Help Cities Lead

British Columbia communities, both large and small, are keen to slash climate pollution from their buildings. But first they’ll need a helping hand from the province.

British Columbia’s local governments are on the front lines of climate change, and grappling with increasing threats to health, property, infrastructure, and their economies.

That’s why so many communities are using all the tools at their disposal to reduce community greenhouse gas emissions. Buildings that burn fossil fuels for heat and hot water represent one of the largest opportunities; on average, such buildings contribute between 40 and 60 per cent of a community’s climate pollution.

We are called Help Cities Lead, but the tools we are advocating for will assist communities of all sizes, and we invite all local governments to support the campaign. With this in mind, Help Cites Lead has identified the five very best policy tools to reduce carbon pollution from buildings—outlined below. Climate policy modelling done by Integral Group shows that all five of these policy tools are needed if local governments and the Province are going to achieve their greenhouse gas emissions reduction targets for buildings.

The Provincial Government has prioritized action on three of these policy tools: mandatory home energy labelling, property assessed clean energy (PACE) financing, and regulating climate pollution for new buildings. Help Cities Lead wants to encourage the province to move swiftly on implementing these measures so leading local governments can put them to work in their communities.

The remaining two tools – building energy benchmarking and regulating climate pollution for existing buildings – are not currently prioritized for action by the Provincial Government and will therefore remain beyond the reach of British Columbia local governments to use. That’s because the Provincial Government will need to first grant communities the authority they need to use them. Existing buildings make up the bulk of building related emissions in communities, it is critical, therefore, for provincial action on these two remaining existing building policy tools to start now as well.

This can’t wait any longer.

The Government of British Columbia has committed to meeting its 2030 climate target; it won’t likely get there unless it empowers local governments on the transition to clean, zero-carbon buildings.

Here’s what they need, and why.

1. Building Energy Benchmarking

What it Does

This policy would require the owners of commercial, institutional, and multi-unit residential buildings to annually measure, report, and/or disclose their properties’ energy usage and greenhouse-gas emissions.

Why it’s Needed

To effectively reduce climate pollution, cities need to ensure the programs, incentives, and regulations they develop will work with specific buildings and building types. And to do that, they need accurate and current building-performance data. Many building owners do not currently collect this information, or do, but do not report or disclose it.

The Evidence

In 2009, New York City first began requiring annual benchmarking for buildings with a floorspace of 50,000 square feet or larger. Today, more than 30 North American subnational jurisdictions—including Ontario—have programs in place. A 2017 Lawrence Berkeley National Laboratories study found that mandatory benchmarking programs contributed to a three to eight per cent decrease in building energy use intensity levels over a two- to four-year period. Although we can’t attribute all of these savings directly to benchmarking, the study affirms a causal relationship between benchmarking policies and energy impacts.

Current Status

Limited authority. There are currently no mandatory provincial or sub-provincial building energy benchmarking programs in British Columbia for existing buildings. It is also unclear if local governments operating under the Community Charter have the authority to introduce them. The City of Vancouver and the Metro Vancouver Regional District are independently exploring the use of benchmarking to support potential future energy and emissions building performance standards. Both of these jurisdictions have unique authority that allows them to do this – the Vancouver Charter and the Environmental Management Act. No other local or regional governments in BC have this authority.

2. Mandatory Home Energy Labelling

What it Does

This policy would require builders to disclose the energy-efficiency performance of their new homes to prospective buyers via an “energy score” label; typically, the builder would affix the label to a home’s electrical-service panel. The sticker would provide homeowners and others with at-a-glance energy information, helping them make better decisions.

Why It’s Needed

Without a detailed picture of their new home’s energy performance, British Columbians can’t accurately estimate the true cost of ownership, and can’t easily identify efficiency improvements that would lower energy costs. Further, if the policy also includes a reporting requirement, local governments could use the label information to help design retrofit incentive programs. Federal and provincial governments require energy labels to help inform consumers shopping for a furnace, vehicle, or refrigerator—but not homes.

