Solar Power Ontario (2021 Guide)
Congratulations! You’ve found the ultimate guide for installing solar power in Ontario!
Published by Rylan Urban on Feb 15, 2018. Last updated May 1, 2021.
Ontario is currently ranked the #9 province in the country for installing a solar power system, scoring as one of the best provinces for upfront system costs and financing options.
This page contains all relevant information about installing solar in Ontario including utility policies, system financing, solar incentives, and natural factors – updated as of May 1st, 2021.
The guide begins by answering the two most common questions about solar systems, then it explores each solar ranking factor.
You can read from top to bottom, or skip to your preferred section by clicking on it below:
Common Solar Questions
When thinking about solar power, the first two questions that often come to a person’s mind are:
- “How big does my system need to be?”
- “How much will it cost?”
You can answer these questions in three basic steps:
1. Sizing Your System
To determine the size of system that you need, you only need to know how much energy you use during the course of a year. Your monthly hydro bill (see Hydro One’s Electricity Bill as an example) will show your usage (in kWh) similar to the photo below:
You can calculate your annual energy by adding up the amount shown for 12 consecutive months. Don’t make the mistake of multiplying a single month by 12 – usage fluctuates greatly depending on the season.
You can calculate the size of the solar power system that you’ll need with the following equation:
Size of system needed (kW) = yearly energy use (kWh) / annual equivalent full sunlight hours (h)
(annual average ‘equivalent full sunlight hours’ in Ontario = 1,166h)
For example, let’s pretend that you added up your power bills and determined that you use 10,000kWh over the course of a year. You would then do the above calculation and determine that you need a 8.58kW solar panel system!
10,000kWh / 1,166h = 8.58kW
2. Physical Sizing
Now that you know the size of your system in units of kW, you can determine how much space the system will require by converting it to units of sqft.
The average solar panel is approximately 18sqft in size (including some buffer room for racking and spacing) and produces about 300watts of power.
The equation to calculate the space that your solar system require is again simple:
Physical space required = size of system needed (in kW) / size of panel (in kW) * physical size of panel (in sqft)
(average size of panel = 0.3kW, average physical panel size = 18sqft)
Let’s continue from the previous section and assume that you need a 8.58kW system. You would do the above calculation and determine that you need 515sqft of space to install your system!
8.58kW / 0.3kW * 18sqft = 515sqft
(note that 300watts equals 0.3kW)
If you’re putting solar panels on your roof, you should know that:
- A south facing roof is best, east and west facing are good, but north is not great
- You may need to replace your shingles (or entire roof) before installing – because panels are guaranteed for 25 years!
If you’re putting solar panels on the ground, you should know that:
- These systems are more expensive upfront due to piling, mounting , and trenching requirements
- They are more efficiency because they can be easily placed to the optimal direction (south), the optimal angle (~45°), and to avoid shading
- Thus, these systems are more efficient and have better lifetime IRRs and NPVs.
Most residential homeowners in Ontario put solar panels on their roof. Rural property owners put systems on the roof of their house or shop – or on the ground in their yard.
3. System Costs
The last piece of basic information that you’ll want to know is an approximation of how much your system will cost. To calculate this, you just need to know the size of the system in units of kW.
The rough calculation is simple. Just take the size of your system and multiply it by the $2.46/watt – the average cost of installing a solar system in Ontario.
You can calculate your total system costs with the following equation:
System cost = size of system needed x cost per installed watt
Continuing with our previous example, we can see that a 8.58kW system would cost approximately $21,107 to install.
= 8,580watts x $2.46/watt
Note that the exact price of the system depends on several factors including the system size, the quality of equipment used, and the complexity of the job.
Even the range in the chart above is just an average – installation prices can easily go as high as $3.00+/watt for premium equipment and high quality installers.
Ready to get started? Then get a free personalized cost estimate:
Every year, we score every province and territory in Canada on the relative feasibility of installing a solar power system. This year, Ontario scores #9, receiving a total score of 59/100.
The remainder of this guide explores each ranking factor individually, while also providing important information about installing solar in Ontario.
(if you want to learn how we score each factor, please visit our Provincial Solar Rankings page)
Major Program: None
Ontario does not currently have any solar incentive programs. These factors are important because they reduce the upfront system costs. We’ve scored Ontario 0/20 for this section.
Rebates & Tax Breaks
The only solar rebate program that was available to Ontario homeowners was the GreenOn Solar Rebate Program – however, this was cancelled by the current conservative provincial government.
Businesses can now use the Federal Tax Provision for Clean Energy Equipment to fully expense their solar system. This means a CCA rate of 100% and the abolishment of the first-year rule.
Other Clean Energy Incentives
There are at least 4 other energy incentive programs available in Ontario. While not considered in our solar rankings, many homeowners choose to leverage these (i.e., home energy efficiency incentives) around the same time they switch to solar.
Production Potential: 1166kWh per kW per year
Ontario is one of the best provinces in terms of the natural factors that influence the maximal amount of energy that a system can produce. We’ve scored Ontario 17.5/20 for this section.
Ontario has the fifth-highest potential to produce solar energy in all of Canada, receiving more solar irradiation than most other provinces except for the prairies and Quebec!
According to data from Natural Resources Canada, the average solar system in Ontario can produce 1166kWh of electricity per kW of solar panels per year.
