Environment Committee on Feb. 6th, 2018

[The Chair (Mrs. Deborah Schulte (King—Vaughan, Lib.)), Liberal, Deb Schulte]

We're getting started a little late. I'm sorry about that.

Thank you all very much for joining us today.

Welcome, Raj and Jati, to the committee today.

I believe we'll do a full two rounds of questioning. I'd like to save about 15 minutes at the end of the meeting to do a little bit of committee business. We will have to continue our discussion on witnesses right after the meeting, so we'll see how we do, but I would like to reserve those 15 minutes for some of the committee work we need to do.

I'd like to introduce our witnesses. First, from the Department of the Environment we have Vincent Ngan, director general, horizontal policy engagement and coordination.

From the Department of Natural Resources we have Sarah Stinson, director, buildings and industry division, office of energy efficiency, energy sector; and Frank DesRosiers, assistant deputy minister in the innovation and energy technology sector. Mr. DesRosiers has been here before.

Finally, from the National Research Council of Canada we have Richard Tremblay, director general, construction; and Philip Rizcallah, director, building regulations.

Welcome to all of you. Thank you very much for being with us today. We're really looking forward to what you have to share with us.

Who would like to start?

Thank you.

[Frank DesRosiers, Assistant Deputy Minister, Innovation and Energy Technology Sector, Department of Natural Resources]

We have a short presentation that I thought might be of interest to committee members. It gives a sense of the frame and what we're up to. It's entitled “Energy Efficient Buildings”. You should have a copy readily available. I will go through it quickly and would be happy to answer any questions that committee members might have in the following minutes.

On the front end, just quickly in terms of the broad context, because I understand that the committee has worked really hard on this over the past months, we have the pan-Canadian framework and its four principal components. The message to convey here is that we're squarely focused on implementation.

Of course, we want to make sure that the plan is implemented and that it happens quickly enough. To this end, we are all working hard with our provincial and territorial colleagues.

Slide 3 gives you a bit of a sense of why energy efficiency is such an important element of our strategy. There are some pretty simple reasons for this. First, when you look at it from just a principle perspective, before producing a new unit of power or energy, how about using the existing energy that you have readily available in your network? That is typically the cheapest way to produce it or to use it. We've added some numbers that show you the extent of the savings that Canadians could realize by using their existing energy out there more effectively.

The second reason we're focusing on energy efficiency in the building sector is that it's a significant chunk of our energy mix and a significant chunk of our GHG emissions in the country. The number of 17% is broadly used in our country to describe the size of the opportunity that we have here in this space.

With this short document, I'll briefly describe what the strategy is all about. It's called “build smart”, with five components. I will note that Minister Carr recently announced, along with his colleague ministers over the past couple of weeks, the envelope of $182 million that is specifically geared toward the building sector. That adds to other envelopes that some of our colleagues, including from Environment, might be at liberty to briefly describe later on.

Slide 4 describes the nature of the challenge. These are things that will be familiar to you, but I thought it would be useful to get it fresh in your minds in terms of the uniqueness of our country and our building environment in Canada. First, it's important to state that we're a fairly high energy user. There's good reason for this. Our country is cold, as we're witnessing these days. It's vast. We also tend to have in our buildings, in our houses, the expectation of a relatively fair amount of space for families and people to live. That's the way of living, I guess, in North America, but we have to heat those larger surfaces. That's surely a challenge.

I spoke about the cold climate, but we also have distinct climates. We have six climate zones in Canada. They range from those living out west in B.C., who have a fairly temperate climate but humid, to a drier environment in the prairies. If you shift up north, obviously you have a cold arctic temperature and a dry setting. Each of those climatic zones requires different solutions so that you're able to have your condo, your house, and your buildings well serviced.

We're also dealing with a great variety of energy sources from hydro, natural gas, nuclear, and other renewable energy sources, which are now taking a bigger share of our energy mix. Each of those adds some degree of complexity.

