Cost of Solar Panels in Ontario (2026): Prices, Rebates & Savings | Xolar

Cost of Solar Panels in Ontario: Complete 2026 Guide

by Xolar |

Switching to solar energy is becoming more popular in Ontario, thanks to the environmental benefits and long-term savings. At Xolar, we help homeowners understand the costs, the installation process, and the available incentives to make switching to solar simple and affordable.

How Much Do Solar Panels Cost in Ontario in 2026?

The cost of installing solar panels in Ontario ranges from $2.42 to $3.50 per watt in 2026, making Ontario one of the most affordable provinces in Canada for solar installations. For a typical Ontario home, the total solar panel system cost falls between $15,000 and $28,000 before incentives — and can drop to as low as $10,000–$18,000 after available solar incentives and rebates.

Ontario has the 5th highest solar energy potential of all Canadian provinces, with southern Ontario receiving some of the best sunlight in the country. Solar installations in Ontario produce an average of 1,166 kWh of electricity per year for every 1 kW installed — meaning a properly sized solar system can offset 80–100% of your electricity bills.

This comprehensive guide covers everything Ontario homeowners need to know about solar costs in 2026: pricing by system size, available rebates and financing, payback periods, net metering, and how to choose the right system for your home.

Solar Panel Costs by System Size in Ontario

The cost of solar panels depends primarily on system size, which is determined by your energy consumption, available roof space, and energy goals. Here’s what Ontario homeowners can expect to pay in 2026:

Cost Breakdown by System Size (Before Incentives):

What’s included in these costs: Solar photovoltaic panels, inverter(s), racking and mounting hardware, wiring, permits, professional installation, ESA inspection, and net metering application.

According to the Ontario Energy Board, the average Ontario household consumes about 9,000 kWh per year. To offset 100% of that usage, most homeowners need a 7.5–8 kW solar panel system — typically costing $18,000–$28,000 before rebates.

Where your money goes (typical cost breakdown):

• Solar panels: 35–40% of total system costs
• Inverter(s): 20–25%
• Racking and mounting hardware: 20–25%
• Labour, logistics, and permits: 15–20%

Ontario Solar Incentives & Rebates (2026)

Ontario homeowners can access several programs that significantly reduce installation costs and improve the overall return on investment when installing solar panels.

Home Renovation Savings Program (HRSP) — Up to $10,000

Ontario’s flagship solar incentive, launched January 2026, provides combined rebates of up to $10,000:

• Solar panels: Up to $5,000 ($1,000 per kW installed, up to 50% of total costs)
• Battery storage: Up to $5,000 (must be paired with a new solar PV system)

Delivered by Save On Energy and Enbridge Gas with support from the Ontario government.

Important note about net metering: Solar panels installed under HRSP must be sized for load displacement only — the electricity generated is used exclusively to meet your home’s consumption needs. Homeowners who receive the HRSP incentive for solar PV and battery storage are not eligible for a net metering agreement. You must choose one or the other — HRSP rebate or net metering — so discuss both options with your installer to determine which provides greater long-term savings for your situation.

Home Energy Loan Program (HELP) — Toronto

Toronto homeowners can borrow up to $125,000 at competitive interest rates (currently 4.67%) for energy improvements including solar panels and battery storage. Repayment is through your property tax bill over up to 20 years, with no penalties for early payoff. This is one of the most generous municipal solar financing programs in Canada.

Better Homes Ottawa Loan Program

Ottawa homeowners can access low-interest, long-term loans for energy-efficient upgrades including solar installations. Zero-interest options are available for qualifying low-income households.

Enbridge Home Efficiency Rebate Plus

Extended until 2027, Enbridge provides grants of up to $10,000 for energy upgrades including solar panels (up to $5,000). Can potentially be stacked with HRSP for maximum savings — check current program guidelines.

Durham Greener Homes Deep Retrofit Rebate

Durham Region homeowners can earn incentives of $5,000 to $10,000 for significant home retrofits that reduce greenhouse gas emissions by 50% or more. Solar installations qualify as part of a comprehensive retrofit package.

Federal Programs (Status Update)

Canada Greener Homes Loan — ENDED: The $40,000 interest-free federal loan program closed to new applications on October 1, 2025. Over 120,000 loans were issued before closure. No replacement program has been announced.

Canada Greener Homes Grant — ENDED: The $5,000 grant for energy-efficient retrofits closed to new applicants in 2024.

Clean Technology Investment Tax Credit (ITC): Businesses investing in clean energy equipment (including solar photovoltaic systems) may be eligible for a 30% refundable tax credit. Consult a tax professional for commercial solar installations.

Net Metering in Ontario: How It Works

Ontario’s Net Metering program allows homeowners to generate their own electricity using solar panels and receive credits on their electricity bills for any excess power they produce. The program is administered by the IESO and is available to customers of any Ontario utility — including Hydro One, Toronto Hydro, Alectra, and others.

