:
This is Bijan Mannani speaking on behalf of Landmark Homes Canada. I have here Dr. Haitao Yu, who is our lead researcher for Landmark Homes Canada.
Landmark Homes' primary business is building new residential homes in Alberta. We have a small operation in Phoenix, Arizona, as well. We started in the home-building business in Alberta in 1977. We have built more than 15,000 homes in Alberta.
The company started venturing into building energy efficient homes back in 2006, and in 2008 we adopted the four principles of sustainability, as defined by The Natural Step Canada, and we made a business. The strategic driver behind our business was to have environmental sustainability combined together with industrialization of construction processes for the residential construction industry.
In 2011 we started a manufacturing facility, panelizing homes in different sections, different segments like Lego pieces. We focused on reduction of waste throughout the processes, the reduction of greenhouse gas emissions during the course of construction by eliminating the need for various contractors and trade partners to travel in individual vehicles to deliver materials to sites and the inefficiencies that we get when building on-site through stick building operations. We also started having very tight building envelopes to one millimetre accuracy, gaining air exchanges significantly below one air exchange per hour—the best we have done is 0.41 air exchanges per hour—and then focusing on making net-zero homes, energy efficient homes, to become the norm for all of our product lines and exceeding the national building code by a minimum of 15% for all of our product lines that we are delivering in the market.
In 2017 we placed our fifth net-zero show home under $400,000. That includes the land, the building, all of the options, upgrades, and GST for a single family home in Edmonton. We are currently on the way to building two other net-zero homes as a normal offering in the Edmonton market. Both are single-family developments.
We have been recognized by CHBA as one of the 22 net-zero qualified builders in Canada and one of the three qualified builders of net-zero homes and energy efficient homes in Edmonton.
Our mandate, what think we need to be accelerating, is to make mandatory labelling and energy modelling of homes both for new homes and for the resale market. The reason for that is to create and raise awareness in the consumer's eye so that it would create a demand for that and change the mindset and the paradigm that the status quo is acceptable. That's a big change that is needed.
The second part is, from the federal government standpoint, investment in research and development in the areas of HVAC and windows, but the biggest part, in our opinion, is the building envelope and the building science side of things.
With respect to funding for special projects or pilot projects, I think that's where the federal government can step in and have a plan for progressively, on an accelerated basis but in a stepwise manner, introducing higher energy efficiency requirements, adding that to the building code, and making that a requirement across Canada. Right now, different provinces are doing different things. It needs a well-coordinated effort from the federal government to be pushing the agenda for energy efficiency in housing.
There have been questions asked about the retrofitting of existing buildings. We currently do not have any particular program in Alberta. We are not in that line of business, but I think that would significantly impact the market by focusing on energy efficiency. If everybody is talking the same language, and the requirements are clearly outlined in a stepwise manner, then we all will be able to benefit from that and make the change that is needed.
With respect to how we can further reduce our carbon footprint and have energy efficiency, we think that in Alberta, where we have set up the manufacturing facility, the off-site manufacturing and panelization facility, it will not only diversify the economy. We are also able to introduce job creation opportunities, and it's a safer working environment. As I indicated earlier, the average home building operation has about 15.4 tonnes of greenhouse gas emissions during the course of construction. This is not during the operation.
Through the manufacturing process, we have been able to reduce those greenhouse emissions to 6.42 tonnes. It's a significant reduction. If Canada is producing an average of 250,000 homes, just the impact of that, similar to the automobile industry manufacturing facilities that are off-site, means that we will be significantly reducing the industry's greenhouse gas emissions and the carbon footprints we are leaving behind, and lessening that impact.
I think we need to have a gradual process of introducing higher energy efficiency requirements. That target needs to be gradual, with a specific schedule and timeline identified in order for the whole industry to gear up with business partners—from builders to HVAC to windows to building envelope installation—where everything goes hand in hand.
Beyond this, if you have any questions, I will be more than happy to answer them.
:
Thank you very much, Madam Chair, and thank you for inviting me to come to the committee.
I would like to provide an overview from our council's perspective on how green buildings can help Canada achieve its GHG commitments and climate change commitments. There's a common understanding now in Canada and around the world that 30% of greenhouse gas emissions are associated with buildings—building construction and operation—and that also applies to Canada.
