If you are building a new home in Alberta with a high-ratio mortgage — meaning less than 20% down — you are required to pay CMHC mortgage default insurance. For most new home buyers, this premium adds thousands of dollars to their mortgage. What many builders and buyers in Alberta do not know is that a geothermal heating system in a new build can trigger a 25% refund on that premium through the CMHC Eco Plus program.
This guide explains exactly how Eco Plus works, what energy performance standard the home must meet, how to claim the refund, and how geothermal fits into the qualification path.
What Is CMHC Eco Plus?
CMHC Eco Plus is a program offered by Canada Mortgage and Housing Corporation (CMHC) that provides a 25% refund on CMHC mortgage insurance premiums for homebuyers whose newly purchased or newly built home meets a qualifying energy efficiency standard. It is available on NHA-insured mortgages — the standard high-ratio mortgage used by buyers with less than 20% down.
The program exists within a broader set of green home incentives described in our guide to Alberta geothermal rebates and incentives, alongside programs like the CEIP financing available to Edmonton homeowners (covered in our CEIP Edmonton guide). Eco Plus is specifically for new builds and works through the mortgage rather than as a direct grant or loan.
How Much Is the Eco Plus Refund Worth?
CMHC mortgage insurance premiums are calculated as a percentage of the insured loan amount. The rates depend on your loan-to-value ratio:
A buyer putting down 5% pays a premium of 4.00% of the mortgage amount. A buyer putting down 10% pays 3.10%. A buyer putting down 15% pays 2.80%. For a $600,000 home with a 5% down payment and a $570,000 insured mortgage, the premium is $22,800. A 25% Eco Plus refund on that premium is $5,700 — returned to the borrower after the home is confirmed to meet the qualifying standard.
For a $900,000 new build with a 10% down payment, the insured mortgage is $810,000, the premium is $25,110, and the 25% refund is $6,278. In Alberta’s new home market, this is meaningful money — and it is money most buyers are already paying regardless, simply because they have a high-ratio mortgage.
What Energy Standard Must the Home Meet?
To qualify for CMHC Eco Plus, the new home must achieve either an EnerGuide rating of 86 or above (on the current EnerGuide scale), or meet the requirements of an energy-efficient building standard such as ENERGY STAR for New Homes, R-2000, or Passive House.
A home with a geothermal heat pump, proper insulation levels (R-24+ walls, R-60+ attic), quality windows, and attention to air sealing typically achieves EnerGuide 86–92 depending on the specific build. This puts most well-specified new Alberta builds with geothermal heating comfortably within the Eco Plus qualification range.
The EnerGuide evaluation is conducted by a certified Energy Advisor (not by CMHC or your builder). The advisor assesses the home design before construction and confirms performance after construction. Your builder needs to be aligned with this process from the start — it cannot be retrofitted after the home is complete and the mortgage is funded.
Why Geothermal Is the Most Reliable Path to Eco Plus Qualification
A home’s EnerGuide rating is primarily determined by two factors: how well insulated and air-tight the envelope is, and how efficient the mechanical systems are. A gas furnace — even a high-efficiency one at 96% AFUE — scores significantly lower in the energy model than a ground source heat pump operating at 300–400% efficiency. Swapping from a gas furnace to geothermal can shift a home’s EnerGuide rating by 5–10 points.
In practical terms: a well-built Alberta home with gas heating might score EnerGuide 80–84. The same home with a geothermal system often scores 86–92 with no other changes. The geothermal system is frequently the single decision that determines whether a buyer qualifies for Eco Plus or not.
Our residential geothermal systems page covers the full new build installation process, and our why Alberta builders are choosing geothermal post covers the developer and builder perspective on this decision.
Step-by-Step: How to Claim the Eco Plus Refund
Step 1 — Choose an energy-efficient builder or specify geothermal: if building custom, specify a geothermal heat pump, R-24+ wall insulation, R-60+ attic, triple-pane windows, and HRV ventilation. This combination reliably reaches EnerGuide 86+.
Step 2 — Hire a certified Energy Advisor early: the EnerGuide process requires a pre-construction energy model and a post-construction evaluation. The advisor must be registered with Natural Resources Canada. Your builder can refer you to one, or you can find advisors through the Natural Resources Canada registry.
Step 3 — Complete your mortgage application with CMHC insurance: your lender processes the NHA-insured mortgage in the usual way. Make sure your mortgage specialist is aware you intend to apply for Eco Plus — they flag this on the mortgage application.
Step 4 — Post-construction EnerGuide evaluation: after the home is built and before final occupancy, the Energy Advisor conducts a blower door test and final evaluation to confirm the EnerGuide rating.
Step 5 — Submit the Eco Plus application to CMHC: provide your EnerGuide evaluation report to CMHC (through your lender or directly). CMHC processes the 25% premium refund, which is typically applied as a principal reduction on your mortgage.
Eco Plus and Other Incentive Programs: Can They Stack?
The Eco Plus refund is a mortgage insurance mechanism — it is separate from other incentive programs and does not reduce eligibility for other programs. It can in principle be combined with available provincial or municipal programs.
The federal 30% Clean Technology Investment Tax Credit applies to commercial and landlord applications, not to homeowner-occupied new builds, so it does not overlap with Eco Plus for most new home buyers. However, buyers building a rental property or multi-unit building should explore both programs with a tax professional.
For a complete current picture of all geothermal incentive options in Alberta, our geothermal rebates and incentives guide is the right reference.
What This Means for Your New Build Budget
The practical implication: adding geothermal to a new Alberta home build adds roughly $30,000–$45,000 versus a gas furnace. The Eco Plus refund returns $4,000–$8,000 immediately through the mortgage. Annual energy savings of $1,500–$2,500 versus gas heating begin immediately. Over 10 years, the combined effect of the Eco Plus refund plus energy savings exceeds the added cost of the geothermal system in most Alberta new build scenarios.
Our geothermal cost guide provides the full cost comparison framework, and our how geothermal works guide covers the technology before you engage installers.
Frequently Asked Questions
Does Eco Plus apply to resale homes or only new construction?
CMHC Eco Plus applies to new homes and to homes that have undergone major energy retrofits to reach the qualifying EnerGuide standard. The process and documentation for a retrofit qualification is more complex than for a new build. For most Alberta buyers, the practical Eco Plus opportunity is in new construction.
Does my builder need to be registered with CMHC for Eco Plus?
No. Eco Plus is a borrower program — the home buyer (or their lender) applies, not the builder. Your builder does need to cooperate with the EnerGuide evaluation process (providing plans and allowing the energy advisor access), but no special builder registration is required.
What if my home scores EnerGuide 84 instead of 86 — am I close enough?
No — EnerGuide 86 is the minimum. If your preliminary energy model shows 84, you need to improve the home design before building. Common improvements: upgrade wall insulation from R-22 to R-24, improve window specification, reduce air leakage target, or confirm the geothermal system sizing and controls. Your Energy Advisor can identify the cheapest path from 84 to 86.
Can I apply for Eco Plus after I have already closed on my mortgage?
No. The Eco Plus flag must be included in the CMHC mortgage application before the mortgage is funded. Once the mortgage is closed without the Eco Plus application, you cannot retroactively apply.
Ready to Plan a Geothermal New Build That Qualifies for Eco Plus?
Envirotech Geothermal works with builders, developers, and homeowners across Alberta on new construction geothermal projects. The team can advise on system specification to support your EnerGuide target. Contact us to start the conversation.
— Envirotech Geothermal | Helping Alberta homeowners and builders spec the right geothermal system for every incentive program — since 2006
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