General HVAC News, Tips & Advice

The impact of pollution on the environment is a major concern for governments across the world, and many have taken steps to control emissions and encourage greener alternatives.

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Canada’s new extended Carbon Tax will be implemented on April 1st, 2019 and is a new initiative to help control Canada’s impact on the environment. It now covers all provinces in Canada, so here’s a look at this tax and its implications.

What Is A Carbon Tax? The Carbon Tax Explained

This tax is applied to activities that cause emissions, specifically greenhouse gasses like carbon dioxide. The tax makes it more expensive to carry out these activities, which means there’s a strong incentive for people to reduce these emissions where they can.

However, this is proposed to be a revenue-neutral tax, which would mean all of the money collected would be redistributed to Canadian taxpayers.

Around 90% of the tax will be returned to Canadians through household rebates, which, in many cases, will help people save money on the purchase and running of a new heating system.

The remaining 10% will go to:

• Schools
• Hospitals
• Small to mid-sized business
• Organizations that won’t be able to pass the tax to consumers directly

In all, the government discourages pollution through this tax, provides an incentive to help reduce emissions and doesn’t hold onto any of the money.

Carbon Tax Facts

People are naturally wary of taxes and parting with their cash. Some critics also raise concerns about a potential impact this tax could have on the economy. Economists however note that these concerns aren’t entirely founded.

Understanding the tax structure and its impact on regular citizens can help reduce some of their worries:

• The new Carbon Tax will be $20 per ton of emission. This will increase each year until it reaches $50 per ton in 2022.
• The impact of this tax depends on the intensity of emissions caused by electricity production in every province, and the fuel used for household heating, whether it be oil, electricity or natural gas.
• Provinces like Alberta, Nova Scotia and Saskatchewan, who use coal-fired plants to produce electricity, will see higher carbon pricing.
• Consumption rates will vary based on location and the weather conditions of the province. Colder provinces will have higher consumption and related costs.
• Homeowners may feel the pinch if they have older, inefficient heating systems and appliances in their homes. The money returned via rebates, however, will in theory make it more affordable to upgrade your system.
• British Columbia, Quebec, Alberta, Newfoundland, and Northwestern Territories already have pollution pricing that meets the new Federal standards.
• Ontario, Saskatchewan, New Brunswick, and Manitoba will have both the Federal Carbon Tax and Cap-and-Trade for large-scale industries in the provinces.
• Prince Edward Island will have its own Carbon Tax and will distribute the revenue as the local government sees fit. It will implement the Federal Cap-and-Trade system on large industrial polluters.

This is a brief look at the Carbon Tax system in Canada. The structure is straightforward but will vary by province so look out for more information from your provincial government.

Heating Types Across Canada

Around 47% of Canadians use natural gas to heat their household, and around 37% use electricity. Approximately 9% use oil and the rest use wood and propane.

Here’s a look at the annual natural gas consumption in Canada:

• 88.4 GJ per year on average in Canada
• 74.3 GJ per year on average in British Columbia
• 100.3 GJ per year on average in Alberta
• 88.7 GJ per year on average in Saskatchewan
• 81.7 GJ per year on average in Manitoba
• 90.8 GJ per year on average in Ontario
• 60 GJ per year on average in Quebec

Quebec, Newfoundland, and the maritime provinces of New Brunswick, Prince Edward Island, and Nova Scotia all use electricity most commonly. 91.50% of Quebec residents, 77.80% of Newfoundland residents, and 60% of New Brunswick heat their home using electricity.

Oil heating is more popular in Prince Edward Island and Nova Scotia with 63% and 47% of residents using it to heat their home.

What Is The Average Heating Cost of The Carbon Tax for Canadians?

Canadians use around 90 gigajoules of natural gas every year to heat their home, and each gigajoule produces around 50kg of carbon dioxide.

If you take the increase of $20 per ton into account, gas will be around $100 more expensive annually. By 2022, the additional $30 will increase the tax to $230 per year.