I have a slide deck here that we will share with you. Here you can see that up to now a lot of progress has been made in the building industry, through the application of voluntary rating systems and voluntary standards such as LEED, leadership in energy and environmental design. We currently have over one billion square feet of LEED buildings in Canada, and it has grown to be the most widely accepted standard for green building in Canada.
Green building not only benefits the environment, but it also creates jobs and promotes economic growth. We did a report that's available on our website. At the end of 2014, the green building industry contributed about $23 billion in GDP, and there were 300,000 direct jobs involved in green construction. You can see that these jobs actually exceeded the jobs in forestry, mining, and oil and gas extraction. It's a significant boon to become a significant economic sector in Canada beyond just the environmental benefits.
Today—and these are the figures at the end of 2016—we estimate that LEED buildings across the country and those built by the federal government save about 1.8 million tonnes of greenhouse gas emissions every year, save about 18 billion litres of water, and so far have avoided about 2.1 million tonnes of landfill waste from construction and demolition.
These are just some of the figures that are available now to highlight the environmental and economic benefits. What we recommend and want to share with the government is that it's really important that you continue to support voluntary industry standards. LEED, and not just LEED but also other industry standards have really built industry capacity. They have built knowledge, and they have worked over time to put the industry on a path of continuous improvement in water efficiency and recycling, and those types of things, but most importantly, energy efficiency.
You can see that LEED standards have played a very important role in delivering buildings that are above the building code, and in that way they have really informed the codes to be more ambitious in terms of the thresholds that are being established for national and provincial building codes.
Finally, the government has established a LEED gold policy since 2005. We do recommend to the government that you have a very important role to play in terms of procurement of real estate, either for construction or for renovation, or for leased space. We recommend that the government continue to support the application of voluntary standards through its own procurement policies, and that would include through upgraded green building policies to LEED platinum, which is the highest level of performance both for new and existing buildings, but also start to look at the new standard in the marketplace, which I'll talk about in a minute, about getting to zero-carbon performance in buildings.
The council believes that in order for us to reach our carbon goals, we need to start thinking less about energy but more about carbon, which is really a slightly different metric. We're really supporting a shift from not just energy, but energy and carbon. If you have two buildings that are identically energy efficient in Quebec, and you heat one with gas and you heat the other with electricity, the one with gas produces 36 times as much greenhouse gas emission as the one heated with electricity.
That speaks to the point that the energy source you're using is hugely important, and where the building is located across Canada is hugely important. We need to take advantage of Canada's clean energy sources. I live in Vancouver, B.C., and hydro is 95% carbon free. In Quebec and Manitoba, we need to take advantage of these clean energy sources to move the building sector towards a low-carbon performance.
There's an area that Canada and the council has embarked on to produce zero-carbon buildings from an operational perspective. This is really to create the building stock of the future. In 10, 20, 30, or 40 years from now, we will need buildings that emit as little carbon as possible. This, of course, needs to be balanced with energy costs and energy efficiency. The goal is to produce buildings that are very low on the energy side.
We introduced a zero-carbon standard last year. There are 10 other countries that have approved zero-carbon standards for buildings—Australia being one of them—or that are in the process of developing one, like Germany and Brazil. Across the world this is an area of innovation.
Zero-carbon standards really balance high levels of energy efficiency, because we still need to pay energy costs, of course, as we all do in gas and electricity. It also needs to be combined with sources of renewable energy. This renewable energy comes either as generated on-site in part or can be procured off-site through renewable energy certificates and, like I said, through our hydro sources of clean, almost carbon-free electricity.
We currently have 16 projects of that standard across the country. The industry is confident that they can meet that standard. In fact, the federal government has one project in the pilot as well, as does the Ontario provincial government and other local governments in Canada. There are also private sector projects. We have projects that range from a small water project in Walkerton, Ontario, to a 60-storey office tower on Bay Street in Toronto. You can really see that the industry is ready to make this kind of investment, and that also needs to be supported by government policy and R and D to move this part of the work forward.
Having said that, we took a broader look at the building sector, and having done several research reports, which again are available on our website, we came to the conclusion that we cannot reach our carbon goals from the building sector without building retrofit. When I talk about building retrofit, I'm not talking about single-family homes right now. I'm talking about larger buildings, those over about 25,000 square feet. Depending on who you talk to, because we don't have perfect data, we have up to over 400,000 large buildings in Canada that have an opportunity to be retrofitted. If you retrofit buildings, you can realize, by 2030, three times as much greenhouse gas emissions savings than if you build every building between now and 2030 as zero carbon. That's the potential of the retrofit sector. In this area, Canada can really take the lead globally in retrofitting existing buildings.
Building retrofit involves very specific strategies from the recommissioning of systems to deeper retrofits that produce 20% to 40% reductions in energy use, and then, a combination of solar or other renewable energy sources along with fuel switching. Fuel switching is when you go from a fossil fuel to a carbon fuel, either electricity or on-site renewables, geothermal, and those types of strategies.
These are the four strategies, and we did a road map. This goes to one of the questions that you asked us to answer for this committee. We developed a road map for retrofits in Canada, and you can see from the map that the strategies differ depending on where your buildings are located. For example, in a low-carbon credit area like Quebec, you really should focus on recommissioning and deep retrofits and on fuel switching, while renewable energy generation is probably less important because you already have a good source of clean energy. On a high-carbon grid, you need to invest more into the generation of renewable energy versus fuel switching, which doesn't make a lot of sense because you would switch fuel with something that's what we call a dirtier grid.
There's an opportunity to really lay that out and really target policy depending on region, building age, and building type across the country to have a really targeted approach, and that actually narrows from 100,000 buildings to about 50,000 to 60,000 buildings.
In finishing off, the Government of Canada has an opportunity to invest in a retrofit economy. We recommend that all custodian departments and agencies of the government develop multi-year retrofit strategies for their portfolios. We are also recommending that the government allocate $1 billion from the Canada Infrastructure Bank for retrofits of commercial and multi-residential buildings in both the public and the private sector. Also, there needs to be insurance to make sure that these retrofits also deliver on their performance improvements both in terms of energy and in terms of carbon.
I'll stop here because the recommendations at the end are very self-explanatory.
Thank you very much.
:
Good morning. My name is Mike Giroux. I'm the CEO of the Canadian Wood Council, as you mentioned.
My background is varied, and it includes working in entrepreneurship, building houses using light gauge steel. I've worked in the cement industry, and I've now been in the wood products industry for eight years. I also spent a little time with the National Research Council.
That's a little about me, but now about the Wood Council itself. The Wood Council has one mission but two elements to the mission. The first is to ensure the fair recognition of wood products and building systems in the national codes of Canada. That's very important because what gets recognized gets built. I'll make the point with respect to green sustainability in a minute.
The second area we're engaged in is in the education of the construction sector itself, everybody from architects to engineers to builders to students. We provide tools and software for this clientele.
In doing all that we invest heavily in the codes development process. We are engaged not only in Ottawa with the National Research Council at the model level, but we are also engaged at the provincial levels where these national codes are adapted and adopted. We are also engaged very much in demonstration. We work with both our funding partners and our R and D partners to demonstrate buildings built with wood in this case, and the idea is to de-risk these buildings so they or their elements eventually can be introduced into building codes.
That's what we do. I'm a little worried about some comments about the building code itself. You probably all know this, but developing building codes and the standards related to them is a five-year cycle. It's a long period of time. In the U.S., it's three years.
In doing that, we might say that's an innovation killer. It's arguably not because they focus very much on their core objectives in the code and these need to be protected at all costs. These stand-alone objectives, which all the technical requirements point to, include energy and water use, fire and structural protection and safety, and health and accessibility. You'll notice there is no core objective in there for sustainability, energy, or CO2. These have been discussed but they have been determined to be complicated. It would really take political drive to have them introduced into the codes.
That is my introduction, and I would like to comment on some of the key points here. I'm not necessarily an expert in them.
First, with respect to greenhouse gas emissions, the reductions in the building sector, and how they can be accelerated prior to the next building code, obviously it's too late to get an objective into the code. Second is that public sector leadership is really helpful and it's also necessary. We can look at real property practices within governments at the federal or provincial level. They need to be less prescriptive, more material neutral. They need to go beyond the first costs to consider life-cycle analysis impacts as these are environmental impacts.
In our case, this is important because we not only look at the operational and sequestered nature of our product. We can make any building the same if we want to. In the end, you look at products that can sequester carbon. Concrete is one of them. There are other products where the embodied energy is interesting. If you make your decisions in part based on the embodied energy of the product you end up with reducing immediately the carbon content of that building and it's really important that be considered.
