Thank you, Mr. Chair, for inviting me to speak to the finance committee today.
My presentation will be about the role of the building sector in a low-carbon economy and how the Government of Canada could consider activities in its 2018 budget.
We know that Canada can build a low-carbon economy and reach its 30% reduction target from the building sector by 2030 by focusing on three initiatives.
First is to invest in zero-carbon building standards for new federally owned and federally funded buildings. Zero-carbon buildings will ensure we create the building stock of the future that will continue to operate at a very low carbon performance.
Second, we think that creating opportunities, road maps, for targeted retrofit investments in each jurisdiction for federally owned and federally funded buildings is also a very important part. Without the retrofit of existing buildings, it would be very hard to reach our 2030 targets. It's also part of building a retrofit economy that will grow the economy and result in skilled new jobs in Canada.
Third is building investor confidence in Canada's retrofit economy, particularly in the commercial and residential sectors.
These actions will establish Canadian excellence in green building innovation, grow the economy through job creation, and increase productivity. Here are a few details.
First, the government has a role to play in mainstreaming zero-carbon buildings, since the government is one of the largest, if not the largest, building owner in the country. By adopting a zero-carbon standard for all new or leased federal buildings, the government would set an example and drive uptake of zero-carbon solutions in the commercial and institutional sectors. It would accelerate the commercial development of low-carbon goods and services and technologies.
It would also increase the confidence, and in a way, de-risk green building solutions for the industry. The government has done this before, starting in 2005, with the adoption of LEED in its green building policy. Also, down the road, it would create the conditions for widespread market adoption of zero-carbon technology in Canada and downstream export opportunities.
The CaGBC proposes to work with the federal government to adopt the zero-carbon building standard as a third-party standard and verification in new and existing federal buildings.
Second, as I said before, building retrofits are an essential part of reaching climate change targets by 2030. They're also the greatest opportunity to grow the economy and to create skilled jobs.
The council proposes to create and implement targeted, what we call “retrofit road maps” for each province and territory to optimize energy performance and incorporate on-site renewable energy systems to significantly reduce carbon emissions from existing larger buildings. These actions we are proposing would reduce carbon emissions from the large-building sector by 51%, overshooting the federal target of 30%.
The success of these carbon reduction activities will depend on a number of factors that are unique to each region and relate to existing building type, size, and age, and also the carbon intensity of the heating sources and the electricity grids. I'll just make this point. An identical building in Quebec with the same level of carbon intensity, if operating on fossil fuels, will generate 36 times as many carbon emissions than if it were operating on a clean energy source. That's where the opportunity is. Meanwhile in Quebec, there's a lot of clean electricity from hydro power.
Finally, the third recommendation is that we need to build investor confidence to engage the private sector in investing in building retrofits. We know that the returns on investment.... The council has over 300 million square feet of existing buildings in its LEED program. The investor confidence project, or the ICP, is a standardized framework for risk assessment and verification of building retrofits.
We have found, through consultation with government and the industry, that performance uncertainty after the retrofit is one of the big barriers in the industry.
This would unleash investment and help to grow the retrofit market. It would provide commercial investors and building owners with confidence in project engineering, performance outcomes, and financial returns.
We are currently piloting this project with the MaRS discovery centre in Toronto, and we propose that the federal government embed the ICP, the investor confidence project, as a requirement in the low-carbon economy fund, the Canada infrastructure bank, and the national housing strategy. These are three great opportunities to support retrofit in buildings.
I would like to finish by reiterating that our recommendations will drive the low-carbon economy while contributing to sustainable economic growth and mitigating the effects of climate change. By adopting the three recommended initiatives, the Government of Canada will secure economic and environmental benefits that extend across the Canadian economy. It would do this, first of all, by spurring innovation within Canadian companies. We already see that happening, but through further investment it could be broadened a great deal. It would also do this by further developing leading expertise and technology in Canada’s green building and clean-tech sectors. Canada is already a leader in these sectors, but with further investment, this leadership could be expanded and make Canada more competitive globally.
It would enable the growth of Canadian small and medium-sized enterprises, because in that sector we see a lot of activity, and it would also create export opportunities for Canadian products and services in the growing, global, green building marketplace. That marketplace is growing exponentially year over year, with about 75 countries having active green building markets, industries, and councils.
Finally, retrofits and our other recommendations will benefit Canadians by creating healthier, more productive environments to live and work in. There is mounting evidence that green buildings are also healthy buildings that contribute to the overall mental and physical health of Canadians in our schools, workplaces, and our homes.
Thank you very much.