• Saskatchewan – $403
• Ontario – $244
• Manitoba – $232
• New Brunswick – $202

These will be the initial rates when the new tax is implemented. The cost will rise at the rate of $10 per ton per year until 2022. At that time, the average annual carbon tax rate will be:

• Saskatchewan – $946
• Ontario – $564
• Manitoba – $547
• New Brunswick – $470

This tax will have an impact on household budgets, which’s why it’s important to take measures to reduce consumption where possible.

Fortunately, most of the tax revenue is directed back towards the residents through rebates. However, the rebates aren’t calculated on an individual basis, so the money you receive may not exactly cover the additional costs imposed by the carbon tax. For this reason, the theory is that homeowners will still be incentivized to opt for more efficient appliances and home upgrades, and more conscious energy use where possible.

What Are Carbon Tax Rebates and How Do They Work?

While the carbon price per ton might seem high, this tax scheme does offer rebates. These rebates encourage consumers to switch to greener solutions.

The rebate amount will depend on the number of people (adults and children), in the household. Citizens will get rebates through refund or tax deductions based on their preference or the local government policy. Here’s a look at the rebates in different regions:

• Saskatchewan – $598 with a net annual gain of $195 in 2019, $295 in 2020, $393 in 2021, and $473 in 2022. The average carbon tax rate is $405 in 2019, which is lower than the rebate.
• Ontario – $300 with a net annual gain of $56 in 2019, $82 in 2020, $108 in 2021, and $133 in 2022. The average carbon tax rate is around $244 in the first year, which means you gain more benefits through a rebate.
• Manitoba – $336 with a net annual gain of $104 in 2019, $153 in 2020, $202 in 2021, and $250 in 2022. The average carbon tax rate is $232 in 2019, and the rebate grows along with the tax increase.
• New Brunswick – $248 with a net annual gain of $46 in 2019, $69 in 2020, $90 in 2021, and $113 in 2022. The average carbon tax rate is $202.

Also, people living outside of census metropolitan areas get added benefits. This tax system takes into account that they might have fewer green alternatives to help reduce their fuel consumption, like being more dependent on a vehicle for transportation for instance. They’re eligible for 10% more in rebates than people in metropolitan areas.

All of these factors show that it is theoretically possible to regain the money you spend on the tax and on using green alternatives, but that will obviously vary from one person to the next. In any case, rebates are claimed to exceed the increased energy cost for more than 70% of Canadians.

What Are The Disadvantages of The Carbon Tax?

The higher cost load for households has caused some disapproval from the public. Here are some points to make a note of, so you know all the details when it comes to the carbon tax:

• Canada’s carbon price is high compared with other countries. Although carbon tax will be effective at preventing wasteful energy practices, it may also cause some financial strain to households with modest incomes.
• The most significant contributors to the emissions total are industrial establishments that cause 40% of the carbon pollution. They’re excluded from this latest tax and are covered under Output-Based Allocation Systems.
• The cost of natural gas in Canada will rise by around 8% over time. The tax will increase the cost of a gallon of gasoline by 16.6 cents in the first year and by 42 cents by the year 2022.
• The price of coal will double over time because it has a surcharge of $100 per ton. Fortunately, most of Canada’s electricity is produced through hydroelectric or nuclear systems, which causes fewer emissions.

The Bigger Picture

Climate change and excessive pollution results in considerable expenses for society and in some ways poses arguably a larger financial liability than the carbon tax.

According to research, health costs due to extreme weather will rise to around $1.6 billion a year, and many experts have mentioned that these additional expenses make taxation a better alternative.

One argument in favour of the carbon tax over increased regulation, is that despite the controversy caused by any new tax, it is viewed by economists as the most efficient way to discourage pollution, taking advantage of natural market forces to achieve its goal. In other words, if something is more expensive, people will generally do less of that thing.

So although taxes aren’t perfect, solutions that depend heavily on increased bureaucracy and complex regulations aren’t necessarily a preferable alternative.

As consumers will get a rebate, they’ll get most of the money they spent on the tax back, hopefully making the tax more manageable for Canadians, while still achieving its objective of lowering carbon emissions.