Last but not least, we're dealing with a vast variety of building types. We have single detached, multi-unit residential units like condos or rentals, office towers, and warehouses. We have the old and the new. You get the picture. This is a very diverse universe we're dealing with.

In the next slide we speak about some of the common themes, because it might seem, with such a disparate set, how will we be able to crack it? The good news is that there are some common challenges or common issues that come out. The first one I would emphasize is around managing heat. If you take it from a broad perspective, roughly 80% of the energy being used is to manage heat. Whether it's to do space heating, which is 65% of it, or water heating, that accounts for a significant share of our challenge.

I would look at it from two broad perspectives. The first one is producing the heat. Do you use natural gas? Do you use diesel? Do you use electricity to produce the heat? Are there more effective ways to produce the heat? Could we use renewable energy to do that same objective? All of this kind of universe gives rise to a lot of innovation and challenges and issues.

Then, how do you manage that heat? How can you make sure that the building envelope is such that you don't lose it on the outside? How do you make sure that your windows are energy efficient or at a very high level of energy efficiency? Again, how do you deal with equipment in terms of energy use inside? How can you make it more effective and more efficient? I would suggest that those two dimensions are certainly worth the time and effort.

The other big buckets, which are appliances and lighting, are the other big sources of energy usage. There are significant opportunities there for us in Canada, but also with our international partners, to adopt leading appliances and lighting technology to make sure that we're able to use less energy. As I'll describe in a minute, we have been able to make good progress there for a range of equipment and appliances in Canada.

Slide 6 describes the plans that I've introduced you to briefly, where we have committed that $182 million. Allow me to describe this succinctly. Our colleagues from the NRC will be able to speak in more detail on the first two measures, which are to make sure that we tap into those energy codes, both the energy codes for new buildings and the energy codes for existing buildings.

Again, from the big-picture perspective, if we look at the prospects for 2030, we see that roughly 25% of that building stock will be new. It would be smart from a Canadian perspective to make sure that those new buildings being erected are adopting the leading technologies in terms of energy efficiency. The remaining 75% is what you see today. If you walk the streets of Canada, urban and rural, you can see all the buildings that are there. Well, guess what? They're still going to be around in 2030 and probably for many years to come. How can we make sure that the building codes for those existing buildings will be, again, ambitious yet cost effective? We want to make sure that we develop codes that are both implementable and achievable for Canadians to afford—and for firms as well.

Again, my colleague Richard Tremblay will describe these more fully in his remarks.

The third measure is around awareness. We're lucky to have very knowledgeable and well-educated Canadians, but they need to have the basic information and facts to make informed decisions, so having the proper labelling and disclosure there is really important. There, we're working very closely with our provincial and territorial colleagues to make sure the information is available and easy for people to comprehend, so that when they buy a house and make that decision, they know exactly what they're getting into and what kinds of prices will follow as a result of that in terms of energy costs.

Next is equipment. I've mentioned just briefly adopting those leading standards for your typical fridge. Look at the fridge you have in your house today or that you can buy at a store, and then compare it to 20 years ago, which is not that far away. They are 60% more efficient than they were back then. They produce the same kind of performance, but they are way cheaper to operate. For dishwashers, it's the same kind of thing. They're 70% more efficient. Also, washing machines are 75% more efficient and use 70% less water.

We can see that the leap in terms of energy efficiency is quite considerable, times millions of units around the country, recognizing that those machines and that equipment tend to be replaced every 10 to 15 years or whatever. You can see that the potential in terms of energy savings for Canadians and for GHG emissions along the way is quite considerable. We certainly will pursue that going forward.

The last dimension, which must not be ignored, is the entire realm of research and development, and demonstration. We are talking about existing technology, but, of course, this area is constantly changing.

How can we make sure that Canada is at the forefront, while considering our specificities, including a northern climate and the expectations of our consumers, our clients?

The challenge is two-fold. First, it is important to develop new technologies, since this sector is prolific when it comes to developing new technologies that seek to meet various needs, and second, the costs must be reduced.