In Quebec there's la charte du bois, and in that policy they look at wood equally. They don't say “choose wood” or anything. They say that you must consider wood equally to other materials. That's very interesting for me and it provides an opportunity, but you shouldn't even have to use the name “wood” in the policy. You should say, “You should be considering all materials.” What's really interesting about the policy is that they go to this next level where they say there should be a carbon metric associated with the policy. Then they introduce the need for a tool that is being developed in Quebec right at this very moment and which is now being partnered in Ontario as well, and will be partnered in B.C.
This tool will help at the LCA life-cycle level to determine the actual carbon metric for those buildings, in particular at the body level now and then operationally later, and should allow proper decision-making. Carbon avoided now has this tendency to accumulate or to be a better story over time, because if you avoid it now it's avoided impacts in the future as well. That said, there's no use having that type of program if you don't monitor and enforce it.
There's another opportunity here and that is to adopt an industrial vision, a vision to where we want to go. If you look at the opportunity, you have existing products, you have new products, and they're going to blend into the buildings of the future. For those buildings of the future we don't have a lot of R and D in that area. We don't do any sort of life-cycle impacts. We have no real idea if these new products, or those new buildings, are an improvement over the last generation of buildings. I think Thomas's group and some of the other programs that we have are starting to lead towards that, but we need to really look at this in terms of an overall vision that includes industrialization in terms of pre-manufacturing of these buildings. That way then that vision can be one of CO2 reductions, or it could be of energy reduction.
At the end of the day it's the environmental impact. The flavour of the day could be water in the future, but when we know what the vision is then industry can go along and follow along in that area. What I find interesting is that once you know that you're going to do this, you can also report on it. You can put out sustainability reports that show that you've improved it and show the audience that you're interested in improving this too, that you've proven this direction.
Retrofits are huge. Like Thomas said, it's probably a bigger market than the new building market in the future. I don't have very much more to add than what Thomas added except perhaps with the carbon taxing that's being considered one of the advantages is that, because it impacts product level and makes some products more expensive than others, as a result of that it might drive a behavioural change. I think that's very interesting, and I would encourage that we continue along that way.
The other thing in the retrofit market is adaptability. At the end, if a new building is not made to be adaptable—you can use the word “durability” in this as well, the longevity of the building—if it's not designed to be adaptable then the costs of the future will be greater. That is an opportunity for building codes.
How could we further accelerate net-zero energy? There's a lot of work being done in that area. What I find very encouraging is that companies like Landmark and others are not only looking towards what we're doing in Canada, but they're looking offshore. I'd like to say that a lot of what we do in terms of our R and D is that we try to invent things here when there's really no necessity for it. In the end we can achieve an awful lot by becoming very expert at adopting and adapting innovation from elsewhere. There is marvellous technology available from Germany, Austria, and offshore that we could bring to Canada.
Those are the points that I'm interested in making today.
Thank you very much for allowing me to speak.
:
Thank you very much, Madam Chair and members, for this great opportunity to address you today on what our industry feels is society's greatest challenge, which is the fight against climate change and how we tackle that through reducing greenhouse gases from the industry building sector and the transportation sector.
The cement and concrete industry represents a direct and indirect economic contribution of about $73 billion to Canada, and we employ about 151,000 Canadians. Our industry supports strong action on climate change, including putting a price on carbon. As of this year, all cement facilities in Canada but one operate in a province that already has a price on carbon.
As governments move towards carbon pricing, they have had to consider the impact of carbon pricing on competitiveness, especially for energy-intensive, trade-exposed industries. Cement is among the most trade-exposed, energy-intensive industries in Canada, and we are very vulnerable to our competitors in the import and export markets that do not have similar carbon-pricing systems, such as almost the entire United States, with the exception of California.
Thankfully, though, with the exception of British Columbia, carbon-pricing systems across Canada, including the federal backstop carbon-pricing system, on the whole strike the right balance between incentivizing emissions reductions while introducing other measures to protect and even enhance Canadian industry and competitiveness as we transition to the low-carbon economy.
Why are carbon pricing and energy-intensive, trade-exposed industries important to a discussion about climate change and the built environment? Because, while well-designed carbon-pricing systems can foster low-carbon innovation in industries that support Canada's built environment, these innovations cannot flourish in a policy environment that does not actively pull them into the built environment decision-making discussion.
