Brunswickers to better manage their electricity bills, be more comfortable and help the environment.

But Green party Leader David Coon was more critical, arguing $20 million wasn’t enough.

He told reporters he agreed industrial carbon taxes should be tapped to pay for the program but said those taxes could be set higher.

And he made a comparison with the federal funding already dedicated to small nuclear reactors -$120 million over five years, announced in 2022. He’s opposed to nuclear energy, saying it is too costly and risky.

“We need enough to eliminate the long waiting list,” Coon said of people waiting for the free heat pump, insulation and air sealing program. “And a lot of people haven’t bothered to apply yet. It would be the most effective investment of public money one could imagine because of the tremendous energy savings for householders and the reduction in the carbon footprint.”

Guilbeault was also asked about the impact his government’s policies would have on the oil industry and specifically the Irving Oil refinery in Saint John. The company employs 4,000 across all its operations, with many of those workers in New Brunswick.

The company has embarked on a strategic review that includes the possible sale of the business. It has made no secret that federal policies haven’t helped its bottom line.

The minister pointed out that people around the world are turning to electric cars. On average one out of 10 cars sold in Canada is electric. In neighbouring Quebec, it is one in five and in British Columbia, one out of four, he said.

“Canadians are embracing electrical vehicles which will obviously drive down the demand for refined oil products,” he said. “Clearly for these companies the future is in alternatives, which is why we are helping them invest in biomass, alternative fuels, hydrogen, because that’s where the world is heading.”