The Evidence

A wide range of case studies have proven out the value of home energy labeling across Canada and the United States. The practice helps sellers convey the value of energy efficiency improvements, adding a selling point to their home. It also offers real-estate agents insight into a home’s efficiency features. 

And it contributes to workforce development by increasing the demand for home energy audits and home performance upgrades. Labelling also helps all levels of government meet energy reduction targets by motivating homeowners and potential buyers to invest in energy efficiency measures. Research on home energy labeling for the City of Edmonton found that the benefits of mandatory home energy labeling outweigh the costs, and noted a positive correlation between energy efficiency features and selling price in the city’s residential market.

Current Status

Limited authority. Provincial governments have authority in Canada to oversee energy labeling programs. The BC Energy Step Code authorizes local governments to require home energy labelling as an administrative requirement for new homes prior to occupancy. However, local governments have no authority to require home energy labelling for existing homes. In the 2018 CleanBC Plan, the Government of British Columbia committed to exploring an energy rating requirement for homes and buildings across the province at the point of sale or lease.

The November 2020 Mandate Letter to the BC Minister of Finance includes direction for the Minister to require realtors to provide energy efficiency information on listed homes. Help Cities Lead encourages this work to continue and for the Province to consult closely with local governments on its design and implementation.

3. Property Assessed Clean Energy (PACE) Financing

What it Does

This policy would allow a property owner to more easily finance the up-front cost of building energy efficiency upgrades, such as a more efficient heating system or windows, by paying the costs back over time through a voluntary property tax assessment. The assessment would be attached to the property, rather than an individual; if and when the property is sold, the financing would carry on with the new owner.

Why it’s Needed

Though many home and business owners understand the benefits of energy and carbon retrofits, upfront costs remain a serious barrier. Property owners either lack ready access to capital or are concerned about the long payback periods of financing. PACE programs close this gap. They’re straightforward to implement and run, and a B.C. version would allow local governments to tap into a $300 million Federation of Canadian Municipalities energy-efficiency retrofit financing program.

The Evidence

Though still obscure in Canada, PACE programs are commonplace south of the border. In the United States, 20 states plus the District of Columbia run commercial-property PACE programs. These programs have financed more than $1.5 billion in capital project upgrades across more than 2,400 properties. They also created more than 17,000 jobs. On the residential side, U.S. homeowner PACE programs have yielded $6.2 billion in capital project upgrades for more than 280,000 homes. These residential PACE projects have created more than 108,000 jobs—all while slashing climate pollution.

Current Status

Limited authority. Without needed provincial legislation, PACE programs in BC are severely limited. Although residential PACE (R-PACE) is permissible for certain measures under the BC Community Charter, it is extremely narrow in scope and cumbersome for a local government to administer. On four different occasions, local governments have passed supportive resolutions at the annual Union of BC Municipalities conference. In addition, PACEBC, a coalition of industry and environmental organizations, has recently formed to advocate for and support enabling legislation. 

The November 2020 Mandate Letter to the BC Minister of Energy, Mines, and Low Carbon Innovation and the Minister of Municipal Affairs include direction for the ministers to enhance energy efficiency programs and incentives for residential and commercial buildings, including PACE financing. Help Cities Lead encourages this work to continue and for the Province to consult closely with local governments on its design and implementation.

4. Regulating Climate Pollution for Existing Buildings

What it Does

This policy would allow local governments to limit the emissions from existing buildings.

Why it’s Needed

Emissions from buildings account for about 11 per cent of British Columbia’s greenhouse gas emissions. This is the third-highest source of emissions, after road transportation (27.1 per cent) and the oil and gas sector (17.6 per cent). For local governments, buildings account for between 40 and 60 per cent of community greenhouse gas emissions. The province will likely not meet its 2030 climate target without addressing emissions from existing buildings.