Consider that, on aggregate, all three levels of government purchase, directly and indirectly, some 60% of all building materials consumed in Canada, and concrete makes up the majority of those building materials. Further consider that our building and energy codes are minimum codes. Our building codes are not the gold standard that you or most Canadians believe them to be, and unless they are significantly changed, they will serve to impede low-carbon innovation, not accelerate it, as Michael Giroux mentioned in his comments.
Procurement decisions made by governments in general emphasize low-cost tenders. We always award tenders to the lowest-cost bidder, and only rarely do they ever consider GHGs or climate adaptation. When governments have considered climate change in a built environment, they've done so with prescriptive policies—for example, policies like “wood first”, rather than leveraging markets towards comprehensive and systemic clean energy or clean growth innovation.
Let me offer an example. Our sector recently came together in total across Canada to promote a new cement, portland-limestone cement, as an opportunity to reduce greenhouse gases from concrete. Portland-limestone cement will reduce the GHG footprint by 10% at no cost. If adopted as a full replacement for all cement sold in Canada, portland-limestone cement could yield annual CO2 reductions of almost one megatonne and, as I said, at no additional cost.
While portland-limestone cement meets the same performance standards as general use cement, has been used in Europe for decades, and is recognized in the 2010 national building code of Canada, it does not enjoy deep penetration across Canada. This is because construction industry codes and standards bodies in the public procurement agencies responsible for planning and commissioning infrastructure projects do not yet value or incentivize new innovations in the low-carbon construction materials and design industry.
Governments, as purchasers of more than half of all concrete produced in Canada, with the stroke of a pen could make portland-limestone cement the default cement in the majority of all projects across Canada, yet our industry's efforts to get this done are inexorably rebuffed. With this one innovation, we can address about 2% of the emissions gap that this government has identified and needs to fill to realize our 2030 target.
Pavement infrastructure offers an important example. Robust third-party life-cycle assessments irrefutably demonstrate the cost and climate benefits of concrete pavements over asphalt pavements. Asphalt pavements last seven to 12 years. Concrete pavements last 40 to 50 years, cost less over their life, and can actually improve fuel efficiency by 7%. These properties alone could result in savings of up to 12,000 tonnes of GHGs per lane kilometre over a 50-year lifespan, compared with a typical asphalt road.
Contrast those two examples with the incessant political interventions in building codes across Canada and the hundreds and hundreds of millions of dollars spent by federal and provincial governments, being poured into championing wood products, especially tall wood buildings, as a significant carbon mitigation strategy. You can then see where our exasperation lies.
The implications of such policies on the built environment, including the prospect of a robust, open, and competitive market-driven clean growth strategy for buildings and building materials, are profound, yet the underlying assumption that wood buildings yield net carbon benefits over alternatives has never, ever been fully articulated, let alone subject to a comprehensive peer review. This is all the more troubling considering the increasingly well-documented shortcomings with the current understandings of the carbon profile of wood products.
Research on GHG impacts of commercial logging suggests the effect on the carbon profile of wood products is significant. A Bureau of Land Management report in western Oregon proposes that when land-use change impacts of deforestation are taken into account, even accounting for regrowth, some 13 tonnes of greenhouse gases are lost to the atmosphere for every tonne sequestered in a wood product. That's a far cry from the carbon neutrality claimed by the wood industry and federal and provincial natural resource ministries.
You can therefore understand our frustration when we saw in budget 2017 that this government is spending some $40 million to support preferential treatment of wood building materials at the expense of other building materials across our country, or recently, your vote on Bill , which has passed second reading, attempting to tilt the playing field towards wood in government infrastructure despite a growing body of evidence that this in fact may increase greenhouse gas emissions and make our buildings more vulnerable to climate change.
In Canada, the most significant carbon impacts from buildings relate to heating and cooling. These operational energy needs account for over 90% of the global warming potential for buildings. Even if the claims the wood industry makes that they are carbon neutral were true, and they're not, the impact that the substitution of wood for steel or concrete would have on the life-cycle emissions of a structure would be marginal. In fact, concrete's thermal mass capabilities can play a significant role in reducing greenhouse gas emissions by reducing operational demands. Today, the strategic use of thermal mass has reduced operational energy needs of large commercial buildings, such as Manitoba Hydro Place, by over 70%.
We need stronger building codes. We need stronger energy codes, and concrete can play a significant role in affordable strategies to meet the much sought-after net-zero building target. Only a robust cradle-to-cradle life-cycle cost and life-cycle climate change assessment can draw out these GHGs and cost-saving performance attributes. Policies by politicians that favour one building material over another without considering the whole are definitely not in the public interest.