Here is how much an average solar system can produce each month, as well as the solar irradiance potential map for Ontario:
This yearly average decreases as you move north in the province and increases as you move south. For example, a 1kW solar system in:
- Toronto would produce about 1,163 kWh/yr
- Ottawa would produce about 1,199 kWh/yr
- Mississauga would produce about 1,160 kWh/yr
- Brampton would produce about 1,155 kWh/yr
- Hamilton would produce 1,152 kWh/yr
Recall that this is the number we used in the System Sizing section!
(maps and solar irradiance data for all other provinces and territories can be found on our Solar Maps page.)
Connection Policy: Net Metering
Rate Design: $0.13/kWh, Tiered
Ontario scores behind most of the provinces when it comes to utility-related factors.
Utility factors determine how much money your utility will pay you for the power you produce, along with how much money you will save on your power bill by reducing your usage. We’ve scored Ontario 22/30 for this section.
Net Metering is one of the most important policy mechanisms that makes solar a feasible energy generation option.
Net Metering essentially means that you earn credits for the excess energy that you produce, which can then be used at a later time. It’s common to produce excess energy during the day and summer but not enough at night and during the winter – so this policy is important!
Good net metering policy allows you to earn full credits for your excess energy which can be carried month-to-month. Bad net metering policy allows you to earn only partial credits for excess energy and credits can’t be carried forward month-to-month.
Ontario’s Net Metering Program falls in the “good” category for net metering policies. It allows for any size of system to be connected to the grid (but utilities can request smaller sizer) and credits can be carried forward month-to-month.
However, it’s important to note that net-metering credits in Ontario expire yearly. Thus, you’ll want to work closely with your installer to make sure your system perfectly matches your energy usage.
Solar Setup Fees
Solar setup fees vary greatly across the province. For example, if you’re a Hydro One customer you don’t have to pay anything, but if you’re a Guelph Hydro customer you have to pay $1,700 for an interconnection study and a bi-directional meter.
This is opposed to several other provinces like Alberta and British Columbia where there are no setup fees for anyone.
Ontario enjoys some of the lowest electricity prices in the country – but lower prices mean lower savings potential when you switch to solar.
Based on a monthly usage of 1,000kWh, the average total cost of electricity in Ontario is $0.130/kWh (this number includes both fixed and variable costs).
This number is higher than the Canadian average of $0.138/kWh (excluding the territories), meaning that property owners in Ontario have moderate savings potential!
(methodology and data on other provinces and territories can be found on our Electricity Prices page.)
Utility Bill Rate Design
Good electricity rate design allows you to save money when you save energy. This might sound intuitive – but not all provinces are same. Superior designs have low fixed monthly fees and tiered electricity rates. Inferior designs have high fixed fees and flat electricity rates.
Ontario scores near the front of the pack when it comes to these factors – having time-of-use rates and fixed monthly fees of $26 (taking into account Ontario’s electricity rebate).
For example, reducing your electricity bill from 1,500 to 750 kWh per month will save you 54% on your electricity bill in British Columbia, 48% in Nova Scotia, but only 43% in Ontario!
Note that fixed monthly fees don’t disappear even if you switch to solar – you’ll pay them as long as you remain connected to the grid. But this isn’t a bad thing – $26/mo is a small price to pay for using the grid as your back-up energy source!
(methodology on our Electricity Prices page.)
The only way to completely remove your fixed costs is to go off the grid, something most homeowners in Ontario don’t do because of high battery costs.
Disconnecting from the grid also means that you won’t be able to participate in your utility’s net metering program.
Upfront Cost: $2.46/watt
Financing: Partial PACE
Ontario is the best province in the country when it comes to financial factors because of low up-front costs and PACE financing options in Toronto. We’ve scored Ontario 19/30 for this section.
Cost of Installation
The upfront cost of installation is obviously one of the largest factors that determine whether or not a person is going to switch to solar. The current average price range in Ontario is about $2.34-$2.59/kW.
(not sure what this number means or how to use it? Jump back up to the Common Questions section.)
However, the price can easily be higher or lower depending on the size of the system, the complexity of the job, the type of equipment used, and even on the quality of your installation company.
In general, aiming for the cheapest price shouldn’t be your goal. Most solar panels are guaranteed to last for 25 years, so you want to make sure that your installation job is good enough to support that.
You’ll also want to be sure that the company you choose will be around in 5 to 10 years from now in case you need service or warranty work done. If you get a quote through us, we’ll connect you with a pre-vetted installer!
Property Assessed Clean Energy (PACE) is an innovative financing option that allows you to cover the entire upfront cost of your solar system (or energy efficiency upgrades) with a $0 down, long amortization period, low interest ‘loan’.
However, unlike a typical loan, this loan is attached to your property (not you) and is paid back on your property tax bill as a Local Improvement Charge (LIC). The only eligibility is that you need to own a certain portion of your home.
While the legislation does exist in Ontario for PACE financing, the only major example of a municipality actually enabling it is the Home Energy Loan Program in Toronto.
Guelph may also be enacting a PACE program in the near future.
Other Energy Financing
Obviously though, PACE is not the only way to finance a solar system. Systems can be financed by cash, bank loans, installer financing, home equity loans, a home equity line of credit, a mortgage (for new builds), or through energy loans.
Other options for Ontario homeowners:
- RBC Energy Saver Loan (energy loan)
- Up to 10 years amortization
- RBC contact number: 1-800-769-2511
Solar Power Ontario
Because of good financing options, lowest installation costs, but a lack of incentives – we rank Ontario as being the #9 best province in the country for switching to solar power.
Ready to get started? Then get a free personalized cost estimate: