Environment Committee on Oct. 20th, 2026

[Branden Leslie, Conservative, Portage—Lisgar, MB]

Yes, I think we're seeing a bit of a trend here. One of our early witnesses talked about the various types of home energy improvements or renovations and whether or not they were actually effective.

A lot of these are promised amounts. You even talked about the possible future benefits with higher prices of fossil fuels, as I believe you mentioned. A lot of this seems not to be based on “here was the bill before and here was the bill after” and what human activity changed in the sense of, “Well, now I can afford it, so I'm turning up my heat a little bit more and my savings are a little bit less,” versus somebody who's trying to be more frugal.

How do we go about getting better data to prove whether or not...? It's not to say that these technologies don't work but to say that the cost savings for individuals actually can be borne out, and we can say with confidence that on a yearly average you'll be saving this many dollars, especially when folks are trying to consider, as our last witness talked about, the potential of moving from 100 amps to 200 amps, where a heat pump being trenched in costs tens of thousands of dollars. I feel that it requires certainty for the individuals who are hearing these potentially big numbers.

Over time, the ROI is going to be good, but if they're going to do an analysis of their own home, with tens of thousands of dollars above and beyond the installation regardless of rebates for a heat pump, for example, how do we do a better job of having actual math showing whether this is going to be cost-effective for people participating in the program or just doing it of their own free will?

[Jana Elbrecht]

There are a lot of pieces there to respond to.

Firstly, our 91% recommendation number is from people who have had their heat pumps for years, so that is from people experiencing those real savings. That is in line with other surveys. The CMHC mortgage user survey found that 93% of people who renovated their home for energy efficiency were satisfied and 76% of them experienced savings—

[Branden Leslie, Conservative, Portage—Lisgar, MB]

You see the challenge. My personal satisfaction versus two sets of numbers are very different things.

[Jana Elbrecht]

Okay. You mentioned the instance where someone, because they are saving more, might be using more energy. I would say that is a good outcome.

If you are keeping your thermostat lower in the winter because you're choosing between your groceries or your heating bills, and your heat now is becoming more affordable, you may turn up your thermostat to a comfortable temperature. You might be saving fewer dollars on your energy bill, but I would say that is a beneficial outcome for the homeowner or the renter.

[Branden Leslie, Conservative, Portage—Lisgar, MB]

Okay.

In a recent article, you said that the heat pump can work alongside an existing gas furnace where that arrangement is the most affordable and reliable choice. Would you support federal eligibility rules that clearly allow the homeowner to keep their gas furnace in place?

[Jana Elbrecht]

Yes, we would recommend that the heat pump rebate be available to households that want to do a hybrid set-up. Part of the reason is that we think a really big opportunity is in people installing heat pumps as a cooling system.

[Branden Leslie, Conservative, Portage—Lisgar, MB]

Are you familiar with challenges with insurance for a complete removal and swap-out to a heat pump in a more moderate climate than the one I'm from? Are insurance companies asking that there be a secondary heat source maintained as part of a transition?

[The Chair, Liberal, Shannon Miedema]

Give a short answer, please.

[Jana Elbrecht]

I'm not aware of any such insurance requirements.

[The Chair, Liberal, Shannon Miedema]

Thank you very much, Mr. Leslie.

Mr. Watchorn, it's over to you for six minutes.

[Tim Watchorn, Liberal, Les Pays-d'en-Haut, QC]

Thank you, Madam Chair.

Thank you to the witnesses for being with us today.

My first question is for Mr. Moreau.

You mentioned a PACE-style program. I imagine you're well aware that the Government of Quebec does not allow municipalities to use a PACE model, even though it's extremely effective in other provinces. Beyond that, the mayor of Prévost, who lives in my riding, wrote a letter that was published in La Presse and co-signed by 33 mayors who say that the Government of Quebec should change the regulations that apply to municipalities to allow for this program.

In what ways would doing so benefit municipalities? How should the Government of Quebec change its regulations to allow municipalities to do so?

[Vincent Moreau]

I don't know the regulation details, but what I do know is that there's a need to harmonize regulations in Quebec so that the PACE mechanism can be scaled up.

Quebec had a precursor to the PACE model, which was called Financement innovateur pour des municipalités efficaces, or FIME. In particular, Plessisville put that in place. It's well known that it works.

Now, to enable municipalities to lend money, there has to be a regulatory change to make it possible to scale up. I agree with that.

There's another barrier to implementing the PACE model. Once the municipalities have provided the grants or budgets for implementing the PACE model, there will be very few private investors there to support or simply continue the PACE-style programs. It's important to know that grants are limited. The model is effective as long as the grants are there, but afterward, how can municipalities go about demonstrating the effectiveness of the economic model to attract private investors? What can be done to allow a private investor to invest or to lend funds to the municipality? How can capital be pooled so that the municipality can lend money through property taxes to carry out energy retrofits on homes?