More exciting but less understood is the role that concrete will play in the emerging game-changing class of technologies known as “carbon dioxide utilization”. Concrete is a critical source and sink for captured carbon. By virtue of the sheer volume of concrete consumed every year, more than any other material on earth with the exception of water, our sector will be pivotal in developing technologies that will ultimately reduce carbon.
Canada's clean growth strategy for the built environment must look to the future it wants, a low-carbon climate-resilient future, and make space for transformative innovations that will get us there.
Let me be clear. We're not asking for government to mandate concrete roads or buildings, nor are we disparaging the competition from other building materials. We are simply asking that government take a sector-neutral approach to planning and using tools focusing on GHGs as we transition to low-carbon and climate-resilient economies.
In conclusion, our primary request is that you recommend that the Government of Canada mandate the use of full life-cycle and environmental assessments for all federally funded infrastructure projects at all three levels of government.
Thank you.
:
Thank you, Madam Chair and the committee, for providing this opportunity to speak to you and be part of this important conversation.
I will not be talking about building materials. I'll be shifting focus to an equally important, if not more important, segment of the climate change solution, which is the HVACR sector. I want to talk a little bit about the role of the HVACR industry in promoting energy efficiency and mitigating climate change.
First, just to be clear on the scope of the HVACR sector, HVACR is heating, ventilating, air conditioning, and refrigeration. I know most of you know that. The scope of our organization is the space heating and cooling of buildings through various methods—hydronic or air systems—which obviously is an essential service in this country. It includes domestic hot water, ventilation, indoor air quality products and services, and refrigeration processes that serve the needs of industry, grocery stores, institutions, hospitals and schools, ice rinks, and various other specialty applications.
Building controls is part of our sector as well. It ties all of these systems together. It's a roughly $7 billion a year activity in Canada, and as I mentioned, it's an essential industry in Canada given our climate. Our members and the industry in general are active in every corner of the country, wherever it's a home or a building, yet our industry is largely hidden from sight because we're behind the walls and under the floor providing these essential services. We're mostly out of sight and out of mind for Canadians.
HRAI, the organization I'm representing here, has been around since 1968. We have roughly 1,350 corporate members. That includes 90 manufacturers, 60 or so wholesalers-distributors, over 1,000 contractors across the country, and a number of associates: utilities, colleges, training institutes, consulting engineers, and so on. Across the country, we have 28 staff, a dozen instructors who are very active in training, five regional managers, and 20 chapters.
Our primary services, like any industry association, mostly have to do with industry advocacy, but we are also heavily involved in industry training, including technical design and business management. The technical design courses that we offer are primarily designed to help technicians meet building code requirements. There's a very heavy energy-efficiency component to that.
We own a trade show that's held every two years called CMPX 2018, which is running in about a month from now. We are also actively involved in environmental stewardship programs. We run a number of programs that the industry manages, taking back products of the industry that have harmful environmental impacts, such as mercury thermostats and spent refrigerants, which are no longer allowed, per regulation.
I want to talk a little about the role of our industry in relation to the pan-Canadian framework. Under the PCF, as I'll call it, there's a significant emphasis on GHG reductions. I think you're all aware that the most significant contributor to greenhouse gas reductions, not only in Canada forecasting into the future but also globally, is investments in energy efficiency. Roughly half of the expected goals will be achieved through investments in energy efficiency. That's significant for our industry because that's where our members live and breathe.
Federal government consultations are well under way now on a variety of issues that affect our industry. There's a consultation that we're participating in called the “market transformation for space heating and water heating equipment in Canada”. We're very happy to be engaged with that.
The PCF acknowledges that space heating is an important part of the solution to reduce greenhouse gas emissions in the building sector and also in relation to water heating. Heating on average represents between 56% and 64% of energy use in homes; in buildings, it's the single largest source of direct-sector emissions. Therefore, improvements in the performance of space heating technology can reduce energy use significantly for a typical residential home or building. As per NRCan, if all residential heating systems were replaced with heat pump technology by 2040, for example, this would reduce residential energy use by 25% and greenhouse gas emissions by 24 megatonnes.