How net metering works:

1. Your solar panels generate electricity during daylight hours
2. Energy you use immediately offsets your grid consumption
3. Excess energy flows to the grid and earns you 1:1 credits at the retail electricity rate
4. Credits carry forward on your electricity bills for up to 12 months
5. Unused credits expire after 12 months (they don’t roll over indefinitely)

Why this matters for system sizing: Since Ontario credits expire annually, it doesn’t make financial sense to dramatically oversize your solar system. The goal is to match your solar production as closely as possible to your annual electricity consumption. Your installer should size your system based on your actual usage history.

Net metering systems in Ontario are limited to 500 kW — more than enough for any residential solar installation.

Note: Homeowners who receive the HRSP solar incentive are not eligible for net metering. The HRSP program requires systems to be designed for load displacement only.

Ontario Electricity Rates & Why Solar Makes Sense

Ontario’s electricity costs have been rising steadily, making solar energy increasingly attractive for homeowners looking to reduce their electricity bills and lock in long-term energy savings.

Current Ontario Rate Plans:

Time-of-Use (TOU) Rates:

• Off-Peak: 7.6¢/kWh
• Mid-Peak: 12.2¢/kWh
• On-Peak: 15.8¢/kWh

Ultra-Low Overnight (ULO) Rate Plan (available November 2025+):

• Ultra-Low Overnight (11pm–7am): 2.8¢/kWh
• Weekend Off-Peak: 7.6¢/kWh
• Mid-Peak: 10.1¢/kWh
• On-Peak: 24.0¢/kWh
• Ultra-High Peak (4pm–9pm weekdays): 28.6¢/kWh

Why the ULO plan is a game-changer for solar owners: With TOU or ULO billing, your solar panels produce power during the most expensive daytime hours — earning you credits at peak rates. You only draw from the grid at night during the lowest-rate periods. This rate structure makes solar installations in Ontario particularly advantageous compared to flat-rate billing provinces.

A solar system paired with battery storage lets you take even greater advantage of the ULO plan by storing daytime solar power and using it during the ultra-high peak evening hours (28.6¢/kWh), while buying grid electricity only during ultra-low overnight hours (2.8¢/kWh).

The Ontario Energy Board raised all rates by 20% in 2024, and rates are expected to continue rising. Installing solar panels locks in your energy costs for 25+ years, providing long-term protection against increasing electricity bills.

Payback Period for Solar Panels in Ontario

The payback period — how long it takes for energy savings to cover your installation costs — is the most important financial metric for any solar investment.

Typical payback period in Ontario: 8–12 years

This varies based on:

• System size and cost — larger systems cost more but produce more savings
• Your electricity consumption — higher usage = faster payback
• Rate plan — TOU and ULO plans provide better economics for solar
• Incentives applied — HRSP, HELP, or other programs reduce upfront costs
• Self-consumption ratio — using solar power directly (vs. exporting) saves more

Example payback calculation:

An 8 kW solar system costing $22,000 before incentives:

• After HRSP rebate ($5,000): Net cost = $17,000
• Annual electricity savings: ~$2,200 (based on average Ontario consumption and rates)
• Simple payback: ~7.7 years
• With panels lasting 25–30 years: 17–22 years of essentially free electricity after payback

After the payback period, your solar panel system continues generating free electricity for many years or decades — leading to significant long-term savings of $30,000 to $60,000+ over the system’s lifetime.

Important: This calculation does not include the increase to property value that homes receive from installing solar. Studies suggest homes with solar sell for 3.5% more on average — adding $17,500 in value to a $500,000 home.

Battery Storage Costs in Ontario

Adding battery storage to your solar installation provides backup power during outages and lets you maximize savings by storing excess solar power for evening use.

Battery storage costs in Ontario:

• Tesla Powerwall 3: $12,000–$15,000 (13.5 kWh capacity)
• SolarEdge Home Battery: $10,000–$14,000 (various capacities)
• Total system + battery: $25,000–$43,000 (before incentives)

HRSP battery rebate: Up to $5,000 for battery storage paired with a new solar PV system. This brings the net battery cost to $5,000–$10,000 for most installations.

Battery storage is not required for a grid-connected solar installation, but it’s increasingly popular for Ontario homeowners who want energy independence during power outages or who want to maximize TOU/ULO rate arbitrage.

Xolar systems are designed to be battery-ready — you can start with solar panels alone and add battery storage later without major modifications. Many customers start with solar and add batteries 1–2 years later after seeing their energy production patterns.

Panel Types & Equipment Quality

The solar panels, inverters, and mounting equipment you choose affect system performance, longevity, and cost. Here’s what Ontario homeowners need to know:

Solar Panel Types:

Most Ontario solar installations use monocrystalline panels — they deliver the best long-term value with higher energy efficiency and production, backed by 25-year performance warranties. Leading brands installed by Xolar include premium manufacturers with strong warranty track records and panels rated for Canadian winter conditions.