[Tim Watchorn, Liberal, Les Pays-d'en-Haut, QC]

I'll give you the example of the program set up by the municipalities to replace septic tanks. Private capital isn't needed. Municipalities can introduce borrowing by-laws, set up their own bank and enable homeowners who don't have much money to do really cost-effective retrofits. In the long term, this benefits homeowners, who will have comfort in the summer and cost savings in the winter.

Do you think that's something that could be used?

[Vincent Moreau]

In fact, that's a parallel for the program, or a copy paste of it.

The only thing I would emphasize is support. I think the best example is Ecohome, which campaigned for the JeRénovÉco model. The organization also does other things, but it supports homeowners from start to finish. It gives them confidence and reassurance when it comes to the best technology choices or the most effective retrofits to make. Afterward, it speeds up the process for the owner when it comes to implementing a PACE-style program or funding such as that of septic systems.

[Tim Watchorn, Liberal, Les Pays-d'en-Haut, QC]

Thank you for the answer.

My next question will be for Mr. Thornell.

You talked about a green bank model. I'd like you to elaborate a bit on that. How would that work with the other programs that are already offered by the federal and provincial governments?

[Aaron Thornell]

I'm not an expert in this, but I think there's been extensive research done by other groups—Efficiency Canada, to name one.

Fundamentally, I think the way it would work would be a one-time injection of public funding to set a baseline. Then different actors would be allowed to access that funding for their own purposes, be that contractor financing, community efficiency financing or PACE financing at the municipal level.

A comparable model, I suppose, in some respects, would be what the federal government did with the Canada Infrastructure Bank, albeit at a larger scale. The building retrofit component of that program targets large-scale commercial building retrofits and institutional retrofits, but replicating that model for the homeowner level or the small residential and multi-unit residential level would provide for flexibility in financing models and terms and be able to address these different disparate challenges that we see from province to province and even from jurisdiction to jurisdiction. I think there's lots of potential.

Again, there are models in the U.S. Michigan Saves is a program that comes to mind. It's been very successful over a long period of time. As well, I believe Australia has developed a fund of a similar nature. I think there are good models to look at and compare.

[Tim Watchorn, Liberal, Les Pays-d'en-Haut, QC]

Thank you.

Ms. Elbrecht, I'd like to have your opinion on that. What would be the best model to get people to retrofit their homes so that they can benefit from the cost savings and comfort savings?

[Jana Elbrecht]

I would definitely agree with the green bank recommendation. This is a model in which the federal government provides low-cost capital and a first loss responsibility, but the financing is provided through institutions that are closer to a homeowner. That could be a municipality, a utility with energy as a service option, on-bill financing or fintechs that are ready to go to work with contractors.

Obviously, we don't want a contractor to become a bank, but if a fintech can work with a contractor, the contractor can come to a homeowner and say, “If you go for the heat pump option, we can offer you a model where you pay x dollars per month.” To a homeowner, it might not be obvious that there are federal dollars behind this. You might have to give up some of the credit.

It is a way to provide those solutions in different models that work for different households. It could be that your furnace breaks and you need an emergency replacement, or you want to engage in a municipal or utility program.

[Tim Watchorn, Liberal, Les Pays-d'en-Haut, QC]

Thank you very much.

Thank you, Madam Chair.

[The Chair, Liberal, Shannon Miedema]

Thank you, Mr. Watchorn.

Mr. Bonin, you have the floor for six minutes.

[Patrick Bonin, Bloc, Repentigny, QC]

Thank you, Madam Chair.

Mr. Moreau, I'd like to know something. You mentioned the private sector when it came to PACE-style programs, but I'm not sure why PACE-style programs would need the private sector.

[Vincent Moreau]

As Mr. Watchorn mentioned, municipalities operate according to borrowing capacity, but they have a borrowing limit. Once a municipality has exceeded that borrowing limit, where will it get the money from? Does it end the PACE-style program, which works?

What we're seeing right now is that it's very popular; people sign up for it, PACE-style programs are implemented, but the envelopes empty out very quickly, and the municipalities depend on grants, which often come through the green municipal fund, which means the Federation of Canadian Municipalities, or through other public funders.

Now, what can be done to interest private investors through a financial vehicle that could give them a certain return and enable them to lend, at a higher volume, the amounts needed to accelerate the decarbonization of homes?

[Patrick Bonin, Bloc, Repentigny, QC]

Let us continue talking about the PACE model.

Why isn't Quebec implementing it? The APCHQ told us about pilot projects in Quebec. However, do we know why there aren't any in Quebec?

[Vincent Moreau]

It's currently due to a regulatory limit. I couldn't go into the details of the regulatory limit, but it's a matter of interpretation. It depends on how a type of retrofit is considered. Can it be incorporated in a PACE-style program? Is it considered an energy retrofit or a home renovation? It's purely a matter of regulatory interpretation. It depends on how it's applied, actually. Quebec's legislation has to be amended to enable municipalities to scale up PACE-type programs and incorporate retrofits.

[Patrick Bonin, Bloc, Repentigny, QC]

Have you ever heard a proper justification?