Here, cost is a critical component, obviously, to make sure that people can afford those new technologies. We're working extra hard on this.

With slides 7 and 8, Mr. Chair, mindful of time, I'll go fairly quickly. Maybe I'll just emphasize the goal we're pursuing in terms of the energy codes for both new and existing buildings. The goal there is to work very closely, as per the vision of the pan-Canadian framework, with our provincial and territorial colleagues with a view to publishing by the year 2022 a new set of building codes for both new and existing buildings, which will require extensive consultation with all of the players on the scene, with a view to having them adopted and implemented broadly by provinces and territories by the year 2030.

In terms of regs for products and equipment, it's the same kind of thing. We're working with our partners to make sure that we adopt leading standards both for products produced both domestically and also with our partners. In total for this envelope we've got $58.7 million allocated over eight years to do the job.

Slide 8 touches on labels and benchmarking, so I described the nature of the challenge here. We are looking to have those labels ready as early as next year, 2019, again working very collegially with our provincial and territorial colleagues.

There we have a few infomercials, if I can call them that, around some of the tools that are out there. Many of you will be familiar with EnerGuide, which gives you a sense of how much energy you consume in your house. You want to know that before you buy it, because you'll end up paying the bills every single month. There's also PortfolioManager: if you are a building manager and you manage shopping malls or office towers, you'll want to know how your building compares to the building next door. This kind of tool can give you a sense of that and suggests the action you can take.

[The Chair, Liberal, Deb Schulte]

I'm mindful of the time and we've gone over by about a minute and a bit. Can I just ask how many of you are going to present today?

[Frank DesRosiers]

Just two, me and Richard.

[The Chair, Liberal, Deb Schulte]

Do I have the will of the committee to hear this through, because we only have two?

[Ed Fast, Conservative, Abbotsford, BC]

Yes.

[Frank DesRosiers]

Thank you, Madam Chair.

In regard to innovation, I mentioned the dual challenge of developing new solutions but also reducing the cost. I'll just give you a sense of the kind of work that is being done, both by our national energy lab, CanmetENERGY, which is focusing on that, and also through the funding that we are providing to innovators and entrepreneurs out there who might have some great ideas to up our game in this regard.

We are working on software and simulation type solutions to try to, again, be able to pinpoint the areas of opportunity and be able to help drive decision-making by consumers, firms, and investors as well.

Another area we're looking at is cheap retrofits. One cool concept that the folks are working on is about applying some prefabricated panels on top of a building. You can do this without disrupting the people living in it. They are able to use all sorts of laser and imaging technology so they are able to snap this very quickly. They can build it in a factory, plunk it on a house, and make it look more beautiful and more comfortable. It's very cheap to do, and it leads to dramatic energy efficiency improvements in that house. That's the kind of approach. In plain language they call it “putting a jacket on a house”. It's the same kind of idea, making it very comfortable and beautiful, and it's very cost-effective. These are the kinds of things that smart researchers are trying to come up with.

All in all, for these research, development, and demonstration projects related to houses and buildings around the country, we've got some $60-some million set aside for that job.

I can skip slide 10, but you see that these are more of the tools that are out there and that we're working in particular with northern communities. We have unique challenges to address to make sure we develop solutions that are suitable to their needs.

In closing, our focus is very much on implementation.

I'm very happy to answer any questions the committee might have.

[The Chair, Liberal, Deb Schulte]

Thank you very much.

I just have a question before I turn it over to our next speaker.

In your slides, you say that 17% of Canada's greenhouse gas emissions are from residential, commercial, and institutional buildings, and yet when you turn to the little pie chart, it shows 23% residential, commercial, and institutional. Which one's right?

[Sarah Stinson, Director, Buildings and Industry Division, Office of Energy Efficiency, Energy Sector, Department of Natural Resources]

Thank you.

