Navigating Commercial Lighting Rebates in Ontario: A 2026 Guide

For many facility managers and property owners in Toronto, Ontario, the decision to upgrade to energy-efficient LED lighting is often delayed by one primary concern: the upfront cost. However, in 2026, the financial landscape for energy retrofits will become more favorable than ever. Between rising electricity rates and aggressive provincial carbon-reduction targets, the available incentives are designed to make “waiting” the most expensive choice you can make. This blog we will explore about  commercial lighting rebates in Ontario.

At Faraday Lighting, we specialize in maximizing these rebates and returns. Navigating the paperwork of the Save on Energy programs and various utility incentives can be daunting, but understanding the core opportunities is the first step toward a self-funding lighting project.

The Core Opportunity: Save on Energy Retrofit Program

The flagship incentive for Ontario businesses remains the Save on Energy Retrofit Program. Managed by the Independent Electricity System Operator (IESO), this program is specifically tailored for commercial, industrial, institutional, and multi-residential facilities.

The program offers two primary pathways for funding:

1. The Prescriptive Track (Instant & Simplified)

This track is ideal for standard upgrades where the energy savings are easily predictable. It provides a “per-unit” rebate for specific technologies.

• Eligible Upgrades: LED T8 tube replacements, integrated LED troffers, and high-efficiency outdoor wall packs.
• Instant Discounts: Many point-of-sale discounts are now available through participating distributors, allowing businesses to see immediate price reductions without waiting for a check in the mail.

2. The Custom Track (For Complex Industrial Facilities)

If your facility has unique operational hours or specialized equipment, such as a heavy manufacturing plant or a 24/7 distribution center, the Custom Track often yields higher returns.

• Focus on Peak Demand: Incentives are calculated based on your facility’s specific reduction in peak demand (measured in kW) and overall energy consumption (kWh).
• Advanced Controls: This track heavily incentivizes networked lighting controls, occupancy sensors, and daylight harvesting systems, which can sometimes double the total rebate amount.

Regional Adders: Double Your Incentives

One of the most significant changes in 2026 is the introduction of Regional Adders. To manage grid constraints in specific parts of the province, the IESO is offering “bonus” incentives in designated zones.

If your business is located in an area with high electricity demand, such as parts of the GTA, the Niagara Region, or specific industrial corridors in Southwestern Ontario, you may be eligible to double your standard incentive. This can often push the rebate coverage to nearly 50% of the total project cost, drastically shortening the payback period.

The Small Business Program: Up to $3,000 in Direct Support

For smaller operations (typically those with 50 employees or fewer), the Small Business Program provides a more accessible entry point.

• Direct Install: Eligible small businesses can receive up to $3,000 for lighting upgrades.
• No Out-of-Pocket Costs: In many cases, the incentive covers the full cost of materials and installation, allowing business owners to complete these upgrades at no cost.

Why Technical Compliance Matters (DLC & Energy Star)

To qualify for any provincial rebate, the products used must meet strict performance standards. Most Ontario programs require fixtures to be DLC (DesignLights Consortium) Premium or Energy Star certified.

Using non-certified “off-the-shelf” products from generic retailers usually results in a zero-dollar rebate. This is where Faraday Lighting’s turnkey approach adds value: we source only utility-approved products and pre-vet them to maximize rebate eligibility.

Common Pitfalls: Why Some Rebates Get Rejected

Securing a rebate is not a guarantee; it requires strict adherence to a specific process.

• Lack of Pre-Approval: Many programs require you to submit an application before the work begins. If you install the lights first and then ask for the money, you may be disqualified.
• Inaccurate Baseline Data: To claim custom rebates, you must provide an accurate picture of your existing energy use. A professional lighting audit is essential here to establish a baseline that the utility will accept.
• Incomplete Documentation: Invoices must show specific manufacturer part numbers and certifications to prove the products meet the program’s efficiency requirements.

How Faraday Lighting Simplifies the Process

The biggest barrier to energy savings isn’t technology, it’s the bureaucracy. Faraday Lighting acts as your dedicated rebate manager. Our turnkey service includes:

1. On-Site Audit: We identify every eligible fixture and control opportunity.
2. Application Management: We handle the entire submission process with the IESO and local utilities.
3. ESA-Compliant Installation: We ensure the project meets all safety codes, which is a prerequisite for final rebate payouts.
4. Final Verification: We assist with the post-installation site visits often required by the utility to release your funds. View all services.

Conclusion: Don’t Leave Money on the Table

In 2026, energy-efficient lighting will no longer be an “extra”, it is a necessity for a competitive business. With the combination of standard rebates, regional adders, and the long-term reduction in your Global Adjustment charges, there has never been a better time to audit your facility.

Is your facility in a double-incentive zone? Our team can check your eligibility instantly based on your location and current lighting setup.

Contact Faraday Lighting for a Rebate Eligibility Assessment