The Evidence

A recent Pembina Institute report concludes British Columbia could reduce emissions from existing buildings by up to 60 per cent by retrofitting three per cent of the building stock each year, and also by converting half of the buildings from fossil fuel heating to low-carbon sources of energy such as electricity. Other U.S.-based research demonstrates that incentive and information programs alone are inadequate to accomplish upgrades at the needed scope, scale, and speed.

As most major building retrofits only take place every 15 to 20 years or, in the case of building envelope improvements, every 40 to 50 years, it is important to ensure that retrofits maximize energy as well as greenhouse gas savings. Delaying measures to reduce emissions will ultimately only increase the cost to achieve these savings. It also increases the risk that the province and local governments will not achieve their GHG reduction targets.

Multiple jurisdictions already regulate, or are planning to regulate, minimum energy performance requirements for existing buildings; at least two—New York City and Tokyo, Japan—directly regulate building emissions. In all cases, the jurisdictions require mandatory energy and/or GHG performance reporting and requirements, as well as other measures that are intended to encourage and support proactive upgrades before they are required.

Current Status:

No authority. With the exception of the City of Vancouver and the Metro Vancouver Regional District, local governments do not have access to policy tools that would allow them to limit greenhouse gas emissions from existing buildings.

5. Regulating Climate Pollution for New Buildings

What it Does

This policy would allow local governments to limit the quantity of greenhouse gas emissions that new buildings constructed within their jurisdiction would be allowed to release. It would also establish province-wide minimum requirements for new-building emissions that would steadily decrease each year, culminating in a near zero carbon standard by 2030.

Why it’s Needed

Approximately one third of the buildings that will be standing in 2050 will be built over the next 30 years. If not constructed to low- or zero-emissions standards, these properties will add to the considerable retrofit burden that our cities will eventually need to address. The most cost-effective time to address a building’s emissions is when it is first built.

The regulation is also needed to prevent a “patchwork” of local government programs. The BC Energy Step Code does not directly address greenhouse gas emissions, but local governments have begun leveraging it to advance community climate objectives. Some are incentivizing  low-carbon energy systems. One is using development permit area guidelines to incentivize low-carbon buildings, and at least one other local government is exploring whether it can use density bonusing to the same end. In short, in the absence of provincial regulation, local governments are working independently and establishing their own definitions and processes. This lack of consistency can prove frustrating for industry.

The Evidence

New buildings today represent a relatively small share of the province’s overall emissions inventory, but they must be regulated to meet very low and eventually zero-carbon requirements if the province is to meet its 2030 and 2050 climate targets. A 2019 Integral Group study concluded that even a very efficient building built to the Upper Steps of the BC Energy Step Code could emit “significant” emissions over its lifetime if it uses natural gas.

Recent modelling of provincial climate policies completed for the Help Cities Lead initiative shows that the introduction of a moderate GHG requirement for new homes by 2022, followed by a zero-emissions requirement starting in 2025 would result in at least 1,400 kilotons of annual GHG savings for BC by 2050. That equals nearly 25% of the projected total GHG emissions from the province’s building sector by 2050 under the model’s business-as-usual scenario.

Current Status

No authority. With the exception of the City of Vancouver, British Columbia local governments presently have no mechanism to require those developing new buildings to install low-carbon energy systems. Without a direct path to regulating GHG emissions attributed to new buildings, a number of British Columbia local governments will continue to use “workarounds” that differ from one community to another.

The November 2020 Mandate Letter to the BC Minister responsible for Housing, includes direction for the Minister to support local governments to set their own carbon pollution performance standards for new buildings. Help Cities Lead encourages this work to continue and for the Province to consult closely with local governments on its design and implementation.

Take Action

If you are a local government leader or elected official—and especially if your jurisdiction has declared a climate emergency—contact the following provincial ministers to voice your support for the five policies detailed above.

Thank you!