Buildings account for 17% of carbon emissions in Canada: 12% of that is from direct emissions related to fossil fuel used to heat those buildings, and then 5% is from indirect emissions that are associated with the production of electricity that's used in the buildings.

[The Chair, Liberal, Deb Schulte]

So that's how you got the 23% on the pie chart.

[Sarah Stinson]

That's how we got the 17%, the 12% plus the 5%.

[The Chair, Liberal, Deb Schulte]

So what's the pie chart telling me? It says “Canada's energy use GHG emissions”, and has buildings at 23%.

[Sarah Stinson]

This is the proportion. These are the emissions. Buildings, commercial and institutional, are 9%....

I'll have to return to you on that.

[The Chair, Liberal, Deb Schulte]

No worries.

[Frank DesRosiers]

One is energy, and the other one is GHG.

[Sarah Stinson]

It is, so it could be in the conversion as well.

[The Chair, Liberal, Deb Schulte]

Okay. I'll leave that with you guys.

[Sarah Stinson]

It's not a direct conversion exactly.

[The Chair, Liberal, Deb Schulte]

Thank you very much.

You're up next.

[Richard Tremblay, Director General, Construction, National Research Council of Canada]

Thank you, Madame Chair.

My name is Richard Tremblay. I'm the director general of the construction research centre at the National Research Council of Canada. I'm here today with Philip Rizcallah, who is the director of our building regulations and market access program. He's been working with the code process for 19 years, which is why he's here with me today.

We are pleased to have this opportunity to speak with you today. We would like to highlight some of the recent NRC initiatives and contributions to help the Government of Canada achieve its targets for both a low-carbon economy and reduced greenhouse gas emissions.

Initially, I would like to provide you with an idea of the scale and scope of the NRC. Our work covers a broad range of scientific and engineering disciplines, the outcomes of which have changed the lives of Canadians and people around the globe. The NRC's 14 research centres are mobilized to deliver on 37 targeted research and development programs.

We are a national organization with some 3,700 highly skilled and innovative researchers and staff located across the country. Our 14 research centres operate out of 22 locations spanning Canada's geography. We have ocean, coastal, and river facilities in St. John's, our astronomy and astrophysics centres in British Columbia, with other facilities in between.

In addition to our workforce, we leverage our scientific facilities in infrastructure to deliver innovation that pushes the boundaries of science and engineering. Over the past century, NRC has produced breakthrough inventions such as radar, the pacemaker, the black box, canola, the Canadarm, a vaccine against meningitis, a 100-year cement used for critical infrastructure, and the first biofuelled jet flight in the world. Moreover, we are proud to claim the late Dr. Gerhard Herzberg, who won a Nobel prize for his work in molecular spectroscopy, as one of our researchers.

Each year, our organization works closely with industry, conducting research and development work with over 1,000 businesses. We provide technical advice to some 11,000 SMEs, and we collaborate with close to 152 research hospitals, 72 universities and colleges, 34 federal departments and 35 international partners.

The NRC is an organization that emphasizes collaboration. I would like to highlight the NRC's exceptional collaboration with respect to the topics we are addressing today. We are aligned with federal priorities and today we focus on three core areas of delivery to business innovation, support for federal mandates, and advancing science and innovation through exploratory research.

Relevant to our discussion today, our organization is the coordinator and custodian of the Canadian national model codes, including the model building code and the model energy code. We provide administrative support to the Canadian Commission on Building and Fire Codes, the CCBFC, and perform research in support of the work of its technical committees. We facilitate uptake in the marketplace of the model codes and new technologies that support the code. We also support standards development for the construction industry, and best practice guides and tools, as well as pilots and techno-economic assessments.

The NRC operates a number of facilities and centres that can test and increase the depth of our knowledge, and contribute to a low-carbon economy and reduction of greenhouse gas emissions.

The Canadian Centre for Housing Technology is one of these centres. This centre appears as a real-life community of homes and is jointly operated by us, Natural Resources Canada, and the Canada Mortgage and Housing Corporation. The facility was designed to provide manufacturers and product developers with a real-world test environment for assessing innovative technologies prior to full field trials in occupied houses.

