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Deborah Baic/Deborah Baic/The Globe and Mail

The federal government's surprising decision to abruptly pull the plug on its popular ecoENERGY Retrofit program has angered some Canadian home and small-business owners, who say it will stall home improvements and slow economic growth.

Andrew Sikomas and his wife just bought a house in the Dalhousie neighbourhood in the northwest suburban pocket of Calgary. The young couple, who are taking possession of the bungalow on April 16, had already arranged to replace the 40-year-old 45- to 55-per cent efficiency furnace with a 94-per-cent efficiency model, at a cost of $5,500.

Unfortunately, they had not yet booked with an auditor to have the pre- and post-retrofit evaluation done, a process which would have eventually returned $1,500 to the couple in the form of federal and provincial rebates.

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"We were ready to do it. Then this announcement just came out of the blue," Mr. Sikomas said of the unexpected cancellation from Ottawa. He still expects to get the provincial rebate but doesn't know whether he will qualify for the federal one.

We were ready to do it. Then this announcement just came out of the blue. Home owner Andrew Sikomas

It doesn't appear likely. Natural Resources Canada announced that as of Wednesday, March 31, at midnight it would "no longer accepting bookings for pre-retrofit evaluations," which is the first step in applying for the program.

Home owners who had already booked an appointment for a pre-retrofit evaluation, completed an evaluation or applied for re-entry to the program before the Natural Resources Department made the statement on Wednesday would still be eligible to apply for a grant. But no further bookings will be considered.

"The program will continue to be administered until March 31, 2011," according to a statement on the ministry's website.

The ecoENERGY Retrofit program, which provides grants of up to $5,000 to Canadians who make their homes more energy efficient by switching to a high-efficiency furnace, high-efficiency water heater or installing new attic insulation, was promoted in the March 4 federal budget.

"Due to unprecedented demand under the ecoENERGY Retrofit - Homes program, the government is allocating a further $80-million to support additional retrofits by Canadian homeowners," the budget documents said.

The program, which was run in co-operation with the provinces, stipulated that a post-retrofit audit had to be completed by March 31, 2011. But, until Wednesday, there was no deadline for the initial application.

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In an e-mail, Natural Resources Minister Christian Paradis said the government has a "responsibility to taxpayers to ensure the program operates within its existing budget and no longer accepting new bookings for pre-retrofit evaluations is the kind of prudent fiscal management Canadians have come to expect from this government."

A phone call to the ministry on Thursday was not immediately returned.

It has given us a large amount of business. So to have it pulled, without any notice, is very shocking. Carol Antonishyn, Arpi's Industries Ltd.

Carol Antonishyn, customer service representative with Arpi's Industries Ltd., a heating, furnace and ventilation company in Calgary, spent the day trying to pull radio ads that mentioned the government's ecoENERGY Retrofit program.

"We had no idea this was happening. So it is very upsetting," she said. The program has bolstered their business and helped customers get some money back, a win-win situation for everyone.

"It has given us a large amount of business. So to have it pulled, without any notice, is very shocking," Ms. Antonishyn said.

Also in Calgary, Mr. Sikomas doesn't understand why the government is killing the energy retrofit program, or why it did away with the equally popular home renovation tax credit, at a time when the economy is still recovering.

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Although upgrading his furnace is going to save him money on heating bills, the government rebate provided his family with the boost they needed to do it now. Had the home renovation tax credit still been around, they would likely be benefiting from that, too.

"If something is working well, having a positive impact and people like it, why get rid of it? With the state of the economy, it seems illogical to kill this program now," Mr. Sikomas said.

With files from Globe reporter Gloria Galloway.

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Personal Finance Web Editor

Roma Luciw is the Globe and Mail’s personal finance editor. She has worked at the Globe as a business journalist since 2001, covering stock markets, breaking news, and most recently anything that helps regular Canadians manage their own money. More

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