A variety of measures related to buildings have been contemplated under the PCF. They include net-zero energy ready building codes by 2030, a model retrofit building code by 2022, labelling and rating requirements as early as 2019, and setting standards to the highest level economically and technically feasible for heating equipment and other technologies. Our industry, I want to emphasize, supports these measures but with a number of important caveats, which I'll come back to shortly.
Just to illustrate, some of the technologies we're talking about include commercial gas furnaces, cold climate air-source heat pumps, gas-fired heat pumps, ground-source or geothermal heat pumps, micro combined heat and power, and integrated systems building controls. This is the tool kit that our industry works with.
The government's plans include what the government has referred to as strategic interventions in the market to accelerate the adoption of high-efficiency space-heating technologies between now and 2035. The government has what has been defined as aspirational goals. A lot of our members have difficulty with the term “aspirational goals”, because they're very hard to pin down, but they include such things as that by 2035 all major space-heating technologies for sale in Canada will have an energy performance of more than 100%. For those who aren't familiar with heating technology, that essentially means that all technology for heating homes will be electric by 2035 because there is no gas-powered or oil-burning technology that can beat 100% efficiency. If that's the goal, that has important implications for our industry.
The plan will also identify barriers and challenges to achieving these goals, and those are part of the big discussion we're having with NRCan and others right at this moment. We'll be looking to implement a variety of measures to overcome barriers using all available tools.
The pan-Canadian framework and all of the things that spill out of that present tremendous opportunities for our industry. As it happens, HVAC unitary products are becoming more and more efficient. The transition to heat pumps presents an opportunity for all of our contractor members across the country. It's a job-growth strategy in a sense, because heating systems will have to be converted in existing homes and buildings. Building smart building controls and implementing systems that will allow better management of buildings creates all kinds of opportunities for our industry. An emphasis on not just product innovation but also building-systems innovation focusing on best practices and enhancing trade skills is very important for our sector. All of that is to say there are tremendous opportunities for our sector. As I mentioned, the industry has a variety of tools in its tool kit to help achieve the goals that the government has set out.
I'm not going to talk about those right now. In fact, I realize I left you at a disadvantage, because I'm looking at a presentation that you don't have. I will make it available to the committee if there's interest in having it. It includes some references to these technologies. The challenge the industry has around the pan-Canadian framework and the transition to a low-carbon economy is the need to adapt. The changing energy mix and transition from oil and natural gas heating to electric pose challenges for many of our members and participants across the country.
Production innovation is feasible, but the reduction of per unit cost for equipment in the context of increasingly stringent performance standards is a challenge. The growing sophistication of codes and building systems poses additional challenges for our sector. In terms of transition to who's going to do the work and how they are going to do it, there's a need for emphasis on skilled labour transitions, which means training.
The HVAC industry is prepared to engage with government at all levels to assist in meeting the challenges of the Paris Agreement. I want to make that clear, but there are some really important principles that need to be seen or adhered to if we want to have constructive engagement. The first is that manufacturers of products that are brought into this country need a runway. There's a product cycle, a time frame to develop and refine products in relation to standards and regulations, and they need time. They need to have foresight on where the regulations are going with time to adapt. Industry consultation is paramount to good program and regulatory design. Knowledge of products comes from our industry and knowledge of our customer base. Consultation facilitates advance preparation for the industry.
We have a strong consultative relationship with NRCan, especially the office of energy efficiency, and with NRC, CanmetENERGY labs, and so on. I want to emphasize that we do have that positive relationship.
I also want to emphasize, however, that the support for climate change needs to be tempered by the need for regulatory harmonization for products coming into Canada and into provincial and territorial markets to keep costs manageable both for industry and consumers. Therefore, we support the work of the regulatory co-operation council and are very interested in the NAFTA renegotiation process and in making sure the recently adopted Canadian Free Trade Agreement can be supported.
I'll leave it on the note that we have a number of other policy priorities and there are a lot of specific policy ideas that come from our industry, but the message I'd like to leave you with is that it's important, from our perspective, to consult early and consult often with industry to achieve effective outcomes.
Thank you for your time.
:
That's a really good question.
The Canada Green Building Council is in the business of setting higher thresholds and driving this forward. I'll go back to when the council started 15 years ago and what happened then.
There are three areas. One is that you're in charge of the code, but we have to keep in mind that the code is back-loaded. You first have to develop it. Then it comes in, and it takes years before it takes effect in the marketplace.