As a recent example of the centres' application to the multi-unit housing market, we recently completed a facility to support industry with numerous technology-evaluation platforms. The infrastructure evaluates exterior insulation systems, renewables, energy storage, electric vehicle power, micro-grid applications, smart-building control, and integration of these technologies.

Another NRC initiative, the Canadian Construction Materials Centre, works closely with manufacturers and suppliers to the construction industry. The centre evaluates an industry's products to determine if they perform to specification and demonstrate that they can meet building, energy, and fire code requirements.

With regard to codes, these evolve based on experience and product innovation. Currently, the NRC works closely with the Canadian Commission on Building and Fire Codes, CCBFC, using an extensive consensus-based process with involvement from all sectors of the construction community and the public on a five-year cycle. This approach provides a reasonable compromise between stability, flexibility, and economic considerations.

This engagement ensures that the best available knowledge drives meaningful change. Change that allows construction professionals the confidence to innovate safely, reduce risks and keep compliance cost low. And they keep these costs lower by establishing uniform, trusted regulations that keep pace with industry change.

This brings me to the NRC's collaboration in the pan-Canadian framework on clean growth and climate change. This framework is Canada's vision for action to help meet its climate change objectives.

As part of the pan-Canadian framework, the NRC, in close collaboration and partnership with Natural Resources Canada, is working with industry to help produce needed technologies at the right cost.

One goal, in accordance with the framework, is the implementation by the provinces and territories of increasingly stringent energy codes. These codes are specifically related to new construction starting in 2020, with the long-term goal of adopting “net-zero energy ready” model codes by 2030. Furthermore, work to develop a model code or guideline for existing construction is to be completed by 2022.

The NRC will play two major and distinct roles to achieve the goals of the pan-Canadian framework. First, the NRC will conduct, monitor, and assemble the body of research and knowledge.

Second, the NRC will also work closely with the Canadian Commission on Building and Fire Codes and its technical committees to meet the timelines outlined in the pan-Canadian framework. It will do this by determining research and resource needs to accelerate the process of code development.

As the process constantly evolves, the provinces and territories will be able to declare when they will adopt specific performance levels with a gradual increase in performance towards the adoption of a net-zero energy-ready code by 2030.

The cost to achieve “net-zero energy ready” is specific to buildings and their locations, so there is no simple, prescriptive number for all types of building and all locations in Canada. Because of this, standing committees on energy codes have been created and are undertaking thorough cost-benefit analyses that consider the building types—residential, commercial, or institutional—their geographic location, the availability of needed trades and technologies, etc.

Evaluations of lab work and research are ongoing, and the NRC is working to meet GHG targets and to identify costs and benefits. As the NRC works in close collaboration and partnership with NRCan, its goals are to make new buildings more energy efficient, to retrofit existing buildings, and to support building codes and energy efficient housing in indigenous communities.

The objective is to have, by 2022-23, a revised model energy code for new construction to be published with several performance tiers, the highest being “net-zero energy ready”.

The Commission's long-term energy policy was developed in response to the Pan-Canadian Framework; the code targets were set to be as closely aligned with the framework as possible.

The timelines included a gradual reduction towards net-zero, with adoption planned by the 2030 code cycle. This objective aims to accelerate this adoption process by aiming to publish the code requirements for “net-zero energy ready” buildings and housing by 2022-23, which would provide sufficient time for the industry to prepare and subsequently accelerate adoption.

To ensure that the code quality, transparency, and fairness are maintained, the NRC will continue to work closely with all the stakeholders to achieve the goals of the pan-Canadian framework through the codes development process.

In addition to these long-term impacts, the creation of a low-carbon economy will result in positive impacts immediately, in terms of wealth and job creation, as we help the industry to innovate.

