Wonderful. Thank you.
Thank you to the committee for asking me to be here. I'm very glad to share my experience of the private sector partnering with local not-for-profit organizations. What you'll hear is that it's not only to reduce their environmental impact, but also to increase their profitability and at the same time grow the low-carbon economy.
Let me tell you a bit about it. I'll start in Waterloo region, with a company called VeriForm.
VeriForm has been around since 1996. They are a sheet metal fabricator. Essentially, that means they bend and cut steel. They have about 35 people or so. Their CEO is Paul Rak. They're based in Cambridge, Ontario.
Back in 2006 Paul and his wife had a daughter. She was their first. They watched a movie called An Inconvenient Truth. As a result of this, Paul went back to his workplace and said, “I'm going to change the way this place operates”—very altruistic—and he started to go about simple things.
He upgraded his lights to T5 from T12 bulbs. He improved the thermostat. He installed a disconnect on his bay door. When the sheets of steel would come in during the winter months, as the bay door would open, his guys would stop and have a smoke break, and the heat was just billowing out in the middle of the winter months. Paul installed the disconnect on the bay door so that when the bay door opened, the heat turned off. Now nobody is taking a smoke break while the bay door is open. They're rushing to get the steel off the truck and close the bay door. Then they can have their smoke break.
These 37 first projects that Paul implemented at his company cost him $46,000. The operational savings in energy costs in the first year alone were $89,000. The average payback period was 6.3 months. Paul expects to save, over the next 10 years, $1.42 million. This is a company of 35 people.
I met Paul as I was starting a not-for-profit in Waterloo region called Sustainable Waterloo Region. That was back in 2008. We ended up inviting Paul to speak at our launch event for this new entity that would convene networks of businesses, helping them to move from an interest in reducing their environmental impact to action.
Paul and VeriForm is one of our first three member organizations. Members that were part of a program we started there, called the regional carbon initiative, get support to set targets to reduce their carbon impact specifically. This means we offer them software to track their carbon footprint. We invite them out to events to meet and hear from people like Paul, from energy auditors, from consultants, to be part of the network of support they would need to reduce their environmental impact. We offer them tool kits, guides, and resources. Then, of course, we recognize the progress they make every year.
Fast forward to present day, that same company, VeriForm, with the support from Sustainable Waterloo Region has since reduced its carbon footprint by 80% and doubled its profit at the same time.
What else has happened in Waterloo region? Those three companies, Athena Software, a small high-tech company; VeriForm; and Enermodal Engineering, since bought by the MMM Group, have since grown to 65 organizations across Waterloo region. These are all organizations that have either intention to set a target to reduce their carbon impact or have already done so. Those targets amount to 55,000 tonnes—12,000 cars off the road every year—and those organizations employ 14% of the workforce.
Not only that, but these companies are paying fees to participate because they're getting value from the services they receive. Those fees in Waterloo region are a sufficient amount to have the program financially break even. This pays for two full-time staff, for the software, for the events, and for all the support they receive in Waterloo region.
Let me return to the low-carbon economy as another example. In 2013 there were five organizations among the 65 that set targets in that particular year. Those five organizations that set their targets had to first do energy audits. They spent $70,000 working with local energy auditors to identify projects that had a payback period of two years or less that were in their financial best interest to complete. They then completed the projects recommended, and spent an additional $90,000 locally on products and services in the low-carbon economy to achieve their targets.
Here are five companies reducing their environmental impact, increasing their profitability, and spending $160,000 in the local low-carbon economy in just that one year.
In fact, today in Waterloo region there's talk of what they are calling a centre for sustainability excellence. This would be a 120,000-square foot, net positive energy building that would be occupied by members of the regional carbon initiative, a transformational iconic space for the sustainability network in Waterloo region to be a hub for all the consultants, businesses, and students. They are even going to have a restaurant on the main floor that, of course, supplies local organic foods. This is the kind of transformational change that can happen in a community when the private sector partners with not-for-profits.
But this is not a Waterloo region story. That's not why you asked me to be here. So let me share with you that back in 2011 the first person who came to me and asked if they could have this same model was a professor from Niagara College. That person applied to the Trillium Foundation and received twice as much funding as we did in half the time. The first person Trillium called was me. Paul from VeriForm and I spoke at their launch event back in 2011. It was on the car ride home from that launch event that I realized this was not a Waterloo region challenge. This is a national challenge that needs a more national response, and perhaps we could be a part of that.
As a result, I left Sustainable Waterloo Region back in 2013 to start a new entity we now call Sustainability CoLab through which we're now supporting seven organizations and communities across Ontario to scale the same model. What I mean by that is having businesses pay fees to a not-for-a-profit to be connected to a network of support, to get access to software and events and those supports, and then to be recognized for the progress they make toward a target. It's not business as usual, but actually reporting on forward-looking goals and being recognized for the success they have.
In Niagara, for example, the Niagara Sustainability Initiative is now up to 23 organizations that have set targets to reduce their carbon by 6,000 tonnes. It includes companies like Quartek Group, Brock University, Niagara Health System, and Fallsview Casino. In Durham, Durham Sustain Ability has a program they call the Durham partners in project green. They have 18 organizations that participate there. They just relaunched six months ago. That includes General Motors, Deer Creek Golf Course, and Durham College. Here in Ottawa, EnviroCentre is going to launch carbon 613, and I am thrilled to invite you all to attend. It's on June 23 at the Kichesippi Brewery from 4 p.m. to 6 p.m. Sudbury, York Region, and Kingston will all follow suit.
To go a step further, this isn't really an Ontario story either. A similar group called Climate Smart in B.C. has been working there for several years, and we've received requests from communities in Alberta, Manitoba, Quebec, and New York state.
Why is this the case? The premise is that businesses measure what matters, and this is in the best interests of businesses right across the country. Yes, there is a federal cost of climate change inaction and the NRTEE estimated that to grow to $5 billion a year by 2020, but at the same time, at the company level there's a business case.
It's not only about saving money on their energy bills. It's about attracting employees who are making their employment decisions based on the environmental strategy of the companies with which they work. It's about improving their brand for those constituents they care most about—often that's their customers. Also it's about looking at trends in the supply chain as Walmart and others start to prioritize their supply chains based on the environmental records of companies they work with, and of course the policy they see coming out of federal and provincial governments.
As we look to see this happen more across the country, I would encourage the committee to look at more support from both federal and provincial governments for non-profits that are supporting businesses in this way. I can speak to a funding program like eco-action, which did support Sustainable Waterloo Region back in 2008. It provided $24,000 of the $200,000 required to get the program started. No other eco-action funding has been provided to Sustainability CoLab or any other member of the network since that time. However, in the last six months alone the Ontario Trillium Foundation has supported about $600,000 across the CoLab network in just the last six months.
I hope to have enlightened you on how the private sector can partner with local non-profits not only to reduce their environmental impact but also to increase their profitability and grow the low-carbon economy at the same time. I really appreciate the chance to share this with you.