Your question is really on how we can move faster and be more ambitious. These volunteer systems have a big role to play. I would like to re-emphasize that the federal, provincial, and municipal governments have tremendous procurement power. In the early days of LEED, it was the federal government and some of the cities that de-risked the approach for the private sector. Even though you need to be responsible with taxpayers' money—I'm a taxpayer too, so absolutely—there's no doubt, and the business cases are so many now, that there is a positive return on your investment if you build to high performance. It's energy savings, water savings, and it differs by building and by owner. If government is procuring buildings, if you build yourself or you renovate or you lease space, it's hugely important.
The other part is just the fact of policy. When this government came into power, just due to the fact that there were policies about carbon, there was a 180-degree change in the industry. That was just from knowing that government was going in this direction and the industry needed to respond to that.
That goes beyond the code. It is more aspirational, because it's not an easy path. It's the combination of procurement, policy, and code, and they need to work in tandem. You need to attack this problem from many different areas.
But the business case is clear that there is a return on investment in this area.
:
Probably the most exciting, forward-looking innovation is an extension of the kinds of technologies that CarbonCure is exploring, which is the beneficial use of captured carbon in concrete as a material. As Michael noted in his remarks, the cement and concrete industry together is both a source of carbon dioxide that can be captured and used, and also a potential sink.
There are literally dozens of different technologies exploring how to take captured carbon and put it into concrete as a material. Concrete is the most used material on the planet after water, so just by volume that means that concrete represents an enormous opportunity to take carbon from the atmosphere and permanently sequester it into our built environment. I see that as the most exciting space in terms of innovation.
However, you're right, there's a menu of strategies that our sector is exploring to get toward that Holy Grail of carbon-neutral and even potentially carbon-positive with some of these carbon capture technologies. There's material efficiency, which is what you're mentioning in the context of that bridge example.
We're looking at substituting the use of fossil fuel in the manufacturing of cement with lower carbon alternatives. That is a nearer-term technology that's already well deployed in a lot of places around the world, and we're working very hard with governments in Canada to facilitate that here as well with some recent successes with the attention on climate.
The two most important messages are yes, there's a ton of innovation happening in this industry, but much like your iPhone, it is not one technology. It is the synergy between hundreds of technologies working together that's going to get us to a very exciting place, not just in our industry but where our industry interfaces with the HVAC industry, for example, and other folks working in the built environment space.
:
Retrofit, very well. These four areas are actually established practices in the industry. We rank them in terms of the percentage of buildings, or the number of buildings, that need to pursue these practices. In the next slide, you'll see where these buildings are located.
It is really important that it's not just a discussion about energy, but that it's also a discussion about carbon.
The recommissioning is something that industry is already doing, but it needs to be expanded. It just means that the system in the buildings work well and they work as they're intended. There's an instant savings for anybody who pursues that.
What we're really looking for, which needs to be incentivized and drawn forward, is retrofit. We say deep retrofit because these are savings of 20% to 40%. It's not just what we call a shallow retrofit, where you just replace the lighting and make a little bit of an improvement. It needs to be a deeper retrofit that looks at the building's systems, not just the lighting but all the building's systems, which, eventually, looks at the building envelope and looks at the energy source.
You could improve a building by simply switching to improve energy efficiency, but also, as the gentleman Mr. Luymes has said, switching from fossil fuel to a heat pump, for example, that uses electricity. They're highly efficient now. You can achieve a lower carbon building that way.
What I'm trying to say is that it really depends.
:
No, and that's typically what happens with the wood industry. They take tens of millions of taxpayers' dollars and then they lobby all of you and get what they want.
Canada is founded on fur, fish, and lumber. Whenever we talk about fish on the east coast or lumber across the country, or if we're talking about fur in Newfoundland, the politicians say, “Oh my God, we've got to answer this.”
Our belief is, choose the best building material for the job that gives you the best life cycle, that gives you the lowest carbon footprint.
Did you know that with a tree that is harvested, they go into the forest, strip all the branches, leaves, and bark, and leave it there to burn in slash piles or to rot. That creates greenhouse gases right away. Then they take the log to the timber mill and they square it off, and all that material is then turned into pellets to power the timber mill. By the time you get to this piece of furniture, there is only 12% of the original carbon sequestered there, and 88% of the carbon has been left on the forest floor or used to power the mill.
These are the facts and they are starting to come out now, as we force the wood industry to tell a truthful story, from cradle to cradle.