In the course of achieving these impacts, the NRC will lead the way in collaborative research and development with other science-based departments. We will be validating hypotheses and claims, developing new knowledge, asking new questions, providing validated answers and solutions, and filling knowledge gaps. This R and D will be invaluable for industry when responding to new business opportunities created by the upcoming low-carbon reality. We will do all this while ensuring that cost-effective solutions are available where and when needed.

Reducing the carbon footprint of our buildings will support Canada in achieving its commitment under the Paris Agreement of a 30% GHG reduction by 2030, which is relative to 2005 levels. The work we do at the NRC to address the challenges of today inevitably results in long-term solutions and innovations that Canada and the world have been waiting for.

To close, it is the NRC's breadth of expertise, our unique scientific infrastructure, and our national scope, all combined, that enable us to bring players together from across Canada and abroad.

Going forward, we are equally well positioned to convene the right stakeholders to work collectively to deliver discoveries and inventions. This will make a difference to Canadians now and in decades to come.

Thank you for your interest. My colleague Philip and I would be pleased to answer any questions at this time, Madam Chair.

[The Chair, Liberal, Deb Schulte]

Thank you very much.

We'll open the floor to questions, and we'll start with Mr. Fisher.

[Darren Fisher, Liberal, Dartmouth—Cole Harbour, NS]

Thank you very much, Madam Chair.

Thank you, folks, for being here. This is a really interesting topic that we've kind of been chomping at the bit to get at. It might stray and get a little broader than it needs to be or should be sometimes, but I want to kind of set the foundation here, and if it sounds like I'm talking in circles, I likely am.

Building codes are within provincial jurisdiction. The national code can be used as a model. We've got the Canadian commission, which is an independent committee of volunteers established by the National Research Council made up of relevant provincial and territorial ministries. So you have the NRC, you have the commission, you have the provincial and territorial codes, and then you've got the federal codes.

I'm interested in how that loop gets closed. How do we actually get things done? How do we impart knowledge from one segment to the next segment?

I'm not sure who wants to take that, but when you think about multi-jurisdictional issues like building codes, how do we make sure we're all moving in the correct direction?

[Richard Tremblay]

In the code process, at the beginning of every five-year cycle, we always make sure that we engage with the provinces and territories, because they have a lot of questions like how much is this going to cost? Can a family afford that? What benefits does it have? They have a lot of questions, and often they need facts.

We integrate and cycle through the PTPACC, which is the provincial and territorial policy advisory committee on codes. As changes are being proposed, basically we sit down with them and explain to them why. They ask questions and we provide facts. We look at the science, but we also look at the social impact and the economic impact so they can first accept on a consensus basis what is in the code.

Afterwards, they can do their legislative process and then have it adopted. That's how we do it. Of course, we also bring federal department to the table and explain it to them. Very often they would say the federal government might have some priorities, but then when we sit down with them and we explain those priorities, they often find out that they have the same priorities. By engaging them at the beginning of the process, we make sure they adopt it.

[Darren Fisher, Liberal, Dartmouth—Cole Harbour, NS]

With regard to energy efficiency and the provincial and territorial building codes, who is doing really well? Are there groups out there, under the provincial and territorial codes, who are exceeding what we have at the national level, or do we have higher expectations in our national codes?

I know that codes have been changing. Three of them changed in 2015, and one of them changed in 2017. Based on the first question, when we do upgrades or changes to our codes, are they readily adapted by the provinces and territories, or is there some form of resistance to some of those changes?

I know I asked you a bunch of questions there.

[Richard Tremblay]

They don't all adopt it at the same time for various reasons. It could be for a lot of reasons, but they don't do it at the same time. Some adopt it as is, and some with a lot of changes.

Right now I'll refer to Philip. I don't know who is ahead and who is behind.

One thing, though, before I turn it over, is that right now the model code is one set of reference. Moving forward with the energy code, we want to have a tiered approach so that a province can say, “We want to be at the top in two years“ and another one can say, “We want to be at tier one and move to tier two in four years and net zero in 2030”.

Philip, maybe you can tell who is who and who is ahead.