And as far as heating and cooling your home is concerned, a good place to start is upgrading your HVAC appliances to newer, high-efficiency systems. A new ENERGY STAR® furnace or A/C can help homeowners reduce costs and save money in the long run, regardless of the effect of the carbon tax.

Almost all furnaces or air conditioners available on the market today come with very good warranties. If you follow the manufacturers’ terms, it is easy to maintain the warranty and be covered in case of malfunctions or breakdowns.

Unfortunately, many customers don’t read the warranty terms and conditions thoroughly. They don’t even realize they have voided the warranty until they need some repairs and find they have to pay out of their pocket.

This article explores the different ways in which you can void your furnace or central air conditioner warranty and find yourself paying for repairs yourself.

Why are Furnace or AC Warranties Important?

Warranties are some of the most important factors to consider while buying furnaces or central air conditioning units. If the warranty isn’t valid, you might be forced to pay for all basic repairs and replacements out of your pocket, which can burn a hole in your pocket.

Here are some reasons why you need a good warranty:

• Most furnaces come with warranties for the heat exchanger and the main components. The heat exchanger is one of the most expensive parts of a furnace and costs a small fortune to replace. Having warranty coverage for this component is essential.
• The heat exchanger warranty is typically for around 20 years, though some brands offer more. That covers the lifespan of the furnace, in most cases. Some manufacturers provide a limited lifetime warranty.
• The main components warranty will usually cover functional parts like blower motors, igniters, and electronic controls. You should check with the manufacturer to see how far this warranty extends.
• Bear in mind that these are limited warranties and will not cover the labour cost involved in repairs. Some installation companies provide additional warranties on installation and maintenance at a fair cost. That can help you save money on future repairs.

Mistakes That Void the Warranty

The manufacturers will only offer a warranty if you meet certain conditions. If you fail to do so, the warrant might become void or will be downgraded based on the company’s policies. Here’s a look at the common mistakes:

1. Warranty Isn’t Registered

Almost all manufacturers require you to register your warranty online soon after you purchase the unit (usually either 60 or 90 days after installation). Different companies have different time limits on this process, but it is a good idea to register within 60 days of installation or the time limit mentioned on their website.

Most manufacturers have online customer portals where you can manage everything from warranty registration to service requests.

You can easily register on such portals with all of your product purchase details, though this must often be done by the contractor. So be sure to follow up with them to make sure it’s been done after install.

You can also call the manufacturer directly to register the product if no registration portal is provided. If you don’t register, you might not be able to claim the warranty. Even if you can, getting the product registered at a later date will require a lot of time and that might delay repairs.

2. Annual Maintenance is Not Performed

Manufacturers expect customers to maintain their appliance well. They recommend annual servicing to ensure the furnace or air conditioner is cleaned and small issues are fixed. This reduces the load on main components and reduces wear.

However, if the annual maintenance isn’t performed, the components of the main unit are more likely to sustain damage and wear easily. This will make manufacturers reluctant to grant warranty benefits to you.

Also note that it is a good idea to schedule annual maintenance with a reliable and approved service provider, ideally the same company that installed it.

This is especially important because the labour portion of the warranty from the local HVAC contractor who sold you your unit, will often only be covered if you have them perform annual maintenance, particularly for extended labour warranties of 2 – 10 years.

If you’re consistent with maintenance, the unit will last for a long time and you won’t have to pay for most of the replacements.

3. Unreliable Service Company

Getting servicing done is essential. It’s even more important to ensure the servicing is done by a reliable and trustworthy heating & cooling company. Make sure all repairs are done by a company that is a licensed distributor of that brand. You should also make sure the servicing company and the installation company are the same.

For example, don’t hire ABC company for installation and XYZ company for maintenance. The inconsistency might have an impact on warranty coverage.

For the best results, look for companies that are in the manufacturer’s distribution network. The company website will provide all the information you need.

4. DIY Servicing

No matter how accomplished you are, it is never a good idea to attempt to service the unit yourself or by an unlicensed friend. Hire an experienced and licensed maintenance or repair service provider to keep your furnace or AC in good condition.