Inverter options:

• String inverters: Single device near your electrical panel, 10–15 year warranty
• Microinverters: One per 1–2 panels, 25-year warranty, better for shaded roofs
• Optimizers + string inverter: Best of both worlds, panel-level optimization with 25-year warranty

Spending more on a 25-year inverter warranty upfront saves you a guaranteed replacement cost down the road — matching the lifespan of your solar panels.

Permitting & Additional Costs in Ontario

Beyond the solar panel system itself, there are a few additional costs to factor into your budget:

Municipal permits: Costs vary by municipality in Ontario. Examples:

• Toronto: Minimum $206.53 + $89.22/hr for examination and inspection
• Hamilton: Minimum $291 for residential solar installations
• Niagara Falls: Flat fee of $371
• Other municipalities: Typically $200–$500

ESA (Electrical Safety Authority) inspection: Required for all grid-connected solar installations in Ontario. Usually handled by your installer.

Utility connection fee: Your local distribution company (LDC) may charge a fee to process your net metering application and install a bi-directional meter.

HST: Ontario’s 13% Harmonized Sales Tax applies to solar panel purchases and installation. While there isn’t a specific HST rebate for solar, homeowners may be eligible for the Ontario Energy and Property Tax Credit (OEPTC).

Home insurance: Solar panels increase your home’s replacement value, which may lead to slightly higher insurance premiums ($75–$150/year additional). Notify your insurance provider when you install solar and keep documentation on file.

Good news: Xolar’s quoted prices include professional installation, engineering and design, all required permits, ESA inspection, and net metering application assistance. We provide transparent, all-in pricing with no hidden fees.

System Sizing Guide for Ontario Homes

Choosing the right solar system size is critical for maximizing your return on investment. Here’s how to determine what you need:

Step 1: Find your annual electricity consumption Check your electricity bills for the past 12 months. Add up the total kWh usage. The average Ontario home uses approximately 9,000 kWh per year.

Step 2: Calculate your required system size Divide your annual consumption by 1,166 (the average kWh production per kW installed in Ontario):

• 7,000 kWh ÷ 1,166 = 6.0 kW system
• 9,000 kWh ÷ 1,166 = 7.7 kW system
• 12,000 kWh ÷ 1,166 = 10.3 kW system

Step 3: Factor in future needs Planning to buy an electric vehicle• Add a heat pump• Growing family• Size your system (or at least your inverter) to accommodate future electricity consumption increases.

Step 4: Assess your roof South-facing roofs produce the most solar energy in Ontario. East and west-facing roofs produce ~80% of optimal. North-facing roofs are generally not suitable for solar. Flat roofs work well with tilted mounting systems.

Xolar provides a free energy assessment to recommend the perfect solar system size for your specific home, roof, and energy goals.

Frequently Asked Questions

Q: How much do solar panels cost in Ontario in 2026? A: The average cost ranges from $2.42 to $3.50 per watt. A typical 7.5–8 kW system for an average Ontario home costs $18,000–$28,000 before incentives. After the HRSP rebate ($5,000 for solar), net costs drop to $13,000–$23,000.

Q: What solar rebates are available in Ontario in 2026? A: The Home Renovation Savings Program (HRSP) provides up to $10,000 ($5,000 solar + $5,000 battery). Toronto’s HELP program offers loans up to $125,000. Enbridge offers up to $10,000 in efficiency rebates. The federal Greener Homes Loan ended October 2025.

Q: How long do solar panels take to pay for themselves in Ontario? A: The typical payback period is 8–12 years. After that, you benefit from 15–20 years of essentially free electricity. With HRSP rebates reducing upfront costs, payback can be as fast as 7–8 years for systems that maximize self-consumption.

Q: Do solar panels work in Ontario winters? A: Yes. Solar panels produce electricity year-round, even in winter and on cloudy days. Cold temperatures actually improve panel efficiency. While winter production is lower (60–75% of peak), Ontario’s long summer days (15+ hours of daylight) more than compensate. Annual production estimates already account for seasonal variation.

Q: Should I choose HRSP rebate or net metering? A: This depends on your situation. HRSP provides $5,000–$10,000 in upfront savings but requires load-displacement-only sizing (no exporting). Net metering lets you earn credits for excess energy year-round but doesn’t provide upfront rebates. For most homeowners with moderate energy usage, HRSP + battery provides the best total savings. Discuss both options with your Xolar solar specialist.

Q: Can I add battery storage later? A: Yes — all Xolar solar installations are designed to be battery-ready. You can add a Tesla Powerwall or other battery storage at any time without major modifications. Many customers start with solar panels and add batteries 1–2 years later.

Q: How much can I save with solar panels in Ontario? A: Most Ontario homeowners save $2,000–$2,400 per year on electricity bills. Over 25 years, total savings typically range from $30,000 to $60,000+ depending on system size, electricity consumption, and rate plan. Solar panels also increase property value by approximately 3.5%.

Q: What happens to my solar panels if I sell my home? A: Solar panels are a physical asset that increases your home’s value. Your net metering contract with the utility is fully transferable to the new homeowner at no cost. We recommend selling the system with the house to maximize your return on investment.