Ontario Solar Incentives Under Save on Energy to Be Reduced in June 2026 — What Industrial Manufacturers Need to Know
Save on Energy has announced a reduction to its Retrofit program incentives for onsite solar generation, effective June 30, 2026. For Ontario manufacturers evaluating solar, this update makes project timing a more critical variable than it has been in previous years.
The Save on Energy Retrofit program has been a meaningful pathway for Ontario manufacturers to offset the capital cost of on-site solar projects. That pathway remains open after June 30 — but at a lower incentive rate. For facilities already evaluating solar, the deadline is a concrete financial variable, not a sales tactic.
What Is the Save on Energy Retrofit Program?
The Save on Energy Retrofit program is administered by the Independent Electricity System Operator (IESO) on behalf of the Province of Ontario. It provides financial incentives to eligible commercial, industrial, and institutional facilities that invest in energy efficiency and distributed energy resources (DER).
For Ontario manufacturers, the program has been a predictable pathway to offset capital costs of on-site solar PV systems. Incentives are structured as prescriptive payments per kilowatt alternating current (kW-AC) of installed capacity — scalable and straightforward for project financial modelling.
The program is available to facilities across Ontario served by local distribution companies (LDCs), including manufacturers in the GTA, Hamilton, Kitchener-Waterloo, London, Windsor, Ottawa, Sudbury, Thunder Bay, and across Southwestern Ontario and the Greater Golden Horseshoe.
What Is Changing: The June 30, 2026 Solar Incentive Reduction
Effective June 30, 2026, Save on Energy will reduce the incentive for the Prescriptive Small-to-Medium Generation Solar DER measure for systems greater than 10 kW-AC:
| Measure | Current Rate | Rate After June 30, 2026 | Change |
|---|---|---|---|
| Solar DER incentive (>10 kW-AC) | $860/kW-AC | $770/kW-AC | −$90/kW-AC (~10%) |
This incentive applies to grid-connected, behind-the-meter solar photovoltaic systems greater than 10 kW-AC installed at eligible Ontario industrial or commercial facilities. These are not feed-in or export systems — they offset a facility’s electricity consumption from the grid.
The Dollar Impact at Scale
A 10% reduction may appear modest in isolation. At the system sizes typical for industrial facilities, the financial difference is substantial.
Industrial solar projects are evaluated on IRR, simple payback period, and NPV. Incentive funding directly affects all three. A reduction from $860 to $770/kW-AC effectively increases the net capital cost of a solar project by the same amount — which can shift a project from approval to deferral at the board level.
The more common scenario is not a deliberate decision to wait — it’s a timeline that slips past the window because internal approval cycles take longer than anticipated.
Who This Affects
The Save on Energy solar DER incentive is broadly available to eligible facilities served by Ontario LDCs. Industries where this change is most directly relevant:
Automotive Parts
Ontario’s largest manufacturing subsector
Food & Beverage
High daytime electricity demand
Metal Fabrication
Primary metals and fabrication operations
Distribution & Warehousing
Large, unobstructed roof areas
Plastics & Rubber
Manufacturing with stable long-term operations
Chemical & Pharma
ICI pricing exposure and high consumption
Printing & Packaging
Daytime-heavy operations
Commercial Property
Improve NOI and long-term asset value
What Remains Available After June 30, 2026
The Save on Energy Retrofit program is not ending. Solar incentives will remain available after June 30, 2026 — simply at a revised rate of $770/kW-AC rather than the current $860/kW-AC.
Facilities that miss the June 30 deadline are not foreclosed from accessing program support. However, any financial modelling or business case prepared using the current $860/kW-AC figure will need to be revised.
Key Dates and Next Steps
Frequently Asked Questions
Frequently Asked Questions
Does the incentive reduction apply to all solar projects, or only new ones?
The revised rate applies to Retrofit applications submitted on or after June 30, 2026. Projects with complete applications submitted before that date will be reviewed under the current $860/kW-AC rate, subject to approval.
What counts as a “complete” Retrofit application?
A complete application includes all required documentation: energy savings calculations, equipment specifications, site information, and contractor details. Partial or incomplete submissions will not be considered under the current rate.
Is the wall-mounted solar DER change separate from the incentive rate change?
Yes. The removal of wall-mounted solar DER configurations from program eligibility is a separate update that affects system design options, independent of the rate change for ground-mount and rooftop systems.
Is the Save on Energy program ending after June 30?
No. The program continues. Solar incentives remain available at $770/kW-AC after June 30. The deadline only determines which rate applies to your application.
Where can I find more information on the Save on Energy Retrofit program?
Visit saveonenergy.ca/News-and-Updates for official program updates and application guidance.
Find out if your facility qualifies before June 30
Circuit Energy offers a free, no-obligation solar assessment for Ontario facilities. We’ll review your site, model the incentives, and tell you where you stand — no pressure.