Experienced professionals have specialized training in the field. They will follow the manufacturer’s requirements during repairs or maintenance to ensure there’s no damage to the components. If they make mistakes or damage components, they have insurance or warranties of their own to help you.

DIY servicing places the unit at risk and voids the manufacturer’s warranty. Whatever money you save on DIY service will be spent on buying replacement parts because they’re not covered under warranty.

5. You Relocate the Unit

It’s almost never a good idea to relocate your unit. In virtually all cases, manufacturer warranties will explicitly state that the unit will only be covered if it is in its original location. So think long and hard about it before undergoing such a move.

Also note that if you sell your home, the warranty may not be transferrable to the new homeowner, or only the base warranty may apply. Same goes for when you buy your home from someone else. At the very least, try to get the warranty documents from the seller.

6. Lost Documentation

It is easy to lost track of all the documentation and sales receipts of your various appliances, but it is important to hold on to them. Without the sale receipt or invoice, you might not be able to claim full warranty.

You can check the manufacturer’s website for their warranty requirements. Sometimes you don’t require documentation if you have registered the product and provided all of the details. If you’re not certain, contact the manufacturer and ask them about the invoice and sales receipt requirements.

7. Poor Installation

Furnace and air conditioner manufacturers always recommend their approved service providers for installation. Different appliances have different installation requirements. Approved service providers undergo training provided by the manufacturers so they are familiar with their products.

This is a safe bet because if the unit isn’t correctly installed and becomes damaged as a result, your warranty will be void. The manufacturers will notice when they send a technician for inspection and see the poor installation.

Improper installation will also affect the lifespan of the unit and cause problems. If you want to save money in the long run, it is a good idea to hire an approved service provider.

8. Different Forms of Uncovered Damage

Every manufacturer has a list of uncovered damage that doesn’t have warranty protection. This can include things like flooding, or faulty wiring in your home, unit paired with incompatible components, etc.

Make sure you use components from the same manufacturer to replace damaged parts. Don’t use old or refurbished components in new appliances.

All of these factors will not just void the warranty, but also shorten the lifespan of the unit by several years.

9. The Unit is Damaged By You

If you happen to damage the unit accidentally, the warranty won’t cover the resultant repairs or replacements. For example, if something heavy falls on it or it’s damaged during nearby renovations, the warranty might become void.

Make sure your furnace or AC unit is properly protected from outdoor elements or accidents. That will help maintain the warranty.

Most warranties only cover manufacturing defects and regular wear and tear. You will have to pay out of your pocket for all other repairs or maintenance. Be sure to check with the manufacturer to see if they offer any extensions or other warranties at a nominal cost.

10. Getting the Unit From an Unreliable Source

Everyone wants to save a few bucks on a major purchase, but we strongly urge you to resist the temptation of buying a unit from someone who isn’t an established local distributor or contractor.

It’s generally not a great idea to buy a unit from an unreliable source like a solo general tradesman on a classified site or worse, a secondhand furnace or A/C.

Manufacturers are not likely to honour any warranty for a heating and cooling system that wasn’t provided by an established distribution channel.

What You Need to Know About Furnace & A/C Warranties

When you purchase an expensive appliance like a furnace, HVAC system, or air conditioner, it is important to understand the terms and conditions of the warranty well.

Most manufacturers provide detailed information on their website. You can usually download a PDF with the terms and conditions to read carefully.

Here are some facts to keep in mind:

• Different companies have slightly different policies. For example, your Rheem appliance might not have the same warranty as your Daiken appliance. Although many brands are in fact owned by the same parent company and so the warranties may be similar in these cases (though not always identical)
• You can expect the warranty to change based on product tiers. For example, a more affordable, entry-level product will have a less comprehensive warranty compared to premium models.
• Don’t just consider the duration of the warranty. You need to check if it covers basic repairs or replacement parts.
• Higher-end brands and models have more flexible warranties. If you fail to register or void the warranty in some way, they might still have a lower, basic coverage instead of a full, comprehensive warranty.
• If you don’t understand the warranty terms and conditions, it is a good idea to ask a professional for advice or search online for warranty comparisons. That will help you choose the right product.